Impact assessment

Fact sheet - owners and directors of regulated clubs

Updated 25 October 2024

Applies to England and Wales

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The IFR will have the power to determine the suitability of prospective new and, under certain circumstances, incumbent owners and directors (or other “officers” with a similar level of responsibility and authority to company directors) of regulated clubs.

The IFR will determine the suitability of all prospective new owners and all prospective new directors once a complete application has been provided to the IFR. The test comprises three key elements:

  1. A fitness test (owners and directors) to assess an individual’s integrity, honesty, financial soundness and, in the case of directors, competence, to ensure they are a suitable custodian to run or own a football club. This draws on similar ‘fit and proper persons’ tests applied by other regulators including the Financial Conduct Authority (FCA), HMRC, and the Solicitors Regulation Authority.

  2. A source of wealth test (owners) to mitigate against the risk of illicit finance in football and ensure the financial sustainability of clubs and the pyramid.

  3. To ensure the financial sustainability of clubs, prospective owners must have sufficient financial resources. They must also provide the IFR with their proposed plan to operate the club, an estimate for those costs, how those costs will be funded and the source of such funding.

Regulated clubs and prospective new owners and directors will be required to notify the IFR if it is likely that a new prospective owner or director will join a regulated club and will need to be subject to the IFR’s tests. 

While prospective new owners or directors must pass all applicable elements of the tests to be found suitable, incumbent owners and directors will not automatically be subject to suitability determinations. Instead, the IFR will have the power to determine (or re-determine) the suitability of an incumbent individual owner or director if it has grounds for concern about the individual’s suitability.

To ensure ongoing compliance with the regime, regulated clubs and individual incumbent owners and directors will be required to inform the IFR of any material change of circumstances, relevant to whether an incumbent owner or director is suitable, at any time. Those changes in circumstances could trigger a test of an incumbent where the IFR has grounds for concern about their suitability.

An individual incumbent owner or director can only be tested on their fitness or, with respect to owners, their source of wealth. Incumbent owners will not be tested on their financial resources or required to submit a financial plan. This is because the ongoing financial sustainability of clubs is already addressed through financial regulation requirements elsewhere in the legislation.  

If the IFR determines that an owner or director is not suitable for their role at a club, they will be removed. The IFR will have enforcement powers to protect clubs from harm the unsuitable owner or director might cause, and to ultimately remove them. These powers include:

  1. Removal directions: The IFR must direct an unsuitable owner, director or director’s club to take all reasonable steps so that they are no longer an owner or director by a specified date. 

  2. Ownership removal orders: In certain circumstances, such as when a person fails to comply with a removal direction without a reasonable excuse, the IFR may make an order to ensure that an unsuitable owner is removed by a specified date. This can include the appointment of trustees with the power to take actions on behalf of the owner. 

  3. Disqualification orders: The IFR may disqualify a person from being an owner or director of any regulated club for a specified or indefinite period.

  4. Directions relating to unsuitable owners and directors: The IFR may prohibit an unsuitable owner or director from carrying out certain activities or exercising certain rights at the relevant club. 

  5. Interim director directions: The IFR may, where necessary, appoint an interim director where the IFR has concerns about the club’s ability to operate effectively or comply with licence conditions.

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