The Problems Facing the SFA If Rangers Fall Into Insolvency – A Guest Post by Brogan Rogan Trevino and Hogan

My favourite commenter named after two Celtic full backs, and two fantastic golfers, was good enough to put a lengthy comment on my last post.

To ensure that it gets the wider audience it deserves, I have copied it below.

Take it away BRTH!



While there has naturally been a focus on the possible exit/survival routes that may be countenanced by the Rangers PLC and/or a Rangers new co– and now some concentration on the actual details of the Whyte/Murray deal– any which way you look at it other than one there is a legal nightmare ahead for Stuart Regan and the newly transparent SFA. I suspect that things are far from clear at Hampden and there is a real danger that there are aspects to any application for admission by a new co that have not been considered– as yet– and which may well tilt the whole thing in another direction.

Stop and consider this? What is the role of the Scottish Football Association? Yes it is there to regulate the laws of football in Scotland, to make rules and apply them, to consider and create new football legislation when appropriate, to ensure compliance with the regulation of its own parent bodies ( UEFA and FIFA) , To represent its constituent clubs where appropriate, to licence in terms of the regulations of both the SFA and UEFA, and at times to be a judicial body applying sanctions where breaches of the rules have been established.

Oh Dear– what a lot of functions and responsibilities– and what a lot of conflicts of interest!

As I have said elsewhere, The SFA does not just represent the SPL clubs– but all of Scottish Football! Some of the smaller clubs may well have a very different point of view to those clubs in the SPL. Many would welcome a giant of the Scottish game having to visit their stadiums twice a year as it would create a substantial financial bonus and enhance the public interest in their leagues– attracting sponsorship, advertising possibilities and so on that otherwise would not exist!

However let’s concentrate on two of the SFA’s clear functions. As a licensing body and as a judicial body which imposes sanctions, The SFA is and must be subject to an obligation to the law that overrides any competing interest or claim by its constituent members. As a licensing body, it’s decisions are certainly open to Judicial review in the Scottish courts and I would suspect that a judicial review would be open to any of it’s members who disagreed strongly enough with any of it’s decisions.

In the past, I have been involved with many judicial reviews concerning Licensing bodies over the years. Two grounds of review are that a) The decision reached is contrary to natural justice and b) that in reaching any decision the body concerned has unreasonably exercised its discretion– where a discretion has been exercised!!

Pausing there, it is very much open to question whether an argument such as that outlined in the Daily Record recently could ever be formally argued before the SFA which is why I suspect that we are about to get a trial by newspaper!

Any argument presented before a judicial body or a licensing body which contains the semblance of an argument which runs along the lines ” It is in your own financial interests to allow our application!” should immediately be dismissed in law as it creates a clear conflict of interest and makes a mockery of the alleged independent and impartial judicial or licensing function.

Any such argument being considered would surely leave the SFA in a very uncomfortable legal place– not to mention UEFA or FIFA — where independence and freedom from personal and collective financial self-interest are under heavy scrutiny and criticism. Take note of the very platform that Platini was elected on!!

So back to judicial review in Scotland.

The current rules in an insolvency position are clear. On Administration ten points at least will be deducted. The ten points I believe is a minimum penalty and it may be that aggravating factors may attract a heavier penalty.

If the Administration is not successfully concluded and liquidation follows the rules state that the licence is lost and surrendered– end of story. An application can then be made by a phoenix company for a new licence and in ordinary circumstances any such company granted that licence would start at the bottom of the league structure and the European regulations regarding the three-year embargo would apply.

Any departure from that set of scenarios on the part of the SFA requires an exercise of their discretion, and in exercising any such discretion the SFA must act according to natural justice and must not exercise that discretion unreasonably.

In that light, look at the footballing and legal facts– as opposed to the “If we are doomed, you are all doomed argument” which has no place in law.

Rangers PLC have deliberately and recklessly broken and flaunted the footballing financial guidelines and have deliberately and recklessly ran up a debt with inter alia HMRC.

Remember that this entire scenario comes about as a result of an attempt to avoid paying due revenues to a relevant tax authority as a result of a connived scheme to avoid paying the taxes that every other club is subject to. Further, I suspect that an examination of the relevant documents surrounding the creation of the EBT and the advice given to Rangers PLC about operating such a scheme will make it clear that no such advice can ultimately be relied upon fully and that there is a clearly stated risk that the entire scheme may well be one which the revenue can have declared illegal with the result that revenues will be due together with accumulating interest and taxes– and that therefore the Directors of Rangers PLC enter into such an agreement fully warned and at their own risk!

