Posts Tagged ‘oldco’

Weekend At Bernie’s

Saturday, September 5th, 2015

In 1989, the American actors Andrew McCarthy and Jonathan Silverman starred in a low-budget comedy entitled Weekend At Bernie’s [1], which became a surprise commercial and cult success, earning back twice its production budget and spawning a moderately profitable sequel, Weekend At Bernie’s 2.

The plot of the movie centres around two young insurance salesmen who discover that their boss, Bernie Lomax, has died having embezzled millions from his own company. However, in the event of his death, crafty old Bernie had left strict instructions that the two nosey salesmen were to be taken out by hitmen – but the duo would be spared so long as Bernie remained alive. Consequently, the two salesmen spend the remainder of the movie attempting to avoid their own deaths by wheeling Bernie’s body around and pretending to everyone that he’s still alive.

It’s a reasonably funny movie, peppered with genuinely hilarious slapstick comedy moments as the two protagonists blunder from scene to scene with their dead boss in tow – dressed up to appear as though he’s alive and well. Admittedly, the whole charade soon becomes somewhat tedious.

Over the past few years, the Scottish public has witnessed a real-life Weekend At Bernie’s unfold, as fans of The Rangers Football Club have repeatedly attempted, often in vain, to convince everyone (including themselves) that their club is still alive and did not die in June 2012 when it went bust. These individuals will go to extraordinary lengths in their attempts to sell this “same club” myth to the rest of us – including, but not limited to issuing death threats and mounting distasteful social media hate campaigns against individuals and private organisations who have the temerity to detract from the narrative, that being: the current club they support is the same club it has always been. [3]

On 1 January 2015 in an interview with the BBC, the current Scottish Professional Football League chief executive Neil Doncaster added further fuel to the Ibrox funeral pyre, with the bizarre insistence that the current club is, in fact, the same one as existed prior to liquidation in 2012 – despite having absolutely no basis in fact or any corroborating evidence to support his assertion. [4]

Doncaster has his reasons for attempting to keep old Bernie alive (those reasons are largely financial in nature, but equally, they’re not a million miles away from trying to keep hitmen off his own back). However, Doncaster is as deluded as the people who have attempted to perpetuate the “same club” myth since June 2012.

Below, various arguments are presented in detail, explaining why each strategy ultimately fails to convince any sane person that the club currently playing football at Ibrox stadium is anything other than a dead corpse, and, just like Bernie Lomax, it’s being trundled around purely for comedic effect.

1: The Lord Nimmo-Smith Commission Argument

The former High Court judge Lord Nimmo-Smith retired in 2009, but in 2013 he produced a document for the Scottish Premier League (now known as The Scottish Professional Football League) as chair of a tribunal which was commissioned to determine whether The Rangers Football Club PLC (founded in 1872 and incorporated in 1899) had breached league rules in its remuneration to over 100 players and staff during the period 2000-2010. [5]

It’s a complex story known commonly as “The Big Tax Case” [6] and is documented at length elsewhere by others, but it concerns a serious charge that the club illegally paid hundreds of players and staff millions of pounds via tax-free offshore benefit trusts, and remains subject to court appeal proceedings. Ultimately, the whole debacle brought about the corporate end of the club when it entered administration on 14 February 2012 due to insurmountable (albeit slightly different) social tax debts, and was subsequently placed into liquidation.

Lord Nimmo-Smith was the man drafted in by the SPL and given the responsibility of attempting to pick the situation apart in an attempt to make sense of it all. It is important to note at this stage that Lord Nimmo-Smith was financially remunerated by the SPL to produce his report.

The two headlines which most Rangers fans cite from the Lord Nimmo-Smith report in support of the “same club” myth are (in no specific order): 1. That Rangers were not to be stripped of the league titles or any trophies won during the period of their financial misdemeanours [7], and, 2: That Lord Nimmo-Smith “ruled” that a football club is capable of being owned and operated, or capable of being bought and sold by a “parent” company or operator – and therefore, because the “club” was sold to new owners when its “parent” company was liquidated, its honours and history remained intact. [8]

Curiously, this so-called “ruling” of Lord Nimmo-Smith’s did not extend to maintaining the company’s financial history – including debts in the millions to hundreds of creditors, which remain unpaid to date.

The stripping of titles (or not) was never mentioned anywhere in Lord Nimmo-Smith’s report – because no such action was covered in the remit of the commission (the report did, however, mention that no sporting sanctions should be levied against Rangers because the financial misdemeanours were carried out by the “previous owners” and not by the “football club” itself).

