Bladesman2019
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- Apr 25, 2019
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Something I’ve never really understood about the Chansiri era is the whole sponsorship situation.
In 2019, it was reported that three Wednesday sponsorships linked to Chansiri — Chansiri, Elev8 and D Taxis — were not commercially active businesses at the time. D Taxis wasn’t even operating as a functioning taxi company, while Chansiri Ltd was reported as dormant. Yet these arrangements contributed around £1.27m a year to Wednesday. The EFL knew about the arrangements and, at the time, was reportedly satisfied that the values weren’t excessive under its financial rules. (The Guardian)
That raises an obvious question: what exactly was the difference between this and the sort of related-party sponsorship issue the Premier League is concerned about with Manchester City?
The Premier League’s rules specifically deal with related-party transactions and whether sponsorship deals reflect fair market value, because inflated deals can effectively provide a club with additional income from its owner’s wider interests. The Premier League has said its APT rules exist to prevent clubs benefiting from commercial deals that aren’t at fair market value. (Premier League)
I’m not saying the two cases are automatically the same — the rules, leagues, dates and evidence are different. And Wednesday’s sponsorships were actually assessed by the EFL at the time.
But given what we’ve subsequently seen, I think it’s fair to ask: if an owner creates or controls companies that aren’t genuinely operating commercially and then uses them to sponsor his football club, should the regulator be investigating whether those payments genuinely represented market-value commercial income?
And if the answer was effectively “yes, but the amounts weren’t excessive”, then it would be interesting to know why that was considered sufficient at the time.
Especially because Wednesday were simultaneously using other financial mechanisms to stay within the rules. The independent disciplinary commission later found that the club had breached the financial regulations over the timing of the Hillsborough sale, resulting in the eventual six-point deduction. (EFL)
So I don’t think the question is simply “should Chansiri be charged with exactly the same thing as Man City?” The more interesting question is:
Were the EFL’s rules and investigation of related-party sponsorships strong enough at the time, and would those same arrangements receive the same treatment under today’s financial regulations?
In 2019, it was reported that three Wednesday sponsorships linked to Chansiri — Chansiri, Elev8 and D Taxis — were not commercially active businesses at the time. D Taxis wasn’t even operating as a functioning taxi company, while Chansiri Ltd was reported as dormant. Yet these arrangements contributed around £1.27m a year to Wednesday. The EFL knew about the arrangements and, at the time, was reportedly satisfied that the values weren’t excessive under its financial rules. (The Guardian)
That raises an obvious question: what exactly was the difference between this and the sort of related-party sponsorship issue the Premier League is concerned about with Manchester City?
The Premier League’s rules specifically deal with related-party transactions and whether sponsorship deals reflect fair market value, because inflated deals can effectively provide a club with additional income from its owner’s wider interests. The Premier League has said its APT rules exist to prevent clubs benefiting from commercial deals that aren’t at fair market value. (Premier League)
I’m not saying the two cases are automatically the same — the rules, leagues, dates and evidence are different. And Wednesday’s sponsorships were actually assessed by the EFL at the time.
But given what we’ve subsequently seen, I think it’s fair to ask: if an owner creates or controls companies that aren’t genuinely operating commercially and then uses them to sponsor his football club, should the regulator be investigating whether those payments genuinely represented market-value commercial income?
And if the answer was effectively “yes, but the amounts weren’t excessive”, then it would be interesting to know why that was considered sufficient at the time.
Especially because Wednesday were simultaneously using other financial mechanisms to stay within the rules. The independent disciplinary commission later found that the club had breached the financial regulations over the timing of the Hillsborough sale, resulting in the eventual six-point deduction. (EFL)
So I don’t think the question is simply “should Chansiri be charged with exactly the same thing as Man City?” The more interesting question is:
Were the EFL’s rules and investigation of related-party sponsorships strong enough at the time, and would those same arrangements receive the same treatment under today’s financial regulations?