Remember too that some of those Directors were paid under that very same scheme!

So this is not a simple case of a business failing and falling into insolvency. This is a case of the Directors deliberately seeking a financial advantage over all competitors which they have been warned in advance may well be unlawful and have sanctions and penalties.

That is a very different scenario to the insolvency of Dundee or Gretna and so on. It is a very different footballing scenario as well, as the entire scheme was designed to ensure that the club concerned could attract the very best players in the country and could win the premier tournaments of the licensing body!

But there is worse to come. On two occasions Rangers have “poached” the national team coach in order to achieve the best possible management of their team. That may be fair enough in a commercial world. However, both of those managers will have wanted to know what the budget will have been to strengthen the squad prior to taking on the job. Let us consider the last such appointment when Walter Smith left Hampden to take up the hot seat at Ibrox.

I will wager ( or at the very least wonder if ) that by that time the Directors of Rangers knew that there was a problem with the tax authorities and the famous or infamous EBT contracts? If so then we have a compounding of the Rangers situation.

If the club had received notice of enquiries being made at that time by HMRC, then going by the advice previously given, they would also know that there was a possibility of a large repayment being due together with penalties and interest.

The prudent director at that point may want to make provision for paying any such liability. Did Rangers? No!!!

Instead, following upon the defeat by Kaunas they went on an unprecedented spending spree to ensure success– all at the cost of paying HMRC and at the cost of complying with the intention of the fair play financial legislation.

Money that could have been used for debt repayment was spent on Mendes, Davis, Lafferty, Whittaker, Naismith ans so on– eventually that extended to the signings of Miller, Jelavic and everyone who followed. Absolutely no attempt at repayment of revenue debt, or the setting aside of money to meet revenue debt, was made.

So this is not accidental insolvency as a result of poor trading– it is a direct result of financial irregularity and it should not be allowed to result in a benefit to the perpetrators of that financial irregularity. Does that argument sound familiar? Yes I thought it would– it is taken from the formal legal pleadings of Rangers PLC lodged in the Court of Session in answer to the claim lodged by one of the architects of this misfortune– namely Martin Bain Esq!

So that is the stance on the financial irregularity of the current Rangers Board! That board of course went through a months long and very public due diligence exercise before acquiring a controlling stake in Rangers PLC. They knew and will have received full legal and accounting advice on the legal status of all revenue claims, how those claims came about and how those claims if successful could affect future trading and licensing of the football club and the PLC.

In such circumstances, Craig Whyte and his cohorts have taken on the previously accepted risk. They are in an even worse position than the former board because they could have simply decided not to invest. They could have waited with any bid for Rangers PLC or its assets until after the First tier Tribunal had reached a decision and the full effect of any legal consequence was known. Yet they didn’t. Instead, in full knowledge and with the benefit of full advice they took on that risk!

We can only speculate as to why that might be. It has been suggested that it as insisted upon by the bank. What would have happened if that had not happened? Perhaps the bank would have pulled the plug and………..? Well the legal consequences are spelt out above. The rules are clear.

So under the current daily Record scenario, in the event of an Administration or even prior to it, the SFA will be approached by someone presumably on behalf of Craig Whyte to exercise an extraordinary discretion ( thus departing from the normal rules ) which it will be argued should apply to some new entity that wants to call itself Rangers because…….?

And it is there that I hit a brick wall! Why should this extraordinary discretion be applied in these circumstances?

If their stadium had been closed because of Fire or Catastrophe or some other physical reason that leads to financial ruin then that may be an argument!

If all their players went on strike or broke contracts or something than that may be another.

In fact any argument that these circumstances were not brought about by the club itself may gain some sympathy in law– but a deliberate and calculated act, the risk of which was accepted and taken on by the controller of the new applicant? Not sure about that!!!

Whyte also has questions of his own to answer with regard to a business track record, source of funding, compliance with companies Act legislation, the ability to trade presuming no European Football ( and that must be legally presumed ) and in general answer the fit and proper fitness test. This is a test which he seems to have spectacularly failed in the eyes of the takeover panel at Rangers PLC as the Directors sitting on that panel refused their blessing and sanction.

