Premiership and European champions Saracens have been sanctioned with a 35-point deduction and a £5m fine, after the club was found guilty of breaching the league’s salary cap. 

The charges stem from the failure of the club to fully announce its player payments during the past three seasons. 

A Premiership Rugby statement 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 Salary Cap Regulations stipulate that a points deduction may be imposed in the current season (2019-20) only. The sanction has no bearing on any other domestic or European competition.

The Independent Panel rejected the club’s challenge on competition law grounds to the validity of the Regulations. In setting out its conclusions, the Panel noted that the salary cap operates in a pro-competitive manner by promoting the objectives of ensuring the financial viability of Clubs, controlling inflationary pressures, providing a level playing field, ensuring a competitive league and enabling Clubs to compete in European competitions.

It comes off the back of an investigation into dealings between the club’s chairman, Nigel Wray and a host of Saracens players. 

Saracens have been one of the most successful British rugby club in recent times and this story is set to rock the game and essentially end the club’s chances of replicating their success this season. 

Having won two of their opening three games, the punishment means reigning champions Saracens are now sitting at the bottom of the Premiership with -26 points.

Issuing a statement, the club emphasised its ‘shocked and disappointed’ by the sanction, it 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 precedent already exists whereby co-investments have not been deemed part of salary in the regulations.”

It added: “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.

“Saracens is proud of its pioneering, innovative approach to player welfare, developing their talents and supporting their entrepreneurial spirit for life beyond rugby.”