Post by QPR Report on Apr 16, 2010 6:20:47 GMT
Guardian/Owen Gibson
Premier League to toughen test for new owners after Portsmouth saga
• Premier League will demand proof of funds
• Owners will have to meet league officials face to face
The Premier League hopes to introduce a new "means and abilities" test that will force prospective owners to provide proof of funds and demonstrate their ability to invest in a club.
It is understood the idea, introduced in part as a response to the chaos at Portsmouth this season, was given a cautious welcome at a meeting of all 20 Premier League clubs and will be voted on at the AGM in June. The new takeover rule will build on the changes announced last May and introduced in March that require clubs to provide financial information for the year ahead and prove they are up to date with payments to football creditors and the taxman.
Had it been in place last year it would have raised major concerns about the takeovers of Portsmouth by Sulaiman al-Fahim and then Ali al-Faraj, who took control of the club in October but seemingly never put any money in.
Under the new rule, the Premier League will also demand a face-to-face meeting with any prospective owner, in an attempt to avoid a repeat of the farcical situation whereby Faraj was never seen in the UK and was never questioned about the state of Portsmouth's books.
The measures, which would become part of the due-diligence process for prospective owners, will require such individuals to prove they have the necessary funds to take a club through the next season and meet all outgoings.
Last year's rule changes, partly in response to government calls for the game to "reassess its relationship with money", also included a tougher fit and proper persons test and a requirement for transparent ownership information.
Richard Scudamore, the Premier League's chief executive, last month admitted that Portsmouth's travails, which left the club in administration with debts of more than £100m in a season during which they have had four owners, had damaged the league's image.
The clubs were also presented with a plan, still subject to a vote at the AGM and agreement with the Football League, to increase the parachute payments to relegated clubs from £23.4m to around £48m and spread them over four years instead of two. The aim is to give relegated clubs more time to adjust to the financial realities of life in the Football League, while the so-called "solidarity payments" to the other Football League clubs will be "significantly" increased so that they are not disadvantaged.
As part of the deal, which is still under negotiation, the Premier League wants the Football League to align the regulations applied to clubs in the Championship more closely with its own.
Under the new plan for parachute payments between 2010 and 2013, relegated clubs would receive £16m for the first two years and £8m for the next two in a bid to help cushion the financial pain of relegation. The imbalance between the Premier League and the Football League has long been cited as a key factor in more than 50 lower-league clubs going into administration in the past decade. It is hoped the new measures will smooth the transition in both directions.
In another change, all money not paid out to relegated clubs because they achieved promotion back to the Premier League within four years would go into the solidarity pot.
It is understood that Scudamore has met Greg Clarke, the new Football League chairman, to discuss the plan.
A Premier League spokesman said that nothing had been finalised. "Any decision regarding the future structure of parachute payments cannot be taken by the Premier League alone and must be agreed with the Football League," he said. "The Premier League is currently in positive discussions with the Football League on a number of issues; however an announcement will only be made once these have reached a satisfactory conclusion."
A Football League spokesman confirmed that discussions were under way. Clarke, while likely to welcome the hugely increased income, will want to be sure that the offer does not upset the competitive balance of his league.The Premier League clubs are expected to back the new measures. The bumper new overseas TV deal, which will raise over £1.2bn, and the £2bn-plus from domestic TV rights for the 2010 - 2013 period, has enabled the Premier League to keep its own clubs happy while also proposed that it boosts the amount that trickles down to the Football League.
Scudamore also confirmed that the Premier League would lodge a formal challenge with the Competition Appeal Tribunal over the recent ruling by the media regulator Ofcom to force Sky to cut the price at which it sells its sports channels to rivals.