Those Directors have since resigned and some have entered the legal courts as a result of what they see as Whyte’s conduct. Whats more, in a few short months, Whyte has threatened to sue various journalists and other media outlets following their apparent criticism or questioning of the legal or business circumstances surrounding Rangers Football Club and Rangers PLC.

So on what basis and under what grounds can the SFA reasonably exercise a discretion to a new applicant under the control of Craig Whyte in these circumstances? What would be the legal position of anyone who objects to any such discretion being exercised?

I again stress that I don’t think that potential financial doomsday is a reasonable argument in law to put before a licensing body or a judicial committee– who of course must call for a report and seek to investigate all of the facts. Thus is far harder than is being suggested in the newspapers and of course if in advance discussions are taking place then all of the member clubs should be notified immediately.

What’s more, any such procedure must surely take a proper legal course and a reasonable amount of time. Any Administration would have to occur before there is an application– indeed it may be that an actual liquidation has to occur before any new application because even in an Administration event all licence places are full. Further the SFA cannot agree to the favourable determination of any licensing application before it is made as that is clearly unlawful!

No, for the SFA, the scenario outlined is a legal nightmare even if all the clubs wanted to agree to such a course. I am aware that there is a voting procedure of 11-1 which Rangers might want to invoke but you see even that very rule may well just be challenge-able on the basis of the voters having their own financial interests in mind as opposed to serving another function– an no licensing body can work legally on such a principle. If there is a conflict of interest any such party should take no part in the proceedings and so if anyone thinks that they will go bust in the event of Rangers going bust and going into liquidation should excuse themselves from any decision-making process.

Two last points:

Watch out for the detail of the FC Sion ruling as there may well be an impact on all of this in the detail of that decision.

Lastly, Celtic Football Club are represented by Messrs Harper McLeod Solicitors who have a number of Licensing and sports law experts who will be only too familiar with all of the above. They are also familiar to the SFA and their judicial bodies, their legal representatives and so on. I have a great deal of respect for Rod McKenzie and his team and they will no doubt steer their clients in the proper legal direction if consulted on any licensing or regulatory manner– as the SFA well know!

My apologies for the length of this post which I will now leave with the intention of returning to my day job!



Many thanks BRTH! Amongst many interesting points I can confirm from personal knowledge that Harper MacLeod is an absolutely top-notch legal firm, and in particular Rod McKenzie is a man who is, and has been for many years, at the absolute top of his game. I suspect that many lawyers would instruct Rod if they had to choose a professional colleague to rely on. Celtic undoubtedly have great talent off the filed, even if on the field that proposition might seem rather more dubious!



Filed under Bain v Rangers, Civil Law, Football, Guest Posts, Rangers, SPL

40 responses to “The Problems Facing the SFA If Rangers Fall Into Insolvency – A Guest Post by Brogan Rogan Trevino and Hogan

  1. Jobo Baldie

    Great post, as always, by BRTH.

  2. TheBlackKnight

    Put simply, a brilliant post!

    I hope for the sake of Scottish Football, as a whole, both the sentiment and actualities, run true.

  3. campsiejoe

    Sums the whole situation up perfectly
    This should be obligatory reading for every member of the laptop loyal, who are now pontificating on this matter

  4. Tommy


    That is an excellent, informative piece and my thanks also to Paul McC for reproducing it here. I sincerely hope and trust it is read and digested at the Hampden Ludge as someone from that inner sanctum is obviously putting out the feelers for a cosy deal in the case of the mighty Glasgow Rangers.

  5. John Johnston

    It is a real education understanding how really hopeless (one has to give them the benifit of the doubt of the less sinister reason) the press in our country are.
    It is equally reassuring that the ramrodding through of any cursory penalty will be difficult to achieve.

    Keep up the finr work gents, we depend on you.

  6. Can anyone enlighten as to why the FC Sion ruling may be relevant.
    Is this a positive or negative with regards to RFC?

  7. macon rouge

    The sentiments I totally agree with, the legal analysis, less so.

    In particular I am concerned about the issue relating to the exercise of ‘reasonable’ discretion by the SFA in that there appears to be an assumption of lack of reasonableness. I also have doubts as to the focus on the licensing, rather than the overall administrative, function of the SFA and the validity of any challenge to that exercise through judicial review, and indeed the general requirement for recusal in relation to ‘alleged’ conflict of interest.
    I also think the attack on the current Rangers regime is, as are so many posts on so many websites, based on unsubstantiated surmises, hopes and desires, rather than hard reality.
    As lawyers we all know we want to see the documents…then we can really raise doubts… and that final ambiguity is deliberate.

