STAR MEETING WITH FSA AND EFL – 1st NOVEMBER 2023
Representatives of STAR, the Football Supporters’ Association (FSA) and the EFL met on Wednesday afternoon to discuss the current and challenging situation affecting the Club alongside seeking an understanding on what would be required to secure a change of ownership. The attendees at the meeting were: Trevor Birch (CEO of EFL), Nick Craig (COO of EFL), John Potterill-Tilney (Director of CFRU), Mark Rowan (Chief Communications Officer of EFL), Sarah Turner (STAR Chair), Matthew Batten (STAR representative), Ashley Brown (FSA representative).
The meeting gave STAR the opportunity to ask a number of questions of the League and a summary of the discussions is as follows:
The EFL began by providing clarification that the current proceedings that remain ongoing are only against Mr Dai. Sanctions are ultimately for the independent disciplinary commission to determine. The League confirmed that it expected a hearing to take place before the end of the month.
The League explained the rationale behind the existing EFL regulations and how they are designed to balance the interests of the clubs and the integrity of the competition. It accepts that in certain circumstances the sanctions issued directly affect players, staff, and fans of Clubs but it has an obligation to the overall membership to uphold the rules that have been voted on. The League acknowledges the frustrations of the Reading fanbase but insists this approach acts as a deterrent in the majority of cases. It was then confirmed that HMRC remains unpaid for August and September and Reading FC are subject to fee restrictions for the next three transfer windows and that the Regulations adopted by Clubs this Summer meant that would now also be referred to a Disciplinary Commission.
All these issues were later confirmed in a public statement issued by the League which could in turn lead to more sanctions imposed on the Club. STAR did receive an advance copy.
The discussion turned to ownership matters and the EFL confirmed the process required to see a change of ownership at the Club. They stated that, based on information available to date they have no power to force Mr Dai to sell the club and that it depends on his willingness to accept a credible bid. EFL notified STAR that they have awareness of potential buyers and will advise on the requirements and processes that need to be followed. However, in order to move the situation forward, it requires the owner to conclude a deal with a purchaser. The League does remain in close contact with officials at the Club on a regular basis but warned these can be incredibly complex transactions and may take some time.
In addition, they have strengthened arrangements on new owners coming into the League by asking them to demonstrate the funding prior to being approved. The EFL said that this policy may be firmer under an independent regulator. The EFL also explained the changes in the owners’ and directors’ test (ODT) that were made after the Bury FC case, such as including external insolvencies as a disqualifying condition. EFL also clarified that the disqualifying condition connected to expulsion of Clubs from leagues currently only applies to domestic Clubs.
STAR raised the issue of a potential insolvency as a result of non-payment of debts and the League confirmed that further protections for clubs entering administration are now in place. Any potential Administrator must now engage in advance with the League to demonstrate how they would finance the Club moving forward. This has previously proved to be the biggest issue in such circumstances. The League accepts Administration is painful due to the 12-point deduction imposed and explained that is to try and discourage Clubs from getting into that position in the first place. It also confirmed that its role in this area is to work with the Club and any appointed Administrator to secure new ownership and meet its ongoing obligations.
Finally, STAR raised the independent regulator and STAR’s call for Reading to be the test case for the new regulator in shadow form. The EFL acknowledged and would raise no objections to this being considered.
The meeting closed with a commitment from both the EFL and STAR to continue engaging as matters develop.