UEFA Club Licensing. – To Comply or not to Comply ?
On 16 April 2018 The UEFA Club Financial Control Body (CFCB) adjudicatory chamber took decisions in the cases of four clubs that had been referred to it by the CFCB chief investigator, concerning the non-fulfilment of the club licensing criteria defined in the UEFA Club Licensing and Financial Fair Play Regulations.
Such criteria must be complied with by the clubs in order to be granted the licence required to enter the UEFA club competitions.
The cases of two clubs::
Olympique des Alpes SA (Sion Switzerland )
and
FC Irtysh (Kazakhstan)
are of particular interest to those following the events under which the SFA awarded a UEFA License to Rangers FC in 2011 currently under investigation by the SFA Compliance Officer because
- The case documentation tell us how UEFA wish national associations to apply UEFA FFP rules
- The cases tell us what might have happened to Rangers FC in 2012 had they not gone into liquidation and as a consequence avoided the same type of sanctions that UEFA applied to Sion and Irtysh.
FC Sion (Olympique des Alpes SA)
Here we are told how the Swiss FL and then the UEFA CFCB acted in respect of FC Sion in 2017 where a misleading statement was made in the Sion UEFA licensing application.
Full details can be read at
but this is a summary.
In April 2017 the Swiss FL (SFL) granted a licence to Sion FC but indicated that a Disciplinary case was pending.
In July 2017 the CFCB, as part of their licence auditing programme, carried out a compliance audit on 3 clubs to determine if licences had been properly awarded. Sion was one of those clubs.
The subsequent audit by Deloitte LLP discovered Sion had an overdue payable on a player, amounting to €950,000, owed to another football club (FC Sochaux ) at 31st March 2017 as a result of a transfer undertaken by Sion before 31st December 2016, although the €950,000 was paid in early June 2017.
Deloitte produced a draft report of their findings that was passed to SFL and Sion for comment on factual accuracy and comment on the findings. Sion responded quickly enabling Deloitte to present a final report to the CFCB Investigation Unit. In response to the Deloitte final report Sion stated:
“il apparaît aujourd’hui qu’il existait bel et bien un engagement impayé découlant d’une activité de transfert. Ce point est admis” translated as
“it now appears that there was indeed an outstanding commitment arising from transfer activity. This is admitted”
What emerged as the investigation proceeded was that the Swiss FL Licensing Committee, after granting the license in April and as a result of a Sochaux complaint of non-payment to FIFA, had reason to refer Sion’s application to their Disciplinary Commission in May 2017 with regard to the submission of potentially misleading information by FC Sion to the SFL on 7th April 2017 as part of its licensing documentation.
Sion had declared
“Written confirmation: no overdue payables arising from transfer activities”, signed by the Club’s president, stating that as at 31 March 2017 there were no overdue payables towards other football clubs. In particular, the Club indicated that the case between FC Sion and FC Sochaux regarding the transfer of the player Ishmael Yartey was still under dispute.
The SFL Disciplinary Commission came to the conclusion that FC Sion had no intention to mislead the SFL, but indeed submitted some incorrect licensing documentation; the SFL Disciplinary Commission further confirmed that the total amount of €950,000 had been paid by the Club to FC Sochaux on 7 June 2017. Because of the inaccurate information submitted, the SFL Disciplinary Commission decided to impose a fine of CHF 8,000 on the Club.
Whilst this satisfied the SFL Disciplinary process the CFCB deemed it not enough to justify the granting of the licence as UEFA intended their FFP rules to be applied.
Sion provided the CFCB with a number of reasons on the basis of which no sanction should be imposed. In particular, the Club admitted that there was an overdue payable as at 31 March 2017, but stated that the mistake in the document dated 7 April 2017 was the result of a misinterpretation by the club’s responsible person for dealing with the licence (the “Club’s licence manager”), who is not a lawyer. The Club affirmed that it never had the intention to conceal the information and had provisioned the amount due for payment and that, in any case, it has already been sanctioned by the SFL for providing the wrong information.
The CFCB Investigation Unit accepted that the Sion application, although inaccurate, was a one off misrepresentation and not a forgery, (as in intended to deceive ) but that nevertheless an overdue payable did exist at 31st March and a licence should not have been granted.
Based on their findings, the CFCB Chief Investigator decided to refer the case to the CFCB Adjudicatory Chamber and suggested a disciplinary measure to be imposed on FC Sion by the CFCB Adjudicatory Chamber, such measure consisting of a fine of €235,000, corresponding to the UEFA Revenues the Club gained by participating in the 2017/2018 UEFA Europa League.
The CFCB Investigatory Chamber submitted that it was appropriate to impose a fine corresponding to all the UEFA revenues the Club gained by participating in the competition considering the fact that FC Sion should not have been admitted to the competition for failing to meet one of its admission criteria.
The Adjudicatory Chambers took all the circumstances (see paras 91 to 120 at http://tiny.cc/i8sxsy ) into consideration and reached the following key decisions.
- FC Sion failed to satisfy the requirements of Article 49(1) of the CL&FFP Regulations and it obtained the licence issued by the SFL not in accordance with the CL&FFP Regulations.
- FC Sion breached Articles 13(1) and 43(1)(i) of the CL&FFP Regulations. (Documents complete and correct)
- To exclude FC Sion from participating in the next UEFA club competition for which it would otherwise qualify in the next two (2) seasons (i.e. the 2018/19 and 2019/20).
- To impose a fine of two hundred and thirty five thousand Euros (€235,000) on FC Sion.
- FC Sion is to pay three thousand Euros (€3,000) towards the costs of these proceedings.
Comment in respect of the award of a UEFA Licence in 2011 to Rangers FC.
It is now public knowledge that an actual liability of tax due before 31stDecember 2010 towards HMRC, was admitted by Rangers FC before 31st March 2011.
This liability was described as “potential” in Rangers Interim accounts audited by Grant Thornton.
“Note 1: The exceptional item reflects a provision for a potential tax liability in relation to a Discounted Option Scheme associated with player contributions between 1999 and 2003. A provision for interest of £0.9m has also been included within the interest charge.”
The English Oxford Dictionary definition of potential is:
Having or showing the capacity to develop into something in the future.
