"The Premier League's decision to introduce new financial regulations in order to improve the financial sustainability of its clubs is definitely a move in the right direction. It follows the same principle as UEFA's Financial Fair Play initiative and will secure long-term viability that can only benefit the league, the clubs, the fans and the game," said Androulla Vassiliou, the European Commissioner responsible for sport.

The new rules, agreed in principle by the 20 clubs in the Premier League, mean that from next season Premier League clubs will not be allowed to make a total loss of more than £105 million (€ 125 million) over the next three seasons. Teams that break the rules could face a deduction in points. The Premier League includes some of the wealthiest clubs in world football including Manchester United, Chelsea and Manchester City. The decision by the Premier League clubs was announced on the same day as the European Commission published a study calling for changes to international rules on transfer fees.

It recommends that FIFA and national football associations’ rules should ensure stronger controls over financial transactions and for the introduction of a fair-play levy on transfer fees, beyond an amount to be agreed by the sport's governing bodies and clubs, to encourage a fairer redistribution of funds from rich to less wealthy clubs.

More information: Premier League clubs agree new financial rules