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Football London
Football London
Sport
Luke Thrower

Premier League make key financial decision that impacts Chelsea, Arsenal and Tottenham transfers

The Premier League has been given a mandate by its clubs to propose a huge change to the financial structure of the English pyramid, according to reports from the Telegraph. Representatives of the division now have to propose their plans to the government, the FA and the EFL.

The changes - dubbed as the "New Deal for Football" - come in light of rising tensions over the state of modern day football and their finances. Both the European Super League and Project Big Picture have launched and collapsed within the past two years with the aim of radical change to such issues, as well as the proposition for an independent regulator.

One of the key changes proposed in the new deal includes making sure that some of the earnings are spent on key infrastructure over wages and transfers. The redistribution of such wealth will also be based on merit across the footballing pyramid, attempting to cap overspending at all levels.

READ MORE: What Neymar did as Arsenal star Gabriel Martinelli's Brazil World Cup inclusion was revealed

There's also the potential for a spending cap across English football, similar to how UEFA operate, with a percentage of the revenue allowed to be spent on transfers and wages. The current limit for Europe works out at 70 percent of earnings. However, it is expected to be more in England.

Overspending is one of the key problems lower down the pyramid, especially in the Championship, where large losses become routine as clubs chase the golden goose that is Premier League money.

Clubs in the second tier have often pushed themselves to the brink of existence at times to close the gap, with teams relegated from the Premier League often having more money in reserve as well as parachute payments, made over two or three years that is meant to help a team adjust to the financial blow of relegation from the top flight.

The cap is expected to stunt that spending but it could see clubs unable to compete with teams at the top as they hit a limit on such revenue before their competitors - similar to how financial fair play rules work - which has led to accusations that it protects the teams at the top. It remains to be seen whether the league will be able to push through such reforms with the rest of the EFL, Government and the FA.

Another huge change could be related to the regulations surrounding Brexit, which has stopped some clubs from signing players due to points-based rules for signing overseas players. The Premier League are set to hold crunch talks with the FA over relaxing such rules, which may lead to the likes of Chelsea, Arsenal and Tottenham being able to sign more players from elsewhere than the current regulations allow for.

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