Which was not true as the liability had already been “developed” so could not be potential.
This was repeated by Chairman Alistair Johnson in his covering Interim Accounts statement
“The exceptional item reflects a provision for a potential tax liability in relation to a Discounted Option Scheme associated with player contributions between 1999 and 2003. “ where he also added
“Discussions are continuing with HMRC to establish a resolution to the assessments raised.”
This could be taken as disputing the liability but In fact the resolution to the assessments raised would have been payment of the actual liability, something that never happened.
In the Sion case it was accepted the misleading statement was a one off misrepresentation, but at the monitoring stages at June 2011 in Ranger’s case the status of the liability continued to be misrepresented and in September the continuing discussions reason was repeated, along with a claim of an instalment paid whose veracity is highly questionable.
The Swiss FL Licensing Committee did at least refer the case to their Disciplinary Committee when they realised a misleading statement might have been made. The SFA however in August 2011, when Sherriff Officers called at Ibrox for payment of the overdue tax , did no such thing and pulled up the drawbridge for six years, one that the Compliance Officer is now finally charged with lowering.
The case of FC Irtysh of Kazakhstan is set out in full at http://tiny.cc/y9sxsy and is a bit more straightforward but is nevertheless useful to compare with events in 2011 in Scotland.
Unlike Rangers FC , FC Irtysh properly disclosed that they had an overdue payable to the Kazakhstan tax authorities at the monitoring point at 30th June 2017. This caused the CFCB Investigatory Unit to seek further information with regard to the position at 31st March
It transpired that Irtysh had declared an overdue payable at 31st March but cited their financial position (awaiting sponsor money) as a reason for non payment to the Kazakhstan FA who accepted it and granted the licence. The outstanding tax was paid in September 2107.
The outcome of the CFCB Investigation was a case put to the CFCB Adjudicatory Chamber who agreed with the CFCB Investigation Unit that a licence should not have been granted and recommended that Irtysh be fined the equivalent of the UEFA prize money, (that had been withheld in any case whilst CFCB investigated.)
The CFCB Adjudicatory Chamber however decided that a fine was not sufficient in sporting deterrent terms and ruled that:
- FC Irtysh failed to satisfy the requirements of Article 50bis(1) of the CL&FFP Regulations and it obtained the licence issued by the FFK not in accordance with the CL&FFP Regulations.
- To withhold four hundred and forty thousand Euros (€440,000) corresponding to the UEFA revenues FC Irtysh gained by participating in the 2017/2018 UEFA Europa League.
- To exclude FC Irtysh from participating in the next UEFA club competition for which it would otherwise qualify in the next three (3) seasons (i.e. the 2018/19, 2019/20 and 2020/21 seasons). This sanction is deferred for a probationary period of (3) three years. This exclusion must be enforced in case the Club participates again in a UEFA club competition having not fulfilled the licence criteria required to obtain the UEFA licence in accordance with the CL&FFP Regulations.
- FC Irtysh is to pay three thousand Euros (€3,000) towards the costs of these proceedings. “
The deferral was because unlike Rangers FC, FC Irtysh had properly disclosed to the licensor the correct & accurate financial information required, so the exclusion was deferred for a probationary period of (3) years.
Comment in respect of the award of a UEFA Licence in 2011 to Rangers FC.
From the foregoing it could be deduced that had Rangers FC qualified for the Champions League (or European League) and not gone bust as a result and so not entered liquidation BUT it became public knowledge by 2012 that a licence had been wrongly and possibly fraudulently granted then
- Rangers would have been fined the equivalent of their earnings from their participation in the UEFA competitions in 2011
- At least a two year ban from UEFA Competitions would have been imposed, but more likely three in view of repeated incorrect statements.
- The consequences of both would have been as damaging for Rangers survival as the real life consequences of losing to Malmo and Maribor in the qualifying rounds of the Champions and European Leagues.
Karma eh!
Interestingly in the UEFA COMPLIANCE AND INVESTIGATION ACTIVITY REPORT 2015 – 2017 , the CFCB investigatory chamber recommended that both the Kazakhstan FA and Swiss FA as licensors
“pay particular attention to the adequate disclosure of the outstanding amounts payable towards other football clubs, in respect of employees and towards social/tax authorities, which must be disclosed separately;
Would the same recommendation apply to the Scottish FA with regard to their performance in 2011 and will the SFA responses thereafter to shareholders in a member club be examined for compliance with best governance practice by the SFA Compliance Officer investigating the processing of the UEFA Licence in 2011?
This would be a welcome step in fully restoring trust in the SFA.
RE SFA having insurance to deal with the claims talked about today- is it possible to have insurance against committing criminal offences in breach of a duty of care?
jimbo
July 30, 2018 at 16:29
That’s the big if. It’s the only way JD would have an argument in court. If TRFC knowingly withheld that SD clause. I wonder if TRFC even knew it existed?
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Sorry but I disagree. If Rangers did not inform JD of such a clause then I would imagine JD have a claim. At the very least for the money they would have spent putting their own deal together, but probably for compensation for the breach of commercial confidentiality.
Rangers saying “We didn’t realise it was there ourselves … what are we like” would not be much of a defence I wouldn’t have thought.
They invited people to tender, there was a clause which was significant with regards to who would be getting the contract and what information Rangers would be passing on to a rival. The people tendering should have been told about it. They probably were so it won’t be an issue.
Can TRFC afford all this? I mean, after the additional outlay on their famous red top is there any money left. What say you Lawman?
By my reckoning that’s about 1200 season books money lost. Any other business someone would be held responsible for such incompetence. What is it with their supporters can they still not see the damage this board are inflicting on their club? Will it be demonstration time again against SD? The SMSM have a lot to answer for yet again. Victory for Dave my ar*e.
By the way a BIG congrats to PMGB he was bang on the money.
EX LUDOJULY 30, 2018 at 16:44
Can TRFC afford all this? I mean, after the additional outlay on their famous red top is there any money left. What say you Lawman?
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Its an absolute joke and no we cant afford it. Whoever authorised the court action, and i think we can guess who, should pay the bill for it.
Yet more incompetence.
Homunculus, I was actually agreeing with what are you saying. Maybe I didn’t explain it well.
