HMRC have taken the Football League to the High Court in an attempt to revoke the football industry debt rule. The Premier League are not challenged but are interested in proceedings.
Under these rules, which are implemented by the Football League and Premier League, clubs which become insolvent will pay off their debts to football related creditors in priority to other creditors – including HMRC.
HMRC are to argue that such a rule was invented by the Football League and therefore has no sound basis in law and that the rules as they stand have led to losses to the taxpayer.
The Football League will argue that the rule is in the best interests of the sport and that failure to pay transfers fees would jeopardise the integrity of the sport. In addition they claim that the rules prevent disruption to fixtures which could otherwise arise as a result of insolvency.
