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Forest placed under transfer embargo...sort of

As we expected, Forest have been placed under a transfer embargo for cocking a snook at FFP regulations, but will it make much of a difference?

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We knew it was coming, but confirmation arrives this morning that Forest have been placed under a transfer embargo for breaching Financial Fair Play rules concerning financial losses.

Forest, along with fellow naughty boys Leeds and Blackburn, were found to have 'exceeded the maximum permitted deviation of £8m - consisting of a maximum adjusted operating loss of £3m plus a further maximum of £5m of shareholder investment' for the 2013/14 season.

This, of course, is not a galloping shock, since Forest have been spending beyond their means for a good while now, but what does it mean? Well, actually, it might not be the most crippling thing to ever happen to us.

Here's the full run down of the sanctions, as explained by the Football League themselves:

Clubs will be prohibited from registering any new professional players (permanent contract or loan) unless they have:

•    24 or fewer established players (players aged 21 or over that have made at least 5 starting appearances for the club). Where clubs have fewer than 24 established players, they will only be permitted to sign players in the following circumstances (with the player in question being added to the club’s list of established players regardless of his age or previous playing experience):

•    Where the employee costs of a player being signed are less than £600,000 per annum (or pro-rata if signed on a shorter contract).

Where clubs have 24 established players, they will be permitted to trade on a ‘one out, one in’ basis but only if the employee costs of the player coming in to the club are no more than whichever is the lower amount of:

•    75% of the equivalent costs of the player going out.
•    Or a maximum of £600,000 per annum (or pro-rata if signed on shorter contract)

In addition:

•    Clubs under an FFP embargo will be permitted to sign a goalkeeper on an emergency basis (in line with existing regulations).
•    Clubs under an FFP embargo will not be permitted to pay transfer fees or compensation fees for professional players.
•    Clubs under an FFP embargo will not be permitted to pay a loan fee to another club, they may only pay the player’s wage (or a contribution towards it).
•    For incoming players, clubs can only pay Agents’ Fees as a benefit in kind to the player in question (as long as they do not exceed the £600,000 employee costs limit).

So the short version is we can't sign any players. Only we can because Forest currently only have 22 'established' players in our squad, leaving room for two more.

Forest are not allowed to pay a fee for a player, but that's probably a good thing because we need to keep an eye on the purse strings lest we are given further sanctions down the road. We're also not allowed to pay big wages for a loan player, but that's probably OK for exactly the same reason, and means in all likelihood we won't be able to renew the loan of Tom Ince. It's fair to say that everyone at In The Top One will not be crying ourselves to sleep over that one.

Any hopes of reigning in the losses for this season might be a little forlorn, as your friend and ours the quite splendid Seat Pitch explains:

Forest’s accounts have yet to be made public, however, given that Forest’s losses in previous years have been £11.6m (2011/12) and £17.1m (2012/13), it’s difficult to see how they could fall to less than £6m this season.

The sale of Karl Darlow and Jamaal Lascelles, and subsequent signings of Michail Antonio and Britt Assombalonga, could help with FFP although a dramatic reduction in expenditure will be required to reduce losses.

While this clearly isn't ideal, it's very far from the end of the world. Forest's squad is basically fine, and one could argue the last thing we need is another turnover of players in January to create yet more instability and churn, as has happened in previous windows.

Sure, you could argue that another striker would be handy, and any hope of signing Jack Hunt permanently looks to have disappeared down the toilet, but other than that this is a collection of players that should be more than capable of at least finishing in the top six, particularly when Andy Reid and Jack Hobbs return.

So let's not panic about all this. Unless you want to, of course. I'm not your dad or anything.