“If TRFC failed to advise JD of the SD matching rights and attached conditions, then it is all TRFC’s own fault and I’d expect that JD would seek recompense for their costs to date, through the courts if necessary.” (Easy Jambo)
……………………………………………………………
That’s the big if. It’s the only way JD would have an argument in court. If TRFC knowingly withheld that SD clause. I wonder if TRFC even knew it existed? They are hopeless at most things so nothing would surprise me.
What a bind. Admit withholding and pay a penalty, or, admit no knowledge of SD grip and face ridicule.
Jimbo
July 30, 2018 at 16:57
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I don’t think “knowingly withheld” has anything to do with it.
They should have told the bidders about the clause. Them not knowing about it would be incompetence on their part, however I don’t see how it would mitigate their part in any damage to the bidder.
They should have known about it.
Well I think the Jambos can relax. I can’t see a bigger bid on it’s way for Lafferty.
£500,000 legal fees for the GASL? No worries – he’ll not pay it anyway!
£500,000 legal fees for the GASL. No worries for him – he’ll no’ pay it anyway!
Jimbo,
If the clause was in the contract, and TRFC signed it, then they knew about it as far as the law is concerned. No ifs and no buts.
This is just one case of many facing TRFC and people connected to the club. How long can TRFC go on without their cash drying up? Is it all or nothing on getting into the group stages of the EL?
Well ,well another loss for DK LTD ,but of course once it’s been washed and rinsed through the PR dept it will be smelling of roses for sevco 2012 .
IMO SDI would be in no mood to do DK any favors here ,no siree ,this little out of court settlement will be in SDI interests and and those interests will have a monetary value .
Did anyone else notice the wee bit about the judge being told the boycott was over ,4 little words but I would suggest a very BIG part of this out of sight settlement.
Let me take a stab at the inevitable club statement
we are pleased a deal has been agreed for the sale of this years kit
a deal that matched current market values
that is all we ever wanted
and the support can now go out and buy the new strips happy in the knowledge that the club will be getting a larger % of any sales
or as I might have put it
on our legal teams advice we conceded this case prior to going back to court and losing even more money as we desperately need to sell the sash and orange strips you all like so much
Someone made a right pigs ear of the timing of committing to a deal with another retail partner
Now we are lumbered with the last thing we wanted
So now we need you lot to go out and buy the all the stock you can from SD as we encouraged the boycott there’s probably an
unsold stock clause in the out of court capitulation
HomunculusJuly 30, 2018 at 16:13
In my opinion the Rangers support have been lied to again. How long will they be willing to just accept this. Their “wagon circling” mentality often lead to them being their own worst enemies. It has been happening for years. They do not take their leaders to task in the same way that the fans of other clubs do.
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Homunculus, are you kidding me?! I’ve just had a look on FF and the overriding view is that although they hate Ashley, they’ll do what the board tells them. I/e. If the board now tell them to buy strips they will; if they tell them not to, they won’t.
Some (not all) believe the board have done a good job in that the 7-year contract has been got out of and SD had to match JDS’ ‘better’ offer. (Although they haven’t seen the JDS offer, it MUST be better as the board were willing to take it). To be fair, others are angry that after paying out £3m and now £0.5m, MA is STILL around and they don’t know how long the clause to match other bids lasts for.
IIRC the ‘hot to trot’ e-mail exhibited to the court seemed to indicate that the third party retailer still awaited confirmation that they had been successful. This might of course have been a selective e-mail. The last thing TRFC would want to reveal in court was that they had already signed a new deal.
So….the key elements are :
1. Does the third party retailer have an unqualified acceptance from TRFC of their offer?
2. Were they made aware prior to their offer that there was an obligation on TRFC to provide details of the offer to SDI for matching purposes?
3. If not, and this obligation was only brought to their attention after the submission of a bid, did they refuse to allow SDI to see their figures?
4. Did the third party retailer offer on the basis of securing all of the services and reserve the right to withdraw if that was not available?
Depending on the answers to the above, if it was me, I’d be considering a claim against TRFC for costs incurred to date and loss of likely profit over the period of the contract.
Again, dependant on the above and any action taken by the third party, this could be seriously injurious to the financial wellbeing of TRFC.
Looking forward to seeing the answers to this in the SMSM….
Scottish Football needs a strong Arbroath.
He said fans thought Mr Ashley pocketed too much of their cash and said there was a widespread view that no “self-respecting” Rangers’ supporter wore a replica shirt.
Mr Justice Phillips has been told the boycott is over.
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Now will come the Embarrassment of wearing a mandarin top you had to buy from sports Direct
REDLICHTIEJULY 30, 2018 at 17:53
In normal circumstances I would tend to agree with your points but would that third party retailer be so willing to kick up a stink if someone has a wee word in their ear about how their business could be adversely affected due to say ,a boycott or such likes
just wondering like
WAS THE DECISION TO SPEND £1MILLION ON MIKE ASHLEY’S SHARES A DIFFICULT ONE? THAT WAS MONEY THAT WENT TO HIM RATHER THAN INTO THE CLUB.
LF: That was a consideration but it brought an end to the well documented difficulties that the club had been having with Mike Ashley. We factored that in and that was ultimately what made us take that decision.
BT: I think that has proven to be the right decision, hasn’t it? In terms of the reaction to it.
LF: We had between 700-1000 new members in the week or two after the Mike Ashley share purchase and I think because it removed his influence from the club, you can’t underestimate or underplay the significance of the purchase, not just for Club 1872 because it saw us become the second largest shareholder, but for Rangers as well.
I remember the negotiations and discussions over a number of weeks. It was myself and Joanne Percival that were dealing with it. But we didn’t know until a certain point who was selling the shares.
We were asked to be in the office a few times and this one time they said they would reveal to us who the seller was. We got a call to say they were still talking to the lawyers and they didn’t know if it was going to be tonight so we ordered a pizza and waited.
It got to about 9.30pm and we said it looked like it wasn’t going to happen so I was driving Joanne home and her mobile rang and it was the call. We pulled over and the person on the phone asked if we could confirm that we were alone in the car and that nobody else was there. They revealed it was MASH that we were purchasing the shares from and Joanne and I literally high-fived each other. We knew the significance of that.
