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FORUMS > Wigan Warriors > Re: What will the RFL do if the DR. Breaks the Salary Cap? |
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| Quote: dubairl "The RFL would want to know what you declared for tax. Also anybody who is caught doing it like that has an 8 year ban as precedent has been set. Also from my previous comment its a lot harder to hide money from the tax man than people believe and its hard to keep a company books straight with yearly salaries being paid of the books.'"
Its not very complicated, is well established and already used by many sportsmen
You register a normal playing contract at a normal wage. This goes from club to player. So Koucash as Salford Red Devils pays SBW £200k a season to play for Salford
Company A based in Dubai pays Company B based in BVI a lump sum of £1m for consultancy services. This money sits in company Bs bank account. The UK tax authorities have no reason, no need and no jurisdiction to query this payment, it has absolutely nothing to do with them. It has even less to do with the RFL. Company A is a shell company owned by Koucash, and company B is a shell company owned by SBW, with his solicitor as trustee. All correct tax on this transaction has been paid in Dubai and BVI. This perfectly legal and above board.
Then, three years later SBW’s contract with Salford ends and he goes home to New Zealand. Whilst there Company B pays SBW a wage of £1m for Sports consultancy services. All correct tax is declared and paid in BVI and New Zealand. This is perfectly legal and above board. The UK tax authorities have no reason, no need, and no jurisdiction to query a payment from the BVI to NZ. The RFL have even less of one
There is no need for two sets of books, no need for hiding anything from the tax man, the RFL can know everything SBW earns and declares to the tax man. For three years he was under the RFL jurisdiction it would be £200k a year.
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| Well we don't need to worry about Bill Williams signing for Salford he's just agreed to go back to rugby Union for the 2015 season in a 2 year with Waikato Chiefs.
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| Quote: Bostonslugholes "Well we don't need to worry about Bill Williams signing for Salford he's just agreed to go back to rugby Union for the 2015 season in a 2 year with Waikato Chiefs.'"
and it is a crying shame that british rugby league is not a realistic option for him.
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| Quote: SmokeyTA "Its not very complicated, is well established and already used by many sportsmen
You register a normal playing contract at a normal wage. This goes from club to player. So Koucash as Salford Red Devils pays SBW £200k a season to play for Salford
Company A based in Dubai pays Company B based in BVI a lump sum of £1m for consultancy services. This money sits in company Bs bank account. The UK tax authorities have no reason, no need and no jurisdiction to query this payment, it has absolutely nothing to do with them. It has even less to do with the RFL. Company A is a shell company owned by Koucash, and company B is a shell company owned by SBW, with his solicitor as trustee. All correct tax on this transaction has been paid in Dubai and BVI. This perfectly legal and above board.
Then, three years later SBW’s contract with Salford ends and he goes home to New Zealand. Whilst there Company B pays SBW a wage of £1m for Sports consultancy services. All correct tax is declared and paid in BVI and New Zealand. This is perfectly legal and above board. The UK tax authorities have no reason, no need, and no jurisdiction to query a payment from the BVI to NZ. The RFL have even less of one
There is no need for two sets of books, no need for hiding anything from the tax man, the RFL can know everything SBW earns and declares to the tax man. For three years he was under the RFL jurisdiction it would be £200k a year.'"
would be that easy if you could just open a company up and bank account in dubai and never mind you are illegally avoiding tax as your residency would be in the uk. think the same thing happened with Harry Redknapp. Anything earning world wide is legible for tax if you live in the Uk.
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| Quote: dubairl "would be that easy if you could just open a company up and bank account in dubai and never mind you are illegally avoiding tax as your residency would be in the uk. think the same thing happened with Harry Redknapp. Anything earning world wide is legible for tax if you live in the Uk.'"
His residency is irrelevant to the tax paid on the transaction between company A and company B. SBW’s residency only becomes important when he takes that money out of Company B, whilst ever it is in Company B its tax considerations are only relevant to the country in which company B is based.
SBW would be perfectly able to draw down that Wage from company B in the UK if he wished. He would at that point pay UK tax on his earnings. He still wouldn’t be in contravention the salary cap rules. It isn’t illegal or against the Salary Cap rules for SBW to earn money from a company other than the one which owns the club unless it is involved with the club in another way.
He could wait until he was back in New Zealand and at that point Company B could pay him the £1m and he would pay that tax to New Zealand.
Harry Redknapp BTW was cleared of all charges.
