The EFL say they are to conduct a “comprehensive review” of the regulations and procedures concerning the financial stability of clubs across their three divisions. The move comes after the EFL expelled League One side Bury after it became apparent that they would not have the financial means to see out the season under their current ownership.
EFL to Conduct Financial Stability Review
What Happens?
In a statement on the EFL website, they say that the review will be conducted independently and led by Jonathan Taylor QC, who is an expert on commercial and regulatory issues within sport. Taylor is currently leading a separate investigation into the company’s governance system and procedures.
The Procedure
The statement continues to say that the review will be conducted in two phases.
Phase one will look to examine the background of Bury’s insolvency (chairman Steve Dale having submitted a Company Voluntary Agreement, which is considered to be insolvency). This will include looking into the ownership of the club, decisions made by management and the funding arrangements of the club. In addition, phase one will go on to the role of the EFL’s regulations, including the application of the Owners’ and Director’s Test, procedures in respect of financial viability, the approach to clubs that enter insolvency and how the EFL will help to secure a long-term future for Bury.
The second phase will then look at the effectiveness of the EFL’s regulations and procedures in terms of ensuring the financial sustainability of clubs. Taylor will make recommendations on any changes that the EFL can make to their Articles of Associations, and those approved at the EFL’s 2020 AGM would then come into immediate effect.
EFL Chair Comments
At the end of the statement, EFL executive chair Debbie Jevans said: “The withdrawal of Bury FC’s membership is one of the most difficult decisions we have ever had to take at the EFL. This review will help everyone to understand what happened at Bury and ensure that, collectively, we learn and apply the right lessons for the future.
“The financial sustainability of EFL Clubs is of vital importance to supporters and communities across the country as well as to the growth and development of the League itself. The EFL recognises its responsibility to examine whether we can improve our regulations and procedures in this area. In close collaboration with our membership, we want to play our part in helping to ensure a successful and prosperous future for the EFL so our Clubs can contribute to their communities for many years to come.”
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