Blocking the rule changes

[markybear 136]

I made this point in another thread and it was also followed up by boss but appears to have flown under the radar in the main. There is one particular method open to Rangers to try and block a rule change at the moment which I hope D&P are considering. This would involve Rangers exploiting certain protections from unfairly prejudicial treatment which are available to shareholders under the Companies Act 2006.

As a bit of background, on 30th April the SPL clubs will consider a range of proposals to amend the Articles and Rules of the SPL. The Articles referred to are those of The Scottish Premier League Limited and are available on the SPL website (SPL Articles).

The Scottish Premier League Limited is a private company limited by shares and therefore subject to the provisions of the Companies Act 2006. As I understand it, each member club holds one share in the SPL Limited and there should be 12 “shareholders” at the moment (Rangers, Scum, Aberdeen, Hibs, Hearts, Dundee Utd, St J, Dunfermline, St Mirren, Killie, ICT and Motherwell).

Section 994 of CA 2006 provides that:

As a “member” of SPL Limited, Rangers are entitled to be protected from SPL Limited’s affairs being conducted in a manner which would be unfairly prejudicial to Rangers.

The very fact that rule changes in respect of members who suffer insolvency events are being proposed while Rangers are in the process of suffering an insolvency event is beyond belief. It’s clear to see that the results of these rule changes will seriously prejudice Rangers’ position and they are surely worth fighting.

I’m sure there are many arguments to be made in respect of the various ways Rangers’ interests are being prejudiced but the two principal ones which spring to mind would be:

1. the changes anticipate increased sanctions on clubs which are in administration (such as the 15 or 1/3 of the previous season’s points rule) and it is not even clear if Rangers will be out of administration by the beginning of next season; and
   
2. the sanctions imposed on “newcos” may be seriously detrimental to the value of Rangers in the event the club is sold to a newco.
   

Of course, some of these arguments may not be successful and it may be that what we see through blue-tinted spectacles as “unfair prejudice” wouldn’t be seen in a similar light by the courts. In any case, let’s hope this is something which is at least being explored by D&P and their advisers.

This was fairly hastily put together this morning so any input from others would be welcome.

Send this or a very similar email to here....

Rangers@duffandphelps.com

Gd work sir.