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| I hope they do nothing as the game needs people like him.
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| I hope the RFL impose a massive penalty on Salford and Koukash retaliates by seeking an injunction to prevent the enforcement of the SC on the grounds that it is an unlawful restraint of trade (which I suspect won't be difficult to obtain, considering that it has failed to meet its objectives and its only real "achievement" has been to reduce players' wages by over a third in real terms).
We might then have a more sensible discussion about the financial regulation and development of the professional game.
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| Quote: Deano G "I hope the RFL impose a massive penalty on Salford and Koukash retaliates by seeking an injunction to prevent the enforcement of the SC on the grounds that it is an unlawful restraint of trade (which I suspect won't be difficult to obtain, considering that it has failed to meet its objectives and its only real "achievement" has been to reduce players' wages by over a third in real terms).
We might then have a more sensible discussion about the financial regulation and development of the professional game.'"
Okay. He can try to claim restraint of trade. He would fail. It's simple. Salford (or anyone else) can sign as many players, on as much as they like. They cannot register them within the competition that is super league unless they fit agreed criteria. In the same way that, for example, judo can impose weight restrictions, or barla can age restrictions, the rfl can impose restrictions on player compensations (or in the actual case, combined player compensation) so long as they don't aim to collude with barla, the nrl or any other body to determine the fair price of player compensation. (For further info look up the trade case of electrical engineers vs agreements made by Google and apple.)
And tribunal would simply say, break the rules of the competition and don't like the sanctum brought down? Don't register for the competition.
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| So the RFL put in place a restriction that says no black people can play rugby league in RFL competition, You think that rule stands up in court because it is a rule of the competition? Of course it doesn't. The rules of the competition are secondary to the laws of the land,
There is protection within the law of this country to protect employees from companies colluding to keep wages down. The salary cap is a restraint of trade. You won't find a solicitor in the country who would argue otherwise. The only defence that would be brought is that This restraint was, fair, reasonable and absolutely necessary to protect the competition, I,e without it the competition would cease to exist and the players would receive less.
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| Quote: SmokeyTA "So the RFL put in place a restriction that says no black people can play rugby league in RFL competition, You think that rule stands up in court because it is a rule of the competition? Of course it doesn't. The rules of the competition are secondary to the laws of the land,
There is protection within the law of this country to protect employees from companies colluding to keep wages down. The salary cap is a restraint of trade. You won't find a solicitor in the country who would argue otherwise. The only defence that would be brought is that This restraint was, fair, reasonable and absolutely necessary to protect the competition, I,e without it the competition would cease to exist and the players would receive less.'"
No ones keeping the wages down. Salford can if they like sign the entire Aussie squad on 10 million a year. They don't have an agreement with Wigan or anyone else they won't. They can then enter said squad of players in 9s tournaments, or exhibition matches or friendlies or anything else. Just not one competition: super league.
Wigan could of kept hock on contract during his drugs ban. He couldn't be registered for super league so isn't on the cap, but could of played in other competitions he wasn't banned in, and still be part of the company on whatever salary appropriate.
Do you think a company would get away with were not employing you because you're too fat? No can sport limit weight? Yes. Can a film director advertise for a black male, ginger and toned between the ages of 35-49 and discriminate based on that requirement? Yes. Sporting institutes have similar luxuries (females in sport are a massive example of this at the moment.) race isn't a requirement to the role, so they can't ban coloured people, the quality of squad can be said to integral to a competition therefore can be used. Unfortunately "quality" isn't quantitive, salaries can be used as a judge of quality (if you assume better players get paid more - naive maybe ... But as good a plan as any)
Ultimately, you don't need to register for a competition. The only way it's restraint of trade is:
A) the rfl have colluded with another governing institute to set the salary cap.
B) entry to the super league requires you to forgo all other contests.
C) the clubs, have agreed, between themselves not to make offers for each other's players and or to pay over x amount for a player, with no governing body involvement.
Are any true?
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| Quote: Magic Superbeetle "No ones keeping the wages down. Salford can if they like sign the entire Aussie squad on 10 million a year. They don't have an agreement with Wigan or anyone else they won't. They can then enter said squad of players in 9s tournaments, or exhibition matches or friendlies or anything else. Just not one competitionthe players are rugby league players, that is their trade, the RFL is restricting their opportunities to ply that trade freely, it doesn't completely stop them playing RL, it does restrict it. There is nothing that says the restriction has to be absolute, just that it unfairly restrains that players ability to play their trade and earn a wage congruent with their skills value on an open market. The salary cap does that. It IS unarguably a restraint of trade. It stops a player earning what they could earn in an open market.