  8. wallyjo

    Excellent piece that condenses the multitude of words, opinions and forecasts regarding this momentous event into realistic prose.

    I have enjoyed reading BRTH on the RTC blog, but consider this synopsis to be the single most illuminating and credible example of professional, measured opinion.

    More please!

  9. Jim Bollan

    It has been suggested in some quarters that HMRC will accept say £10m to settle therefore allowing Rangers to escape administration. Is this probable?


    Superb read – thank you.

    “Remember that this entire scenario comes about as a result of an attempt to avoid paying due revenues to a relevant tax authority as a result of a connived scheme to avoid paying the taxes that every other club is subject to. Further, I suspect that an examination of the relevant documents surrounding the creation of the EBT and the advice given to Rangers PLC about operating such a scheme will make it clear that no such advice can ultimately be relied upon fully and that there is a clearly stated risk that the entire scheme may well be one which the revenue can have declared illegal with the result that revenues will be due together with accumulating interest and taxes– and that therefore the Directors of Rangers PLC enter into such an agreement fully warned and at their own risk!”

    This should never be forgotten…………

  11. Muz

    3rd division with titles stripped is the only fair outcome imo. Thanks for that , lets hope it makes its way to some decent journos for a realistic analysis.
    Seems Sir Jimmys (rip) departure has ended all hopes of a get out for the ranjurs.

  12. A bad day for the laptop loyal

    This is now a matter of far greater importance than merely- Celtic fans dancing on the grave of Rangers. It is a matter of truth, justice and integrity. Someone better point that out to Jim Traynor and Hugh Keevins!

    If justice is not done, and seen to be done, then there won’t be a single argument available to defend our game against accusations of being completely biased and corrupt.

    The single thread of integrity that is currently struggling to hold our game together, will snap for good if the SFA dont treat this matter fairly.

  13. Hector's Army

    Yes, i have also heard the “rumour” from a bluenose friend of mine who said that he read on a Rangers message forum that apparently Arsenal had similar problems with HMRC and managed to settle with them by paying in the region of 10 million quid even though the initial amount being sought was considerably more. My mate seemed pretty convinced or rather hopeful that the same situation would most likely transpire in the Rangers situation. Now i could only take his word for that but i was sceptical. He also said that there are numerous clubs and companies who are being investigated for the very same reasons.

  14. Nailonhead

    Greed is what has caused this scenario, more greed is not the answer.

  15. Mike Bhoyle

    Superb post..thank you…
    However….once again…just as I think the situation has been clearly and cleverly explained …up pops Macon Rouge with obvious knowledge of the matter…and produces another dark cloud which will rain on my parade…again!!
    Does anyone really know the absolute facts ??

  16. Pingback: R*ngers Potential Outcome?


    what a load of rubbish even worse the muppets swallow it hook line and sinker get alife ffs the sfa rules on clubs going to administration are out there go google it and dont listen to some non entity trying to be important rangers are going no where were here to stay G.I.R.U.Y

  18. Allan Elder

    These points don’t add up

    If the club had received notice of enquiries being made at that time by HMRC, then going by the advice previously given, they would also know that there was a possibility of a large repayment being due together with penalties and interest.

    The prudent director at that point may want to make provision for paying any such liability. Did Rangers? No!!!

    Instead, following upon the defeat by Kaunas they went on an unprecedented spending spree to ensure success– all at the cost of paying HMRC and at the cost of complying with the intention of the fair play financial legislation.

    Money that could have been used for debt repayment was spent on Mendes, Davis, Lafferty, Whittaker, Naismith ans so on– eventually that extended to the signings of Miller, Jelavic and everyone who followed. Absolutely no attempt at repayment of revenue debt, or the setting aside of money to meet revenue debt, was made.

    Why would anyone set aside money to pay something that wasn’t due? The problem here is that EBTs, used properly, were a legal avoidance mechanism as used by thousands of firms throughout the UK. The HMRC is using this as a test case in the hope that, if they win, they will be able to plunder the premier league clubs who have used similar schemes. It looks like, if the HMRC win, then Man U and Chelski will be passing the bill onto their players.

