League details suspension decision

Although it has not been an historic policy to provide written explanations of its decisions, the EVO-STIK NPL's board has taken the decision to provide a full and detailed account of the case following consultation with the Football Association and in light of the considerable speculation surrounding it.

Set out below for supporters is the full text of the written explanation which sent to the chairmen and women at all 68 clubs ahead of Sunday's September board meeting of the EVO-STIK NPL.

Background
The league has held several meetings with Ilkeston FC since September 2015. The club was sanctioned for breaches of the Financial Reporting Initiative (FRI) including defaulting on a Time To Pay (TTP) agreement with HMRC, causing the club to be placed under threat of suspension by the league.

On 14th July 2016 the NPL Finance Panel met with the club to hear charges relating to further breaches of the FRI including defaulting on a second TTP agreement with HMRC, together with breaches of rule in relation to Football Creditors and a breach of licensing regulations.

The club pleaded guilty to all charges and, following a lengthy meeting, the hearing was adjourned until 21st July to allow the club further time to provide documentation confirming that agreement had been reached with football and non-football creditors, including HMRC. At all times the league has given every consideration to Ilkeston FC’s circumstances and this support has been acknowledged by the club in correspondence.

On 21st July the club’s unconditional licence was withdrawn and replaced by a conditional licence requiring confirmation of settlement of all football and non-football debts to be provided by 3rd August. The club did not meet those conditions so, on 10th August, the licence was suspended.

Ilkeston FC did indicate that they expected an influx of monies from the transfer of a former player but were unable to disclose the amount involved, so the league could not determine whether the income derived from the sell-on would cover football and HMRC creditors. Ilkeston FC did not appeal the decision to suspend their licence and the league received no further up-dates from the club, forcing the NPL to postpone four league games.

Confirmation that football creditors had been settled was received on 23rd August and the league received confirmation that settlement had been reached with HMRC three days later, at which point, Ilkeston FC’s conditional licence was re-instated.

HMRC & registrations embargo
The annual FRI 1 return forms signed by NPL clubs authorises HMRC to disclose information to the NPL when requested. Where a club has HMRC arrears and does not have a TTP agreement in place, or has defaulted on a TTP agreement, the league’s policy is to impose a registrations embargo. In this case the league imposed a registrations embargo until such time as the club provided evidence of a TTP agreement being in place with HMRC.

Failure to fulfil a fixture
Once a fixture is postponed, the league must issue a charge under rule 8.6, failure to fulfil a fixture. These charges were heard on 31st August by a panel which excluded NPL directors from the Premier Division. It was noted that the club had now agreed payment terms with all the recorded creditors. A fine was imposed for failing to fulfil four fixtures, with Ilkeston FC’s unconditional Licence made subject to review after a period of three months.

Reasons for decision
The club contested that it should have been charged under Rule 4.8 and not Rule 8.6. The panel considered that Rule 4.8 applied to minor infringements only and that the severity of the situation in this case warranted charges under 8.6. The panel noted that the league had been in dialogue with the club since March 2016 regarding the default on the (second) TTP agreement with HMRC which initiated the chain of events leading to the suspension of the club’s licence. The panel considered the content of the correspondence between the league and the club and found that the problem had advanced well beyond that of minor misdemeanour to which Rule 4.8 would have applied.

The club contested that the league’s actions went beyond the bounds of its authority thereby being prejudicial to the club. This was rejected by the panel on the grounds that the club had already pleaded guilty to the breaches of licensing regulations which caused the licence to be suspended. The league’s letter of the 20th August 2016 laid down the required actions from the club and the actions required.

The club contested that the league had failed to provide full evidence justifying the charge by way of due process and that the club had been prejudiced and that there was a lack of fairness shown. The panel’s view was that all correspondence had been supplied.

The club contested that the league had been heavy handed and unsupportive of the club as a transgressor but the panel found that support had been given over several months in the form of meetings and correspondence to try and assist the club.

The club contested that the league had failed to consider all options when reaching the decision to postpone the four scheduled fixtures. The panel disagreed noting the various conference calls attended by NPL executive members and at which all available options were considered.

The club contended that there was a defence of just cause for not fulfilling the fixtures in that the league had prevented them from doing so. The panel rejected this argument on the grounds that the situation leading to the postponement of the fixtures had been caused by the club not meeting its obligations as agreed in previous meetings and correspondence.

Questions and answers
1. Why has this dragged on so long? At every stage the NPL’s objectives have been to resolve the situation as quickly as possible. The league has also been in regular contact with the FA on this matter to try and bring about a swift resolution.

2. Why were Ilkeston not sanctioned more severely as a result of gaining an unfair advantage by not having paid football creditors and HMRC? First, neither the NPL nor FA can dictate to any member club what they pay players although - like other leagues - the NPL continues to monitor clubs’ financial status via the FRI. The league maintains a regular dialogue with HMRC – to which all NPL clubs have empowered us via FRI 1.

3. Why did the league ‘deny’ Ilkeston FC the opportunity to bring in revenues from fixtures in order to pay creditors? The amounts involved were significantly in excess of that which would have been covered by allowing fixtures to go ahead.

4. Was the panel which heard the Ilkeston charges impartial? The panel did not include directors from any NPL Premier Division club. At the panel hearings on 14th and 21st July, Ilkeston FC were advised of the composition of the finance panel and raised no objection.

5. Should NPL clubs’ financial information be seen by representatives of other clubs? First, every NPL director is subject to a Code of Conduct which includes strict rules around confidentiality. Second, should the league have to resort to recruiting external assistance in managing the mandatory FRI initiative, the (potentially significant) cost would have to be met by member clubs.

6. Why were the first fixtures that Ilkeston FC permitted to play against sides represented on the league board? Pure co-incidence.

Follow us: @evostikleague on Twitter | Facebook www.facebook.com/evostikleague | The NPL Facebook Group www.facebook.com/groups/TheNPL/