Salford couldn't sign the Aussie squad pay them £10m and play them in other competitions, as a member of the RFL they need RFL permission to compete in any tournament or game. Regardless, the very fact that they couldn't play these players in SL restricts the value of that player, their exclusion from SL or the punishments stemming from them playing is a restraint of trade.
There is no legal argument that it isn't a restraint of trade, nobody would put it forward as a legal defence. Their defence would be that the restraint of trade which the salary cap is, is reasonable and protects a legitimate interest which needs to be protected.
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| Quote: SmokeyTA "the players are rugby league players, that is their trade, the RFL is restricting their opportunities to ply that trade freely, it doesn't completely stop them playing RL, it does restrict it. There is nothing that says the restriction has to be absolute, just that it unfairly restrains that players ability to play their trade and earn a wage congruent with their skills value on an open market. The salary cap does that. It IS unarguably a restraint of trade. It stops a player earning what they could earn in an open market.
Salford couldn't sign the Aussie squad pay them £10m and play them in other competitions, as a member of the RFL they need RFL permission to compete in any tournament or game. Regardless, the very fact that they couldn't play these players in SL restricts the value of that player, their exclusion from SL or the punishments stemming from them playing is a restraint of trade.
There is no legal argument that it isn't a restraint of trade, nobody would put it forward as a legal defence. Their defence would be that the restraint of trade which the salary cap is, is reasonable and protects a legitimate interest which needs to be protected.'"
A) if it's so obviously a restraint of trade how come nobody has brought the case forward except a few keyboard lawyers on here? Could it be because actually there's more to it than your opinion?
B) there trade is sport. They are sportsmen, there are limitations in sport. Whether they be age, weight, nationality or value. These are legal and required.
C) there are rugby league leagues that have no salary cap restrictions. Even in the uk. There is not a mass exodus from the super league to the league with no salary cap. Therefore "fair value" can be assumed.
D) yes, Salford can sign whoever they like to play in other competitions. Do you think the rfl have a say in who Leeds tykes sign because they're linked to the rhinos?!? The only reason agreement for the rfl is needed is when players cross over and that's due to the insurance reasons of the players in the sl
E) a player, who is cup tied for the challenge cup is not seen as of lower value ( I would stand corrected if you can show me any evidence that points otherwise) so by extension one cannot say sl exclusion devalues a player. In fact when players have been banned, transfer fees have still been paid (Martin Gleason after being banned due to betting springs to mind) so there is evidence the extension holds.
F) just saying restraint of trade over and over doesn't make it true.
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| Quote: Magic Superbeetle "A) if it's so obviously a restraint of trade how come nobody has brought the case forward except a few keyboard lawyers on here? Could it be because actually there's more to it than your opinion?
B) there trade is sport. They are sportsmen, there are limitations in sport. Whether they be age, weight, nationality or value. These are legal and required.
C) there are rugby league leagues that have no salary cap restrictions. Even in the uk. There is not a mass exodus from the super league to the league with no salary cap. Therefore "fair value" can be assumed.
D) yes, Salford can sign whoever they like to play in other competitions. Do you think the rfl have a say in who Leeds tykes sign because they're linked to the rhinos?!? The only reason agreement for the rfl is needed is when players cross over and that's due to the insurance reasons of the players in the sl
E) a player, who is cup tied for the challenge cup is not seen as of lower value ( I would stand corrected if you can show me any evidence that points otherwise) so by extension one cannot say sl exclusion devalues a player. In fact when players have been banned, transfer fees have still been paid (Martin Gleason after being banned due to betting springs to mind) so there is evidence the extension holds.
F) just saying restraint of trade over and over doesn't make it true.'"
You are wrong, and this little rant is just embarrassing and simply highlights that fact you have got this little argument in your head and have jumped in with both feet rather than actually read what I put, but what it also highlights is that you don't have the first clue about what you are talking about.
The salary cap is a restraint of trade, there is no argument there, except by you, who doesn't understand what a restraint of trade is. There are a huge amount of restraints of trade, you yourself are likely party to some. Most employment contracts are a restraint of trade, I know mine is.
In my contract it says should I leave my current employer, I cannot work for a competitor in the uk for a period of one year. This is a restraint of trade but is enforceable because it is reasonable, I agreed to it, it is specific and it is a limited restraint purely to protect a legitimate interest. Therefore, though it is a restraint of trade, and nobody would argue different, it is enforceable for the reasons outlined above.