  19. Frankie

    Rangers are facing an insolvency event and it’s Celtic fans who are panicking! Panicking that the consequences of insolvency for Rangers wouldn’t be as serious as they would wish.

    Though just how serious their beloved Celtic would wish those consequences to be is debatable.

  20. all them who r ither booted out or running out are the ones that put the club in this mess so should they not be hunted down and made stump up out of the millions they took out of the club murray and all the rest , the club cannot be held responcible for there greed make them pay . N.S. K.T.B.F.F.H. AND R.T.I.D. , Y BECOS W.A.T.P.

  21. Brogan Rogan Trevino and Hogan

    Good Morning,

    Sorry I have not had the chance to come back on some of the comments made on here so will try and address some ( but not all ) as concisely as possible!

    Macon Rouge

    I note all that you say about the Administrative function of the SFA over and above the Licensing function. The same to a certain extent can be said of the SPL. Even an Administrative body can be subject to Judicial Review to make sure that it is legally carrying out its functions or carrying out the functions within the law.

    However, I would go so far as to say that there is an argument at least to say that any Administrative body could be successfully judiciously reviewed if it simply did not exercise it’s function properly at all. Let’s say a body has the ability to mount an investigation or commission into a member club or other participating party as a result of publicly known facts and circumstances or even an accepted set of findings from a court or tribunal. However, let’s say the body concerned simply decided to make no investigation whatsoever or simply did not start a commission which may lead to further penalties for the member club and that this was against the wishes of one or more of their members. Then that member could ask for that decision to be judicially reviewed. Perhaps the argument would be that not to investigate further would simply make no sense. If– and I stress if— it were suggested that no such investigation took place because there could be a financial fall out for everyone concerned including some of those who would order any such investigation! This was the gist of some of what was argued in the media a few days ago. Administration of that type may well be judicially reviewed.

    With regard to unreasonable exercise of discretion, this is no more than one of the grounds upon which a decision or process which has been judicially reviewed can be overturned or instead remitted back for further consideration. It does not follow that there is any presumption or reasonableness or otherwise and it would be for the party bringing the court action to argue and show that such and such an act was an unreasonable exercise of discretion.

    As for the current Rangers Board– with respect if they were in the dark about the tax case, its issues, risks and consequences then they have very serious issues with their advisers who acted in the takeover so I think it is reasonable to assume that they knew the ins and outs of what they were getting into — but yes it is an assumption on my part that they are not so daft as to not have made some reasonable inquiry and proceeded on an informed basis.

    Allan Elder

    You question why I suggest that the prudent Director would have set some money aside as soon as they realised that there might be a liability following an initial approach from HMRC and then go on to point out that at that stage there is no debt actually due and so why take steps to cover it?

    I see your point but if I were advising the Directors of Rangers that is precisely what I would advise them to do– and here is why.

    As you say EBT schemes worked properly can be and often are perfectly legal. I have sat in the offices of National firms of accountants who offer such specialist schemes and gone through the operation and setting up of similar schemes with partners of said firms. However to cover the professionals, they stress that the decision to operate any such scheme rests with the directors of the company concerned and whilst they will provide counsel’s opinion that the whole set up is legal and defend-able against attack by HMRC that is by no means a guarantee and is merely an opinion. Further, their often substantial fee will cover defending any attack or challenge by HMRC to a certain level but will not cover all fees beyond that level nor represent any form of indemnity in the event of the scheme ultimately being declared illegal and unlawful with the result that there is tax to pay together with penalties and interest.

    So at the outset the decision to go down the EBT road is at the Directors risk.

    Further, as you may well be aware, if the scheme is incorrectly administered by the Directors then that can render the whole scheme null and void which in turn leads to tax, interest and penalties being payable..

    Turning to Football clubs and Rangers in particular– as I understand it the whole HMRC argument is that there was never a proper EBT in the first place and that the whole scheme was illegal from the off. In his own pleadings Martin Bain alludes to HMRC arguing that Rangers Football club will be hopelessly insolvent if the tax penalty and interest is found to be due and that this must have been known to the Directors. The argument would appear to go on — and I stress I do not know for certain but can only pick out from what has been said elsewhere– That the Directors of Rangers football club clearly had access to funds which they used A) to buy more players with and B) to pay down the debt to the Bank of Scotland instead of either paying the revenue or setting aside funds to meet a revenue debt which any Director acting reasonably ought to have known was in fact due and which arose out of prior trading in this fashion.

