Newcastle United will be assessed under UEFA's football earnings rule this coming season in the Champions League
A general view of a Newcastle United shirt
Newcastle are back in the Champions League(Image: Serena Taylor/Newcastle United via Getty Images)
Newcastle United may have to alter their spending plans in order to comply with UEFA regulations for the upcoming season.
The start of July saw European football’s governing body hand down fines to Aston Villa, Chelsea, Barcelona, Olympique Lyonnais and Hajduk Split for breaching the organisation’s football earnings rule (FER), which was assessed for the first time in 2024/25.
FER was introduced to limit how much clubs competing in UEFA competitions can spend on player and coach wages, transfers, and agent fees relative to their revenue, with the level initially set at 90 per cen before falling on a sliding scale to 70 per cent.
UEFA handed down fines of €20m to Chelsea, with €60m suspended, and €5m to Villa, where €15m was suspended, after both clubs were found by the First Chamber of the Club Financial Control Body (CFCB) to have been in breach of FER.
One of the key themes of the decision was the stance of the CFCB on player swaps, something which a number of Premier League clubs engaged in last season as a way of creating quick profit to allow them to be compliant with the Premier League’s profit and sustainability rules, which are likely to be replaced by a version similar to UEFA’s squad cost ratio rule in the next couple of years.
The profit created from the sales of academy graduates to one another, so Chelsea’s sale of Ian Maatsen to Villa and Omari Kellyman heading in the other direction in separate deals that created pure profit due to neither player holding book value, was deemed non-admissible by the CFCB and could not be counted towards either club’s FER position when assessed by UEFA. That pushed both closer to breaching regulations.
Newcastle and Nottingham Forest will be assessed next season due to their competing in the UEFA Champions League and, potentially still for Forest due to the Crystal Palace ownership situation, the Europa League respectively and neither club will be able to include the profit made from the sale of players in their FER submissions, meaning that the threshold will appear closer than it would have been otherwise.
In the same week that saw clubs with challenged PSR positions including Chelsea, Villa and Everton, player trade with each other, both the Magpies and Forest, who had PSR concerns of their own, engaged in a deal that saw Newcastle acquire Forest’s Greek international goalkeeper Odysseas Vlachodimos join for £20m while Magpies academy graduate Elliot Anderson headed the other way, again in a separate deal, for £35m.
The deal enabled Newcastle to realise £35m in accounting profit straightaway, while only adding £4m per year in amortisation costs, if he signed a five-year deal. That handed Newcastle a £31m bump that helped to stave off any PSR issues.
But UEFA won’t allow that deal to be included in the calculations when it comes to FER for next season, meaning that the room for manoeuvre is less, with the threshold for a potential breach closer than it otherwise would have been, although the club may have done just enough to avoid the kind of fines that have been handed out in recent weeks they find themselves scrutinised this time next year.
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