It has not been easy at Club 1872 and because it is run by people who are passionate about it and believe in the project, that is why you can take it to heart. But that was such a significant moment for us and what it is all about. We want to be working towards that again and something that is so important for the club.
The money did go directly to Mike Ashley. But we believe it was an investment in the club in terms of removing his influence. It was a really good moment.
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http://www.heraldscotland.com/sport/15898584.Rangers_Q_A__Club_1872_on___1million_share_issue_fundraising_drive__Ashley_share_purchase__board_representation_and_fan_ownership/?utm_content=buffer30052&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer
Poor Dears…
FAN OF FOOTBALLJULY 30, 2018 at 18:02
REDLICHTIEJULY 30, 2018 at 17:53In normal circumstances I would tend to agree with your points but would that third party retailer be so willing to kick up a stink if someone has a wee word in their ear about how their business could be adversely affected due to say ,a boycott or such likes
just wondering like
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Guess it comes down to how strong a case they have and how much money is at stake. What sort of stuff would the TRFC fans be buying from their stores? SDI will be carrying all the TRFC tat so does a boycott of a third party mean anything?
Scottish Football needs to continue helping out poor lawyers…..
BIGBOAB1916JULY 30, 2018 at 16:08
Big Mike gets a fourth strip handed on a plate, he can sell a training top for the price of a strip, you gotta hand it to him. What time is statement o clock for this one.
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Off the shelf training top,£9.99 stick an ibrox club badge on it and sell it for £40
What a time for Mr Ashley to be alive.
Is it too early to wheel out “Humelliated”(before the *un blags it) , or better to wait until a future contretemps ?
(Have had a few sightings of it elsewhere -a case of great minds ,etc ..
I obviously did not explain things well enough.
In normal circumstances, all things being equal, JD tenders for a contract with TRFC. They don’t get it. Tough titties it’s par for the course. JD take the hit for their own expenses in the failed bid. No recompense from any court.
But in this case. If JD bid for the contract unaware that SDI had on option to see their bid (JD) and match it, and then as a result, failed with their tender, THEN FOUND OUT about the withheld information from TRFC/SDI, then in my opinion they would have a claim. They did not realise they were bidding with a high degree of failure likely.
My next point was an after thought. What if, unbelievably, TRFC themselves were unaware of the clause in their contract with SDI (that they had the right to match (or better) any tenders from 3rd parties?) Would that stand up in court as mitigation in the event of a claim against TRFC by for example JD? I very much doubt it, ignorance of the law etc.
If TRFC told JD that SDI had this option, and they went into this with open eyes then JD don’t have a leg to stand on in my opinion.
I hope that better explains my thoughts.
THELAWMAN2JULY 30, 2018 at 16:54
EX LUDOJULY 30, 2018 at 16:44Can TRFC afford all this? I mean, after the additional outlay on their famous red top is there any money left. What say you Lawman?
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Its an absolute joke and no we cant afford it. Whoever authorised the court action, and i think we can guess who, should pay the bill for it.
Yet more incompetence
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Yet you have spent months telling us the oldco board that included Johnston, King, Mini Murray and assisted by the likes Dickson all competently dealt with HMRC/overdue payables and Euro iLicence applications.
EBTs
Euro Licence
Mike Ashley
TOP
Bigotry and Orange tops
Morelos fantasy transfer
Gerrard still waiting on his £6m warchest
Exactly how many strikes do these guys get before they are out?
Once again, and especially with these clowns in charge, I ask what exactly does the current club playing at Ibrox offer Scottish Football.
Like the oldco – they are a permanent embarrassment and an occassional disgrace.
Time to get rid of these clowns and reinvent your club. Either that or just sit back and accept the ridicule.
CLUSTER ONEJULY 30, 2018 at 18:00
A dilemma right enough
PADDY MALARKEYJULY 30, 2018 at 18:23
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Is it too early to wheel out “Humelliated”
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True humiliation will come from the Terraces when fans mock the ibrox support for having to buy their replica tops from SD.
Excuse me,i feel a song coming on
So …did The Rangers Misrepresent the business opportunity to JD and if there was a Misrepresentation, was it
–Innocent in that they had no idea the clause was in the existing contract and they had good reason to believe they were correct in this assumption.
– Negligent, as they had no idea the clause existed but they have not checked or done due diligence
– Fraudulent, they knew it was there but thought lies and deceipt would work out in this case so tried to hush it up
My guess is that the 1st does not stand up, normally I would think the 2nd option was most likely but given prior history I know what I think is most likely in this scenario,
Fan of Football,
Did anyone else notice the wee bit about the judge being told the boycott was over ,4 little words but I would suggest a very BIG part of this out of sight settlement.
*******
I read that tailpiece as a reference to the boycott situation in 2017, when ” no self respecting”, etc., statement was made during the dispute of that time.
A time when Sons of(S)truth were in their pomp.
I thought it was strange that it was regurgitated in today’s reporting.
JIMBOJULY 30, 2018 at 18:24
I think we are on the same page with this. The possibility of TRFC being unaware of the disclosure clause seems unlikely to me though.
They might however have taken the view that they could ignore it and somehow come out the other side smelling of roses. Seems unlikely but hey, nothing would surprise me about these guys.
An interesting aspect though is just what TRFC’s professional advisor(s) said about the contractual obligations and tender process. If TRFC were badly advised then perhaps they would have a claim themselves?
However, if it was an in-house resource that has led to them incurring circa £500K of unnecessary costs and left them still tied to SDI I wonder if the person(s) concerned are now contemplating falling on their sword(s)?
Scottish Football needs a strong Arbroath.
WOTTPIJULY 30, 2018 at 18:26
Yet you have spent months telling us the oldco board that included Johnston, King, Mini Murray and assisted by the likes Dickson all competently dealt with HMRC/overdue payables and Euro iLicence applications.EBTsEuro LicenceMike AshleyTOPBigotry and Orange topsMorelos fantasy transfer
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Ive done no such thing to be fair. I havent got a nice word to say about any of the 4 people you mention above.