The reason that “no title stripping” became the headline from the report was because Rangers were given sight of the document prior to its publication on 28 February 2013 and the PR machine carefully pre-spun the story by leaking key elements of its contents to the BBC ahead of the official announcement at noon that day – with a specific emphasis on “there will be no stripping of titles under the commission’s punishment recommendations“. Having not actually read the full report, but wishing to be first with the story, the BBC duly reported this as the fundamental outcome of the commission – and the rest of Scotland’s media followed suit. When Lord Nimmo-Smith finally released his report later that day – and it became apparent to all that title stripping was never on the agenda – it was too late for any media outlets to run with the real story.

In fact, the Lord Nimmo-Smith report – regarded by Rangers fans as the cornerstone of the “same club” myth – found the club guilty of wrongdoing in respect of the improper registration of players and deliberately withholding important information from the SFA regarding the same – but not of operating an illegal tax scheme – and recommended that the football authorities fine whoever was willing to admit to being in charge of the club/company the grand sum of £250,000.

The Commission deliberated in August 2012 before the Big Tax Case delivered its verdict (a decision which supported the line taken by Lord Nimmo-Smith that an illegal tax scheme had not been used by the club and that no sporting advantage had been gained in doing so). However, an earlier incarnation of the tax avoidance scheme was used by the club to pay three players between 2000-01 and 2002-03 and was instigated by the former Scottish FA president Campbell Ogilvie (who held a director’s role at Ibrox until 2005). It was known as a Discounted Options Scheme – commonly referred to as “The Wee Tax Case”. This scheme was determined to be illegal by the courts and Rangers were issued with a bill of £4m by HMRC. [9]

However, Lord Nimmo-Smith was unaware of these payments, as the details were withheld by Rangers from the SPL as being subject to legal proceedings in the same way the “Big Tax Case” details were. The SPFL Board and the SFA have been made aware of this in a series of letters, but have chosen to take no further action on the matter. Rangers have never been punished by the SFA or the SPL for being found guilty of running the Discounted Options Scheme, despite the obvious sporting implications.[10]

Notably, the £250,000 fine recommended by the Lord Nimmo-Smith commission is yet to be recovered by the SFA – because the current owners/operators of the club formerly known as “Rangers” maintain that it was a financial sanction levied on a completely different entity (the different entity being the previous owner and operator of the club, which was liquidated and therefore has no responsibility for its debts). This is despite the fine having been levied on the “club”, not its “owner” or “operator”. [11]

However, the SPFL (the body which emerged from the later merger of the SPL and the Scottish Football League) claims that the current Rangers owners entered into an agreement as a condition of the transference of Rangers’ SFA registration to the club’s “new owners” – which stipulated that the new company would be liable for the football debts of the old company – an agreement which the SPFL is having difficulty enforcing because it can’t quite make up its mind if the current club is the same club or merely an entirely new entity which agreed to assume responsibility for the old one’s debts.

Lord Nimmo-Smith’s report makes frequent mention of “oldco” in reference to The Rangers Football Club PLC (a company which was incorporated in 1899 and is currently undergoing liquidation proceedings), which is also conveniently ignored by the proponents of the “same club” myth. The logic applied here is known in psychology circles as cognitive dissonance – put simply: the human brain has a tendency to ignore the bad things about something unpleasant, while emphasising the good things about the bad thing – no matter how incompatible with logic and common sense doing so may seem.

It’s a dense document, peppered with legal jargon that often seems confusing and contradictory – and appears to reach the bewildering conclusion that because no-one knew Rangers were breaking the rules, then the club didn’t really do anything wrong – but they should be fined a piddling sum for their mendacity anyway.

In his definitions early in the report, Lord Nimmo-Smith wrote:

“Rangers Football Club was founded in 1872 as an association football club. It was incorporated in 1899 as The Rangers Football Club Limited. In 2000 the company’s name was changed to The Rangers Football Club PLC, and on 31 July 2012 to RFC 2012 PLC. We shall refer to this company as ‘Oldco’.” [12]

Eight days following the publication of Nimmo-Smith’s report, the commission was compelled to issue an additional document to further explain how it had reached its conclusions, which said:

