The Football Governance Act 2025 (the "FGA") has created an entirely new regulatory landscape for English football. From the 2027/28 season, every club in the top five divisions will need an operating licence from the Independent Football Regulator ("IFR") simply to compete.
At a glance: the licensing regime
| What is a provisional licence? | A time-limited licence (up to three years) that clubs need to compete in the Premier League, EFL or National League from the 2027/28 season onwards. Where the IFR is satisfied the club meets the full licence test, it will grant a full licence without a separate application. A minimum one year of reporting under the mandatory licence conditions is required before a full licence is granted. |
| Who needs to apply? | All 116 clubs in the top five men's divisions of English football, plus any club promoted from National League North or South into the National League. |
| How do clubs apply? | Via an online application form, which includes clubs submitting a strategic business plan (with financial forecasts) and a personnel statement setting out governance and management structures. |
| Application window | 2 November 2026 to 26 February 2027 for clubs already in the top five divisions; after confirmed promotion for National League North/South clubs. |
| Decision timeline | The IFR has up to three months from receipt of a "complete" application (i.e. IFR deems it has sufficient information) to make a decision on whether to grant a licence, with a target of deciding all applications by the end of May before league AGMs. |
| IFR support | Each club will have a named IFR supervisor who will be available to support, provide updates and answer queries throughout the application process. |
| Ongoing conditions | Once licensed (whether on a provisional or full licence), clubs must comply with the four Mandatory Licence Conditions ("MLCs") regarding financial plans, corporate governance statements, fan consultation, and annual declarations. |
| Consequences of refusal | Without a licence, a club cannot compete. However, refusal is a last resort - the IFR will work with clubs to address concerns before reaching that point. |
| How public is the process? | The IFR will maintain a public online register of licensing decisions, including details of amended MLCs and Discretionary Licensing Conditions ("DLCs"). While the IFR will consider redactions for commercially sensitive information, clubs should anticipate a much higher level of public transparency around their regulatory position. |
What is the IFR licensing regime?
Purpose and objectives
The licensing regime sits at the heart of the FGA. Its overarching aim is to help the IFR meet its three statutory objectives of:
- promoting clubs' financial soundness,
- protecting the systemic resilience of English football, and
- safeguarding the cultural heritage of the game.
In other words, this means the regulator is primarily concerned with whether clubs can pay their bills, withstand financial shocks and continue operating sustainably - not with dictating sporting strategy.
Who does it apply to?
The regime covers all men's teams in the Premier League, the Championship, League One, League Two and the National League, including clubs promoted annually from National League North and South. It also applies to club owners, directors, senior executives and, indirectly, the league bodies themselves.
While operations relating to women's teams do not fall under the scope of the IFR, the IFR may consider a broad range of factors when evaluating whether a club has appropriate financial resources, including "any other competitions in relation to which a team is operated by the club". A club operating a Women's Super League team alongside its men's teams could therefore see the IFR take account of the women's team's financial profile as part of its holistic assessment.
Provisional and full licences
The licensing pathway is a two-stage process. Clubs will first apply for a provisional licence, which lasts up to three years. During this period, they must comply with the four MLCs and work towards meeting the three Threshold Requirements (i.e. having appropriate financial resources, appropriate non-financial resources and fan engagement) before being granted a full licence.
The earliest a full licence could be granted is June 2028 (for clubs licensed ahead of 2027/28), following at least one full round of reporting. Crucially, if a club has not met the full licence test after three years, the IFR can extend the provisional licence or, ultimately, revoke it.
IFR's approach to licensing
The IFR has made clear that its approach will be risk-based and proportionate rather than prescriptive. It does not intend to set uniform financial thresholds for every club. Instead, it will conduct a risk assessment in parallel to the licensing process to assess each club's individual circumstances, business model, and risk profile. Higher-risk clubs may receive amended MLCs or DLCs, which can impose additional requirements around debt, liquidity, spending or governance.