Sports governing bodies claim the move will have a significant impact on the amount they are paid for rights and harm investment in grass-roots sport. "We do not undertake this process lightly; however the consequences for UK sport and UK sports fans are too serious and fundamental for us to ignore," Scudamore said
www.guardian.co.uk/football/2010/apr/15/premier-league-test-owners-portsmouth
Premier League to toughen test for new owners after Portsmouth saga
• Premier League will demand proof of funds
• Owners will have to meet league officials face to face
The Premier League hopes to introduce a new "means and abilities" test that will force prospective owners to provide proof of funds and demonstrate their ability to invest in a club.
It is understood the idea, introduced in part as a response to the chaos at Portsmouth this season, was given a cautious welcome at a meeting of all 20 Premier League clubs and will be voted on at the AGM in June. The new takeover rule will build on the changes announced last May and introduced in March that require clubs to provide financial information for the year ahead and prove they are up to date with payments to football creditors and the taxman.
Had it been in place last year it would have raised major concerns about the takeovers of Portsmouth by Sulaiman al-Fahim and then Ali al-Faraj, who took control of the club in October but seemingly never put any money in.
Under the new rule, the Premier League will also demand a face-to-face meeting with any prospective owner, in an attempt to avoid a repeat of the farcical situation whereby Faraj was never seen in the UK and was never questioned about the state of Portsmouth's books.
The measures, which would become part of the due-diligence process for prospective owners, will require such individuals to prove they have the necessary funds to take a club through the next season and meet all outgoings.
Last year's rule changes, partly in response to government calls for the game to "reassess its relationship with money", also included a tougher fit and proper persons test and a requirement for transparent ownership information.
Richard Scudamore, the Premier League's chief executive, last month admitted that Portsmouth's travails, which left the club in administration with debts of more than £100m in a season during which they have had four owners, had damaged the league's image.
The clubs were also presented with a plan, still subject to a vote at the AGM and agreement with the Football League, to increase the parachute payments to relegated clubs from £23.4m to around £48m and spread them over four years instead of two. The aim is to give relegated clubs more time to adjust to the financial realities of life in the Football League, while the so-called "solidarity payments" to the other Football League clubs will be "significantly" increased so that they are not disadvantaged.
As part of the deal, which is still under negotiation, the Premier League wants the Football League to align the regulations applied to clubs in the Championship more closely with its own.
Under the new plan for parachute payments between 2010 and 2013, relegated clubs would receive £16m for the first two years and £8m for the next two in a bid to help cushion the financial pain of relegation. The imbalance between the Premier League and the Football League has long been cited as a key factor in more than 50 lower-league clubs going into administration in the past decade. It is hoped the new measures will smooth the transition in both directions.
In another change, all money not paid out to relegated clubs because they achieved promotion back to the Premier League within four years would go into the solidarity pot.
It is understood that Scudamore has met Greg Clarke, the new Football League chairman, to discuss the plan.
A Premier League spokesman said that nothing had been finalised. "Any decision regarding the future structure of parachute payments cannot be taken by the Premier League alone and must be agreed with the Football League," he said. "The Premier League is currently in positive discussions with the Football League on a number of issues; however an announcement will only be made once these have reached a satisfactory conclusion."
A Football League spokesman confirmed that discussions were under way. Clarke, while likely to welcome the hugely increased income, will want to be sure that the offer does not upset the competitive balance of his league.The Premier League clubs are expected to back the new measures. The bumper new overseas TV deal, which will raise over £1.2bn, and the £2bn-plus from domestic TV rights for the 2010 - 2013 period, has enabled the Premier League to keep its own clubs happy while also proposed that it boosts the amount that trickles down to the Football League.
Scudamore also confirmed that the Premier League would lodge a formal challenge with the Competition Appeal Tribunal over the recent ruling by the media regulator Ofcom to force Sky to cut the price at which it sells its sports channels to rivals.
Sports governing bodies claim the move will have a significant impact on the amount they are paid for rights and harm investment in grass-roots sport. "We do not undertake this process lightly; however the consequences for UK sport and UK sports fans are too serious and fundamental for us to ignore," Scudamore said
www.guardian.co.uk/football/2010/apr/15/premier-league-test-owners-portsmouth