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Saracens hit with £5.4m fine and points deduction for salary cap breach

Alex Lewington of Saracens runs with the ball during the Gallagher Premiership match against Northampton Saints (by Luke Walker/Getty Images)

Premiership Rugby has today (Tuesday) handed Saracens a 35-point deduction and a fine in excess of £5m (€5.8m/$6.45m) for breaches of its salary cap rules, with the reigning English and European champion stating it will appeal the “heavy-handed” sanctions.

Today’s announcement brings to a close a probe into business partnerships between some of the London club’s players and its chairman, Nigel Wray. The charges, which relate to the three seasons spanning 2016-17 to 2018-19, were brought in June following a nine-month investigation by Premiership Rugby, the organising body of the top division of English club rugby union.

An Independent Panel has ruled that Saracens failed to disclose payments to players in each of the three seasons. In addition, the club is found to have exceeded the ceiling for payments to senior players in each of the three campaigns. The Panel has imposed a total fine of £5,360,272.31, along with the total deduction of 35 league points, which is applicable to the ongoing 2019-20 Premiership season.

The Salary Cap Regulations were first introduced in 1999 and currently amount to a £7m cap. The Independent Panel rejected the club’s challenge on competition law grounds to the validity of the regulations. The BBC reports that Saracens in March claimed they “readily comply” with the regulations, stating they were able to spend above the £7m cap due to the high proportion of home-grown players in their squad.

The Guardian newspaper said the investigation looked into investment and property partnerships Saracens stars, including England internationals Owen Farrell, Maro Itoje and the Vunipola brothers, held with Wray, who secured full control of the club in April 2018.

A Premiership Rugby spokesperson said: “The Salary Cap is an important mechanism to ensure a level playing field for Premiership clubs and maintain a competitive, growing and financially sustainable league.

“Today’s decision by the Independent Panel upholds both the principle of the Salary Cap and the charges brought following an extensive investigation by Premiership Rugby. We are pleased that this process has reached a conclusion and we look forward to another exciting season of Premiership Rugby.”

The verdict comes off the back of a successful 2018-19 season for Saracens, who lifted both the Premiership and European Champions Cup trophies. Saracens have won two of their three Premiership games so far this season and the sanctions will leave the club bottom of the table on -26 points before a trip to Gloucester on Saturday.

Saracens today confirmed they will launch an appeal against the decision, stating they are “shocked and disappointed” by the verdict. In a statement, the club said: “The club is pleased the Panel acknowledged it did not deliberately attempt to breach the salary cap and steadfastly maintains that player co-investments do not constitute salary under the regulations. This view is supported by independent legal and professional experts.

“The club will continue to vigorously defend this position especially as PRL (Premiership Rugby) precedent already exists whereby co-investments have not been deemed part of salary in the regulations.

“As previously stated, the club made administrative errors relating to the non-disclosure of some transactions to PRL and for this we apologise. We are pleased to confirm we now have a robust governance framework in place and this will be overseen by an external counsel to ensure the club follows best practice.

“Furthermore, it is the club’s belief that the Panel’s narrow interpretation of the regulations is detrimental to player welfare across the league and is damaging the development of elite level rugby in the UK.”

Wray added: “It has been acknowledged by the Panel that we never deliberately sought to mislead anyone or breach the cap and that’s why it feels like the rug is being completely pulled out from under our feet. We will appeal all the findings.”