Former English champions Derby County have become the latest victim of economic distress exacerbated by the COVID-19 pandemic following an announcement that they are set to go into administration and face the prospect of a 21-point deduction for breaching financial fair play rules. 

In a statement, Derby said, "Last week, it became clear that the process which has been under way to identify a purchaser for the club likely would not be productive over the near term, despite negotiations with credible parties. 

"Because the COVID-19 pandemic has had a severe impact on the revenues and profits of all of its businesses, the club has been unable to service its day-to-day financial obligations. The directors had no choice but to make the tough decision to take this action and protect the club. 

"The irony is that the club's financial forecasts show the emergence of a financially sustainable picture. Absent the COVID-19 pandemic, we undoubtedly would have been able to trade through. The club's revenues and cash flow took a circa £20 million ($27.4 million) hit.

"We cannot stress enough how devastating it is to be forced into this position. We will continue our work under the stewardship of the administrators to help facilitate their process and their effort to find a purchaser," it concluded. 

The English Football League confirmed Derby would face a 12-point deduction once the insolvency event is finalized, adding to the nine-point deduction agreed in earlier talks with the EFL for breaking Championship rules. According to Derby owner Mel Morris, administrators could be appointed early next week and will take complete control of the finances at the struggling club, which is coached by former England captain Wayne Rooney. 

Rooney's side sit 16th in the Championship after only one win in their opening seven games of the new season. The possible 21-point deduction would see them drop to the bottom of the league table on minus 14 points, which means the club's relegation to League One appears inevitable. 

Derby's plight is emblematic of the profound obstacles that football clubs face amid the pandemic. According to a study by audit firm KPMG earlier this year, 20 of Europe's biggest powerhouses lost more than 1 billion euros ($1.17 billion) in revenue over the past year while almost 10 percent has been knocked off players' average values.

The financial hit was echoed by another audit giant Deloitte, who said in a report that the big five European leagues saw an 11 percent decrease in revenue from the previous season, before COVID-19 hit. The English Premier League was especially impacted, with revenue falling by 13 percent, the first drop in the league's history. Over half of Premier League clubs reported a loss. 

The situation in the Italian Serie A is equally bleak. On Friday night, Juventus announced a loss of 210 million euros for the 2020-21 financial year due to the pandemic's impact on the transfer market and ticket sales. 

The club said revenue from player registration rights dropped 129 million euros from 2019-20, while ticket sales fell more than 41 million euros from the year before, with overall losses more than twice as much as in 2019-20.