Saracens are relegated!

[Tiglon]

Rank sensationalism by Tom Morgan and The Telegraph. This is no ‘loophole’, nothing has been ‘circumvented’. All permitted in the #salarycap regs, fully disclosed to, and approved by, the Salary Cap manager in advance.

I don't think that was in doubt. As I understand it, the review is not to find out if other clubs have been breaking the rules, but to assess whether the rules are fit for purpose.

[loretta]

A year or so in the wilderness, pay off a few big bucks contracts and re-sign some of those players on lesser contracts.
If player X is on say £500k with a 3 year contract but pay him off now after a year "salaried" and a £500k pay out. Then sign him on a 2 year contract for £250k. Over 3 years player gets the same so quite happy and official salary bill cut by the time they return to top level.
They can juggle the size of this year's pay out to fiddle it how they like.

This assumes they have the money to do so, or the shell company has!

Come the return to the premiership all that will be seen is the £250k contract.
Had they allowed scrutiny it might be clear that that all was really done was to front load the contract in all but name.

Not saying that's what will happen. It might be that they wish to protect some of the club officials who were unhappy with the breach but were forced into it.

As stated earlier in this thread, Sarries will have to be cap compliant for 2 years prior to being allowed promotion. Payoffs would be included. Granted, if there's no hope of compliance this year, they might as well chuck around the cash.

[trendylfj]

What worries me about the 2 years compliant reg is that it could be change by his lordship in his review of the reg or at least he could recommend that it is changed to compliant on promotion.

[Cardiff Tig]

Wouldn't surprise me if they drop the 2 year compliance in this case. It's effectively punishing them twice for the same offence.

[RichieB]

Hopefully Myners will think about the future implications and appropriateness of the salary cap, not just the extent to which Saracens cheated and closing loopholes.

There is something not quite right about players moving (for example) to France to earn better money than on offer in England.

No doubt the cost of this review will be in the £ Millions, I'm not saying it isn't required, just that I hope it is value for money.

[loretta]

Wouldn't surprise me if they drop the 2 year compliance in this case. It's effectively punishing them twice for the same offence.

Or just once, properly!

[Mark62]

Wouldn't surprise me if they drop the 2 year compliance in this case. It's effectively punishing them twice for the same offence.

Is it though.
Could there be an argument that once they are down in the championship they should have to abide by the same set of regulations as the other championship clubs.

[Tiglon]

Genuine question, but has it been confirmed anywhere that a promoted club has to have complied with the cap for two years prior to promotion?

The rules state that they have to submit their declaration for the year of promotion and the certification for the previous year, yes. But both these are just forms filled in by the club - the certification form has a section where the club indicate whether they were over or under the cap in that year. Therefore, from what I've read (and I admit I have not read every word of the full regulations), if Sarries are promoted next season, for this season they would only have to submit the certification - I can't find anywhere in the rules that says they need to have actually complied with the cap in that season.

Have I missed something?

[fentiger]

Genuine question, but has it been confirmed anywhere that a promoted club has to have complied with the cap for two years prior to promotion?

The rules state that they have to submit their declaration for the year of promotion and the certification for the previous year, yes. But both these are just forms filled in by the club - the certification form has a section where the club indicate whether they were over or under the cap in that year. Therefore, from what I've read (and I admit I have not read every word of the full regulations), if Sarries are promoted next season, for this season they would only have to submit the certification - I can't find anywhere in the rules that says they need to have actually complied with the cap in that season.

Have I missed something?

OK, well everyone knows they are not complying this season, it's in the public domain! So any form of self-certification to the contrary would be a pack of lies?

[loretta]

Genuine question, but has it been confirmed anywhere that a promoted club has to have complied with the cap for two years prior to promotion?

The rules state that they have to submit their declaration for the year of promotion and the certification for the previous year, yes. But both these are just forms filled in by the club - the certification form has a section where the club indicate whether they were over or under the cap in that year. Therefore, from what I've read (and I admit I have not read every word of the full regulations), if Sarries are promoted next season, for this season they would only have to submit the certification - I can't find anywhere in the rules that says they need to have actually complied with the cap in that season.

Have I missed something?

You could well be right. If they have certification that they complied with the cap this year, they would only have to spend one year in the championship. Problem being, given that they are being relegated for non-compliance this year, how likely is it that they can credibly provide such a document?

Or, what fentiger said.

[Tiglon]

Genuine question, but has it been confirmed anywhere that a promoted club has to have complied with the cap for two years prior to promotion?

The rules state that they have to submit their declaration for the year of promotion and the certification for the previous year, yes. But both these are just forms filled in by the club - the certification form has a section where the club indicate whether they were over or under the cap in that year. Therefore, from what I've read (and I admit I have not read every word of the full regulations), if Sarries are promoted next season, for this season they would only have to submit the certification - I can't find anywhere in the rules that says they need to have actually complied with the cap in that season.