    In the event of the company going into Liquidation– which must be a very reasonable possibility– then the Liquidator has the right– The revenue would argue that it is an obligation– to pursue the Directors personally for any unpaid liability which remained unpaid to the Revenue post liquidation.

    Accordingly, if you are advising the Directors you have to point out — ” Hey guys, you could personally be chased for this if it all goes a co co and you might want to think about putting money aside or settling with the revenue to protect yourself rather than blowing it on more players etc etc”.

    Of course if you do that you do not appease the fans nor have guaranteed income from Europe so the Directors are in a quandry and there is a clear conflict between being able to make provision for a possible (probable) revenue debt and the continued success of the club. There is a difference between the success of the “Club” and the survival of the PLC that governs that club.

    As I mentioned I have recently acted for Directors under similar circumstances where they were pursued re unpaid revenue debt post liquidation– although not on an EBT scheme and for far lesser sums— but even the cost of defending such a claim leaves a hefty hole in the wallet and obviously there is a huge degree of stress when you are personally pursued as you have to deal with wife and kids and a potential attack on your home and personal assets etc. That is why they should have been prudent because they will be held to account here or at least leave themselves open to such a claim and it is the job of the adviser to make them aware of that possibility. It is then up to the Director to act or not on that advice.

    I can’t believe that any Director would be party to running up a tax bill like this and not anticipate that there might be a problem.

    On EBT’s and football clubs– yes there is a distinct attempt by the Revenue to chase clubs who pay players in this way to the detriment of the revenue. Arsenal have operated such a scheme for years and again as I understand it the Revenue want to chase them and other clubs.

    I recently had cause to speak to someone who may be considered a bit of a specialist when it comes to football clubs, money and so on. He helped– or attempted to help– the position at Stricken Portsmouth FC and said that in his discussions with the Revenue they were most uncompromising and unwilling to do any deals even though they would end up with nothing by not agreeing to a substantial discount. The reason for this is that they want to frighten the bigger clubs into abandoning the whole EBT scheme and to pay proper tax. They want to mount a full operation on this just like they have started to do in other areas.

    Part of the argument– especially for foreign born players was as follows.

    1. The EBT only works if it is purely discretionary and does not form part of any contract– many football clubs ( such as Rangers ) apparently fall foul of this and there is clear contractual documentation covering the EBT payments. The Result? Tax due with interest and penalties!

    2. Foreign born players should only be actually paid from a discretionary EBT scheme and able to avoid tax if they are properly resident abroad. During their playing careers they are domiciled in Britain for income and revenue purposes, and therefore if monies are paid while they are here and it is not a true discretionary payment then tax is due at HMRC rates– not at the rate of any country of birth etc. Result? Tax , interest and penalties are due.

    3. Clubs who have entered into unlawful agreements with players are under a duty not to pay them as soon as they realise or ought to have realised that the contract was unlawful. To do so they risk losing the player but that is tough. The player may well sue but the courts will not enforce an illegal contract.

    Portsmouth refused to pay Sol Campbell and he sued. The court case disappeared possibly because the illegality of the contract could not be enforced.

    In speaking to this guy it became clear that the revenue do want to get right into the football clubs who operate such schemes and Arsenal with their long association with foreign players who were living in and around London on huge wages paid in this way are very much a target.

    The suggestion has been made to me that the revenue are looking for footballing scalps. Portsmouth was one but the biggest creditor was Gaydamek who lost £72 Million of his own money in three years so the Revenue who were due £12m could not dictate the pace and direction of any insolvency. With Rangers they are a far bigger creditor and there is a real possibility that by playing hard ball with Rangers they will collect far more out of English clubs with incredibly wealthy Directors once they have demonstrated that the schemes were illegal and that they will chase the Directors in the event of wrongful trading being suspected.

  22. John Johnston

    The best compliment I can pay you is that you are a great teacher. More power to you.

  23. MidlothianCelt

    Most interesting and illuminating post. Despite the obvious complexity what appears clear is that the Scottish footballing authorities cannot – even if they wanted to – fast-track a post-insolvency Rangers back into the SPL. There are simply too many hurdles to overcome – even if Rangers have friends at court.

    On the issue of due diligence undertaken by Whyte pre-purchase I would love to see the legal/accounting advice obtained on the prospects of a positive outcome with the big tax case. One would have thought the fact the the old Board had twice attempted to reach a settlement with HMRC with a £3m and then £10m offer (both rejected) would have provided a pointer as to Rangers’ chances of victory. If any of us owned a business and was prepared to hand-over £10m to the taxman it can only have been because we had received advice suggesting our case was very, very, weak.

