HMRC fights for full voting rights at Portsmouth

HMRC has claimed there were “material irregularities” when votes were counted
at the recent Portsmouth FC company voluntary arrangement (CVA) ballot, in a
court submission filed today.

The tax office said it was “unfairly prejudiced” in the voting process of the
CVA, set up by administrators.

HMRC filed an appeal against the CVA at the High Court today on the grounds
that: “the interests of HMRC have been or will be unfairly prejudiced” by the
decision to reduce its voting rights.

Voting rights are distributed based on the level of debt owed to each
creditor.

A CVA needs 75% of creditors, by value of their debt, to be approved. HMRC is
owed approximately £37m by Portsmouth FC, representing about 25% of the total
CVA vote.

However, its voting right was reduced to reflect just £24m.

Had HMRC been given its full vote it could have blocked the CVA. HMRC had
voted against the CVA, which will see creditors receiving approximately 20p in
the pound over five years.

The CVA is now frozen until a decision on the appeal has been made.

The administrators were unavailable for comment at the time of publication.

Earlier today, they said if HMRC’s appeal failed they would pursue it for
losses which could amount to “millions”.

Further reading:

HMRC
faces “millions” in costs if Portsmouth appeal fails

Portsmouth
FC CVA approved

Breaking
news: HMRC to veto Portsmouth CVA