WAS THE DECISION TO SPEND £1MILLION ON MIKE ASHLEY’S SHARES A DIFFICULT ONE? THAT WAS MONEY THAT WENT TO HIM RATHER THAN INTO THE CLUB.LF: That was a consideration but it brought an end to the well documented difficulties that the club had been having with Mike Ashley. We factored that in and that was ultimately what made us take that decision.BT: I think that has proven to be the right decision, hasn’t it?
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Are these guys still employed tonight by club 1872?
REDLICHTIEJULY 30, 2018 at 18:14
Sorry I was thinking more of their general sportswear sales ,although if this third party was to find itself on the sevco banned list then the bears would be running out of sports stores although Greaves in Glasgow seems to be well thought of .
JIMBOJULY 30, 2018 at 18:24
My next point was an after thought. What if, unbelievably, TRFC themselves were unaware of the clause in their contract with SDI (that they had the right to match (or better) any tenders from 3rd parties?) Would that stand up in court as mitigation in the event of a claim against TRFC by for example JD? I very much doubt it, ignorance of the law etc.
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This is defo not the case as the court summary outlined that Rangers contacts SD to tell them about the entirety of the offer and gave them 10 days to respond as per the clause.
Just checked the SD website and the TRFC blue Puma top is available for half price. This would suggest there’s a bit of old stock waiting to be bought back before the new red tops arrive.
CLUSTER ONEJULY 30, 2018 at 18:03
Your post got me thinking .
Remember the hurry for club 1872 to raise funds for the SG share issue ,what happened to that episode ,I may have missed it but as far as I know no share issue has been forthcoming .
Was funds raised and if so ,where are these funds now ,there was a sale of shares not long after the call to wallets at club 1872 ,anyone know exactly who was behind this purchase .
REDLICHTIEJULY 30, 2018 at 18:36
JIMBOJULY 30, 2018 at 18:24
I think we are on the same page with this. The possibility of TRFC being unaware of the disclosure clause seems unlikely to me though.
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I would go further and say there was not the slightest chance they didn’t know….Otherwise they would have a claim against their lawyers who scrutinised the contract.
I was wondering about the confidentiality aspect to the tendering process.
In my past I was a low level procurement person for a government agency. I can’t say I am very knowledgeable about tendering processes. At our level we sought out suppliers, compared and contrasted and placed the order/s.
But I do remember reading that when high level contracts are put out to tender, confidentiality and secrecy of the various bids is sacrosanct. For plenty of reasons.
For Mike Ashley to have the right to see the details of other bids flies in the face of everything I understand to be fair and honest tendering. It would also contradict European legislation as I understood it. Yet the judge mentions nothing about it. I must be mistaken. Or maybe it only applies to government contracts.
THOMTHETHIMJULY 30, 2018 at 18:35
I think it will feature highly in the unseen settlement ,I suspect MA would have been less than pleased with the sevco boards conduct during the boycott and as such ,he will be making sure he is not out of pocket if it continues .
IMO this settlement will be very much to MA satisfaction
REDLICHTIEJULY 30, 2018 at 18:36
JIMBOJULY 30, 2018 at 18:24
I think we are on the same page with this. The possibility of TRFC being unaware of the disclosure clause seems unlikely to me though.
They might however have taken the view that they could ignore it and somehow come out the other side smelling of roses. Seems unlikely but hey, nothing would surprise me about these guys.
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They might however have taken the view
Get some good news out about the strips to deflect from kings court case that day.
I believe someone jumped the gun with the strip announcement to cover a bad news day and is now today a lot of cash lighter and still with sports direct.
will heads roll for this?
FAN OF FOOTBALLJULY 30, 2018 at 18:50
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CLUSTER ONEJULY 30, 2018 at 18:03Your post got me thinking .
Remember the hurry for club 1872 to raise funds for the SG share issue ,what happened to that episode ,I may have missed it but as far as I know no share issue has been forthcoming .
Was funds raised and if so ,where are these funds now.
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Your post got me thinking.
Was funds raised and if so ,where are these funds now…..£500k legal bill
There;s a thread on the Bears Den where they are discussing today’s court news and how many tops they need to sell to cover the £500k costs. One poster reckons that at £50 a pop it would only take 10000 willing buyers!
More interestingly another poster claims that Premier League clubs make £3 on each £50 top and has produced a Daily Mirror article as evidence.
https://www.mirror.co.uk/sport/football/news/replica-football-shirts-rip-fans-7455562
Now my Higher Maths tells me that that equals 6%.
It would appear that Big Mike gave Charles Green a good deal with 7 % back in the day.
It’s also a bit strange that as Mirror Group Newspapers knew this that the Record did not inform it’s readership that the Rangers Retail deal was better than standard.
ULYANOVAJULY 30, 2018 at 20:09
I took a trip over to The Bears Den and noted this little addition to the correction of the maths wizard’s calculation of how many strip sales would be needed to cover the legal costs :
“Just done a little research and Premier League clubs only get £3 from a £50 top so we’d have to sell around 170,000 shirts just to make that money back probably”.
I’m still laughing…..
CLUSTER ONEJULY 30, 2018 at 19:54
bfbpuzzled
July 30, 2018 at 16:42
“RE SFA having insurance to deal with the claims talked about today- is it possible to have insurance against committing criminal offences in breach of a duty of care?”
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http://www.acas.org.uk/index.aspx?articleid=3751
http://www.hse.gov.uk/pubns/hse40.pdf
These should help.
jimboJuly 30, 2018 at 18:24
I obviously did not explain things well enough.In normal circumstances, all things being equal, JD tenders for a contract with TRFC. They don’t get it. Tough titties it’s par for the course. JD take the hit for their own expenses in the failed bid. No recompense from any court.But in this case. If JD bid for the contract unaware that SDI had on option to see their bid (JD) and match it, and then as a result, failed with their tender, THEN FOUND OUT about the withheld information from TRFC/SDI, then in my opinion they would have a claim. They did not realise they were bidding with a high degree of failure likely.My next point was an after thought. What if, unbelievably, TRFC themselves were unaware of the clause in their contract with SDI (that they had the right to match (or better) any tenders from 3rd parties?) Would that stand up in court as mitigation in the event of a claim against TRFC by for example JD? I very much doubt it, ignorance of the law etc.If TRFC told JD that SDI had this option, and they went into this with open eyes then JD don’t have a leg to stand on in my opinion.I hope that better explains my thoughts.
