It is sad for the supporters but I cant see anyone stepping in here to buy them. It is just too much money involved to clear the debt. No disrespect to Bury etc but this is the 1st big club to disappear I think.
Shocking if true, considering the transfer was in the summer of 2019
I’d like to see channel 5,”Can’t Pay We’re Take It Away”, roll up label and remove assets to the value of. They own very little, the sight of players being loaded in the back of an old transit van would make unusual viewing.
If I’m honest I still don’t see why Arsenal should have any priority for payment over and above local trades people.
Agreed but on the flip side of that, it's crazy that they've only received 20% of the fee more than TWO YEARS after signing him.
Ok it's Arsenal so they can go without 8m for a while, but what if it was a smaller team, or even us?
Or a Butchers, or St. John’s ambulance? There’s no reason football creditors should be ahead of anyone else.
I don't disagree, i made the same point earlier in the thread. But it was agreed by the clubs so naturally they're not going to agree to something that might potentially lose them money.
You could argue that say for example a club like Accrington are owed 1m for a player, that's a huge sum to them, so why should they only get a small % of that if the club they sold him to get the player and then later go into administration.
If I’m honest I still don’t see why Arsenal should have any priority for payment over and above local trades people.
I agree........but sadly it's in their rules which is voted on by the league's chairman.
Yeah but I think the law of the land needs to be tightened up on this. There should be a list of priority creditors but off the top of my head it should start with HMRC followed by the Police, local authority and any registered charity. After that, in my opinion Krystian Bielik is no more a priority than 50 boxes of steak and kidney pies.
If I’m honest I still don’t see why Arsenal should have any priority for payment over and above local trades people.
Agreed but on the flip side of that, it's crazy that they've only received 20% of the fee more than TWO YEARS after signing him.
Ok it's Arsenal so they can go without 8m for a while, but what if it was a smaller team, or even us?
Or a Butchers, or St. John’s ambulance? There’s no reason football creditors should be ahead of anyone else.
Well, there is from a football league maintenance standpoint. If you're not obliged to pay your football creditors back as a priority then you can afford to speculate wildly knowing you'll never actually have to pay the team fully for their players unless it goes well. Throw around £50m on players, pay £10m of it now and see what happens. If it works, great, up you go and you can afford to cover your initial outlay later. Fail, and it doesn't really matter. You can default on your payments and knock the other clubs, which means that those clubs never get the money they were reliant on for their players, and probably budgeted for signings based on that promised cash. That creates a domino effect pointing downwards, and before long you have a string of teams who have spent a wad of money that they're never going to see because the first team can't afford to pay it and don't have to. If that goes on enough then the leagues collapse in on themselves and no-one is paying anyone anything, be it other teams or local greengrocers. It's not fair on the smaller businesses, but that's the reason it happens. It's a miserable world.
If I’m honest I still don’t see why Arsenal should have any priority for payment over and above local trades people.
I agree........but sadly it's in their rules which is voted on by the league's chairman.
Yeah but I think the law of the land needs to be tightened up on this. There should be a list of priority creditors but off the top of my head it should start with HMRC followed by the Police, local authority and any registered charity. After that, in my opinion Krystian Bielik is no more a priority than 50 boxes of steak and kidney pies.
The law of the land does put HMRC first.
Would people feel differently if Derby owed Rochdale 800k than if they did Arsenal 8 million. I suspect they would.
If I’m honest I still don’t see why Arsenal should have any priority for payment over and above local trades people.
Agreed but on the flip side of that, it's crazy that they've only received 20% of the fee more than TWO YEARS after signing him.
Ok it's Arsenal so they can go without 8m for a while, but what if it was a smaller team, or even us?
Or a Butchers, or St. John’s ambulance? There’s no reason football creditors should be ahead of anyone else.
Well, there is from a football league maintenance standpoint. If you're not obliged to pay your football creditors back as a priority then you can afford to speculate wildly knowing you'll never actually have to pay the team fully for their players unless it goes well. Throw around £50m on players, pay £10m of it now and see what happens. If it works, great, up you go and you can afford to cover your initial outlay later. Fail, and it doesn't really matter. You can default on your payments and knock the other clubs, which means that those clubs never get the money they were reliant on for their players, and probably budgeted for signings based on that promised cash. That creates a domino effect pointing downwards, and before long you have a string of teams who have spent a wad of money that they're never going to see because the first team can't afford to pay it and don't have to. If that goes on enough then the leagues collapse in on themselves and no-one is paying anyone anything, be it other teams or local greengrocers. It's not fair on the smaller businesses, but that's the reason it happens. It's a miserable world.
