The Football Governance Act has received Royal Assent, making it onto the statute book before the new football season kicks off in August.

Fair Game CIC – which Bates Wells worked with on amendments to the legislation – described its passage into law as “a victory for fairness, sustainability, and the future of football. It’s a testament to the tireless work of Fair Game clubs who have stood up, spoken out, and demanded better.”

The Act will establish an Independent Football Regulator (IFR), tasked with overseeing the financial and corporate governance of the 116 clubs in the top five tiers of the men’s game.

The Independent Football Regulator

A Shadow Regulator has been in operation since 2024, laying the foundations which should enable the IFR – under the leadership of David Kogan – to hit the ground running when it launches later this year.

The IFR will have three primary objectives: protecting the financial sustainability of regulated clubs; protecting the financial resilience of the football pyramid as a whole; and safeguarding local clubs’ heritage as the heart of their communities.

It will launch with an extensive to-do list, including requirements to publish:

  • practical guidance for clubs on the new regulatory regime;
  • a State of the Game report, which it will do within 18 months (and then every five years); and
  • a Football Club Corporate Governance Code.

The IFR will also be working to put in place a licensing system. Through licensing conditions imposed on regulated clubs, the IFR will be able to:

  • subject prospective owners and directors to a “fit and proper” person test before they buy or join a club, and require owners to explain the source of their wealth and their financial plans for the club;
  • monitor clubs’ financial planning, and place bespoke conditions on clubs where it has concerns about cashflow or risk exposure;
  • require clubs to have an effective fan engagement regime. Clubs will have to meet with fan representatives to discuss key strategic matters and heritage issues – decisions to change crests or home shirt colours, for example, will not be permitted unless clubs can demonstrate that a majority of fans support them;
  • approve (or veto) certain decisions, including decisions to relocate a home ground or join a breakaway league; and
  • require clubs to report on their compliance with the (upcoming) Football Club Corporate Governance Code, including their equality, diversity and inclusion initiatives and their contributions to the local community.

If a club fails to comply with its licence conditions, the IFR will have a range of enforcement powers – from the issue of a “censure statement” to the withdrawal of the licence (and thereby the club’s removal from the league). It will also be able to seek court injunctions requiring clubs to take certain steps.

Clubs that are dissatisfied with the IFR’s decisions – including its decisions about discretionary licence conditions, its “fit and proper” person assessments, and its exercise of enforcement powers – will be able to challenge them, in the first instance by requesting an internal review. Beyond that, clubs will be able to appeal to the Competition Appeal Tribunal, where the IFR’s decisions will be open to challenge on judicial review grounds (e.g. that they were unlawful, irrational, or made on the basis of a flawed process).

What clubs should do now

For now, clubs are waiting to see the IFR’s detailed guidance – but the legislation sets out some minimum evidence requirements which clubs can turn their minds to straight away.

Provisional licence

All clubs will be required, as a first step, to obtain a provisional operating licence. The application requirements will be confirmed by the IFR in due course, but the Act specifies that clubs will at a minimum have to submit a “personnel statement” (identifying the club’s owners and officers) and a “strategic business plan” (setting out the proposed operation of the club, the costs of operation, and the source of funding).

Full licence

The clubs will then have up to three years to work towards to meeting the requirements for a full operating licence. Before granting a full licence, the IFR will have to be satisfied that a club:

  • meets the Act’s “threshold requirements” – i.e. has “appropriate” financial and non-financial resources, and an effective mechanism for consulting with fans;
  • is complying with the mandatory licence conditions that the IFR is required to impose on all clubs – namely requirements to submit financial plans and corporate governance statements, and to carry out regular fan consultation;
  • is complying with the duties on clubs, including duties not to make certain key decisions without IFR approval; and
  • does not have an owner or officer who is unsuitable for the role.

The IFR may also impose any discretionary licence conditions that it considers necessary to ensure that a club will meet the threshold requirements, and/or to protect the financial resilience of the system as a whole.

The IFR plans to take a “participative” approach, and the period following the grant of the provisional licence could involve extensive dialogue between clubs and their new regulator. Getting this early engagement right is likely to be crucial. Any discretionary licence conditions will be determined on a club-by-club basis (based on each club’s unique circumstances, financial position, and risk factors), as will the levy to be paid. Clubs will need to make sure that the IFR has clear, comprehensive evidence in relation to all of the requirements set out above, so that it can take an evidence-based and proportionate approach.

Benjamin Thomas and Helen Fry are Bates Wells’ specialists on the legislation. Ben is a specialist in sports sector work and Helen is a senior associate in our public and regulatory team. If you run a club that will be affected by the new regulatory regime and would like any guidance as to how the legislation might affect you, please get in touch with Ben ([email protected]) or Helen ([email protected]).