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14. SANCTION PRINCIPLES – APPROACH TO SANCTION
91. The Premier League made a number of submissions as to the principles that
should be applied by the Commission when determining the appropriate
sanction. Those submissions remain relevant notwithstanding our decision
not to adopt the structured formula advocated by the Premier League. The
Premier League identifies four separate heads that it submits should guide
our decision making in relation to sanction. It recognises that adoption of
that approach should not result in a sanction that is greater than one that is
necessary and proportionate for achieving the purpose that underlines the
individual heads.
92. The first head is that of punishment. A breach of the PSR involves an
overspend in excess of £105 million above the target of a nil PSR loss. It is
therefore at any level a serious breach. Further, as was recognised in
Sheffield Wednesday FC v The Football League Ltd a breach of the PSR will
confer a sporting advantage on the defaulting club, to the detriment of
competing clubs who have managed their finances more responsibly. The
fact that that sporting advantage cannot be quantified but must be inferred
underlines the need for a sanction that imposes a proper punishment.
Anything less than that would encourage default to the expense of compliant clubs.
93. The other heads overlap with the head of punishment. The second head is to
vindicate compliant clubs. The sanction must ensure that the defaulting club
does not retain a benefit at the expense of other clubs. The third head is that
the sanction must act as a deterrent to clubs that might be tempted to breach
the PSR. The sanction must be such as to demonstrate that such breaches do
not confer a lasting benefit. The fourth head is to protect the integrity of the
game – a sport that attracts global support. The Premier League cited the
authority of Bolton v The Law Society [1994] 1 WLR 512.