“It will be recalled that in Article 2 ‘Club’ is defined in terms of ‘the undertaking of an association football club’, and in Rule I1 it is defined in terms of an association football club which is, for the time being, eligible to participate in the League, and includes the owner and operator of such Club. Taking these definitions together, the SPL and its members have provided, by contract that a Club is an undertaking which is capable of being owned and operated. While it no doubt depends on individual circumstances what exactly is comprised in the undertaking of any particular Club, it would at the least comprise its name, the contracts with its players, its manager and other staff, and its ground, even though these may change from time to time. In common speech a Club is treated as a recognisable entity which is capable of being owned and operated, and which continues in existence despite its transfer to another owner and operator. In legal terms, it appears to us to be no different from any other undertaking which is capable of being carried on, bought and sold. This is not to say that a Club has legal personality, separate from and additional to the legal personality of its owner and operator. We are satisfied that it does not.“ [13]

So, Lord Nimmo-Smith specifically differentiated between the two “Rangers” entities, then clarified that a football club is a separate entity from its owner and operator. However, in the same clarification, he also asserted that a club does not have a legal personality – and therein lies the crux of the problem: if a football club does not have a legal personality (in the way, say, a house or a car does) then it simply does not exist in any tangible or legal sense. If it does not exist, it cannot be passed from owner to owner.

This “legal personality” definition is not commensurate with the popular argument that the original Lord Nimmo-Smith report specifically “ruled” that Rangers is/was/forever-shall-be the same club as it was prior to liquidation in 2012; either the club exists as an entity that can be bought and sold, or it does not. It cannot be like Schrödinger’s Cat; appearing to be both simultaneously alive and dead. In truth, the club exists only in the way Bernie Lomax did; as an amusing plot device contrived to keep its benefactors alive.

Additionally, contracts with players did not transfer to the Newco as stated above in Lord Nimmo-Smith’s addendum, in line with the Transference of Undertakings of Protection of Employment law (TUPE) which entitles employees of liquidated companies to move to any new company that has assumed control of the former company’s assets under the exact same terms and conditions as were held with the previous company. In fact, 67 players raised a legal action over the handling of their contracts and ten separate players chose not to move to the new company – and the new “owners” at Ibrox failed to mount a successful challenge to recover £6m in compensation from the clubs which some of the players eventually moved to, as would be normal. In fact, the new owners were forced to pay the departing players’ legal costs for wasting everyone’s time. [14]

The legal challenge failed because the players were fully entitled under TUPE regulations to walk away from the new company, since their previous employer had gone bust and their contracts were voided as a result. Crucially, in line with employment law, it was ruled at the same tribunal that the departing players’ SFA registrations were held with their employer (i.e. The Rangers Football Club PLC) and not the mythical “club” component of the organisation.

This is by far the most stringent legal point which is conveniently ignored or dismissed by supporters of the “same club” myth – and it fundamentally wrecks any ridiculous notion that the club is somehow the same legal entity as it was before it was liquidated in 2012. If Rangers are the same club, it begs the question: why were ten contracted players legally allowed to move to new clubs without any form of compensation being paid to their former club?

The answer is simple: because the club they were contracted to no longer existed.

An interesting aside to this issue is that the new owners of Rangers were required, under the conditional transference of SFA membership agreement, to pay sums owed to other clubs for players that had been purchased while under the guise of its previous incarnation – yet not the debts owed to ordinary, non-football creditors – which may yet be subject to legal proceedings. [15]

However, the crucial point at which the Lord Nimmo-Smith argument falls down is a much simpler one: the remarks made in his commission report were not a legal ruling or a court judgement in any way, shape or form; they were his own personal interpretation of the SPL and SFA rules and Articles of Association – which he was paid to produce. In other words, it was a report produced by a commercial entity to protect its financial interests.

In July 2013, the SFA subsequently modified its Articles of Association to reinforce this issue. Previously, under the SFA’s rules, a club was defined as:

“a football club playing Association Football in accordance with the provisions set out in Article 6”

Whereas the new Articles of Association now define a club as:

“a football club playing Association Football in accordance with the provisions set out in Article 6 and, except where the context otherwise requires, includes the owner and operator of such club“.

So, according to the SFA’s own Articles of Association, when Rangers went bust 2012, there were no separate “club” and “company” entities defined – the club was the company. Now, it is both the club and the company – just in case anyone else tries to pull a Sevco by liquidating, wiping out their debts and setting up a new “holding” company to operate the mythical “club”.

