Reigning champions Saracens will be relegated from rugby union’s top flight at the end of this season following persistent salary cap breaches, Premiership Rugby have confirmed.
Sarries had already been deducted 35 points for the current Premiership campaign and fined £5.4m for three seasons’ spending above the cap.
Proof of immediate cap compliance was required to avoid further sanctions.
The club will finish this season before entering the Championship for 2020-21.
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“Premiership Rugby is prepared to take strong action to enforce the regulations governing fair competition between our clubs,” chief executive Darren Childs said.
“At the conclusion of dialogue with Saracens about their compliance with the Salary Cap Regulations, it has been decided that Saracens will be relegated at the end of this season.
“At the same time as enforcing the existing regulations, we want to ensure a level playing field for all clubs in the future, which is why we have asked Lord Myners to carry out an independently-led review of the salary cap.”
In the past five years Saracens have dominated both domestically and in Europe, winning four Premiership titles and three European crowns.
This decision also means that should the club successfully retain its European Champions Cup crown, they would not be permitted to defend the title next season.
Their cup campaign continues on Sunday, when they welcome Pool Four leaders Racing 92 to Allianz Park, hoping to better Munster’s result and qualify for the knockout phase.
Neil Golding, who took over from Nigel Wray as Saracens chairman earlier this month, said: “I acknowledge the club has made errors in the past and we unreservedly apologise for those mistakes.
“I and the rest of the board are committed to overseeing stringent new governance measures to ensure regulatory compliance going forward.”
Premiership Rugby introduced the salary cap in 1999 to ensure the financial viability of all clubs and the competition.
‘They had two choices – they took relegation’
Although Saracens’ relegation is the punishment some clubs were seeking, there is still a sense of dissatisfaction with the outcome among their fiercest critics.
Exeter Chiefs were beaten by Sarries two years in succession in the Premiership’s showpiece final, and their chief executive Tony Rowe is still bitter about how long it has taken the game’s authorities to take firm action.
“They’ve taken relegation,” Rowe told BBC Radio Devon following the news. “Let’s be very honest about this before people have sympathy with Saracens.
“They had two choices: they could either open up their books so that Premiership Rugby could do a forensic audit of exactly what has gone on, or they could take relegation. So it was their choice not to open up their books.
“Premiership Rugby – all the chairmen – we just want to move on. It was their opportunity to open up everything to the salary cap people, or take relegation. They have decided to take relegation.”
He added: “We just want to move on. They have cheated. And I’m just a bit upset it has taken so long to do this. At the moment they are still picking their team each week largely from the squad they had last year which is still in breach of the salary cap. They have been asked by the rest of the Premiership clubs to reduce that (the squad) back as well.
“Everybody has had their suspicions for a long time. Five years ago they were hauled over the coals for similar offences. We just want a level playing field. Every club just wants the same opportunity and chances and let’s hope we get back to that.”
Asked whether Saracens should be allowed to keep their titles, he replied: “I’m not sure about that. There is still some more to come out and I’m not privy to talk about that at the moment.”
Dilemma for star names
The move calls into question the futures of the club’s international stars, such as England players Owen Farrell, Mako Vunipola and Maro Itoje, given the need to trim the wage bill and the fact the club will no longer be competing in elite competition, both domestically and continentally.
While the Rugby Football Union have confirmed that players operating in the Championship will be eligible for England duty, financial constraints could make it difficult for the club to retain the services of their elite personnel.
One issue the players themselves may find is that potential suitors among other clubs have already put much of their recruitment for next season in place and already spent a large extent of their cap.
The other concern is that a move to France’s Top 14, a regular destination for top-level southern hemisphere talent and rugby league converts from the Australasian National Rugby League, may be a potentially lucrative option.
Such a move would guarantee elite-level competition but would also rule out international representative rugby as the RFU will only select home-based talent.
Thus far, Scarlets-bound full-back Liam Williams is the only confirmed departure from the club, and the Wales international was due to end his contract at Saracens at the end of the season in any event.
BBC Rugby Union correspondent Chris Jones
This is an extraordinary story – the biggest in English club rugby history – as the Saracens dynasty dramatically crumbles.
Who knows what would have happened if the club had taken a different approach back in November, when they met the initial punishment with indignation rather than contrition – a stance that infuriated their rivals.
But with the club still breaching the cap in January, Saracens and Premiership Rugby have come to what appears to be a negotiated settlement, with the club accepting relegation.
However, while there is finally confirmation of their fate, the questions still come thick and fast: namely, what on earth happens to this star-studded squad between now and next season?