-15 points on exiting administration??

[paintingstandsatderby]

https://www.derbytelegraph.co.uk/sport/football/football-news/Derby-county-masterstroke-carlisle-capital-6538527

Worrying line in this article about a possible 15 point penalty on exiting administration. First I've heard of it. Anyone know more about this?

[RadioactiveWaste]

Just now, paintingstandsatderby said:

https://www.derbytelegraph.co.uk/sport/football/football-news/Derby-county-masterstroke-carlisle-capital-6538527

Worrying line in this article about a possible 15 point penalty on exiting administration. First I've heard of it. Anyone know more about this?

If we don't pay enough creditors enough, yup, we get a bunch more deductions.

But it looks like no one wantas to pay enough for us to avoid it.

 

[alexxxxx]

Yeah this has always been the case if the outcome to the creditors is less than efl rules. 

Tbh I'm not really sure what it achieves apart from punishing supporters, making relegation likely again, distorting the competition and making a club less attractive to new owners...

The old owners will have ran off, the admins will have done what they can, so I'm not really sure what it achieves but I'm sure it makes some fans and chairmen of other clubs happy. 

Edited January 24, 2022 by alexxxxx

[Ram1988]

Surley the Binnie family or whoever takes us over will pay off enough of the debts not to allow this to happen? 

[ram59]

Knowing the EFL, they'll apply it this season if we get enough points to get over the 21 point penalty or next season if we end up being relegated because of the 21 point penalty. They'll want to make sure we suffer because of the extra 15 points.

[Ghost of Clough]

25 minutes ago, paintingstandsatderby said:

https://www.derbytelegraph.co.uk/sport/football/football-news/Derby-county-masterstroke-carlisle-capital-6538527

Worrying line in this article about a possible 15 point penalty on exiting administration. First I've heard of it. Anyone know more about this?

It's just giving Kieran Maguire's opinion that £28m isn't enough to cover the minimum amount to avoid the 15 points. My opinion is that it is enough.

His opinion is based on £20m MUST be repaid to MSD and £8m MUST be paid to Arsenal/Lech upon exiting administration, leaving nothing else for anyone else. My belief is those transfer payments will only have to be paid when they fall due, and the £20m can be dealt with at a later date upon agreeing with MSD.

[duncanjwitham]

7 minutes ago, Ghost of Clough said:

It's just giving Kieran Maguire's opinion that £28m isn't enough to cover the minimum amount to avoid the 15 points. My opinion is that it is enough.

His opinion is based on £20m MUST be repaid to MSD and £8m MUST be paid to Arsenal/Lech upon exiting administration, leaving nothing else for anyone else. My belief is those transfer payments will only have to be paid when they fall due, and the £20m can be dealt with at a later date upon agreeing with MSD.

From what I've seen, he also seems to be arguing that preferred creditors (including HMRC) need to be paid 100% to avoid the 15 point penalty, but I can't find any rules anywhere to back that up.

[TigerTedd]

29 minutes ago, ram59 said:

Knowing the EFL, they'll apply it this season if we get enough points to get over the 21 point penalty or next season if we end up being relegated because of the 21 point penalty. They'll want to make sure we suffer because of the extra 15 points.

That would be cruel wouldn’t it. Beat Cardiff on the last day, get ourselves out of it, then get slapped with a 15pt penalty 5 mins after the final whistle. I can totally see the efl doing that. 

[Ghost of Clough]

3 minutes ago, duncanjwitham said:

From what I've seen, he also seems to be arguing that preferred creditors (including HMRC) need to be paid 100% to avoid the 15 point penalty, but I can't find any rules anywhere to back that up.

HMRC could insist on 100%, but it's up to them if they will accept less. As we know, 100% will result in liquidation, but the discussions between MPs kind of suggests they'll strike a large chunk of that off

[RadioactiveWaste]

16 minutes ago, Ghost of Clough said:

It's just giving Kieran Maguire's opinion that £28m isn't enough to cover the minimum amount to avoid the 15 points. My opinion is that it is enough.

His opinion is based on £20m MUST be repaid to MSD and £8m MUST be paid to Arsenal/Lech upon exiting administration, leaving nothing else for anyone else. My belief is those transfer payments will only have to be paid when they fall due, and the £20m can be dealt with at a later date upon agreeing with MSD.

I think you're right based on the mention of meeting full asking price. The full asking is surely avoiding the extra deduction.

[duncanjwitham]

1 minute ago, Ghost of Clough said:

HMRC could insist on 100%, but it's up to them if they will accept less. As we know, 100% will result in liquidation, but the discussions between MPs kind of suggests they'll strike a large chunk of that off

He seems to be saying that we get -15 if we don't pay HMRC 100%, not that we *have* to pay 100%. We can negotiate lower but that will automatically trigger the deduction.

[Gritstone Ram]

8 minutes ago, duncanjwitham said:

From what I've seen, he also seems to be arguing that preferred creditors (including HMRC) need to be paid 100% to avoid the 15 point penalty, but I can't find any rules anywhere to back that up.

More than likely you won’t find any rules because the EFL haven’t made them up yet based upon they aren’t sure how to ensure we get the points deduction yet.

[gfs1ram]

Any 15 point deduction will be at the start of the following season. I believe Leeds got that punishment way back but still made the play offs of Div 1.

[Sparkle]

If we continue to sell the younger players then the bidders will be offering much less it’s that simple as there is nothing to work with and a minus 15 point deduction will be guaranteed as new bidders will be offering no CVA and the creditors get nothing. The inaction of the EFL and the actions of the two parasite clubs are strangling Derby county

[Indy]

25 minutes ago, duncanjwitham said:

He seems to be saying that we get -15 if we don't pay HMRC 100%, not that we *have* to pay 100%. We can negotiate lower but that will automatically trigger the deduction.

That’s me! ?

[Fullspizz]

I suppose if there was a deal made with HMRC to pay say 25% up front and then the remainder over a set period it would prevent the -15 point deduction?

I don't think I have read anywhere about everything having to be paid in  a lump sum.

 

Just a thought

[PistoldPete]

51 minutes ago, duncanjwitham said:

From what I've seen, he also seems to be arguing that preferred creditors (including HMRC) need to be paid 100% to avoid the 15 point penalty, but I can't find any rules anywhere to back that up.

He’s been saying that for a while and as far as I know he’s the only one who thinks that. 
 

in fact he’d been saying we have to pay 100% to Hmrc without any other qualification.

Edited January 24, 2022 by PistoldPete

[Ghost of Clough]

Completely hypothetical here, but if Arsenal now said they're writing off all money owed for Bielik, I'm fairly certain that we wouldn't get a 15 point deduction for not paying it. The same will apply to the HMRC debt.
In 2020, HMRC got promoted from the unsecured league to the preferential league. All this means is they're higher in the pecking order. As far as I recall, the EFL regs only say Football creditors are to get 100% rather than preferential creditors.

My understanding is the following debts in priority order are:

1. Fixed charge holders
MSD - £20m (was floating charge, but became fixed upon administration)
MSD loan - £5m (taken out to get us through to Jan)

2. Admin fees
Quantuma - £5m (estimated)

3. Preferential
Transfer fees - £8.4m
HMRC - £26m

4. Unsecured
Trade - £4.3m
Accruals - £3.9m
Other - c£1m

I make that:
£20m deferred
£5m at 100% = £5m
£5m at 100% = £5m
£8.4m when it falls due
£26m at 25% = £6.5m (if agreed with HMRC)
£9.2m at 25% = £2.3m

That's £27.2m guaranteed (not far off the reported £28m!), with the £20m for the stadium to be resolved at a later date.
 

What I also believe is that HMRC are entitled to their 100% prior to unsecured creditors getting more than 25%.

[atherstoneram]

1 hour ago, Ghost of Clough said:

HMRC could insist on 100%, but it's up to them if they will accept less. As we know, 100% will result in liquidation, but the discussions between MPs kind of suggests they'll strike a large chunk of that off

MP's can suggest what they like, it makes them look as if they care.It is up to HMRC and the Exchequer to make the final decision. Some MP's would go to the opening of an envelope if it made them look good.

[plymouthram]

5 hours ago, Ghost of Clough said:

HMRC could insist on 100%, but it's up to them if they will accept less. As we know, 100% will result in liquidation, but the discussions between MPs kind of suggests they'll strike a large chunk of that off

I read somewhere (and I can't remember where) that the tax must be all paid off. It can be paid in instalments probably with 25% paid up front straight away. Could be wrong not sure.