The law needs to step in. No sympathy with football clubs like Derby and Sheffield Wednesday or even Charlton if they fall foul of the rules. The way to discourage stupid transfer speculation is to make default penalties draconian. Go bust owing eg Arsenal £8 million then get relegated without appeal three divisions. No way should any business become a priority creditor just to prop up the absurd and frankly sick football finances.
My understanding is that HMRC are the initial creditors that must be settled first.
Then according to the laws of the game (not the actual law) football debts must be settled in order to continue to be allowed to have your golden share that enables you to remain in the league.
If you are not in the league then there is no chance of the other creditors being paid as you are definitely not a viable concern.
I don’t like the often small local businesses being down the line for settlement but can somewhat understand why they do it that way.
If I’m honest I still don’t see why Arsenal should have any priority for payment over and above local trades people.
Agreed but on the flip side of that, it's crazy that they've only received 20% of the fee more than TWO YEARS after signing him.
Ok it's Arsenal so they can go without 8m for a while, but what if it was a smaller team, or even us?
Or a Butchers, or St. John’s ambulance? There’s no reason football creditors should be ahead of anyone else.
Well, there is from a football league maintenance standpoint. If you're not obliged to pay your football creditors back as a priority then you can afford to speculate wildly knowing you'll never actually have to pay the team fully for their players unless it goes well. Throw around £50m on players, pay £10m of it now and see what happens. If it works, great, up you go and you can afford to cover your initial outlay later. Fail, and it doesn't really matter. You can default on your payments and knock the other clubs, which means that those clubs never get the money they were reliant on for their players, and probably budgeted for signings based on that promised cash. That creates a domino effect pointing downwards, and before long you have a string of teams who have spent a wad of money that they're never going to see because the first team can't afford to pay it and don't have to. If that goes on enough then the leagues collapse in on themselves and no-one is paying anyone anything, be it other teams or local greengrocers. It's not fair on the smaller businesses, but that's the reason it happens. It's a miserable world.
The law needs to step in. No sympathy with football clubs like Derby and Sheffield Wednesday or even Charlton if they fall foul of the rules. The way to discourage stupid transfer speculation is to make default penalties draconian. Go bust owing eg Arsenal £8 million then get relegated without appeal three divisions. No way should any business become a priority creditor just to prop up the absurd and frankly sick football finances.
Is that a good punishment though? What if we had another Southall/Nimer situation with a bit more money to it. The owner 'spends' £20m, can't pay it, goes into admin and then splits. The punishment, as usual, then falls on the club and the fans for the actions of a dodgy businessman, just like it did with Wigan when their owner decided he just couldn't be arsed with them anymore and put them into administration until a buyer came to take it off his hands. What would a three tier relegation mean to these people? I agree that money in football is a total wreck but it's so difficult to provide proper deterrents when owners just don't give a shit about the mess they leave behind them. Really the best bet is moving more towards the German 51% model, but that would reduce the money flowing into the people at the top's coffers so you can rule that out
If I’m honest I still don’t see why Arsenal should have any priority for payment over and above local trades people.
I agree........but sadly it's in their rules which is voted on by the league's chairman.
Yeah but I think the law of the land needs to be tightened up on this. There should be a list of priority creditors but off the top of my head it should start with HMRC followed by the Police, local authority and any registered charity. After that, in my opinion Krystian Bielik is no more a priority than 50 boxes of steak and kidney pies.
The law of the land does put HMRC first.
Would people feel differently if Derby owed Rochdale 800k than if they did Arsenal 8 million. I suspect they would.
HMRC used to be preferential creditors, but not any more.
I think that most reasonable people would expect that all creditors should be treated equally. It is grossly unfair that one person gets all their money and someone else gets nothing.
If I’m honest I still don’t see why Arsenal should have any priority for payment over and above local trades people.
I agree........but sadly it's in their rules which is voted on by the league's chairman.
Yeah but I think the law of the land needs to be tightened up on this. There should be a list of priority creditors but off the top of my head it should start with HMRC followed by the Police, local authority and any registered charity. After that, in my opinion Krystian Bielik is no more a priority than 50 boxes of steak and kidney pies.
The law of the land does put HMRC first.
Would people feel differently if Derby owed Rochdale 800k than if they did Arsenal 8 million. I suspect they would.
HMRC used to be preferential creditors, but not any more.
I think that most reasonable people would expect that all creditors should be treated equally. It is grossly unfair that one person gets all their money and someone else gets nothing.
