E10 probably knows ...

[Jorge Porbillas]

... but is it true that members clubs a la Barcelona are banned under Football League rules?

On another message board I frequent, someone claims that Dagenham & Redbridge were a members club but had to become a company on promotion to the football league.

Is this true?

[Anton Gramscescu]

E10 probably knows ...

A club does have to be a limited company to be in the League. That would place some restrictions on your governance structure, but not many. If every member is a shareholder and it`s a maximum of one share per person, what's the difference?

I would assume all Spanish clubs are also limited companies, for liability and financial purposes if nothing else.

[ursus arctos]

E10 probably knows ...

Barca, Real Madrid, Athletic and at least one other club (Osasuna?) were granted grandfather exemptions to the similar Spanish regulation. In any case, there are limited liability provisions that apply to the four of them.

And as Gramsci notes, the mere requirement of form doesn't exclude a member owned club, as illustrated by the case of the Green Bay Packers.

[NHH]

E10 probably knows ...

Under Article 4 of the FL, a member must be incoporated under the Companies Acts. Dagenham were a members club run like many as a unincoporated association. Under League rules, they had to incorporate and chose to maintain their governance arranagements - ie the way they did things - by becoming a Company Limited by Guarantee, which is a corporate body used by not-for-profit associations and charities. It was the form used by Nottingham Forest until 1992 and Wycombe Wanderers until 2004.

The League don't allow Industrial and Provident Societies - or mutuals - because (laughably) mutuals can't use the full provisions of the insolvency acts.

This means that the League - so concerned to stamp out administration that they penalise clubs by 10 points - also at the same time don't want to allow a corporate form which would be legally unable to enter administration.

UA - In understood the four clubs (you are correct with the four you mention) which are still member associations were exempted from the 1992 reorganisation because the root casue of the govert pressure was indebtedness, particualrly to the state in the form of unpaid taxes (where have we seen that before?)

As the four clubs mentioned didn't have significant debts at the time, they could retain their structure. All the others had their state debts wiped out as long as they converted to the the new SAD form created for the purpose.

[Jorge Porbillas]

E10 probably knows ...

Cheers for that NHH