    I suspect that both the old and new regimes at Ibrox knew/know they are stuffed – which is why Whyte planned for insolvency all along. Like most Celts I hope that HMRC will find some way to stymie this blatant attempt to deny the public purse of what it’s legitimately due – and that the Scottish footballing authorities do not offer Rangers any favours.

    Sharp practice should not be rewarded.

  24. macon rouge

    Mike Bhoyle and BRTH
    Sorry for the delay in posting a reply, but I have been away

    Mike first:
    I am not in any way trying to rain on the parade, I want to be there, singing and dancing. The point of my post was a warning against too many assumptions being made and too many conclusions drawn from a lack of detailed information. In my view, the best posts, and not just here, come when people use their forensic skills to comment on particular documents, or to explain what the accepted legal/accountancy/regulatory situation is, and how those rules might apply to the current situation at Rangers. Beyond that, I don’t think we can speak with certainty and have to admit that we are speculating and in some cases, and I plead guilty as well, engaging in wishful thinking.

    Of course Administrative bodies are subject to judicial review. In a way that is what I was trying to say, but, the essential point is that the roles may conflict and the SFA may try to hide behind their administrative function to avoid suggested irregularities in their licensing function.
    I completely agree that wrongful exercise of discretion, or a refusal even to consider exercising discretion, is equally open to judicial review. However, the issue would have to be decided on the basis of Wednesbury reasonableness, i.e. that it was such that no reasonable body in that position could have acted as it did. I was just warning that the SFA could/would raise a defence in that regard as far as their administrative role went, and to be honest I have never been one for relying on the impartiality of the judiciary.
    As for the current Rangers’ board, I have long been an advocate of, and posted about,the possibility of wrongful, if not fraudulent, trading, but I am also aware how difficult it is to get a result, even for mere wrongful trading. We now know, thanks to RTC, that the old board were getting advice on wrongful trading, which is to be expected, given the precarious nature of the company, but that doesn’t mean that the current board were ‘objectively’ wrong to carry on trading. They had an arguable defence in relation to the EBT case and they had the prospect of European money and of course they had season ticket money. Things may changed when they got dumped out of Europe, but again we are relying on speculation about their current finances.

    I am delighted that your personal experience shows that HMRC are getting tough. Let’s wish them every success.

  25. Pingback: A General Update on Scottish Footballing Legal Issues (Part 1) Rangers Edition – Friday 11th November | Random Thoughts Re Scots (and Other) Law

  26. jocky

    The most recent slip from the SPL is that under the new sponsorship agreement they “guarantee” (Neil Doncaster SPL Chief Exec) Sky 4 league games between Celtic & Rangers. Those that watch Scottish Football (my commiserations) will know that the SPL cannot guarantee that as both teams will have to be in the top 6 come “the split”. It is entirely likely, based on history, but not guaranteed. My team, Celtic, came 5th when there were restructuring in the 80s, Liverpool have finished 7th in the EPL and not won the league for 21 years – something unthinkable to fans watching in the 70s and 80s…

    Here we get back to BRTH’s point about self interest. It is in the interest of the SPL Chief Exec, the SPL as a body and indeed the SPL members (possibly excluding one) that Rangers either do not get punished under SFA rules (whether that is relegation or even the minor punishment of points docked) as it may jeopardise the new FIVE YEAR television deal which will keep much of Scottish football afloat.

    My prediction is that the rules of the SFA, and indeed the rule of law, will take second place when it comes to the financial irregularity of Rangers. That is a very bad scenario for anyone who enjoys sport.

    • Jocky,

      Thanks for your interest.

      I can’t imagine that the TV contract would allow such blatant interference as some have suggested eg if Rangers or Celtic finished 7th, the SPL would magically “promote” them in to the top 6 anyway.

      I am sure that what Neil Doncaster meant was that there was a financial penalty to be paid should there not be 4 Old Firm games.

      As BRTH said, and I also agree with yu, the SFA/SPL faces a huge challenge in dealing with this issue.

  27. Govanfront

    I’ve meet some hate filled people in my time but this place takes the biscuit is it Rangers you hate or the Protestant of Scotland that you want to see hammered.

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