However, there is one further area where the Lord Nimmo-Smith argument falls down miserably: Scots Law. As the BBC noted in their public response to the findings of their own Trust – in respect of a number of upheld complaints over the corporation’s reporters and presenters repeatedly referring to “oldco” and “newco” in relation to Rangers (for more on this see point 4 below):

“A football club, once incorporated, is indistinguishable in Scots law from its corporate identity. If the club was separate it would need its own constitution, committee members, trustees, etc. Rangers Football Club does not have that because it is incorporated.” [16]

To repeat: the idea that a football club and its “history” are legal, tangible assets that can change owners (in the same way a house or a car can) is fictional nonsense.

In the original incorporation documents of The Rangers Football Club Limited, submitted to Companies House in 1899, clearly stated in its Memorandum and Articles of Association, it is written:

“The words “Club” and “Company” and also the words “Member” and “Shareholder” throughout the said Memorandum and Articles of Association shall, where the context admits of it, be of synonymous meaning.”

So, all the way from the national archives, printed, stamped, signed, agreed, approved and incorporated comes the damning details: the club and the company are synonymous – ie. they are one and the same. There’s just no getting away from it.

Unfortunately, Lord Nimmo-Smith’s learned opinion, which is based on incomplete evidence withheld from him, has never been tested in court – which would be the most appropriate and definitive means of shutting down the debate for good – but it suited the SFA and the SPL’s agenda at the time; to attempt to restore Rangers and its income potential to the top-flight of Scottish football for the supposed benefit of all mankind, as quickly as possible. Instead, it risks slowly poisoning the very thing it was intended to protect.

2: The European Football Club Association Argument

The European Club Association (ECA) is an independent body which represents football clubs at European level. Its stated function is to protect and promote European club football with the aim of creating a democratic governance model that reflects the key role of clubs. Every country in Europe is represented by at least one club.

Members are awarded either Ordinary Membership – which is set aside for founding members and clubs who are participating in their country’s top league, in addition to regular European football, and Associate Membership – which is set aside for founding members who are no longer participating in their country’s top league, and, as a result, not participating regularly in European competition.

It has no regulatory powers in regard to any formal business in relation to football. Its real purpose is to protect the income of its member clubs. In truth, it is merely a group of rich people who wish to maintain their wealth by asserting a collective influence on the organisation with the actual power; UEFA.

In a rather feeble fashion, Rangers fans cite this group as another irrefutable reason for the world to believe their club is the same entity it was before liquidation. The basis for this argument is that Rangers are currently an Associate Member of the ECA – having previously been an Ordinary Member prior to liquidation, whereupon the club’s status was revoked. In December 2012, a vote was taken in Moscow at a meeting of the ECA’s executive committee to decide whether to grant Associate Membership to the “new” Rangers, a motion which passed. (Interestingly, the oldco had been a founding member of the ECA in the days following the disbandment of the G14 – another organisation designed to promote the wealth of a select few European top-flight elite clubs).

In 2012, following the Moscow meeting, the ECA released a statement:

“Rangers FC held ordinary membership with the ECA before entering into administration and later into liquidation. Meanwhile Rangers FC, owned by the Rangers Football Club Plc, transferred all its assets, including its goodwill, to Sevco Ltd (Sevco Ltd later changing its name to the Rangers Football Club Ltd). Alike at Scottish FA level, this ‘new entity’ had to re-apply for membership with ECA as according to Swiss law, membership of an association is neither heritable nor transferable (article 70.3 of the Swiss Civil Code). In dealing with these re-application, ECA applied the terms and provisions of our membership policy and statutes. According to the prerequisites set out in the membership policy, Rangers FC did not meet the requirements to be granted ordinary membership (top division and European licence). With regards to associated membership, the membership policy states amongst others that founding members are granted automatic membership,” the spokesperson explained. Taking into account that the ‘new entity’ also acquired the goodwill of the ‘old entity’, it was held by the ECA executive board that the goodwill, taking into account legal and practical arguments, also included the history of the ‘old company’. Consequently it was concluded that Rangers FC was entitled to associated membership of ECA as considered to be a founding member.” [17]

In other words, the ECA took a committee decision to let Rangers back in for old times’ sake.

As stated above, this organisation has absolutely no power to determine whether a football club exists as a legal, continuing entity – it’s a lobby group. Its machinations have absolutely no basis in law, and its decision to recognise Rangers as a continuing entity means nothing in practical terms. It’s what the Germans refer to as “a cat in a sack”.

