English Premier League 'Fit and Proper Person' Rules: Are They Tough Enough and Are They Being Strictly Applied and Enforced?
Football is not only the world's favourite game, but it is also the world's most lucrative sport. Indeed, according to Sepp Blatter, the President of FIFA, football's world governing body, football is now a product in its own right. As such, the famous remark of Bill Shankly, the legendary former manager of Liverpool Football Club, when asked whether football was a matter of life and death, "Oh no" he said, "it is much more important than that!" is not so far away, nowadays, from the actual truth about the 'beautiful game'!
With so much money sloshing around the game, it is not surprising that football has attracted many investors, not least foreign ones, a number of whom are unscrupulous and out for their own ends and gains and not 'for the good of the game'. Indeed, some of them are down right criminals and could use their investments in football clubs for money laundering and tax evasion purposes (see the author's comments on the OECD Report of 1 July, 2009 on 'Money laundering and tax evasion in football' published on the official website of the TMC Asser International Sports Law Centre on 17 August, 2009).
The English Premier League is not only the world's most popular League, but is also the world's most lucrative one. And, with the recent purchase of Portsmouth Football Club, by the Saudi, Ali al- Faraj, half of the twenty English Clubs comprising the Premier League are now owned by foreigners.
This fact and the controversial purchase and sale of Manchester City Football Club by the former Thai Prime Minister, Taxin Shinawatra, who is wanted in his own country on corruption charges, as well as the number of Football Clubs that have gone into liquidation, through reckless financial arrangements (especially highly leveraged 'buy-outs' such as the one that brought the Glazer's to ownership of Manchester United Football Club), has prompted the English Football Authorities to introduce a 'fit and proper person' test to root out unsuitable investors in English Football Clubs.
So, what are the rules?
The 'fit and proper persons test' was first introduced in 2004 with the intention of safeguarding clubs against falling in to the ownership of unscrupulous owners, with nothing in place before that time to stop those previously convicted of criminal offences, such as fraud, from buying and running clubs.
Rules were established jointly between the English Premier League, Football League and the Football Conference that any prospective director of a football club or someone looking to buy over 30 per cent of the club's shares needed to satisfy them that they were 'fit and proper' persons to do so.
The details of the test are detailed and complex but the most important points prohibit anyone with unspent criminal convictions relating to acts of dishonesty or someone who has taken a football club into administration twice from taking charge of a football club.
The only person currently known to have fallen foul of these rules is Dennis Coleman, who, as director of Rotherham United, was responsible for twice taking the Yorkshire club into administration (insolvency).
The exact criteria vary between the Premier League and the Football League after government pressure saw the former tighten up its rules, whilst those of the latter remain in their 2004 form. However, the Football League's chairman, Lord Mawhinney, is currently seeking to reach agreement with other interested football bodies in order to correct this imbalance.
The Premier League now asks members to publicly declare the names of anyone who owns over 10 per cent of the club. The Football League asks for names of owners of clubs, but does not currently make them public. The Premier League also seeks assurances about where money is coming from to fund a club.
An important difference remains that the Premier League applies the test before a takeover is approved whereas the Football League garners information only after a deal has been completed. …