In a landmark shift for English football governance, all 116 clubs across the top five tiers of the men’s game, including the Premier League, Championship, League One, League Two, and the National League, will be required to hold a licence to compete from the 2027–28 season.
The move, spearheaded by the newly established Independent Football Regulator (IFR), marks the most significant structural reform in the domestic game since the formation of the Premier League in 1992.
The licensing system, announced this week, is designed to enforce higher standards of financial sustainability, fan engagement, and corporate governance.
Clubs will need to demonstrate the soundness of their financial plans, how they engage with supporters on key issues such as ticket pricing and club heritage, and how they meet governance benchmarks to secure a provisional licence.
Why Now?
The introduction of the IFR and its licensing regime is a direct response to years of instability, financial mismanagement, and fan disillusionment across the football pyramid. From the collapse of Bury FC in 2019 to the near-demise of Derby County and the backlash against the proposed European Super League, the need for independent oversight has become undeniable.
The government-backed Football Governance Bill, which underpins the regulator’s authority, aims to protect clubs as community assets, not just commercial entities. The IFR will have the power to intervene in cases of financial risk, block unsuitable ownership takeovers, and ensure clubs are run in a way that safeguards their long-term future.
What It Means for EFL Championship, League One and Two Clubs
For EFL clubs—many of which operate on tight margins and face chronic financial pressures—the new licensing system is both a challenge and an opportunity.
On one hand, the requirement to meet stricter financial and governance standards could expose vulnerabilities. Clubs with unsustainable wage bills, opaque ownership structures, or poor supporter relations may struggle to meet the new criteria without significant reform. The days of speculative spending and short-termism could be numbered.
On the other hand, the system offers a framework for stability. By enforcing transparency and long-term planning, the IFR could help clubs avoid the boom-and-bust cycles that have plagued the lower leagues. For well-run clubs, it’s a chance to be rewarded for prudence and community focus.
Importantly, the regulator’s emphasis on fan engagement could empower supporters in unprecedented ways. Clubs will be expected to consult fans on key decisions, including changes to club identity, stadium relocation, and ticket pricing. This could strengthen the bond between clubs and their communities—something EFL sides have long championed.
Ipswich, Bolton and the Blueprint for Compliance
Clubs like Ipswich Town, Bolton Wanderers, who have recently undergone ownership changes or financial restructuring, may find themselves ahead of the curve. Ipswich, for example, has invested heavily in infrastructure and fan engagement under Gamechanger 20, while maintaining a sustainable wage structure.
These are precisely the kinds of practices the IFR aims to institutionalise across the pyramid.
However, the transition won’t be seamless.
Smaller clubs in League Two or the National League may lack the resources to meet compliance demands without external support.
The IFR has acknowledged this and plans to introduce a phased approach, starting with provisional licences and offering guidance to help clubs meet full requirements.
A New Era of Accountability
The introduction of mandatory licensing is a watershed moment. It signals a shift from reactive crisis management to proactive regulation. For EFL clubs, it’s a chance to reset to build on their community roots, professionalise operations, and ensure their survival in a volatile football economy.
But it also raises the bar. From 2027–28, simply existing won’t be enough. Clubs will need to prove they are fit to compete not just on the pitch, but in the boardroom and beyond.