3: The UEFA website argument

UEFA is the administrative governing body of all football in Europe. It represents all of the national football associations of Europe, runs nation and club competitions including the UEFA European Championship, UEFA Champions League, UEFA Europa League, and UEFA Super Cup, and controls the prize money, regulations, and media rights to those competitions. UEFA defers to all domestic associations (such as the SFA) in relation to domestic club matters and only gets involved if the matter under dispute is cross-border, involves one of their cross-border competitions, or if the local association in question has acted improperly in the application of its own rules.

Rangers fans cling to the notion that because Rangers are listed on UEFA’s website, with all of the previous club’s history and honours listed, then the club must be the same one as it was before liquidation in 2012. [18]

However, UEFA has never made any public statements about Rangers’ legal status as a football club, and refers all such matters to the SFA.

For a club to become eligible to participate in any of UEFA’s domestic football competitions, it is required to be a member of its national football association for three uninterrupted seasons. Since the current Rangers Football Club was only incepted in 2012 and was not granted SFA membership until 3 August 2012, it did not meet the requirements until August 2015, and is therefore not valid to participate in any UEFA competitions until at least season 2016/17 (since the licensing threshold date ended on 31 March 2015).

This is conveniently ignored by Rangers fans, as it can be easily explained by their “holding company” myth (ie. that a club is capable of being owned and operated, as per Lord Nimmo-Smith’s report) and the delay is merely an inconvenience of the prior holding company being liquidated.

The one entertaining component of the UEFA website argument is the fact that the governing body still lists Rangers’ date of foundation as 1873 on its website, when in fact the club was founded in 1872 – another little snippet the club’s fans are all too happy to ignore because it fails to support their argument.

All of the earliest records of Rangers’ foundation date maintain that the club was founded in 1872. However, in the 1920s, this date was changed to 1873. John Allen, the man who edited the Daily Record newspaper at the time – and who also edited the Rangers Annual Yearbook – failed to notice in 1922 that Rangers were 50 years old. So, instead of releasing the 50th anniversary annual one year later in 1923, he decided to change the club’s founding year from 1872 to 1873 – so that he could publish a book that would bring in some cash in its new Jubilee year. It took almost two decades before the deliberate mistake would be corrected following pressure from the club’s fans and historians.

It would appear that Rangers’ date of foundation is something of a movable feast, depending on the circumstances and context.

One other aspect of the UEFA website is the inclusion of a Uefa coefficient for Rangers, which has been maintained on the organisation’s website. Coefficients are calculated based on an equation involving the performances of a given club participating in European competition and the overall performances of other clubs from the same country participating in the same European competitions. [19]

Unfortunately, Uefa’s co-efficient system also lists other clubs which are no longer in existence – including Unirea of Romania and the club formerly known as Derry City from Northern Ireland. Derry City were liquidated in 2009 and the club was denied entry into following season’s Europa League competition. The “new” Derry City was able to participate in European competition in 2013, but the Uefa coefficient ranking was not inherited by the new company. Derry City now has a completely new Uefa coefficient. [20]

4: The Advertising Standards Authority argument

In 2013, the Advertising Standards Authority (ASA) upheld a ruling in favour of Rangers following an advertising dispute over whether the club should be allowed to use the slogan ‘”Scotland’s most successful club”. The 82 separate complaints argued that the club could not boast such a claim because it had only existed for one year and its honours were easily outstripped by other clubs.

An original ASA ruling (which was also in Rangers’ favour) was reviewed after a remark submitted on behalf of the club in its own defence was deemed to be false (ie. that the claim to “owning” the previous club’s history was supported by the London Stock Exchange – it was not).

The ASA stood by its original ruling not to uphold 82 complaints that Rangers were misleading consumers by using the “Scotland’s most successful club” advertising slogan. The new adjudication said the ASA was confident that consumers would understand that the claim was in reference to the history of Rangers Football Club, but did accept that that the club’s history was “separate to that of Newco”.

The ruling said:

“We consulted with UEFA, which explained that its rules allowed for the recognition of the ‘sporting continuity’ of a club’s match record, even if that club’s corporate structure had changed. We also consulted with the SFA, which confirmed that its definition of a football ‘club’ varied depending on context, and could sometimes refer to an entity separate from the club’s corporate owner.” [21]

UEFA and the SFA have since declined to clarify the remarks made to the ASA. The SFA, having overseen the demise of several clubs in its history (Third Lanark, Clydebank, Airdrieoneans) should know exactly what constitutes a “club”, and perhaps the definition of a football club entirely depends on which club is being referred to.

