The Premier League has charged Everton and Nottingham Forest with breaching its financial rules.
Both clubs have been referred to an independent commission for alleged breaches of profit and sustainability rules in their accounts for 2022-23.
Under Premier League regulations, clubs can lose a maximum of £105m over a three-season period, or £35m per campaign, before facing sanctions.
Clubs that breach those rules are at risk of a fine or a points deduction.
Everton are currently appealing against a 10-point deduction from a previous charge.
The Premier League said in a statement that Everton and Nottingham Forest “have each confirmed that they are in breach of the league’s profitability and sustainability rules”.
It added: “This is as a result of sustaining losses above the permitted thresholds for the assessment period ending season 2022-23.
“In accordance with Premier League rules, both cases have now been referred to the chair of the judicial panel, who will appoint separate commissions to determine the appropriate sanction.”
The clubs now have 14 days to submit their formal responses, and under league rules the hearings must be concluded within 12 weeks. Appeal hearings must be held before 24 May 2024 and the complaint resolved before 1 June.
Clubs are in breach of profit and sustainability rules (PSR) if their calculation over the relevant period results in a loss in excess of £105m, although that threshold is reduced by £22m for each season a club spends in the Championship over the course of that relevant period.
Nottingham Forest spent two seasons in the Championship within the three-year assessment period, meaning the maximum loss for the club is £61m.
Clubs had to submit their accounts for 2022-23 by 31 December under new rules designed to speed up the reporting process and ensure any penalties were imposed during a season when the alleged transgression took place.
The Premier League had 14 days from the reporting date to inform clubs whether they were in breach or not.
Everton are 17th in the Premier League table and sit just one point above Luton Town, who are in the relegation zone having played a game more, while Nottingham Forest are four points clear of the drop zone in 15th. (BBC)
