EFL’s Insolvency Policy guidance

We are publishing extracts from the EFL’s Insolvency Policy guidance, a document that is not publicly available but which governs how the EFL considers sanctions and restrictions on clubs going through administration and other insolvency events.

The document makes several important points.

Firstly, it confirms that the policy is guidance only. It explicitly states that it “does not and cannot cover every eventuality.”

Secondly, it confirms that the EFL retains absolute discretion when determining how to deal with clubs experiencing an insolvency event.

The guidance goes further, stating that the policy and guidance notes do not bind the EFL, and that each case must be considered on its individual merits.

It also states that the conditions imposed can be adapted depending on the circumstances presented to the EFL.

In other words, the EFL has both the power and the responsibility, to exercise judgement.

This evening, EFL Chief Operating Officer Nick Craig publicly raised the possibility that Sheffield Wednesday’s membership of the league could be at risk.

Such statements will understandably cause enormous concern among supporters who have already endured one of the most damaging ownership periods in modern EFL history.

For years Sheffield Wednesday has suffered under the stewardship of an owner who the EFL itself deemed fit and proper. The club has declined dramatically during that period while supporters, staff and the wider community have paid the price.

Now the club sits in administration, with the prospect of new ownership and a chance to stabilise and rebuild.

To potentially force Sheffield Wednesday into a second successive relegation as a result of additional punitive measures would not punish those responsible for the club’s decline.

It would punish supporters, employees, players and any new ownership group attempting to rescue one of English football’s historic institutions.

This is precisely why the EFL’s own guidance makes clear that each case must be considered on its merits and that discretion exists within the framework.

The policy also sets out specific factors the EFL says it will consider when exercising this discretion. These include:

•⁠ ⁠the statutory duty to act in the best interests of the EFL as a whole
•⁠ ⁠the public perception and credibility of the EFL
•⁠ ⁠the creditworthiness of the club
•⁠ ⁠the effect on supporters
•⁠ ⁠the effect on local communities served by the club

These considerations are particularly relevant in the case of Sheffield Wednesday.

Few supporter bases in English football have endured more over the past decade. The effect on supporters has already been severe, culminating in relegation this season following years of decline under an owner previously approved by the EFL.

The club also sits at the heart of its community in Sheffield, with thousands of supporters, families and local businesses connected to its future.

At the same time, the club is now in administration with the prospect of new ownership and a pathway toward financial stability.

In that context, further punitive sanctions risk undermining the very factors the EFL states it must consider - including the effect on supporters, the impact on the local community and the wider credibility of the league itself.

Sheffield Wednesday supporters are not seeking advantage over other clubs. We recognise the importance of fair regulation and equal treatment across the football pyramid.

However, fairness must also recognise context.

Sheffield Wednesday have already paid a heavy price this season, culminating in relegation. What supporters seek now is a more level playing field and the opportunity for the club to rebuild under new ownership, not further punishment for failures that occurred under an owner approved by the EFL itself.

It is entirely right that all EFL clubs should be treated fairly and consistently.

That principle must include Sheffield Wednesday, a founder club of the football league, that has already suffered enormously during a decade in which the EFL’s own regulatory oversight failed to prevent the damage that unfolded.

The discretion outlined within the EFL’s own policy exists for situations exactly like this.

Sheffield Wednesday supporters have suffered enough.

We urge the EFL to apply its own guidance responsibly and ensure that the focus now is on allowing the club to recover, stabilise and move forward under new ownership.