The Advertising Standards Authority is the self-regulatory organisation of the advertising industry in the United Kingdom. It is a non-statutory organisation and so cannot interpret, create or enforce legislation. As with Lord Nimmo-Smith and the ECA, the ASA has no authority to determine whether a football club is a continuing legal entity – only the law does. As an organisation, it exists entirely to uphold standards agreed by its members and those enforced by government legislation – but more importantly, it exists to promote revenue growth within the overall advertising industry.

Put simply: it exists to make rich people even more wealthy. (There’s a pattern emerging here).

If you find yourself relying on the ethics of the advertising industry to back up your argument, you’re in a bad place.

5: The BBC Trust Argument

In May 2013, the BBC Trust ruled that the BBC’s News and Sport website had inaccurately reported that Rangers Football Club had been liquidated in 2012 (the complaint being along the lines of: only the “holding company” was liquidated, not the actual club). One of the complainants asserted that the Corporation was operating under the influence of institutional bias – which was rejected by the Trust – but the complainant requested the Trust to review their claim. [22]

In its findings, the BBC Trust ruled that the complaint of institutional bias would not be considered for appeal and said that the terminology used by the BBC in its reporting (not just when reporting about Rangers, but in general) often depended on the purpose and context of the material and the intended audience.

However, the Trust also said that while there was no justifiable “news” reason to treat Rangers Football Club as a new entity simply because its had been liquidated and its assets had been flogged off to a new owner, there was justification in differentiating between the two different companies when referring to business matters.

Ultimately, the Trust ruled against its own Corporation, saying that it had not used “clear, precise language” when referring to the Ibrox outfit, and that due accuracy had not been achieved when making reference to the “old” and “new” Rangers. (It specifically referred to football matters and business matters in its judgement). The Trust also admitted that the complexity of the Rangers saga had probably caused the problem, but that bias was not an influencing factor.

Finally, the Trust also conceded that Rangers fans were a sensitive bunch, and perhaps it was not necessary to rub it in by constantly mentioning that their club had died. However, in a contradictory fashion, the Trust also said that referring to “old” and “new” aspects of the organisational setup at Ibrox was probably unavoidable at times, and, indeed, would often be necessary in the interests of clarity for people who were not of a Rangers persuasion.

The complaint was therefore upheld – but only in part. However, Rangers fans often cite this as a victory and claim that it demonstrates further proof that their club is the same one it has always been – and they perpetuate the myth that the BBC was found guilty of wrongly referring to to Rangers as “oldco” or “newco”. The logic follows that if the BBC got it wrong, everyone else must be wrong too.

However, the Trust only ruled that the BBC had not achieved due accuracy when referencing the two different corporate entities that have been involved in football and business operations at Ibrox. The BBC Trust did not rule that the BBC had been wrong to make use of the terms “oldco” and “newco” or that it was wrong to describe the club as “old” or “new” – merely that it had been inappropriate to do so in the specific news stories which were subject to the complaint and the appeal – and, the BBC should attempt to apply a more stringent description in future when discussing business and football matters relating to Rangers.

As mentioned earlier, BBC Scotland subsequently released a statement in its own defence of the Trust’s ruling (since the Trust’s decisions are final and the BBC cannot appeal against a Trust decision) asserting that a football club cannot be afforded the protections of a legal entity unless it is incorporated (which Rangers Football Club PLC was in 1899, until it was liquidated in 2012).

There’s not much more to add to this, other than to say that the BBC has tended to be circumspect in its references to Rangers (old or new) since the Trust ruling – although a case cropped up late in 2013 when BBC Scotland received complaints that their journalist Jim Spence had made a similar “old” and “new” reference to Rangers on air. The claim was that Spence said “the club is dead”, but what he actually said was:

“John McClelland who was the chairman of the old club, some people will tell you the club, well, the club that died, possibly coming back in terms of the new chairman.”

Subsequently, all Hell broke loose. The fans of the “same club” myth rose up against Spence and issued all manner of rabid complaints and death threats towards him.
The BBC Trust subsequently ruled that Spence had done nothing wrong, was a national treasure, and that Rangers fans were, well, a bit mental. [23]

Interestingly, this subsequent ruling is ignored by Rangers fans.

6: The SFA Registration Argument

In 2012, Rangers Football Club PLC went into liquidation and lost its share (and by way of share, its place) in the Scottish Premier League.