Have I missed something?

OK, well everyone knows they are not complying this season, it's in the public domain! So any form of self-certification to the contrary would be a pack of lies?

You misunderstand. From what I can see in the rules, it's not certification that they are within the cap, it's certification of the total amount they are paying to players, whether that is over or under the cap. Indeed, there is an option on the form to say that they are over the cap! So they have to submit this form, but where does it say they have to have been within the cap?

It's not certification of being under the cap, it's certification that the amount they have paid is X, where X could be either over or under the cap.

[loretta]

What would be the point of such a document, if it didn’t matter if you were over?

Monye on Radio 5 podcast, said that you had to comply for 2 years in order to avoid front loading of contracts. He should know, having been through it with Quins. Without it being 2 years, Sarries could do exactly that, chucking massive lumps of cash at their squad in the rest of this season

Could you provide a link to the rules please?

[Tiglon]

Monye is a former rugby player, I'm not sure his skillset is in reading or understanding regulations (if he has read them at all). I'm not saying I'm right, but I think we're all assuming that something is the case and I'm struggling to see any evidence for it.

I'll try to explain it better. This is the entire section on promoted clubs:

15 Promoted Club
15.1 A Promoted Club shall, within 28 days of receiving confirmation of promotion to the Gallagher
Premiership from PRL, comply with the requirements of Regulation 4.4 by providing to the
Salary Cap Manager the documents listed in Regulation 4.4.
15.2 A Promoted Club shall provide copies of its Declaration for the 2018-19 Salary Cap Year and
its Certification for the 2017-18 Salary Cap Year as required under Regulations 4.2 and 4.3.

So, they need to submit the documents in 4.4 and the Declaration for promotion year and certification for previous year.

Section 4.4 is quite long, so I won't copy and paste the whole thing. To summarise, it is a list of documents used as evidence to support the declared or certified total amount for the cap. E.g. player contracts, address, injury certificates for dispensation etc. It's the supporting documentation to prove that what they they've paid, is actually what they've paid.

4.2 Declaration for 2019-20 Salary Cap Year
Between 1 June 2019 and by no later than 4.00pm on 30 June 2019, each Club, with the
exception of the Relegated Club, will provide to the Salary Cap Manager (with a copy to the
Accountants), in respect of the 2019-20 Salary Cap Year, a copy of:
(a) a Declaration in the form set out in Schedule 2 signed on behalf of the Club by the Chief
Executive Officer and the Financial Director of the Club. The Declaration certifies the sums
which the Chairman, the Chief Executive Officer and the Financial Director, having made full
and proper enquiries, expect the Club to pay during that Salary Cap Year by way of Salary in
respect of the Club's Senior Players and Academy Players;
(b) the total amounts paid or payable provided or to be provided as Salary in that Salary
Cap Year by or on behalf of a Club or a Connected Party of the Club in respect of its
Senior Players and Academy Players or any Connected Party of those Players in the
form of the spreadsheet at Schedule 6; and
2019-20 Regulations – Board Approved (updated 5 February 2019) Page 15 of 57
(c) minutes in the form set out in Schedule 5, of the meeting of the board of directors of
the Club at which the Declaration was formally approved on behalf of the Club,
including details of the directors in attendance or absent at that meeting.

The Declaration form described above is as follows:

Declaration
We hereby confirm on behalf of [name of club] that in accordance with the Premier Rugby Limited
Salary Capping Regulations (and the definitions set out therein) the following amounts are the total
sums expected to be paid as Salary to all of the Senior Players and Academy Players of [name of club]
during the Salary Cap Year [ ] to [ ]:
[Sum to be inserted] for the purposes of the Senior Ceiling
[Sum to be inserted] for the purposes of the Academy Ceiling
We attach for these purposes at Schedules 1 and 2 details of the sums expected to be paid as Salary
to each of the Senior Players and Academy Players of [name of Club] for the purposes of the Senior
Ceiling and the Academy Ceiling including details of any Connected Party of the Club or any Third
Party (including their names and contact details and the relevant amounts) who we believe will pay
Salary to Senior Players/Academy Players of [name of club] during the Salary Cap Year [ ] to
[ ].

Very straight forward - it's a declaration of the total amount paid for the purposes of the cap, for the current (promotion winning) year. This does not appear to be a declaration that the club is operating within the cap, only that it is paying £X.

