Ibrox crisis: The penalties that Charles Green’s Rangers could face
STV have considered the issues that still remain unresolved for newco Rangers and the possible outcomes.
Following the Scottish Football League’s decision to admit Charles Green’s newco Rangers to Division 3 for the forthcoming season, the Ibrox club have some clarity on their immediate future.
However, a number of unresolved issues remain outstanding and there are still hurdles to be cleared before Ally McCoist’s team can play a competitive match.
We’ve looked at the questions remaining for Green, Rangers and the governing bodies in Scottish football.
Isn’t it settled? Don’t Rangers start their season with the Ramsden’s Cup match against Brechin on July 28?
Not necessarily. Newco Rangers may have been granted membership of the Scottish Football League but that decision is pending a transfer of the Scottish Football Association membership from the old Rangers company to Green’s. SFA membership is required for any club to play professional football in Scotland.
Wait, why “newco” Rangers?
Green’s company that purchased the assets of the old Rangers company that is to be liquidated doesn’t hold an SFA membership. The old Rangers still does, until the membership is transferred or the company is liquidated. Until a transfer takes place, a distinction has to be made.
Reports have claimed that there was a secret plan to present Green with punishments or sanctions for all the issues in return for SFA membership and a place in Division One. Is that likely to happen?
STV has learned that the draft document was intended as a way to explain the worst case scenario across several issues as information after Green took over but was not an offer or negotiation. Each of the issues still has to be settled independently.
Sources within the governing bodies have said that there is no “offer” on the table for Rangers.
The SFA is not dealing with the “EBT issue” (explained later) and has no meeting scheduled for August 10. That date has been set aside for an SPL board meeting but discussion of off-contract payments is expected to take place before then.
So why hasn’t the SFA membership transfer taken place yet?
An application has been made to the SFA but has not yet been approved. The stumbling block is that by assuming the membership of the old Rangers company, newco Rangers would be accepting a continuation of the existing club.
That means that the disciplinary process that saw the old club being found guilty of five breaches of SFA rules still has to be concluded.
The SFA must also receive information from administrators Duff and Phelps that satisfies the requirement for Green’s consortium to be considered as “fit and proper”.
But the sanction that was imposed for those breaches, the signing embargo, was ruled as illegal by the Court of Session, wasn’t it?
The SFA’s independent Appellate Tribunal imposed fines, censure and a 12 month registration embargo. When Rangers challenged that in court, it was ruled that the registration embargo was not a punishment available to the tribunal.
So how do they get an SFA membership?
Newco Rangers need a membership and so have three options. They could withdraw the transfer application and just apply for a new membership. That route is almost certain to fail though as the new company don’t have three years of accounts and wouldn’t satisfy the financial requirements.
The club could ask that the Appellate Tribunal is reconvened and chooses an available punishment, as the Court of Session directed. The available punishments are: expulsion from the game and termination of membership, suspension of membership or suspension from the Scottish Cup.
Alternatively, newco Rangers could decide to accept the original punishment, setting aside the Court of Session decision and agreeing to follow the football disciplinary process.
Discussions are ongoing between Rangers and the SFA over a solution.
Do the SFA still have to rule on the use of EBTs or “dual contracts”?
The contracts issue is being dealt with by the Scottish Premier League. The SFA would be the appeals body in the event that the SPL decision is disputed. Since they may have to appoint a panel to deal with that in the future, they will not investigate or start proceedings shortly.
So what is happening with the EBT investigation?
The First Tier Tax Tribunal has still to announce their judgement on whether Employee Benefit Trusts are tax avoidance or tax evasion. However, that isn’t actually relevant to the football bodies.
The issue that faces the SPL is not whether EBTs were a tax dodge but whether Rangers players were made payments that were separate from the contract lodged with the SPL. If players were paid outside of the declared amounts in their contracts, then the old Rangers company would face sanctions from the SPL.
What would those sanctions be?
The SPL does specify punishments in its rules and regulations but clearly a fine or warning would be irrelevant to a club that is no longer a member of the league. The stripping of titles is an available punishment.
After an investigation was launched it was confirmed that Rangers had a “prima facie” case to answer but the process was put on hold until the league situation was concluded. The SPL has confirmed that they will now deal with the matter but no deadline or timescale has been set.
Would teams who finished as runners-up in competitions be awarded Rangers’ titles?
The respective rulebooks of the governing bodies do not provide specific guidance on this subject.
There is a precedent for matches where rule-breaking has been proved to be annulled or a win awarded to the opposition team. The calculations and implications involved in applying this to every game seem unworkable and it is more likely that seasons would be taken as a whole.
The SPL or an independent board can “withdraw the award of a title”, as per the rulebook of the league. It does not state whether the side finishing second would retrospectively be awarded the title, and the SPL has refused to confirm its processes.
With the SPL refusing to comment on that scenario, it is still unclear if the league would expect prize money to be repaid or medals returned.
The rules of the Scottish Cup do not specifically state a team can be stripped of any success in the competition.
Rule 39 (Infringement of Rules) of the competition say any club found to have infringed the regulations can be “liable to a fine, censure, suspension, order to replay a match, ejection from the competition and/or any such other sanction(s) as specified within these rules.”
It does not state anywhere in the Scottish Cup rules that a title or award can be withdrawn.
In the case of the League Cup, organised by the SFL, the rules do not state a specific course of action in the case of its rules being infringed.
As a guide, other specific rule breaches make reference to being deemed to be serious misconduct, which can result in the competition organiser imposing “any other sanctions or conditions which the Board may think fit.”
Additional reporting by Grant Russell