Pay Up Pompey,Pompey Pay Up!

[Summerof69]

The tax on 'image rights' is 21%, whilst the top rate of tax is 40-50%.

Quite a bit of saving.

[pauld]

Have HMRC got some new angle on the football creditors rule? The last time they went to court over it the judge wasn't interested saying something along the lines of football being able to make their own rules and that the court (or anyone else) has no say in them. I haven't seen anything to suggest it will turn out any differently this time round.

Looks like you may be right that they are indeed going for this line jonny. Portsmouth News reporting these opening statements from HMRC QC:

Opening the case for HMRC Ian Mitchell QC said the taxpayer was always the victim when a club went into administration.
He told the judge: 'It's always the Treasury which loses out when a football club becomes insolvent.
He added: 'What the football authorities have done is design a set of rules and a payment system which means that football creditors get paid and HMRC doesn't.'
The revenue is unhappy that football creditors are entitled to be paid in full.
Mr Mitchell added: 'That's's why the football authorities always want clubs to win a company voluntary agreement (CVA).
'Their policy is to make it impossible for anyone to challenge this rule and in every occasion it's HMRC which loses out.'

Which as you say seems a slightly odd angle for them to challenge the CVA on. Meh, don't see HMRC winning this anyway tbh. And I don't think they do either - I think it's all part of their new improved macho stance with football and possibly paving the way to push for a change in the law so that the FC rule and image rights loopholes are explicitly closed.

[jonny72]

I think I read that the new HMRC challenge to the football creditors rule is to be heard in November, though they appear to be trying to get that moved forward and rolled in with the action against Portsmouth. Or something like that.

I still can't see HMRC getting anywhere with this argument. If a club wants to play professional football in England they have to fulfil all financial obligations to other football parties, the rule doesn't legally oblige them to but if they don't they'll be kicked out of the game. I don't get why HMRC think they (or the courts) have any right to change that rule. Plenty of similar arrangements in other industries - a bank terminating your accounts with them if you don't pay them all the money you owe them for example.

I can't help but wonder if HMRC are going about all this the wrong way. Maybe they should be dropping all the legal challenges and instead working with the clubs and associations to resolve the financial issues properly. HMRC could inform the associations as soon as a payment is missed, then restrictions could be placed on the club immediately. Stuff like that.

[pauld]

I think I read that the new HMRC challenge to the football creditors rule is to be heard in November, though they appear to be trying to get that moved forward and rolled in with the action against Portsmouth.

Don't see how they can tbh. Surely any challenge to the CVA has to be on the grounds of what the law actually is, not what HMRC wish it was? If they're going to challenge the CVA on this basis, it's not so much an appeal, more a prolonged (and probably pretty expensive) Kevin the teenager style "It's NOT FAIR!!!!" whinge

[thedarkprince]

Tal Ben Haim has joined West Ham on a 5 month loan so Pompey are down to a squad of 14 with no recognised first team keeper.  Might stick £10 on relegation.

[Summerof69]

Tal Ben Haim has joined West Ham on a 5 month loan so Pompey are down to a squad of 14 with no recognised first team keeper.  Might stick £10 on relegation.

That's if they start the season.

[reeves4england]

Coventry to be top of the league on Saturday night?

[RobertT]

While the HMRC can;t really challenge the rule itself, they can probably make an argument that it has no legal standing and as such is not valid when considering a CVA - in their mind, so what if that means the club gets chucked out.

[jonny72]

While the HMRC can;t really challenge the rule itself, they can probably make an argument that it has no legal standing and as such is not valid when considering a CVA - in their mind, so what if that means the club gets chucked out.

If I understand it correctly, it doesn't have any legal standing - there is no legal obligation for the administrator to make payment in full to football creditors a part of a CVA. But if it isn't part of the CVA then no one will pay anything for the club as it will be kicked out of the PL / FL and all other football competitions, so it's worthless (bar any other assets). So it is always part of the CVA which the creditors then get to vote on, if they don't like it they can vote against it - no one is forcing the creditors to agree to it.

The point the original judge hearing this argument still stands - it's a football rule and there is no legal basis for HMRC or the courts to overrule it. HMRC have their own rule, pay in full or we'll oppose the CVA - why is this any different?

[pauld]

Apparently Andronikou has now decided it's sufficiently important for him to grace the hearing with his presence and has turned up at court for the afternoon session. Pompey fans must be praying he keeps his yap shut (unlikely)

[Power to people]

Apparently Andronikou has now decided it's sufficiently important for him to grace the hearing with his presence and has turned up at court for the afternoon session. Pompey fans must be praying he keeps his yap shut (unlikely)

How unlikely is this he'll probably be holding his own 'court' outside the london courts of law to give his own verdict I expect anyway, he just can't help himself he loves the limelight too much and has to feel he is being listened to.

[Barry Scott]

I suspect he's called his own press conference so he can explain how he has put HMRC and everyone else in their place with his superior superiority.

[Power to people]

"The judge was trying to pinpoint on exactly which grounds the Revenue had brought the case against the club"

Sounds as if HMRC may have run into a problem

[Ardiles]

So AA really might be the saviour of Portsmouth FC?

I think I know someone who isn't going to be happy.

[pauld]

So AA really might be the saviour of Portsmouth FC?

I think I know someone who isn't going to be happy.

From reading the Pompey sites, it seems they went off down all kinds of obscure avenues this afternoon, including "what happened when Wimbledon went bust" (even though they didn't). Sounds like the judge may have had the same problem with HMRC's case as jonny and I did - "yes, the FC rule may well be unfair, now what's your point?"

If that is the case, then ironically it would be HMRC who were Pompey's saviours (by trying to bundle all their complaints into what should have been a straight challenge to the CVA itself).

However, I think there's a lot of folks (including the media) trying to read simple "Oooh, that doesn't sound good for Pompey/HMRC" interpretations into what are obviously pretty complex legal discussions. For example, this Wimbledon thing sounds odd/irrelevant but seems to have been part of (or followed on from) a discussion on how the PL/FL differ in treating insolvency events in member clubs.