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In 1981, the Football Association scrapped Rule 34 from its laws of the game.
The stipulation ensured that no director or owner of a football club could be paid a salary of dividend for their ‘custodian’ role. Since that watershed moment, the acceleration of English football’s capitalistic tendencies has been exponential.
In 1992, the breakaway Premier League was formed so that established clubs would not have to share as much of their revenues with the lower divisions. Then came the connected booms in media rights and sponsorship as the Premier League nailed its early distribution and marketing strategies.
The influx of money into the sport has generally translated to player wage inflation, although without the FA’s Rule 34 it became apparent that clubs were at a bigger risk of being manipulated by their owners for profit. This fear, coupled with the fact that loss-making at club level in the 1980s and 90s had been habitual, led to lobbying against the FA for improved regulation. In 1997, Sir John Smith, former Deputy Commissioner of the Metropolitan Police, recommended a test on shareholder suitability in a report commissioned, but later dismissed, by the FA.
In 1999, a Labour government emergency unit, the Football Task Force, reached the same conclusion. In 2003, an Independent Football Commission, imposed on the reluctant FA by the Labour government, called for the enforcement of “proper corporate and financial governance.”
The FA, Premier League and Football League finally agreed to lay down regulations vetting the background of owners in 2004, naming it the Fit and Proper Persons test.
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