Bankrupt TTFA has $98.5M in Liabilities
By Sue-Ann Wayow
THE Trinidad and Tobago Football Association (TTFA) total outstanding liabilities and unasserted claims are at approximately TT$98.5 million and the Normalisation Committee (NC) of the TTFA has moved one step closer to developing an implementable plan to address the long-term debt by making a proposal under the Bankruptcy and Insolvency Act of Trinidad and Tobago.
In a press release, the Committee stated that on Monday, the Supervisor of Insolvency was informed of its intent to which “will enable a structured approach to the restructuring of the TTFA and the preparation of a fair, transparent and acceptable payment proposal to address the TTFA’s debt.”
The NC stated, “This process as it was designed, will allow the TTFA to manage its operations and provide a stay from all legal proceedings and creditor actions for a period of up to six months, thereby securing the TTFA’s assets while the management and NC work under the oversight of the independent Trustee to develop and present a proposal to address the TTFA’s debt to all creditors.”
The NC is also making it clear that it has not filed for bankruptcy and the filing of the notice will ensure that all creditors are treated equitably in the settlement of the TTFA’s debt, NC stated. The TTFA is also not being dissolved.
While other options were considered, NC stated, “With its accumulated debt and track record of poor management and governance, the TTFA would not qualify for a loan of the size necessary to settle its debt from a bank or other financial institution.”
After consulting with Ernest and Young, the notion through the Act was determined to be the best and most viable.
The Bankruptcy and Insolvency Act provides an avenue for individuals or organisations in financial difficulty to seek the protection of the Courts from litigation while they develop a payment proposal and negotiate with creditors to settle outstanding debt through a court-supervised process that is fair, transparent, and equitable.
Maria Daniel, a Licensed Trustee, has been appointed to manage the debt proposal process, which will be guided by the rules of the Act, Chapter 9:70.
The process will include meetings with and the submission of claims and supporting documents by all creditors, a review and verification of the claims and the development of a proposal to deal with the valid outstanding liabilities.
Once the proposal has been developed and approved by the creditors, it will be sanctioned by the Courts and the NC will proceed to implement the proposal in accordance with its terms. During the development of the proposal and its implementation, the NC’s day-to-day management of the TTFA will be unaffected, the NC added.
It also gives the TTFA the protection of the Courts from claims on its current and future income and the TTFA’s existing assets will be used to deal with the existing debt. The total figure of those assets is yet to be determined by an independent third-party valuation. The day-to-day operations of the TTFA and future football activity will be funded with subventions from FIFA in the first instance, the NC stated.
Commenting on the decision to seek protection under the Bankruptcy and Insolvency Act, NC chairman Robert Hadad said: “The TTFA is currently hamstrung with debt, and we can’t allow past mismanagement and poor governance to cripple the future of football or indeed its daily operations. This option, under the supervision of the Supervisor of Insolvency, the Trustee and the courts, ensures transparency, equity and independence in the process while, at the same time, ensuring that our current subventions are used for the day-to-day running of the TTFA and its present and future needs. The intent is to rehabilitate as opposed to dissolve the TTFA with a view to preserving continuity and the development of football in Trinidad and Tobago for future generations.”
NC stated that no additional debt was accumulated since it was appointed as the Committee focused on improving the systems of governance and controls and neither FIFA nor the Trinidad and Tobago Government had any legal obligation to repay the debt.
On March 17, 2020, the international governing body for football, the Fédération International de Football Association (FIFA), announced the Bureau of FIFA Council’s decision to appoint the NC, in accordance with Art. 8 Par. 2 of the FIFA Statutes.
The mandate given to the NC included the running of the TTFA’s daily affairs, establishing a debt repayment plan that is implementable by the TTFA, review and amend the TTFA Statutes and other regulations where necessary and to ensure their compliance with the FIFA Statutes and requirements before duly submitting them for approval to the TTFA Congress and organise and to conduct elections of a new TTFA Executive Committee for a four-year mandate.
FIFA appointed Robert Hadad (Chairperson), Judy Daniel (Deputy Chairperson), Nigel L Romano (Member) and Trevor (Nicholas) Gomez (Member) to serve as members of the NC.
One additional committee member can also be appointed.