In the King's speech, delivered on 7 November 2023, the introduction of a Football Governance Bill was confirmed “to safeguard the future of football clubs for the benefit of communities and fans”. We take a look at what the legislation aims to achieve and when progress might be seen.
Following a commitment by the Government in 2019 to set up a fan-led review of football governance, a report was published in November 2021, setting out conclusions and a number of recommendations to ensure the future of English club football. Threats such as financial mismanagement and poor governance, COVID-19 and an attempt to set up a European Super League which threatened the structure of the entire English football pyramid highlighted the fragility of the system and prompted the review. Overall strategic recommendations included creating a new independent regulator, which would oversee financial regulation in English football, and to establish tests for new owners and directors to ensure financial sustainability and that only appropriate and qualified individuals could run clubs.
Following on from this, in February 2023, the Government published a White Paper setting out its proposals for future legislation on the reform of club football governance. We commented on the legal implications of the Government's proposals and how effective they might be in our earlier article - in short, “it remains to be seen whether the independent regulator is going be truly effective in achieving these objectives whilst at the same time not stifling investment into football, and how the new regulator will work in practice alongside the various other regulatory regimes”.
As heralded in the King's speech, this is now all coming to fruition as part of the Government's plans to foster a “strong society” for the long term by “supporting those things which help bring the community together”. So what exactly is the Football Governance Bill going to achieve and when?
The aim of the proposed legislation, as set out in the briefing notes to the King's speech, is to “strengthen the governance and financial resilience of football clubs to protect the national game and clubs' link with communities and fans” by:
- Establishing a new independent regulator for English football clubs to address issues of financial sustainability and ensure fans' voices are listened to.
- Creating a new, strengthened owners’ and directors’ test to ensure they are suitable.
- Setting a minimum standard of fan engagement which clubs will need to meet and requiring the support of a majority of fans for any changes to the club’s badge, name, home shirt colours.
- Requiring clubs to seek the Regulator’s approval for any sale or relocation of the stadium and demonstrate how they have consulted their fans as part of this.
- Preventing clubs from joining breakaway or unlicensed leagues, such as the proposal to create a European Super League in 2021.
- Intervening as a last resort to ensure financial sustainability through the redistribution of broadcast revenue.
- Establishing a compulsory Football Club Corporate Governance Code.
The new regime is intended to apply to the top five tiers of the English football pyramid.
Following the speech, the House of Commons Culture, Media and Sport Select Committee Chair, Dame Caroline Dinenage MP commented: “Now the Government is committed to establishing the independent football regulator, it should get on with setting it up in shadow form by the end of the year”.
The timing for implementing the legislation itself will depend on the speed at which the Football Governance Bill will be presented before Parliament for debate. Once both the House of Commons and the House of Lords have agreed the content, the Bill will be presented to the King for Royal Assent. Once this is given, a Bill becomes an Act and becomes binding primary legislation. Changes can be made to the Bill during its progress through Parliament and, indeed, it is possible that a Bill may not receive Parliamentary approval.
In the meantime, subject to Government funding, steps can be taken to set up a non-statutory, shadow regulator, with the aim of ensuring that the independent regulator is operationally functional as soon as the legislation comes into force. This was recommended in the November 2021 report, in light of the fact that the proposed new regulatory regime is likely to introduce significant changes for football.
Although the Bill is said to have widespread support, which would facilitate its passing through Parliament, we don't expect to see any significant developments before 2024 kicks off.
The Regulator will address systemic financial issues in football while providing the certainty and sustainability required to drive future investment and growth, so that the Premier League and the English Football League remain a global success story. It will also provide greater protections for club heritage, address the issue of breakaway competitions, and most importantly ensure that fans have a greater voice in their own clubs.