severnside gull
Well-known member
Just looking at the regulations on administration etc as obviously the outcome of this process could impact critically on us (very different in the event of liquidation of course).
First looking at the issue of the local MP and the leader of the local council asking Cameron to intervene and instruct HMRC to withdraw their application for a winding-up petition (due before the courts on 20th Feb) - if the administrators had responded promptly and sought to deal with HMRC BEFORE THE PETITION WAS ADVERTISED (it isn't made public until a week after the application to the court was made and the club notified) then HMRC might have cut a deal and could have withdrawn the petition. However, once the petition is advertised it is my understanding that HMRC as the petitioner cannot withdraw its application without the permission of the court. Advertising of the petition also means that anyone else who is owed money can apply to the court to join the petition so even if HMRC withdrew someone else could continue the petition on their own behalf. In that event they would potentially get claim to monies from any resultant liquidation and HMRC would (potentially) lose their place in the queue. If that reading of the rules is correct then DC cannot instruct HMRC to withdraw as the process has already gone beyond the (advertising the petition) point of no return. It also means that for HMRC to withdraw at any point from there onwards would be to risk any claim to money from a subsequent liquidation and that would be a very dangerous position to put themselves in as guardians of the public purse.
As to the ability of Portsmouth FC to enter administration - if they applied to go into admin before the winding up petition was published they could have done so via a postal application BUT because they did nothing (seemingly) they now HAVE TO APPLY IN PERSON TO THE COURT for permission to enter administration and that appears likely not to be given without a full court hearing. They got away with it last time which makes doing so again distinctly improbable.
It does now seem less likely that they will receive validation allowing them to access their bank accounts prior to the scheduled hearing on 20th Feb or that they will be permitted the let out of going into administration (effectively stopping the winding up petition in its tracks) ahead of the hearing.. That all means that on 20th February they will face a full winding up petition before the courts without any protection. At that stage if there are no other petitioners, HMRC could still deal on the debts they are owed in exchange for either immediate payment in full or in part (but you would think it would have to be a very large part with another quarter (another £800K) imminent. HMRC might of course seek to set a precedent and agree to seettle based on scheduled payments as a preferential creditor. However the football authorities would not allow this and if a deal was cut on that basis Pompey might risk losing the golden share that entitles them to league membership so it seems an unlikely compromise. Of course if other petitioners join then HMRC cannot afford to deal.
Realistically if a last ditch deal can be reached at the court it is now likely to be at the cost of a substantial payment to HMRC; at very best administration; and at worst liquidation. What seems least likely now is that they will find a new owner or a substantial influx of funds (unless Chanrai has a change of heart and decides to fund the club as a going (money-losing) concern.
If administration is an outcome (and I can only see that happening if Chanrai takes up ownership responsabilities and pays HMRC whilst accepting that they are otherwise insolvent) the Supporters Trust appear to be convinced there will be no more than a 10 point deduction but that to me appears optimistic given their history. Of course should a higher points deduction be made the club will threaten a legal challenge on the basis that their previous administration was under EPL not FL jurisdiction. My feeling however is that, as the two entities are totally inter-dependent that challenge would fail. Ten points takes them into relegation territory. 15 would dump them adrift at the bottom and probably assure relegation.
The other outcome, liquidation, means we lose points gained against them but so do others and at this stage of the season it probably balances out give or take. I would love to see the real effect if anyone can work it out. though. Pompey Supporters Trust have a Plan B which sees a phoenix club starting again, still at Fratton Park (may or may not be practical) and attracting 8000 fans a week to matches in the Conference South (!!). For that to happen there is a very narrow window (21 days I think) for them to register with the FL and if they fail their starting point is going to be way lower down the football pyramid and possibly financially untenable as the club they currently are.
'Ees complicated, as Gus would say, but for certain it will be very interesting to follow what happens over the next 13 days to see if a miracle can happen but as every day passes the outcome looks less and less promising and as it stands my guess would be that the opportunity for administration may have been allowed to pass with the only games left in town being for Chanrai to cover the HMRC debt in the hope of eventually getting a buyer or (if he feels that it would be a case of good money after bad) then liquidation.
