Portsmouth could be first PL club declared bankrupt
Portsmouth could become the first Premier League club to be
declared bankrupt after being given a deadline to clear its debts
by the British government.
HM Revenue and Customs filed a winding-up petition against
Portsmouth at London’s High Court on Dec. 23, and the club must
show it can pay the tax it owes at a full hearing scheduled for
If HMRC hasn’t recovered its money from Portsmouth by then,
the club could be declared bankrupt and a receiver appointed.
However, Portsmouth is disputing the amount owed in taxation
debt and expects “HMRC to withdraw their demands forthwith.”
The Premier League’s bottom club said in a statement
Wednesday that it has not been “formally” served with a winding-up
petition and is “shocked and surprised” that this action has been
Portsmouth, which spent heavily on players before winning the
2008 FA Cup, has had three owners since August and failed to pay
its players on time twice this season.
“Extreme efforts have been made to reach payment arrangements
with HMRC to allow the owner time to deal with inherited debt,” the
south-coast club said.
Pompey said their owner, Saudi Arabian property magnate Ali
Al-Faraj, has given 9.7 million pounds ($15.4 million) to HMRC.
“In such a tough economic environment, the club finds it hard
to understand this action by HMRC,” the club said. “It is well
known that the business has been in a difficult position following
former owners’ decisions and the current owner is committed to
resolving this and moving forward.”
Portsmouth has been subject to a transfer ban since October
from the Premier League, which was founded in 1992. The indefinite
sanction, which stops the club buying players in January’s transfer
window and beyond, was imposed to prevent the club’s liabilities
and wage bill increasing.
“We continue to monitor Portsmouth’s situation closely and
remain in frequent dialogue with the club,” the Premier League said
in a statement. “Clearly, we hope they settle any issues they have
with the HMRC before the court hearing in February.”
Portsmouth was on the brink of administration before the
season started in August with Sacha Gaydamak trying to sell the
club. Premier League officials are understood to have been working
with the club since the offseason to stop it going into
The desperate financial situation looked to have been eased
in late August when Sulaiman Al-Fahim completed his protracted
takeover, but the Dubai businessman’s ownership lasted less than
six weeks as he failed to refinance the club and pay the players’
wages on time.
Al-Faraj’s subsequent takeover was portrayed as rescuing the
club, but he has struggled since October to find investors to pay
off the debts owed to other clubs and HMRC.