The Football Governance Act received Royal Assent on 21 July 2025 [1], marking a significant milestone in establishing the world’s first Independent Football Regulator (IFR) of men’s elite football. The Act comes after years of mounting concerns over structural vulnerabilities within the sport and the urgent need for reform to ensure its long-term stability. Its introduction follows a series of high-profile crises that exposed weaknesses in English football’s governance and financial systems.
How did we get here?
There have been over 60 insolvency events involving English football clubs since the Premier League’s launch in 1992 [2], but it was the more recent high-profile collapse of Bury FC and Macclesfield Town, which heightened concerns regarding unsustainable financial practices of football clubs. The existential threat posed to English football by the proposal of a European Super League in April 2021 was the catalyst for a UK government intervention. In the immediate aftermath of the announcement of the failed breakaway competition and the supporter outrage which followed, a comprehensive fan-led review of football governance was initiated, the results of which were to highlight the need for reform across football. A set of recommendations were proposed, which were developed further in a government White Paper, and which included the establishment of an IFR to promote the long-term sustainability of English football [3].
Following a, sometimes, contentious parliamentary process, the Football Governance Act was finally passed and enacts many of these recommendations, with the aim of addressing financial instability, governance issues, and the safeguarding of football’s heritage. The IFR will operate under three primary objectives:
a. Ensuring clubs’ financial soundness;
b. Promoting systemic financial resilience across the football pyramid; and
c. Protecting the heritage of clubs valued by fans and communities.
The future of English football
The Football Governance Act ushers in a new era for English football, but its implementation presents significant challenges for clubs across the pyramid. The introduction of statutory regulation, sitting above the existing regulations set by the Football Association, English Football League and Premier League, will require clubs to adapt to another layer of regulation demanding careful planning and compliance.
Though the IFR is not expected to become operational until later this year, the Shadow Football Regulator has been in place since 2024 and has been engaging with the industry and fan groups with a view to publishing detailed guidance to help stakeholders prepare.
Key provisions of the Football Governance Act
a. Licensing
A core function of the IFR will be a licensing system for the 116 clubs in the top five tiers of the football pyramid requiring clubs to adhere to financial, governance, and fan engagement standards in order to operate [4]. There will be two types of licence: ‘provisional’ and ‘full’.
Regulated clubs must first apply for a provisional licence which will require the submission of a personnel statement detailing the clubs owners and officers and ultimate owner; strategic business plan; and any other information required by the IFR rules. The grant of a full licence will need to be determined before the expiration of the provisional licence (or, as extended).
b. Owners and Directors
Whilst owners’ and directors’ tests are not new in elite English football, the regulator will implement a strengthened owners’ and officers’ test [5] to assess the fitness to operate, source of wealth, and financial plans of prospective custodians. Incumbent owners, while not automatically subject to these tests, could still face scrutiny if concerns arise.
If the IFR determines that an individual is unsuitable to become an owner or officer, it will make a disqualification order disqualifying them from holding that position. If the IFR determines that a current owner or officer is no longer suitable, they will be required to take all reasonable steps to cease to be an owner or officer within a specified time. If they do not take steps or remain in position beyond the specified time period, the IFR will make an ownership removal order. These orders may include the appointment of trustees to take over the running of the club.
These powers will likely deter unsuitable custodians but could also lead to disputes and legal challenges, particularly where ownership structures are complex or opaque. To ensure fairness, the IFR will consider clubs’ individual circumstances and risks, applying proportionate regulation.
c. Distribution of revenue
Financial distribution across the football pyramid remains a contentious issue. While the Act includes backstop powers for the IFR to mediate and enforce revenue-sharing agreements between the Premier League and the EFL, the regulator will only intervene if the leagues fail to reach an agreement themselves [6]. This creates uncertainty for lower-league clubs reliant on equitable revenue distribution, while also placing pressure on the Premier League to negotiate in good faith to avoid regulatory intervention.
It will also have backstop powers to address revenue distribution disputes if a football led solution cannot be reached between the Premier League and the English Football League. This mechanism will be triggered only under specific conditions, such as prolonged deadlock between leagues or evidence that the current distribution model threatens the financial sustainability of the football pyramid. The backstop aims to provide a last-resort solution to ensure equitable revenue sharing that supports the long-term health of the game.
d. Investigatory powers and enforcement
The IFR is empowered with significant powers to conduct investigations (including unannounced inspections known typically as ‘dawn raids’) and to require any person to provide information where it has reasonable grounds to suspect that a person (i.e. club, owner, potential owner, officer, senior manager, etc.) has committed a “relevant infringement”, as listed under Schedule 7 [7].
It will be a criminal offence for any person to provide false or misleading information, destroy information, or otherwise obstruct an officer of the IFR acting in the course of an investigation and liable to a penalty on conviction of a fine and/or imprisonment for up to 2 years.
e. Duties on clubs
The Football Governance Act provides the IFR with a suite of powers allowing it to intervene in cases of financial mismanagement, ensure fan consultation on key heritage issues, and prohibit clubs from joining competitions such as the European Super League [8].
For clubs, the Act’s emphasis on transparency and accountability presents both an opportunity and a challenge. While improved governance and fan engagement can strengthen clubs’ reputations and community ties, the increased regulatory scrutiny and associated costs could strain resources, particularly for smaller clubs. The levy imposed to fund the IFR, though proportionate to clubs’ financial circumstances, adds another layer of financial obligation.
Preparation
While transparency, financial sustainability and accountability in football will be welcomed in some quarters, not least, amongst fans, stricter regulation and the associated financial burden may prove unattractive to potential owners and investors. While the impact of the new regulation on clubs will take some time, like all good teams, the preparation, if it has not started already, should start now.
In the coming months, the IFR will need to consult both clubs and the wider eco-system of fans, investors and other stakeholders on its approach to regulation. Whilst the licensing model will likely be top of its agenda (including the fees to fund it), the IFR will no doubt have to deal with a live case load on various issues from the outset. Clubs will need to:
- Understand their new duties and issues that require regulator consent (e.g. on logo, name and stadium changes);
- Engage with the regulator now on shaping what ‘good’ looks like in terms of both the form and practical reality of licensing (where there will be significantly different views across different tiers of the game);
- Ensure that internal procedures are adequate to deal with statutory oversight over and above existing league and association procedures.
The legal sector will play a pivotal role in supporting clubs through this transition. From reviewing governance frameworks and ownership structures to advising on compliance with licensing requirements, legal expertise, particularly from other regulated sectors, will be essential in helping clubs navigate the complexities of the new regime.
Beyond compliance, clubs may also need strategic advice to align their operations with the Act’s objectives. This could include developing robust financial plans, strengthening stakeholder engagement, and proactively addressing potential risks.
The Football Governance Act is a landmark piece of legislation but how the IFR actually implements it will be critical. The regime’s successful implementation will depend on how effectively clubs, leagues, and stakeholders engage with the new regulatory landscape to shape the narrative and seize the initiative at the early stages of its development. For clubs, the next chapter will be about balancing compliance with sustainability, while ensuring they remain competitive on and off the pitch.