First looking at the issue of the local MP and the leader of the local council asking Cameron to intervene and instruct HMRC to withdraw their application for a winding-up petition (due before the courts on 20th Feb) - if the administrators had responded promptly and sought to deal with HMRC BEFORE THE PETITION WAS ADVERTISED (it isn't made public until a week after the application to the court was made and the club notified) then HMRC might have cut a deal and could have withdrawn the petition. However, once the petition is advertised it is my understanding that HMRC as the petitioner cannot withdraw its application without the permission of the court. Advertising of the petition also means that anyone else who is owed money can apply to the court to join the petition so even if HMRC withdrew someone else could continue the petition on their own behalf. In that event they would potentially get claim to monies from any resultant liquidation and HMRC would (potentially) lose their place in the queue. If that reading of the rules is correct then DC cannot instruct HMRC to withdraw as the process has already gone beyond the (advertising the petition) point of no return. It also means that for HMRC to withdraw at any point from there onwards would be to risk any claim to money from a subsequent liquidation and that would be a very dangerous position to put themselves in as guardians of the public purse.
As to the ability of Portsmouth FC to enter administration - if they applied to go into admin before the winding up petition was published they could have done so via a postal application BUT because they did nothing (seemingly) they now HAVE TO APPLY IN PERSON TO THE COURT for permission to enter administration and that appears likely not to be given without a full court hearing. They got away with it last time which makes doing so again distinctly improbable.
It does now seem less likely that they will receive validation allowing them to access their bank accounts prior to the scheduled hearing on 20th Feb or that they will be permitted the let out of going into administration (effectively stopping the winding up petition in its tracks) ahead of the hearing.. That all means that on 20th February they will face a full winding up petition before the courts without any protection. At that stage if there are no other petitioners, HMRC could still deal on the debts they are owed in exchange for either immediate payment in full or in part (but you would think it would have to be a very large part with another quarter (another £800K) imminent. HMRC might of course seek to set a precedent and agree to seettle based on scheduled payments as a preferential creditor. However the football authorities would not allow this and if a deal was cut on that basis Pompey might risk losing the golden share that entitles them to league membership so it seems an unlikely compromise. Of course if other petitioners join then HMRC cannot afford to deal.
Realistically if a last ditch deal can be reached at the court it is now likely to be at the cost of a substantial payment to HMRC; at very best administration; and at worst liquidation. What seems least likely now is that they will find a new owner or a substantial influx of funds (unless Chanrai has a change of heart and decides to fund the club as a going (money-losing) concern.
If administration is an outcome (and I can only see that happening if Chanrai takes up ownership responsabilities and pays HMRC whilst accepting that they are otherwise insolvent) the Supporters Trust appear to be convinced there will be no more than a 10 point deduction but that to me appears optimistic given their history. Of course should a higher points deduction be made the club will threaten a legal challenge on the basis that their previous administration was under EPL not FL jurisdiction. My feeling however is that, as the two entities are totally inter-dependent that challenge would fail. Ten points takes them into relegation territory. 15 would dump them adrift at the bottom and probably assure relegation.
The other outcome, liquidation, means we lose points gained against them but so do others and at this stage of the season it probably balances out give or take. I would love to see the real effect if anyone can work it out. though. Pompey Supporters Trust have a Plan B which sees a phoenix club starting again, still at Fratton Park (may or may not be practical) and attracting 8000 fans a week to matches in the Conference South (!!). For that to happen there is a very narrow window (21 days I think) for them to register with the FL and if they fail their starting point is going to be way lower down the football pyramid and possibly financially untenable as the club they currently are.
'Ees complicated, as Gus would say, but for certain it will be very interesting to follow what happens over the next 13 days to see if a miracle can happen but as every day passes the outcome looks less and less promising and as it stands my guess would be that the opportunity for administration may have been allowed to pass with the only games left in town being for Chanrai to cover the HMRC debt in the hope of eventually getting a buyer or (if he feels that it would be a case of good money after bad) then liquidation.
Hahahahahahaahahahahahaaaaa
) I do wonder whether they are already too late to apply for administration. They would have to demonstrate that they can afford to remain operational and pay the administrators' costs etc while continuing to seek a new buyer and also that there is some real signs of there being a potential buyer. Failing that they are technically and practically insolvent and liquidation looms ever closer.