4.3 Certification for 2018-19 Salary Cap Year
(a) Between 1 September 2019 and by no later than 4.00pm on 30 September 2019, each
Club will provide to the Salary Cap Manager (with a copy to the Accountants), in respect
of the 2018-19 Salary Cap Year, a copy of:
(i) a Certification in the form set out in Schedule 3, signed on behalf of each
Club by the Chairman, the Chief Executive Officer and Financial Director of
the Club;
(ii) minutes in the form set out in Schedule 5 of the meeting of the board of
directors of the Club at which the Certification was formally approved on
behalf of the Club, including details of the directors in attendance or absent
at that meeting;
(iii) to the extent that it has not already done so pursuant to Regulation 4.4, full
copies of all written contracts the Club has entered into with its Players and
with any companies or other entities which agree to provide or procure the
provision of non-playing services by a Player to the Club (e.g. image rights
and promotional services contracts); and
(iv) details of the residential address or addresses of all Players.; and
(v) details of each Club’s Group including names and address of the legal and,
to the extent reasonably practicable, beneficial owners of shares in each
company within the Group;
(vi) to the extent reasonably practicable, details of each body corporate in
relation to which any Director and/or shareholder of the Club is:
(A) interested in shares comprised in the equity share capital of that body
corporate of a nominal value equal to at least 10% of that share capital;
or
(B) entitled to exercise or control the exercise of more than 10% of the
voting power at any general meeting of that body.
(b) Such Certification must include:
(i) the total amounts paid or payable provided or to be provided as Salary in the
preceding Salary Cap Year by or on behalf of a Club or a Connected Party of
the Club in respect of its Senior Players and Academy Players or any Connected
Party of those Players in the form of the spreadsheet at Schedule 7;
(ii) the name of any Third Parties or Connected Parties that have provided
payments or benefits in kind to Players of that Club or to Connected Parties of
those Players or a statement that the Club is not aware of any such payments
or benefits;
(iii) lists of related parties of the Club as identified by the board of directors of the
Club and of all transactions between the Club and those related parties both
2019-20 Regulations – Board Approved (updated 5 February 2019) Page 16 of 57
as required and defined by International Auditing Standards (IAS 550) and as
would have been identified by the Club to establish the statutory disclosures
included in the Club’s annual statutory accounts. For the purposes of the
Regulations, all transactions in this respect are deemed to be material; and
(iv) a statement that the Club has or has not complied with the Senior and
Academy Ceilings for that Salary Cap Year.


There it is in bold. It can be certification to say the club has or has not complied with the cap in that year. Here is the form itself:

Certification
We hereby certify on behalf of [name of club] that to the best of our knowledge and belief in
accordance with the Premier Rugby Limited Salary Capping Regulations (the “Regulations”) (and the
definitions set out therein) the following amounts were the total sums actually paid as Salary to all of
the Senior Players and Academy Players of [name of club] during the Salary Cap Year [ ] to
[ ] less any credits applicable pursuant to Regulation 3 of the Regulations.
[Sum to be inserted] for the purposes of the Senior Ceiling

[Sum to be inserted] for the purposes of the Academy Ceiling
We certify for these purposes at Schedules 1 and 2 details of the amounts actually paid as Salary to
each of the Senior Players and Academy Players of [name of club] for the purposes of the Senior
Ceiling and the Academy Ceiling including details of any Connected Party of the Club or any Third
Party (including their names and contact details and the relevant amounts) who any of us believes
have paid Salary to Senior Players/Academy Players of [name of club] or any Connected Party of a
Player during the Salary Cap Year [ ] to [ ].
We being the Chairman, the Chief Executive Officer and the financial director with the approval of the
Board of Directors of [name of Club] hereby certify that to the best of our knowledge and belief:
1.1 the total amount of Salary of [name of club] was over/under the Senior Ceiling and was
over/under the Academy Ceiling for Salary Cap Year [ ] to [ ]; and
1.2 we are not aware of any payments or benefits in kind paid or payable, provided or to be
provided by any Connected Party of the Club or any Third Party to or in respect of a Player
or any Connected Party of a Player pursuant to any agreement which has not been made on
a proper arms-length negotiation between the Player and the Connected Party of the Club
or the Third Party.


Again, it demands that the club certifies the total amount paid for the purposes of the cap, and specifically to certify whether or not the club operated within the cap in that season. They are very specifically not required, under these sections, to certify that they have complied with the cap.

So, the declaration for year of promotion and certification for year prior to year of promotion are to provide information as to their total salary payments, but I cannot find anywhere that states they have to have actually complied with the cap in those seasons. As far as I can tell, it is about gathering information about promoted clubs, which may be useful in detecting any breaches once they are promoted (i.e. to make it more difficult for a club to give a contract while in the Championship which involves benefits the season after promotion which may otherwise be able to be kept hidden), but there is no demand that a promoted club has complied with the cap in the year of promotion or any previous year.

Apologies for the long post, and if I have missed anything!

The rules in full can be found here:

https://d2cx26qpfwuhvu.cloudfront.net/p ... b-2019.pdf

[Cardiff Tig]

And there must be a difference between a team being over the cap for having too many players and for front loading contracts. If Sarries show that they got rid of players to lower their wage bill I can't see them being denied promotion.

[loretta]

Well. We can live in hope...