Premier League defends preferential insolvency rule

The debate rages on!! The Football Association ("FA") has started its defence of the (in my view) totally unfair Football Creditors Rule ("FCR") which it claims gives it super-preferential status over any other creditor in a formal insolvency of a FA football club. See the article in Accountancy Age here.

In no other industry does a creditor command anything like the "ransom" status in terms of priority of payments over any other creditor in a business that becomes insolvent. What the FCR means is that football-related creditors in a failed football club get paid before ANYONE else does. When a football club fails due to rampant profligacy (sorry - bit incensed over this!) why should its governing body and (usually) highly paid footballers and their agents have the advantage over everyone else? Surely the FA should be taking steps to govern its clubs properly so insolvency doesn't happen? In a badly run football club, all creditors should be treated like any other creditor, just like any other business...

The bank of HMRC is right to challenge the FCR.