A new study from The University of Manchester has revealed that the complex ownership structures of English Premier League (EPL) football clubs could jeopardise their long-term stability. Researchers Dr Peter Duncan and Professor Nicholas Lord have called for stricter regulation, urging the incoming independent football regulator to scrutinise ownership arrangements more closely.
The research, published on Policy@Manchester, warns that existing regulations fail to adequately protect clubs from financial misuse, leaving them vulnerable to potential exploitation. By analysing publicly available data, the academics uncovered a wide range of ownership complexities across EPL clubs.
Key Findings
Among the standout discoveries for the 2023-2024 season were:
- Many EPL clubs are owned by extensive networks of holding companies.
- Over half have at least one holding company incorporated offshore.
- Seven clubs use multiple overseas jurisdictions in their ownership chains.
- 12 clubs have more than 10% of holdings that cannot be traced back to their beneficial owners due to secrecy provisions.
The researchers noted that while some complex structures may have legitimate commercial purposes, they can also serve to obscure funding sources, hide the nature of transactions, or conceal the identities of investors.
“Such practices expose clubs to illicit financial flows, which could jeopardise their futures,” Dr Duncan and Professor Lord warned.
Inadequate Regulations
The EPL’s current Owners’ and Directors’ Test, designed to ensure clubs are not controlled by unsuitable parties, was criticised for its limitations. The study highlights that it is possible to own up to 25% of an EPL club without undergoing checks on the source of funds or suitability.
Dr Duncan and Professor Lord support proposals for enhanced regulations, including:
- Fitness and propriety tests for owners and directors.
- Detailed due diligence on the identity and source of funds for prospective owners.
- Robust financial planning requirements.
The researchers argue that embedding these measures into legislation could prevent problematic ownership arrangements and better safeguard clubs.
Transparency and Accountability
The study also recommends a thorough review of both current and proposed ownership structures, focusing on their complexity and use of secrecy jurisdictions. The academics urge regulators to demand detailed justifications for convoluted arrangements and collaborate with HMRC to address tax implications.
To enhance transparency, the researchers propose that clubs be legally required to disclose the identities of their beneficial owners, supported by verifiable public records.
“Enhanced regulation and transparency will ultimately protect the future of our national sport,” they concluded.
The findings come as the government prepares to introduce an independent football regulator to improve governance within the sport.
The full study, Protecting Premier League Football Clubs through Tighter Regulation, can be read on the Policy@Manchester website.
