The Football Governance Act 2025: an open goal or VAR error?

A little over a week after Chelsea were crowned “world champions” in the controversial 2025 FIFA Club World Cup final at MetLife Stadium in New Jersey, a little closer to home, on 21 July, the historic Football Governance Act 2025 (the “Act”) came into UK law, establishing an independent football regulator for England and Wales. 

Just in time for the new Premier League season, my colleague Shaaf Alam and I take a closer look at the contents of the Act, what it seeks to address, and potential past issues that, had similar legislation been in place over past seasons, could have been mitigated. 

To set the scene, the Act (and the desire for an independent football regulator) came into being as a result of a fan-led review of the game, and a similar bill was introduced to Parliament by the previous Conservative government in spring 2024, but failed to receive Royal Assent before the outcome of the last UK general election. However, with Premier League matches being watched live from Boston to Beirut on a weekly basis, along with TV series such as FX/Disney's “Welcome to Wrexham” shining a light on the Football League like never before to global audiences, there appears to be a concerted drive in Westminster to preserve and protect one of the UK's biggest sources of soft power globally. While, domestically, football clubs such as Bury FC, Sheffield Wednesday and Blackpool (to name just a few) have fallen victim to poor financial oversight in recent seasons (sometimes fatally), invoking fan (and therefore voter) ire in constituencies up and down the country. 

The Act can be broken down into the following key sections: 

• Creation of an independent football regulator (the “IFR”), whose powers will be (among others) the ability to license clubs and monitor their financial stability while ensuring they adhere to a certain level of financial hygiene; 
• Stronger powers to regulate prospective owners of clubs, and enforcement powers to remove owners if they fail to adhere to certain standards; 
• Ensuring a club regulated by the IFR cannot relocate its home ground, change its crest and/or home shirt colours without fan approval; 
• a prohibition on IFR-regulated clubs competing in closed-shop competitions or “breakaway leagues”; and 
•  an enhanced ability to ensure financial sustainability across professional football in England and Wales, including powers to intervene in financial redistribution across the football pyramid.

Below, we take a closer look at some elements of the Act and how they could have been applied to prevent previous issues familiar to fans in past seasons. 

Under the Act, clubs will now need to apply for a license from the IFR to compete in their respective leagues. The IFR's ambit will be over the top 5 leagues in professional football in England & Wales (that is, from the National League upwards). The Act sets out two types of licenses: “provisional” and “full” (the former allowing clubs to operate for three years while working towards “full” license status). In order to attain a full license, clubs must meet a statutory test set out in the Act, which includes (among other things) owners (and officers) meeting certain thresholds (discussed in greater detail below). 

Fans across the game will be familiar with prospective owners of football clubs regulated by the Premier League, Football League and National League having to meet respective “fit and proper” persons tests to be eligible for ownership, but the Act (and therefore, by extension, the IFR) sets out a stringent framework for judging the eligibility of an individual to own a club or to be appointed as member of the board. 

It is, however, unclear how this legislation will interact with the current “fit and proper” tests already in place across each tier of the football pyramid, which could create a legal limbo if a prospective owner were to be deemed eligible under, for example, the Premier League's test, but fail the IFR's criteria (which will no doubt lead to some spirited Talk Sport and BBC Five Live call in discussions if this were to occur in future seasons) but will likely be addressed in granularity once the IFR is established later this year.  

The Act states that an individual will meet the “individual ownership fitness criteria” if that individual “has the requisite honesty and integrity” and is “financially sound”, along with strict criteria for what such an individual needs to submit to the IFR to demonstrate the latter limb. 

However, what about incumbent owners failing to meet these tests? With Sheffield Wednesday's players having to start their pre-season preparations without ready access to sock tape earlier this month due to a strain (putting it mildly) on the club's finances: Sheffield Wednesday in crisis: So broke they cannot even afford sock tape, there is now an obligation on owners or licensed clubs to notify the IFR if there has been a “material change of circumstances” which may be considered relevant to whether an individual or organisation is suitable to continue to be an owner of a licensed club. 

The IFR also has the ability to issue directions as to how a licensed club is run (in effect potentially preventing an owner from undertaking what the IFR has deemed to be a damaging course of action for the club) or, in the most extreme circumstances, could order a compulsory sale of the club in question. Had this legislation been in place in 2014, it may have been some comfort to Birmingham City fans following the incarceration of then-owner Carson Yeung, following his conviction by a Hong Kong court of numerous counts of money laundering, who, given he was judged to be a “fit and proper” person by the Premier League at the time of his acquisition, did not lead to a compulsory sale of the club at that time, given no wrongdoing under those regulations occured: Carson Yeung and the takeover that was a riddle wrapped in a mystery | Carson Yeung | The Guardian. 