_____________________
No.
A commercial contract is normally valid and enforceable unless there has been deception or misrepresentation on behalf of either party.
Given both Rangers and SDI will have involved their legal advisors in the contract that will not be the case. Rangers may have a case against their legal advisors should they have been negligent in their advice.
There is no indication this is the case, and plenty of evidence that Rangers are incompetent and incapable of running their business in a sustainable manner
I suspect the Rangers legal people would be able to point to advice given on the consequences of the termination agreement with SDI , and given that particular chicken came home to roost today, they will have been proven correct.
The court papers for the interim interdict hearing suggested damages would be difficult to calculate as “ there was the possibility for an INDEFINITE number of renewals “
That suggests SDI will have the opportunity to match any 3rd party offer in perpetuity . As others have pointed out , it’s highly unlikely anyone will bid in future given :
A) SDI will see their commercial offering in full and B) SDI effectively become the decision maker on 3rd party bids rather than Rangers
Bidding for any contract involves cost. Bidding for a long term contract worth many £Millions involves significant cost . Nobody will want to incur that cost given a competitor holds sway over the decision making .
To agree to this , either against legal advice or not , suggests a level of incompetence that is incomprehensible or an alternative of not agreeing which was far worse.
As King has failed to deliver the Nomad he said he would within days in March 2015 , the shareholders of RIFC will be completely unaware of the implications . Should King ever make the Takeover Panel required offer, today’s events should guarantee anyone who is not an emotional investor , will bite his hand off for the 20p per share
If I recall correctly the SFA announced on Christmas Eve 2014 that Billionaire Mike Ashley would not be allowed to increase his shareholding in RIFC. I presume (possibly wrongly) part of the reason for that was that they knew super rich Dave King was waiting in the wings to make Rangers really ‘strong’, and that unlike Ashley he only had the club’s best interests at heart. I wonder how different things might actually have been had a tax evading criminal not been the SFA’s first choice?
Barcabhoy,
“The court papers for the interim interdict hearing suggested damages would be difficult to calculate as there was the possibility for an INDEFINITE number of renewals “
That suggests SDI will have the opportunity to match any 3rd party offer in perpetuity .
……………………………………………….
That is breath taking to the point of sounding illegal in it’s status, to be bound in such a way for ever.
Not that I have any sympathy for TRFC but my goodness. I wonder who the TRFC signatories were. Ibrox directors, management and their lawyers, accountants etc.
What’s the betting Dave King didn’t sign the contract?
ULYANOVA
JULY 30, 2018 at 20:09
=============================
Is that not just the club’s direct cut.
If they are working with a retail partner then would they not receive a payment for that, plus potentially a cut of the retail income.
Barcabhoy July 30, 2018 at 20:56
========================
On reading the last judgement again, I’ve formed the view that the indefinite renewals would only come into play if there were no third party offers for one or more of the three elements. In that circumstance SD would be allowed to renew the previous deal for a further two years on the same terms, which in theory could be repeated an indefinite number of times.
What is not clear is what matching rights, if any, are maintained following the expiry of an SDI matched contract, say in two or three years time i.e. will SDI have the right to match any new third party offer or automatically renew in the absence of such an offer?
I assumed that the kit deal would be between SDI and TRFC , and not RIFC . Different board of directors .
BARCABHOY
JULY 30, 2018 at 20:56
==============================
I think I said this, or something similar before.
Mike Ashley will employ experts in this sort of deal, under English law.
If Rangers did not do the same then we are kind of into a “hell slap it into them” situation.
People will recall that Ticketus thought their deal to buy tickets survived an insolvency event, only to be told by the Scottish Courts “Not here they don’t”
The fact that they went to Court, to only later back down before the Judge heard the evidence suggests to me that someone pointed out to them they had no chance. If that is the case who knows what the final deal will be. I strongly suspect it will be very much in SDI’s favour.
Any statement Rangers release should be taken in that context.
Was this kings deflection statement at the time, to keep those asking questions about the deal?
HOMUNCULUSJULY 30, 2018 at 21:58
Totally right! High Court, London. He didn’t have to move his Tanks too far then!
Probably been posted before but gives a good idea what the deal is between Rangers and Sports Direct.
http://www.bailii.org/cgi-bin/format.cgi?doc=/ew/cases/EWHC/Comm/2018/1697.html&query=(Rangers)+AND+(king)
from the 2nd of this month
Being found in contempt of court, as early as next month, (16 August) could bring a jail sentence of up to two years or an unlimited fine. Both the Court and the Takeover Panel have a common interest in seeing their authority respected, and that of the law.
————
Could today be the start of a very bad few weeks for Mr king?
MERCDOC
JULY 30, 2018 at 22:25
Probably been posted before but gives a good idea what the deal is between Rangers and Sports Direct.
————————
The court reports say they are negotiating a new contract. Knowing Mr Ashley I doubt that the new contract will be as generous as the one reported on the 2nd of July.
GIOVANNIJULY 30, 2018 at 22:58
It looks as if Ashley has a sweet deal already, maybe Rangers want it changed? Going on Kings form, it won’t be for the better! Ashley will be doing backflips!
i’m not a lawyer but this looks good for SDI:
Paragraphs 5.2 to 5.9 and 5.11 in Schedule 3 provide as follows:
“5.2 In the event that Rangers receives an offer from such a third party (Third Party Offer) to enter into an agreement with Rangers for any of the Offered Rights or all or any combination of the Offered Rights, Rangers shall provide SDIR with written notice (Notice of Offer) of the terms of the Third Party Offer (and a copy of any written Third Party Offer that is not subject to restrictions on its disclosure) within 5 days of receipt by Rangers of the Third Party Offer. Rangers shall reject any Third Party Offer that does not permit it to disclose the information required under this clause 5.2 and/or the Material Terms (as hereinafter defined).
5.3 The Notice of Offer shall include whether the Third Party is made for any of the Offered Rights or all or any combination of the Offered Rights (identifying which Offered Rights as applicable), in each case together with any connected commercial arrangements, and full details of:
5.3.1 any payment to be made by the third party to Rangers;
5.3.2 any revenue share or royalties to be paid between Rangers and the third party;
and
5.5.3 the duration of the agreement between Rangers and the third party.
