Nottingham Forest have been docked four points for breaching Premier League profit and sustainability rules, BBC Sport understands.

The immediate loss of points mean Forest drop below Luton Town into the Premier League’s relegation zone.

They are the second top-flight team to be penalised for PSR breaches after Everton lost 10 points in November, which was reduced to six on appeal.

Forest, who are likely to appeal the ruling, had a hearing on 7 and 8 March.

Premier League clubs can lose £105m over three seasons – £35m per campaign – but, because Forest spent two years of the assessment period in the Championship, their maximum loss was only permitted to be £61m.

The league’s rules state any appeals process should “conclude no later than and if possible some time before 24 May”, five days after the final day of this season.

Forest were charged in January and the Premier League said in a statement that both they and Everton “confirmed that they are in breach of the league’s profitability and sustainability rules”.

Forest, who hired leading sports lawyer Nick de Marco to defend them, are thought to have based their case around the sale of Brennan Johnson to Tottenham Hotspur in September.

The move, worth more than £45m, took place after the accounting deadline but Forest argue selling Johnson at a later date allowed them to earn a higher fee than if they had sold him by 30 June.

More to follow.

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