The Act also deals with ensuring emotive issues close to the hearts of fans are not enacted without their approval. While fairly uncommon in English sport (although with the famous example of the Crazy Gang's relocation 62 miles up the M1 to Milton Keyes being the notable exception), approval from the IFR must be sought for a relocation of a club's home ground which, among other things, requires the club to consult with its fans, and take their views into account. With this in mind, Lisa Nandy was keen to point out that “for Wimbledon supporters it will mean your stadium can't be relocated without you having a say. It will put fans back in the rooms where decisions are made, it will mean all clubs have to reach the standard of the best clubs”. 

A notification must also be made to the IFR if a licensed club intends to dispose of “any freehold or leasehold interest” in its home ground, or use any interest in its home ground as security in respect of loan or other liability, and the IFR must grant its approval if it “satisfied that the taking of the step would not undermine the financial sustainability of the club”.  

This power of the IFR raises the possibility that it will be able to approve sale and leaseback arrangements clubs have employed in recent years with respect to their stadiums, seen as non-controversial in the commercial property sector, but if employed in the football context,  allows clubs to boost revenue and potentially allow a club to meet its “financial fair play” requirements. Derby, Sheffield Wednesday, Aston Villa and Reading have used this procedure in recent years (and Derby and Sheffield Wednesday were docked points for breaching the EFL's profitability and sustainability rules as a result). 

A licensed club will also not be able to make any “material changes” to any emblem or crest of a relevant team operated by the club, or the predominant home shirt colours of such a team, unless the club has taken reasonable steps to establish that the changes are supported by a majority of the club’s fans in England and Wales. Had the Act been in place in 2018, it may well have prevented Leeds Utd's controversial attempt to change its crest in the fact of widespread fan backlash: Leeds United: New club crest mocked by social media users - BBC Sport or Cardiff City owner Vincent Tan's decision to rebrand the club's crest from a bluebird to a dragon and change its home strip from blue to red in 2012: Cardiff City FC fans react to red shirt rebranding - BBC News. 

One of the most high-profile measures in the Act is the prohibition on IFR-regulated clubs participating in “closed-shop” or “breakaway” competitions without approval. This provision is clearly aimed at preventing a repeat of the European Super League (ESL) saga of 2021, when six Premier League clubs announced their intention to join a largely closed competition, sparking immediate backlash from supporters, governing bodies and the UK Government. The IFR’s licensing powers would enable it to take swift regulatory action against any club seeking to enter such a competition without meeting the approval criteria, which would require consideration of the competition’s openness, financial integrity and impact on the domestic football pyramid.

An interesting legal and regulatory question arises when considering how this prohibition might interact with expanded or restructured FIFA-sanctioned tournaments, such as the new 32-team FIFA Club World Cup. While not “closed” in the ESL sense, these competitions can create similar tension points – particularly around fixture congestion, player welfare and the balance between domestic and international obligations. With the Premier League and Professional Footballers’ Association already bringing proceedings against FIFA over the congested international calendar, it remains to be seen whether IFR oversight could extend to scenarios where an English club’s participation in an international tournament might materially impact its domestic obligations: Premier League and Professional Footballers' Association suing FIFA over international calendar congestion | Football News | Sky Sports.

From a commercial and governance perspective, this raises broader strategic considerations for clubs and their owners. Participation in high-profile global tournaments can significantly increase revenue and brand exposure, but the IFR’s mandate places clear guardrails around competitions that risk undermining the domestic game. Future disputes are likely to test the limits of these provisions. For example, if a tournament is structured in a way that meets FIFA or UEFA’s regulatory framework but still falls foul of IFR standards. This interplay between national regulation and global football governance could become one of the most complex and contested areas of the Act in practice.

In conclusion, the Act seems to be a well-meaning and sensible piece of legislation, attempting to put the views of fans based in England and Wales at the forefront of approving any material prospective changes to their clubs, so mistakes from the past (some of which have been highlighted above) are not repeated in the future. 

However, with the Premier League said to be critical of the need for a regulator, and with a vast amount of further explanation required as to how the IFR will seek to enforce its mandate and the provisions of the Act once the IFR comes into being, whether the IFR becomes a key player or merely an armchair supporter in the ever evolving landscape of English football has yet to be seen.  

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