HMRC goes behind in Football League court clash

by Rachael Singh

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30 Nov 2011

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High Court London

HM REVENUE & CUSTOMS were shot down in court by the residing judge on a case challenging insolvency rules in football administrations.

The taxman is battling against the football league over its controversial Football Creditor Rule (FCR) which prioritises some creditors over others.

The first argument put forward by the taxman this morning said the rule is discriminatory because it does not treat all European football creditors equally. HMRC argued some European clubs are given priority while others, such as French clubs, are not.

The FCR prioritises the payment of football creditors such as other clubs and players ahead of other creditors, which HMRC believes is unlawful and outside the rules of insolvency - that all creditors should be treated equally.

However, residing judge Mr Justice David Richards said he was not "convinced" that this argument should be brought up in this particular hearing as it is "complex" enough.

He added he was not "persuaded these arguments should be vetted in these proceedings".

Justice Richards said HMRC needs to consider if it would like to pursue the argument outside of this case as a separate challenge.

The court case involving HMRC and the Football League over the Football Creditor Rule began today and is likely to end next week with a judgement to follow next year.

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