IPS Reform

[EIM]

NHH should be able to help with this.

In Doc Adam Brown's essay on FC United (from the Soccer and Society Journal) he mentions that being an IPS is the only form of football club governance outlawed by the league.

In a Supporters' Direct magazine, it suggests that this law was up for review some time in 1997.

What's the craic with this? Why was it outlawed? And did they ever change it?

[EIM]

IPS Reform

Fuck me.

How the fuck did I put this in World?

[NHH]

IPS Reform

If you put it in Football, I'll answer it there. Or maybe through PM as I doubt there are any humans interested really.

[EIM]

IPS Reform

Can some clever admin send this over to football?

OR maybe you can just pm me the answer, if that's easier.

[DCI Harry Batt]

IPS Reform

I'm interested.

[EIM]

IPS Reform

And as this question originated on the FCUM forum, I'm sure at least two other so called humans are too.

[Purves Grundy]

IPS Reform

I'm interested, but admittedly I'm only borderline human. More like one of The Tomorrow People, really.

[Anton Gramscescu]

IPS Reform

I suspect I would be interested, but would need to know what IPS stands for.

[Crusoe]

IPS Reform

Assuming you mean Industrial & Providential Society, lots of supporters trusts seem to be these, but I'm buggered if I can find any rules against them owning clubs (based on a very basic web search, so I may be totally wrong).

[Anton Gramscescu]

IPS Reform

Not out on a Friday night, Crusoe? Too much work, or busy planning the Big Day?

[Crusoe]

IPS Reform

Skint & bored, truth be told. Trying to think of reasons to avoid work this weekend...

[My Name Is Ian]

IPS Reform

*Raises hand meekly*

I'm interested in this.

[My Name Is Ian]

IPS Reform

Actually, that's just bollocks, isn't it?

All supporters trusts are Industrial & Provident Societies, aren't they (ie, mutually owned, not for profit etc - I always think of working mens clubs as being the parallel)? I mean, in that they're governed by the 1965 Industrial & Provident Societies Act. The act is definitely supposed to be up for review, I think.

[EIM]

IPS Reform

It's an interesting essay too, if any one wants a read.

[My Name Is Ian]

IPS Reform

Yeah, I'd like to read it. The only specific rule relating to club ownership that I'm constantly reminded of is the famous rule 34 (still, I think, on the FA statutes), which prevents club directors from making a profit from their clubs (this, of course, is the reason why all clubs that float on the stock market - and plenty of others beside - form holding companies of which the clubs are wholly owned subsidiaries).

[EIM]

IPS Reform

PM me your email addy, and I'll send it over.

[NHH]

IPS Reform

Well, Dr B is 95% right. The FA don't make any stipulation about corporate form (though they should, but that's another matter...)

The Football League, however, require that a club be a body registered under the Companies Acts. That means a Company Limited by Shares (public or private), a Company Limited by Guarantee or (since 2005) a Community Interest Company.

What is ruled out is anything other than this - which means an Industrial and Provident Society, an unincorporated association or a Charitable Corporation. Since the last of these is only posible since 2007, and the middle one technically doesn't exist, we'll admit Adam's point.

My instinct is that the League didn't actually prohibit the IPS (or co-op, for the layperson) but that it was just not thought of when they wrote the rules. The people who wrote them thought (and still think) in terms of companies, and are pretty unclued up about other corporate vehicles.

When we raised the issue with the League, we were advised that the reason they didn't support an amendment to the rules of the League was that IPS are not allowed to enter administration, and this is something they wanted to preserve the possibility of. This is from a body which deducts up to 25 points for entering administration. It wants to stop it. But wants to also admit it needs to remain a possibility. Can you see why they've never grasped the nettle of regulation yet?

The Treasury have a power to allow IPSs to enter administration, which was looked at, but not as yet used. There are sound reasons why this is the case which are far too technical to detain us here, but suffice to say, it's not actually that easy to do.

The legislation governing IPS was passed in the 1890s, and then codified in 1965, 1967 and 1974. The dates are significant; whilst governments of all hues have reformed company law, only Labour government give a shit about IPSs. The current lot eventually got around to reviewing it in 2006, but the minister responsible (Ed Balls) moved on when Brown became PM. The review reported a massive desire to change the acts to benefit Co-ops, but the current minister is on maternity leave. There will be welcome changes to Credit Unions (part of the same review) which is long, long overdue, but no news as yet about changes to the IPS.

In some senses, the Football League is symbolic anyway. Trust-owned clubs are just the holders of the majority of shares in the club limited as a company, and the Companies Act 2006 makes the burden of running a company as a subsidiary much easier, so the hassle of running it this way is much less.

[EIM]

IPS Reform

Cheers v much.

Mind if I stick that on the FCUM forum?

[NHH]

IPS Reform

Be my guest

[My Name Is Ian]

IPS Reform

PM sent, EIM.

And thanks for the explanation, NHH. I'm taking notes.