They aren't preferred creditors but they won't take pennies in the pound if the assets are more than their debt. Especially when it's PAYE and NI. As is the case with Derby.
And it is unfair, but if you got made bankrupt owning a massive bar tab, would you expect the land lord to let you back after paying 10p in the £1?
If I’m honest I still don’t see why Arsenal should have any priority for payment over and above local trades people.
I agree........but sadly it's in their rules which is voted on by the league's chairman.
Yeah but I think the law of the land needs to be tightened up on this. There should be a list of priority creditors but off the top of my head it should start with HMRC followed by the Police, local authority and any registered charity. After that, in my opinion Krystian Bielik is no more a priority than 50 boxes of steak and kidney pies.
The law of the land does put HMRC first.
Would people feel differently if Derby owed Rochdale 800k than if they did Arsenal 8 million. I suspect they would.
HMRC used to be preferential creditors, but not any more.
I think that most reasonable people would expect that all creditors should be treated equally. It is grossly unfair that one person gets all their money and someone else gets nothing.
They aren't preferred creditors but they won't take pennies in the pound if the assets are more than their debt. Especially when it's PAYE and NI. As is the case with Derby.
And it is unfair, but if you got made bankrupt owning a massive bar tab, would you expect the land lord to let you back after paying 10p in the £1?
If the assets are worth more than the debt then everyone would get their money. It has been awhile, but I think that the only PAYE and NIC that get priority above everyone, is the PAYE and NIC that the administrator deducts from employees.
No, I would not expect to be let back in. I would also not expect it to be down to me which of the people I owed money too got paid and which didn’t.
It's quite simple, if there wasn't football credit being thrown around then there wouldn't be any problem about football debts being paid.
For example, Derby offer Arsenal £10m for Beilik, spead over 5 years or some other nonsense. Arsenal look at Derby and that's a big risk, we'll take the cash up front thanks, unless your owner wants to personally guarantee the credit. Problem solved. There's only need for football debts to be paid first because football clubs don't want to pay up front and other clubs are stupid enough to offer credit to businesses any proper lender wouldn't touch with a barge poll.
Seriously, no bank would loan Derby even thousands of pounds, let alone millions, but arsenal were happy to. And everybody else is somehow supposed to protect arsenal from their own stupid business decisions.
If you can't pay up front for a player, then hard luck, go and get a cheaper player or a loanee, or a free agent.
I can see the logic in the “Football Creditors Rule”, as it does limit the risk of contagion to other clubs. However I think it is too broad - I’m not sure why players (and I assume managers) get paid in full while other employees don’t. My opinion is that they become just another unsecured creditor, with an option to terminate their contract/registration at will.
Comments
Twenty people have lost their jobs at Derby County as administrators begin cutting costs at the Championship club.
The losses come despite administrators hoping short-term funding will be in place next week.
https://www.bbc.co.uk/news/uk-england-derbyshire-58747216
Minimal savings, but they have to do something...
They own very little, the sight of players being loaded in the back of an old transit van would make unusual viewing.
Ok it's Arsenal so they can go without 8m for a while, but what if it was a smaller team, or even us?
You could argue that say for example a club like Accrington are owed 1m for a player, that's a huge sum to them, so why should they only get a small % of that if the club they sold him to get the player and then later go into administration.
It makes you wonder if the fee was in reality far less than the headline figure, as it was so spread out.
Would people feel differently if Derby owed Rochdale 800k than if they did Arsenal 8 million. I suspect they would.
I think that most reasonable people would expect that all creditors should be treated equally. It is grossly unfair that one person gets all their money and someone else gets nothing.
And it is unfair, but if you got made bankrupt owning a massive bar tab, would you expect the land lord to let you back after paying 10p in the £1?
No, I would not expect to be let back in. I would also not expect it to be down to me which of the people I owed money too got paid and which didn’t.
For example, Derby offer Arsenal £10m for Beilik, spead over 5 years or some other nonsense. Arsenal look at Derby and that's a big risk, we'll take the cash up front thanks, unless your owner wants to personally guarantee the credit. Problem solved. There's only need for football debts to be paid first because football clubs don't want to pay up front and other clubs are stupid enough to offer credit to businesses any proper lender wouldn't touch with a barge poll.
Seriously, no bank would loan Derby even thousands of pounds, let alone millions, but arsenal were happy to. And everybody else is somehow supposed to protect arsenal from their own stupid business decisions.
If you can't pay up front for a player, then hard luck, go and get a cheaper player or a loanee, or a free agent.