Sevco 5088 was incorporated by a consortium led by the businessman Charles Green on 29 March 2012 and was awarded the rights by the insolvency practitioners Duff & Phelps to purchase the assets of the failed Rangers Football Club PLC on 14 June 2012. Serco 5088 then passed those rights to Sevco Scotland Ltd (which was incorporated on 29 May 2012 – also by Mr Green), who subsequently bought the assets for a considerably reduced price than their perceived market value.

The transfer of rights is disputed by the previous owner of Rangers, Craig Whyte, who is currently the subject of fraud proceedings for his part in the club’s purchase and financial collapse.

Sevco Scotland then made a formal request for the old company’s share in the Scottish Premier League be transferred to them, and a vote was taken to decide the matter at an emergency meeting of the Scottish Premier League. However, Sevco Scotland’s request to transfer the share was rejected, and the share was taken up by Dundee Football Club, who moved up to the Scottish Premier League from the Scottish First Division. [24]

As a result, all clubs in Scottish football moved up one place to occupy the gap left by the liquidated Rangers Football Club PLC, and a space became available in the very bottom tier of the Scottish Football League for another club to gain membership.

Sevco Scotland then made a formal application to join the Scottish Football League, and a vote was taken by its member clubs to grant a space to the new club in the lowest tier of Scottish Football, the Third Division – which was dependent on the new club holding Scottish Football Association membership. Since it was a new club, it had no such credentials.

The new company then made a hasty application to the Scottish Football Association to transfer the full Scottish Football Association membership which had previously been held by The Rangers Football Club PLC to the new limited company, Sevco Scotland.

In order to allow the Scottish football season to commence, Sevco Scotland were offered a conditional membership of the SFA, which lasted from 27 July to 3 August.
A conditional transfer of the membership was formally granted by the SFA on 3 August (the conditions included Sevco Scotland accepting liability for the previous company’s football debts, fines and any contractual arrangements with players and staff under TUPE regulations) – and, after reaching agreement with the SFA and the SPL (now known as the SPFL) on the transference of membership, the new club then became a full member of the SFA. [25]

By this point, Sevco Scotland Ltd had applied to Companies House to change its name to The Rangers Football Club Limited on 31 July 2012 (which was the name of the club which had gone bust) and sought permission from the insolvency experts BDO to do so, which was granted. [26]

The new club was then brought under the ownership of an entirely separate company known as Rangers Football Club PLC, which was incorporated on 16 November 2012.
Rangers Football PLC then changed its name to The Rangers International Football Club Ltd on 27 November 2012.

The application to conditionally transfer the SFA membership of The Rangers Football Club PLC to Sevco Scotland was made entirely at the discretion of the SFA – despite a formal route of associate SFA membership being the normal process for a new club joining the Scottish Football League. No formal or public process was launched to seek applications from clubs around Scotland, who may have wished – or deserved – to obtain SFA membership at the time.

So, a completely new application for the conditional transference of membership by the new club had to be made – and at no point in the process did both companies (The Rangers Football Club PLC and Sevco Scotland) hold uninterrupted, continued membership of the SFA. The membership was transferred from one club to another.

Sevco Scotland, or The Rangers Football Club Limited, or The Rangers International Football Club LTD (ie. the “new” Rangers) were subsequently treated as an entirely new club – for example: their ensuing participation in the 2012/2013 Scottish Cup commenced in the early rounds, whereas Premier League clubs do not participate until later rounds as an advantage of top-flight league status – which Rangers lost when the SPL rejected their request to transfer the share held by the previous company to the new one. Similarly, the new club was not eligible to participate in any UEFA competitions due to not holding SFA membership for the mandatory three-year qualifying period (as stated above in ‘The UEFA Website Argument’).

All of this means that the club, at one point in the past held SFA membership and a share in the SPL – then, it went bust, and lost both before seeking firstly a conditional membership, then a conditional transference of the membership, in order to gain a place to play in Scottish football. If it had been the same club, none of these issues would have arisen.

The final word

Numerous other arguments exist in various forms across the web, social media, on forums, in pamphlets and documents issued and propounded by determined Rangers fans – some are amusing, many are desperate and tend to cling to tenuous interpretations of casual remarks or throwaway comments by people who hold no power or authority to determine the legal status of the club/company.

As mentioned previously, the “same club” myth has never been properly subjected to any form of legal challenge (largely because the opportunity has never presented itself – yet), but overwhelming evidence continues to refute the notion that the club is somehow a continuing legal entity – and there exists no more an authoritative voice than the conditions set down by a Crown Office legal official overseeing proceedings in open court.