Key licensing requirements
| Financial regulation | Financial oversight is the backbone of the regime. Clubs must submit annual financial plans using the IFR's standardised template, demonstrating how they will hold and maintain appropriate financial resources and manage identified risks. These plans must show the club is financially sound under normal operating conditions and resilient under stress. Financial plans must include stress tests covering three core scenarios:
Each stress test must be accompanied by a credible mitigation plan. The IFR's key focus is on actual cash inflows and outflows and a club's ability to manage adverse scenarios. A high level of detail is expected. Clubs must provide balance sheet forecasts at six-monthly intervals, profit and loss forecasts quarterly, and cash flow statements (direct or indirect) quarterly. Line items span everything from player wages and transfer fees to broadcasting income, stadium costs and shareholder loans. Clubs must also submit the underlying assumptions (e.g. revenue projections, player trading expectations, funding arrangements and contingent liabilities) which must be realistic, evidence-based and cautious. Where there is a material change in circumstances, clubs must notify the IFR and submit an updated financial plan "as soon as reasonably practicable" to ensure the IFR has up-to-date information. KEY: Impact of player transfers It is worth highlighting that, when assessing a club's liquidity, the IFR has made clear that football players are not to be treated as liquid assets given the inherent difficulty of realising value outside transfer windows. For clubs whose financial resilience rests heavily on the prospect of player sales, this is a particularly important distinction. On the transfer side, the IFR does not seek to approve or intervene in individual player signings. However, where a club's overall completed transfer expenditure materially departs from the assumptions underpinning its financial plan, the club is expected to notify its supervisor as soon as reasonably possible. In such cases, the club may also be required to update and resubmit its financial plan - a requirement that underscores the importance of realistic budgeting at the outset. |
| Corporate governance | Another of the IFR's key aims is to promote sound corporate governance. The Football Club Corporate Governance Code (the "Club Code") sets out five principles that clubs must apply on an "apply and explain" basis:
Clubs must submit corporate governance statements explaining how their practices apply the principles of the Club Code by 31 October 2027 and every two years thereafter. They must also publish them online. While a failure to follow a specific recommended practice does not automatically trigger enforcement action, fans and stakeholders can hold clubs publicly accountable through the published statements. |
| Fan engagement | Fan engagement is now a regulatory obligation. Under the new framework, clubs must establish a representative body of fan representatives (whether elected or appointed) and consult them regularly on "relevant matters." These matters range broadly, covering the club's strategic direction and business priorities, ticket pricing, operational and matchday policies, and heritage issues. Each club must also submit an Annual Fan Consultation Report to the IFR by 15 August each year. Crucially, this consultation cannot be a tick-box exercise: it must be collaborative, two-way, open, and genuinely integrated into the club's decision-making processes. These fan engagement requirements carry real commercial implications. Section 49 of the FGA prohibits clubs from making material changes to their crest, home shirt colours, or team name without following prescribed steps. For crest and shirt colour changes, clubs must take "reasonable steps" to demonstrate that a majority of fans in England and Wales support the change. Name changes require prior FA approval. Clubs planning kit redesigns or branding refreshes should therefore build the IFR's assessment timeline into their project planning from the outset, particularly given that manufacturer lead-in times can be lengthy, leaving little room for delay if consultation or approval processes run long. |
| Business planning | The strategic business plan, which forms the core of the provisional licence application, goes beyond a club's financial forecasts. It requires clubs to answer questions on strategy, funding, fan engagement and corporate governance. Critically, it must be formally approved and signed by a club director or individual with appropriate authority, confirming its accuracy and completeness. |
What should clubs and stakeholders be thinking about now?
1. Prepare your "governance architecture" early
- The corporate governance statement is not due until 31 October 2027, but the governance structures will need to be firmly in place well before that. Clubs should be reviewing their board composition, committee structures, policies on risk management and internal controls, and considering whether appointing independent non-executive directors would strengthen their position.
- For clubs with less formalised governance arrangements, this may represent a significant programme of work — and engaging specialist governance advisers early can help ensure structures are fit for purpose.
2. Get ahead on financial planning
- While the first annual financial plan must be submitted between 17 and 31 May 2028 (although the IFR retains discretion to ask for it earlier), the provisional licence application itself requires detailed financial forecasts spanning up to 20 months. Clubs should begin building their forecasting capability now, ensuring they can produce balance sheet, P&L and cash flow projections at the intervals the IFR requires. Those with complex ownership or group structures will want expert input on defining their reporting perimeter and ensuring consolidated reporting is accurate.
3. Map your corporate group structure
- The requirement to submit a clear corporate group diagram, identifying the ultimate owners, all subsidiaries, the stadium owner and the regulatory reporting perimeter, may expose structural complexities that take time to resolve. Clubs and their owners should carry out a thorough structural review early, particularly where multi-club ownership, offshore holding companies or third-party stadium arrangements are in play. Note that any group restructuring, acquisition, disposal or ownership change will trigger a resubmission obligation.
4. Establish fan engagement mechanisms
- Fan consultation is an ongoing mandatory condition, not a one-off exercise. Clubs should begin building, or formalising, their fan engagement infrastructure well ahead of the provisional licence, including establishing representative groups, defining consultation processes, devising fan engagement and consultation policies, and embedding stakeholder input into governance practices.
- Clubs already operating under Premier League or EFL fan engagement frameworks can build on those structures but should assess whether additional steps are needed to meet the IFR's principles.
5. Stress test, your stress tests
- The three mandatory stress scenarios - income shock, relegation and loss of main funding source - require not only financial modeling, but credible, actionable mitigation plans. Clubs should start developing and stress-testing their mitigation strategies now, particularly those with concentrated funding sources or heavy reliance on owner funding. Professional advice on scenario modelling and contingency planning will be valuable in ensuring these plans withstand IFR scrutiny.
6. Engage proactively with your IFR "supervisor"
- Every club will have a named IFR supervisor. Clubs should build that relationship early and use it proactively, particularly to clarify any areas of uncertainty around reporting requirements, financial plan content or governance expectations. The IFR has signalled clearly that it wants to support clubs in obtaining and maintaining their licences (and that refusal of a licence is a last resort), and early, constructive engagement will be more productive than a reactive approach.
Need practical guidance on the new licensing regime? We have a dedicated sport group spanning corporate, commercial, real estate, dispute resolution, immigration and technology – meaning we can work with you to fully understand and plan for the IFR's impact on clubs and help you prepare for the changes ahead.
