Championship clubs have voted in favour of introducing a groundbreaking new financial fair play model, the Football League announced today.
All but three of the npower Championship's 24 clubs voted in favour of introducing the model, which is based on UEFA's financial fair play regulations, and plans to curb Football League debt by limiting investment from owners and total spending.
Football League research has revealed that the 72 clubs that form the Championship, League One and League Two are on course to rack up a combined £2billion of debt unless spending and investment from 'sugar daddy' owners is curbed.
The regulations will be introduced next season on a gradual basis, but sanctions for non-compliance will not be put in place until the 2014-15 season.
Under the regulations, from the 2014-15 season, clubs who record total losses of over £6million will be hit with either a transfer embargo or a fine that could run in to the millions.
The club in question will be fined if they are promoted to the Barclays Premier League and will be hit with a transfer embargo if they remain in the Championship.
Owners will be allowed to invest £6million next season, £5million the following and £3million the following season.
Financial losses per season will also be curbed under the new regulations.
Clubs will be allowed to record a £4million loss next season, £3million per season for the next two campaigns, and £2million per season from 2015-16 onwards.
The money generated from any fine imposed will be shared among the clubs in the Championship who are compliant with the regulations.
The initiative is seen as an important step to stopping Football League clubs going bust.
Earlier this season Portsmouth went into administration and Football League chairman Greg Clarke predicts several clubs will go out of business if this scheme is not adopted.
The Football League have been consulting with the Premier League and the FA, and are confident the initiative will get the official backing of both bodies.
The scheme applies to the Championship only, but League One and League Two already have initiatives to make them more financially sound.
League Two clubs are already allowed to spend 55% of turnover on wages and a similar scheme will be introduced to League One next season after a successful pilot scheme this term.
Any League One club spending over 65% of their turnover in the 2012-13 season, or 60% of their turnover in the 2013-14 season will be hit with a transfer embargo.
Clarke said: "On the pitch we have three exciting, competitive divisions with crowds at their highest levels for 50 years. But that success isn't necessarily being reflected on our clubs' balance sheets and we have to remedy that situation or face an uncertain future.
"I'd like to commend the Championship clubs for the courageous decision they have taken today.
"It means that for the first time, all 72 Football League clubs have agreed to take concerted action towards controlling their financial destiny.
"Whilst we cannot promise that these rules will deliver results overnight, they will begin to lay the foundations for a league of financially self-sustaining football clubs."