On 19 July 2013 at a court hearing for Rangers Football Club PLC in Edinburgh, in his opening statement at the start of a First Tier Tax Tribunal appeal hearing (the appeal being made by HMRC against the verdict of the “Big Tax Case”, Colin Bishopp, Upper Tribunal Judge said:

”Before coming to the detail of the case it is worth making a preliminary observation. I have referred (above) to the strong feelings of many football supporters. Perhaps because of such feelings, professional football clubs are often regarded as having a special status. In some respects that may be the correct view; but it should nevertheless not be overlooked that a modern professional football club is not a “club”, in the sense of an unincorporated association of members who join together in pursuit of a common purpose, but a commercial enterprise whose function is to generate profits for its shareholders. From that perspective it has no special status, and there is no reason why its tax affairs should not be as open to scrutiny as those of any other profit-making organisation. The players, too, have no greater right to conceal their tax affairs from public scrutiny than any other taxpayer. The fact that they are in the public eye is irrelevant. Any application for privacy, anonymity or redaction of detail must therefore be supported by the same type and quality of evidence as would be required of another taxpayer, and will be granted only for the same reasons.” [28]

These remarks demonstrate – above all other evidence – that there is absolutely no legal basis for the Rangers Football Club to circumvent Scots Law by arbitrarily defining itself as separate legal entity from Rangers Football Club PLC (or The Rangers International Football Club PLC or The Rangers Football Club Ltd or Sevco 5088 or Sevco Scotland Ltd) solely to protect the mortally-wounded pride of its deluded supporters and lay claim to an ephemeral notion such as “history” and “honours”.

The “club” component of the organisation has absolutely no protected legal status – only the company does – and since the company was liquidated in 2012, it now exists only in the memories of its supporters and in media chronicles of past events.

Put simply: Rangers Football Club, as it was, is dead. Just like Bernie Lomax.


1. Weekend At Bernie’s:
2. BBC Sport, 12 June 2012, ‘Rangers to re-form as new company’:
3. Channel Four blogs, 12 October 2012, Alex Thomson’s view, ‘Threats and silence: the intimidation by Rangers fans’:
4. BBC Sport, 1 January 2015, ‘Neil Doncaster: Q&A with SPFL chief executive’:
5. BBC Sport, 17 August 2012, ‘Lord Nimmo Smith chairs SPL payments probe’:
6. BBC News, 20 November 2012, ‘Former Rangers Football Club wins Big Tax Case appeal’:
7. BBC Sport, 28 February 2013, ‘SPL Commission will not strip club of SPL titles’:
8. The Herald, 25 September 2012, ‘Green: ‘the Commission has, in effect, ruled that Rangers and its history did not die’’:
9. STV News, 7 June 2012, ‘Rangers administrators blame HMRC penalties for £4m tax bill increase’:
10. The Scottish Football Monitor, 6 October 2014, ‘Harper Macleod and LNS’:
11. BBC Sport, 17 December 2014, ‘SPFL to withhold Rangers’ broadcast fee to cover EBT fine’:
12. Lord Nimmo-Smith SPF Commission report at The Internet Archive:
14. Daily Record, 31 January 2013, ‘Rangers lose out in £6m compensation battle over newco contract fiasco’:
15. STV News, 21 February, 2013, ‘Rangers say all football debt has been cleared over player transfers’:
16. BBC News, 18 June 2013, ‘BBC Trust upholds complaints over reporting on Rangers’:
17. STV News, 14 December 2012, ‘European clubs body downgrades Rangers’ status but recognises history’
18. Uefa, Rangers FC:
19. Uefa coefficients:
20. BBC Sport, 21 February 2012, ‘Derry City are refused entry to Europa League by Uefa’:
21. The Drum, 11 December 2013, ‘ASA rules in favour of Rangers FC in advertising dispute following appeal’:
22. BBC Trust ‘Coverage of Rangers Football Club, BBC Online’:
23. The Drum, 3 October 2013, ‘BBC Editorial Complaints Unit clears BBC Scotland Sportsound presenter Jim Spence over Rangers row’:
24. BBC Sport, 3 August 2012, ‘Dundee’s SPL membership is ratified a day before opener’:
25. SFA website, 3 August 2012, ‘Transfer of membership’:
26. ESPN, 31 July 2012, ‘Rangers confirm name change’:
27. First Tier Tax Tribunal appeal hearing PDF: