British Prime Minister Rishi Sunak confirmed plans for an independent football regulator to safeguard the future of English soccer clubs in his King's Speech on Tuesday.
The Independent Regulator for Football (IREF) will have the power to step in to address cash flow and other systemic issues within clubs, many of which are financially vulnerable.
"Legislation will be brought forward to safeguard the future of football clubs for the communities and fans," King Charles said in the speech.
A separate government briefing document said the fragility of the English footballing pyramid had been exposed in recent years.
"The collapse of Bury FC, the devastating impact of the pandemic on clubs, and the botched plan for a breakaway European Super League have all revealed the financial unsustainability of some clubs and the need for more accountability for fans," it said.
The Regulator will operate a licensing system which will apply to the top five tiers of English men's football with the power to act on issues including financial regulation compliance, corporate governance and fan engagement.
More stringent tests will be made on club owners, minimum standards of fan engagement will be introduced and clubs will not be allowed to join breakaway or unlicensed leagues.
Fair Game, a band of clubs campaigning to improve football governance, described the announcement as an "historic moment for football".
"[The IREF] represents a real chance to end the cycle of overspending and mismanagement that has plagued our National Game and threatened the very existence of our clubs," Fair Game CEO Niall Couper said in a statement.
"Reckless spending, disconnect between clubs and their communities, and lip service to equality standards must be consigned to the rubbish bin of history," he added.
"This transformation can only be achieved if the regulator has the teeth and resources to deliver."
The government bill noted the Premier League's success globally and how it attracts more viewers and higher revenues than any of its international rivals in the 2021-22 season. The league's aggregate revenue was £5.5 billion ($6.8 billion) compared to £2.8 billion for Spain's LaLiga.
Clubs, however, are consistently losing money and relying on external funding with their debt levels rising.
Since the 1999-2000 season, 19 out of 23 Premier League seasons resulted in pre-tax losses for all clubs combined. Across the Premier League and second-tier Championship, net debt increased to £4.4 billion in 2022.