(together, the Material Terms).
5.4 Where a Third Party Offer/Notice of Offer relates to all or any combination of the Offered Rights, (or where there are any connected commercial arrangements,) the Third Party Offer/Notice of Offer shall set out the details (including Material Terms) of each element separately. SDIR may request further information concerning or clarification of any Third Party Offer/Notice of Offer within 10 Business Days of receipt and Rangers shall respond in writing within 5 days of such request. SIDR’s request shall be in writing (which for these purposes shall include email).
5.5 The parties acknowledge and agree that the information provided in accordance with paragraphs 5.3 and 5.4 shall be confidential information for the purpose of clause 15.
5.6 Within 10 Business Days of SDIR’s receipt of the Notice of Offer (or further information/clarification from Rangers, if requested),SDIR shall provide written notice to Rangers as to whether it is willing to match the Material Terms of the Third Party Offer in all material respects in relation to any of the Offered Rights or in relation to all or any combination of the Offered Rights (and, in each case, any connected commercial arrangements if applicable).
5.7 If SDIR is so willing, Rangers and SDIR shall enter into a further agreement on the same terms as this Agreement, save only as to any variation required to effect the Material Terms and whether such agreement shall relate to any of the Offered Rights or all or any combination of the Offered Rights (and, in each case, any connected commercial arrangements if application).
5.8 Should SDIR exercise its matching right in accordance with this paragraph, Rangers shall not approach, solicit, tender for, negotiate with or enter into any agreement with that third party or any other third party in respect of the Third Party Offer and/or the any of the Offered Rights (and, in each case, any connected commercial arrangements if applicable) in respect of which the matching right is exercised. Should SDIR exercise its matching right in respect of some but not all of the Offered Rights, Rangers may enter into an agreement with that third party on the Material Terms set out in the Notice of Offer only in respect of the Offered Rights over which SDIR has not exercised its matching right only. Should SDIR not exercised is matching right over any of the Offered Rights, Rangers may enter into an agreement with that third party on the Material Terms set out in the Notice of Offer.
5.9 Subject to paragraph 5.8, any new or amended offer or indication of interest from a third party in respect of any of the Offered Rights shall be a separate Third Party Offer and the terms of this paragraph 5 shall apply.
…
5.11. Save as expressly permitted in this paragraph, Rangers shall not approach, solicit, tender for or enter into negotiations or any agreement with any third party in relation to any of the Offered Rights.”
170,000 jerseys just to cover Uncle Mick’s costs. 170,000 x £50 a pop of fans money…£8.5m….
Just to end up in a weaker position than they were already in……Ibrox must have a big glass turnstyle and they can see them coming.
Ashley will want his money so won’t want to see them go bust, but a nice wee secret contract giving him first dibs if it does would be handy to thrust in front of an administrators nose. Win win.
But it will maybe suit him better to accept reduced terms, spread over a longer period, with a few wee attachments to double ensure he gets paid a wee bit extra for his trouble..
Better still…Both !.
I think Sevco can scrub any substantial retail money from their forecasts, for the foreseeable future.
A weaker position.!…..C’mon, who would really believe they will be in a stronger position?
Eight and a half million pounds eh…. Jeezo….What’s that in season books?
The judge was told Sports Direct had run up legal costs of £350,000 and Rangers £185,000, …. says it all really.
Almost one year ago to the day…
https://stv.tv/sport/football/1394943-jamie-walker-s-head-has-been-turned-by-rangers/
And as if by magic, there’s a piece along the same lines in the Record today about Lafferty.
I was going to suggest that Hearts should offer £100k for Morelos and ‘turn his head’, but the danger with that is that the offer might get accepted
No chance. Hearts would be mad to only receive 100k to accept Morelos.
old ones are always the best…
I am not any kind of business man, as Mrs C will readily testify( my first and only attempt a selling something on e-bay netted me precisely zero, because I hadn’t properly allowed for parcel-post costs, to the USA!)
But if I were, say, some kind of, say, insurance broker or some such, I think I’d be making overtures to whoever it is at Ibrox who handles their contracts. He ( or she, perhaps) seems to be even less business sharp .
I would reckon that careless reading of any contract and/or RIFC plc’s desperation to get a few pennies in the pound per insurance premium would let me get a right good few pennies more from the fans using my services on the recommendation of RIFC plc!
ulyanovaJuly 30, 2018 at 20:09
There;s a thread on the Bears Den where they are discussing today’s court news and how many tops they need to sell to cover the £500k costs. One poster reckons that at £50 a pop it would only take 10000 willing buyers!More interestingly another poster claims that Premier League clubs make £3 on each £50 top and has produced a Daily Mirror article as evidence.https://www.mirror.co.uk/sport/football/news/replica-football-shirts-rip-fans-7455562Now my Higher Maths tells me that that equals 6%.It would appear that Big Mike gave Charles Green a good deal with 7 % back in the day.It’s also a bit strange that as Mirror Group Newspapers knew this that the Record did not inform it’s readership that the Rangers Retail deal was better than standard.
____________________________-
What’s more, if they only make £3 per £50 top, they are going to have to sell a lot more than 10,000 to recoup that £500,000.
JIMBOJULY 30, 2018 at 21:35
Barcabhoy,“The court papers for the interim interdict hearing suggested damages would be difficult to calculate as there was the possibility for an INDEFINITE number of renewals “
That suggests SDI will have the opportunity to match any 3rd party offer in perpetuity .……………………………………………….
That is breath taking to the point of sounding illegal in it’s status, to be bound in such a way for ever.
Not that I have any sympathy for TRFC but my goodness. I wonder who the TRFC signatories were. Ibrox directors, management and their lawyers, accountants etc.
What’s the betting Dave King didn’t sign the contract?
…………………………………………………………………………………………………………………
What needs to be remembered and not underestimated, was just how cosy old Big Hands and MA might have been at the original set up of the retail deal. From memory MA provided a £5m loan with an additional £5m available for drawdown. That is a big risk considering where Sevco were starting from.
