Possibility of only 2 going down this season?

[hobbit]

I was just wondering about this scenario involving Portsmouth.

What would happen if Portsmouth went bankrupt and completely out of business?
That means only 2 teams dropping down from Premier League to Championship.
They would not change the rules about 3 going up, or 3 coming up from Division One, so that would leave a situation with only 2 teams being relegated from the championship.

It would not surprise me to see Portsmouth take the 10 point deduction and go for administration to ensure temporary survival so I think the chances are quite small with bankruptcy/insolvency but it would be an interesting situation.

[Harpers So Solid Crew]

They won't go out of business tho, they will probably end up in administration, and by the looks of it any deuction this season won't make a difference, so should start next season on a minus again at Championship level.

[West Stand Man]

I am sure that one of the accountants will respond, but my reading of this is that the administration route may well be closed to them if the court hearing today goes against them. The taxman may not be prepared to allow them to stay in business and so intends wind them up. If they were ready to go into administration I suspect they should already have done so and they seem to have missed that chance (or will have done if it all goes wrong today).

[Dirk Gently]

It would not surprise me to see Portsmouth take the 10 point deduction and go for administration to ensure temporary survival so I think the chances are quite small with bankruptcy/insolvency but it would be an interesting situation.

It's not necessarily their decision on what they take - they're not picking options from a menu. Oh, and it's a 9 point deduction in the Premier League.

[Harpers So Solid Crew]

I read it as you about not going into administartion if they get a winding up order, however it is believed that they have money to make a payment to HMRC and a plan to pay in installments, HMRC will almost certainly accept it, as it will mean a better return on the debt that them being wound up, whan HMRC(I Believe ) are in the same line as the rest of the creditors.

[Dirk Gently]

I read it as you about not going into administartion if they get a winding up order, however it is believed that they have money to make a payment to HMRC and a plan to pay in installments, HMRC will almost certainly accept it, as it will mean a better return on the debt that them being wound up, whan HMRC(I Believe ) are in the same line as the rest of the creditors.

Yep - HMRC no longer have "preferred creditor" status after the Enterprise Act - they are in line with all the other creditors - after the "Football" creditors.

[bobby m's syrup]

Cardiff City are in court to face a winding up order today.
http://news.bbc.co.uk/sport1/hi/footbal ... 506666.stm
Should it be granted, I imagine that all results achieved against them would be void.

Any experts who can expand further?

[Row Z Royal]

28 page thread on General Football that goes through the above.

[Harpers So Solid Crew]

The revenue will take the deal offered in both case, it means they get in ahead of others owed money.

Looks like Cardiff are kinda doing what Leicester, build new stadium, then write of the debt on it.