A legal expert has told CoventryLive that Wasps could be left with a multi-million pound bill if the European Commission uphold a complaint by Coventry City's owners over the sale of the Ricoh Arena.
That's the same potential outcome as the legal action Sisu had pursued through the UK courts before a final rejection by the Supreme Court in April.
That failed bid for a judicial review argued Coventry City Council had undervalued the stadium operating company when Wasps bought it for around £20million in 2014.
Lawyers for Sisu and the companies that make up the football club argued it was worth close to £50m.
Wasps said in a statement yesterday that the EC action was "very similar in all matters of substance to the recent court actions".
And a law expert from Coventry University has told CoventryLive that while the latest action was not "a legal process per se" it has the potential to see the rugby club paying anything deemed as sate aid - plus interest.
The complaint to the European Commission has reignited the deadlock with landlords Wasps that could see the club homeless next season.
Sisu are yet to respond to our request for further details on the nature of the complaint and its implications.
Submitting a complaint to the European Commission
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According to the European Commission website, complaints made to them are only taken up if they relate to a public body.
The website reads: "The European Commission can only take up your complaint if it is about a breach of Union law by authorities in an EU country. If your complaint is about the action of a private individual or body (unless you can show that national authorities are somehow involved), you have to try to solve it at national level (courts or other ways of settling disputes). The European Commission cannot follow up matters that only involve private individuals or bodies, and that do not involve public authorities."
To submit a complaint to the European Commission, Sisu will have had to fill out a form including the following details:
- a description of exactly how you believe that national authorities have infringed Union law, and which is the Union law that you believe they have infringed
- details of any steps you have already taken to obtain redress
Once the European Commission has confirmed it has received a complaint, it will assess the complaint and aim to decide whether to initiate a formal infringement procedure against the country in question - this usually happens within 12 months.
Latest on the Ricoh Arena Row
What happens now?
Following the decision of the Supreme Court to dismiss legal action on April 16, CoventryLive spoke to a law expert at Coventry Law School, who said it may be the case that the decision of Coventry City Council to sell the Ricoh below-value constitutes an illegal grant of state aid under Article 107 of the Treaty on the Functioning of the European Union, and if so an investigation by the European Commission may commence.
We went back to Dr Stuart MacLennan to get a further insight into what this new development means.
Dr MacLennan, a senior lecturer in law and research development director, told us that that Sisu’s complaint to the European Commission is like “referring someone to the police”.
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He said: "Sisu’s complaint to the commission is not a legal process per se .
"The European Commission is in charge of policing state rules, so SISU’s complaint is very much like referring someone – in this case Coventry City Council – to the police.
"It is probably fair to say, therefore, that SISU are not bringing any legal action against the Wasps."
According to Dr MacLennan, if a public body has conferred a ‘selective advantage’ on a business it is treated as anti-competitive and is usually, therefore, prohibited.
Speaking about the stages of the process the complaint will go though, Dr MacLennan said a preliminary investigation would come first.
He said: "The Commission will conduct a preliminary investigation, after which they might decide this doesn’t warrant further investigation.
"If, however, they decide to conduct an in-depth investigation, the Commission has extensive powers to investigate the matter fully."
Dr MacLennan said there are three potential outcomes if a full investigation takes place.
He outlined these as:
- positive (the grant to aid was lawful);
- conditional (the grant of aid is lawful provided certain conditions are fulfilled);
- or negative.
A negative decision "would require Coventry City Council to recover from the Wasps not only the initial aid granted, but interest as well," he added.
Details on the nature of the complaint are yet to be revealed by Sisu or the European Commission.
Speaking on BBC Coventry and Warwickshire radio yesterday, Professor Christine Oughton, an expert on the European Commission, said the Commission has rules on “state aid being given to commercial enterprises” and football clubs are part of that.
She added: “If aid gives a club an unfair advantage over other clubs and a complaint is made, they could investigate.”
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