I don’t believe Big Hands, could have given a to$$ regarding the minor detail which might bite their erchies further down the line. He was in for a quick buck, regardless of the rhetoric. In any subsequent renegotiation, MA held all the aces and still does, potentially milking them in perpetuity. This is his return for the risk taken with the £10m finance offer.
I have not had time nor the inclination to read all the details of the retail agreement and as has been suggested, an admin event or even liquidation may be required to rid them of MA. However a thought sprang to mind; What if someone (his Glibness) set-up their own “Retail Business” (Taps’R’us) and then offered The Rangers a deal with a much more generous split on all future merchandising. Would MA then walk away?????
NORMANBATESMUMFCJULY 31, 2018 at 10:44
What if someone (his Glibness) set-up their own “Retail Business” (Taps’R’us) and then offered The Rangers a deal with a much more generous split on all future merchandising. Would MA then walk away?????
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Now that would be out of the frying pan and into the fire! 🙂
The offer would have to be a bona fide one AND put into full effect or there could be serious legal ramifications for the parties involved. No side letters! 🙂
Scottish Football Monitor needs to set up a sports retail consultancy service….
NORMANBATESMUMFCJULY 31, 2018 at 10:44
What needs to be remembered and not underestimated, was just how cosy old Big Hands and MA might have been at the original set up of the retail deal. From memory MA provided a £5m loan with an additional £5m available for drawdown. That is a big risk considering where Sevco were starting from.
I don’t believe Big Hands, could have given a to$$ regarding the minor detail which might bite their erchies further down the line. He was in for a quick buck, regardless of the rhetoric. In any subsequent renegotiation, MA held all the aces and still does, potentially milking them in perpetuity. This is his return for the risk taken with the £10m finance offer.
I have not had time nor the inclination to read all the details of the retail agreement and as has been suggested, an admin event or even liquidation may be required to rid them of MA. However a thought sprang to mind; What if someone (his Glibness) set-up their own “Retail Business” (Taps’R’us) and then offered The Rangers a deal with a much more generous split on all future merchandising. Would MA then walk away?????
___________________________________________________
Green was long gone by the time the £5m + £5m happened. It had nothing to do with him. The fact was that the club needed the loan at the time and the reality of it is that MA could have taken a lot more than an “interest free” loan with Ibrox etc all up for grabs for such a loan.
This was the time he locked down the 7 year contract which ended in a £3M payout.
I think we now know the real reason a certain Director resigned.
Best to be highly sceptical about any story you read stating the SDI judgement wasn’t really a loss for Rangers
A couple of days ago Andy Devlin in The Scottish Sun , wrote that Rangers had pulled an offer for Man City youngster Kean Bryan after a “ problem with his medical “
Steven Gerrard then promptly showed the lie in that story by admitting Bryan had rejected Rangers and wanted to consider other options
Now Andy Devlin is well known as being the first journalist Traynor goes to when he wants a story put out there . Hard to blame Devlin as most journalists would kill to be the go to guy. However they must know that there will be plenty of occasions when what they are given is a PR lie designed to deflect criticism or kill a story .
Likewise the guff that regularly appears in Rangers Observer and Follow Follow . Traynor knows that he can give them a complete fabrication and they will print it word for word . That unquestioning compliance has also become the norm at Club 1872 . Compromised writers are just another reason why Rangers continually fail. The financial results are desperately bad, the legal battles are being lost left right and centre , the share issue has never materialised, the promised nomad is now all but forgotten .
Unsustainable financial results ,losing battles with the authorities, and PR lies which kills criticism was all part of the lead up to the demise of Murray’s Rangers. You’d think that a vocal scepticism and robust questioning would be the minimum expected of the media and fans groups .
Hard to imagine that Hearts fans would sit silently if their club adopted a Romanov type strategy , yet Rangers fans , by and large , don’t seem to have any concerns . It’s bizarre
So it appears the boycott may be back on tsk tsk as my old man used to say as thick as sh+te in the neck of a bottle.
I noticed that one of the erudite (is that some kind of glue? © Private Eye) posters said that the £500K was no problem, it could be set against tax!
Scottish Football needs a strong Arbroath.
According to the interweb (therefore 100% FACT) Rangers did in fact play in training gear the other night
https://museumofjerseys.com/2018/07/30/rangers-maintain-a-european-tradition/
Then, last week, Steven Gerrard’s side made the trip to take on NK Osijek. The Croatian side wear blue and white hoops, so the expectation was that the new orange third kit would be called upon, but there was a fly in the ointment regarding the advertising of betting firms.
The solution was for Rangers to apply numbers – and the Utilita logo on the back – to a set of training tops (though the ones used for actual training have a black crest) as they won 1-0.
============================================
Which kind of goes back to my original thoughts. Why did they not have the orange kit sans betting advertising. Either the didn’t realise they would need them (Poor) or they couldn’t get anyone to provide then (V Poor).
Oh and why did the SLO say it was in fact their “Fourth Kit”.
And to think all this 4th strip nonsense could have been avoided, if finances permitting, the kit man could have boarded an Easy Jet in Split and nipped over to Bodrum to source some mandarin tops on match day ….
HomunculusJuly 31, 2018 at 13:17
Quite simply, if TRFC had released a statement along the lines of that report (missing out, or amending, the bit about the orange strips) they’d have looked a lot less stupid than they do now. If they’d only learn to admit they’ve cocked up from time to time they’d be in a much better place than they are now, but it’s almost as if the WATP attitude prevents them from admitting frailty in case they look somewhat inferior to a rival, but they always seem to end up looking worse.
The red top with black badge has been used in at least 3 training sessions.
The red top with the white badge has only ever been seen once. In the game the other night.
So either:
1) The guys who revealed on 2nd July that we had 4 kits but will only be selling 3 and my contact at the club were right and there really is nothing to see.
2) We turned up with Orange tops with Red32 on them and were told we had to remove the sponsor so as an emergency, instead of taping over the sponsor like Celtic once previously attempted or instead of making 20 orange tops with no sponsor on them and flying them out to Croatia on time, we got them to make up 20 red tops with different colour badges, names, numbers and new socks and fly them out on time.
Occams Razor at play in my opinion.