English soccer’s Everton FC may be deducted 12 points in this season’s Premier League (EPL) campaign for breaching Profit and Sustainability (P&S) rules.

Last week, a disciplinary hearing into Everton’s alleged violations began after the EPL referred the Merseyside club’s case to an independent commission in March.

The EPL has asked the commission to impose a record-breaking deduction of up to 12 points, according to the Daily Telegraph.

Specific charges have not yet been revealed – although it has been suggested that tax misdemeanors relating to loans for Everton’s under-construction £760m ($922m) Bramley Moore Dock stadium are involved.

The EPL’s P&S rules say clubs are permitted to sustain losses of up to £105m for three years before facing potential penalties.

However, Everton have reported losses of £371.8m over the past three years, and annual losses for five consecutive years.

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A relegation death sentence?

The news has come as part of a tough week for Everton, with the club having lost in the league to local rivals Liverpool FC in the Merseyside derby on Saturday (October 21) and mourning the passing on Monday (October 23) of long-time chairman Bill Kenwright.

A 12-point punishment would have seen Everton relegated in each of the last two seasons. The club has been in the top flight ever since the 1954-55 season but finished just two points from relegation in 17th place last season.

Unfortunately for the nine-time league winners, points deductions and relegation go hand-in-hand.

In 2010, Portsmouth FC were docked nine points for flirting with administration. The club narrowly avoided liquidation when it went into administration two years later. Middlesborough, meanwhile, were deducted three points for postponing a game at short notice in 1997 due to a lack of available players. Both clubs went on to be relegated.

There is, however, “no certainty what the sanction will be at this stage”, according to Conrad Wiacek, Head of Analysis at GlobalData Sport. “Premier League chiefs have called for a points deduction, but it remains speculative and will be determined by the independent commission,” he notes.

Manchester City sit pretty

Some backlash has focused on the EPL’s inconsistent verdicts on financial violations.

Many have pointed to the alleged breaches of financial rules by reigning champions Manchester City. That club faces 115 charges of breaching financial rules and has had a microscope held up to its overwhelming success over the past decade for ties to Emirati state-owned companies.

“It calls into question the processes and governance of the Premier League,” says Wiacek. “Manchester City were charged in February but no movement has happened there, whereas Everton were only charged in March. It also exacerbates accusations of bias, with referees recently taking trips to the UAE to officiate matches for substantial financial compensation.”

Former Liverpool defender and Everton academy recruit Jamie Carragher scolded the announcement on X (formerly Twitter), saying Manchester City could face relegation to the sixth-tier “National League North”.

Such a punishment seems unlikely – as do calls for Manchester City to be stripped of league titles. But the EPL has set a clear precedent with Everton’s potential points deduction.

“Any breach of financial rules resulting in a points deduction means the Premier League will have to apply the same punishment to City and Chelsea if both clubs are found guilty,” Wiacek comments. “In City's case, with 115 charges pending, that could result in multiple relegations and losing honors.”