The Premier League has taken decisive action by charging Everton and Nottingham Forest for alleged violations of its financial rules, particularly breaches of profit and sustainability regulations within their 2022-23 accounts.

Both clubs now face referral to an independent commission, as outlined by Premier League regulations, which caps allowable losses at £105m over three seasons or £35m per campaign before clubs risk sanctions like fines or points deductions.

Everton, currently contesting a 10-point deduction from a previous charge, and Nottingham Forest have acknowledged breaching the league’s profitability and sustainability rules.

The Premier League, in a statement, specified that the breaches were due to sustaining losses beyond the permissible thresholds for the assessment period ending the 2022-23 season.

The statement reads, “In accordance with Premier League rules, both cases have now been referred to the chair of the judicial panel, who will appoint separate commissions to determine the appropriate sanction.”

Profit and sustainability rule breaches are calculated based on losses exceeding £105m over the relevant period, with adjustments for seasons spent in the Championship.

Nottingham Forest’s two seasons in the Championship within the three-year assessment period reduce their maximum allowable loss to £61m.

Under new reporting rules introduced to expedite the process, clubs had to submit their 2022-23 accounts by December 31.

The Premier League, within 14 days of the reporting date, notified clubs of any breach. This streamlined process ensures that any penalties are imposed during the season in which the alleged transgressions occurred.

As the cases progress to separate commissions, Everton finds itself in a precarious 17th place in the Premier League, holding just a one-point advantage over Luton Town in the relegation zone.

Nottingham Forest, in a more comfortable position, stands four points clear of the drop zone in 15th place.