Should however my contract have said should I leave my employer I cannot work for a competitor, worldwide, ever. Then even though I had agreed to it, and even though it is in my contract and even though it is the same restraint of trade, it would not be enforceable because it isn't reasonable, isn't specific and isn't a limited restraint to protect a legitimate interest.
Similarly should the SC ever be taken to court, the defence of it would not be that it wasn't a restraint of trade, because clearly and obviously it is, the defence of it would be that as a restraint of trade it was reasonable, specific and a limited restraint to protect a legitimate interest. Cheap labour is not a legitimate interest. Their defence would be that it is necessary to keep clubs sustainable, to keep the competition even and that it provides stability which otherwise wouldn't be there protecting the players interest aswell. It was mutually beneficial.
Whether this defence would work is unknown.
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| Quote: SmokeyTA "You are wrong, and this little rant is just embarrassing and simply highlights that fact you have got this little argument in your head and have jumped in with both feet rather than actually read what I put, but what it also highlights is that you don't have the first clue about what you are talking about.
The salary cap is a restraint of trade, there is no argument there, except by you, who doesn't understand what a restraint of trade is. There are a huge amount of restraints of trade, you yourself are likely party to some. Most employment contracts are a restraint of trade, I know mine is.
In my contract it says should I leave my current employer, I cannot work for a competitor in the uk for a period of one year. This is a restraint of trade but is enforceable because it is reasonable, I agreed to it, it is specific and it is a limited restraint purely to protect a legitimate interest. Therefore, though it is a restraint of trade, and nobody would argue different, it is enforceable for the reasons outlined above.
Should however my contract have said should I leave my employer I cannot work for a competitor, worldwide, ever. Then even though I had agreed to it, and even though it is in my contract and even though it is the same restraint of trade, it would not be enforceable because it isn't reasonable, isn't specific and isn't a limited restraint to protect a legitimate interest.
Similarly should the SC ever be taken to court, the defence of it would not be that it wasn't a restraint of trade, because clearly and obviously it is, the defence of it would be that as a restraint of trade it was reasonable, specific and a limited restraint to protect a legitimate interest. Cheap labour is not a legitimate interest. Their defence would be that it is necessary to keep clubs sustainable, to keep the competition even and that it provides stability which otherwise wouldn't be there protecting the players interest aswell. It was mutually beneficial.
Whether this defence would work is unknown.'"
Because I'm the one with an argument set in my head. Right. And I'm not sure why you think I'm ranting. Anyway.
Almost everything you say there is right, Yes you can't be limited to joining competitors for life ... That's like saying all of Wigans contracts including a clause saying they can't sign for saints ... A perfectly valid point, and as I said, restraint of trade would be the case if there were an agreement by the clubs alone, without governing body rules, to only pay x amount, but as it's the rules of a competition, there's no colluding (since other competitions don't have the same rules - it would be interesting from a legal standpoint, if the rfl and nrl set the same salary cap ... Not that that will ever happen)
It's a very easy argument to prove the aim of the salary cap is not cheap labour, as not all clubs are spending to the cap ...
Don't get me wrong, I'm not a massive fan of the cap, and there are lots of things wrong with it (mainly it's the bottom clubs dictating it's value as opposed the top) but it's not illegal.
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Quote: Magic Superbeetle "Okay. He can try to claim restraint of trade. He would fail. It's simple. Salford (or anyone else) can sign as many players, on as much as they like. They cannot register them within the competition that is super league unless they fit agreed criteria. In the same way that, for example, judo can impose weight restrictions, or barla can age restrictions, the rfl can impose restrictions on player compensations (or in the actual case, combined player compensation) so long as they don't aim to collude with barla, the nrl or any other body to determine the fair price of player compensation. (For further info look up the trade case of electrical engineers vs agreements made by Google and apple.)
And tribunal would simply say, break the rules of the competition and don't like the sanctum brought down? Don't register for the competition.'"
You are not correct. A salary cap is a restraint of trade. A quick search on google found this piece from a leading barristers' chambers:
www.monckton.com/docs/library/Salary%20Caps.pdf
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Quote: Magic Superbeetle "Okay. He can try to claim restraint of trade. He would fail. It's simple. Salford (or anyone else) can sign as many players, on as much as they like. They cannot register them within the competition that is super league unless they fit agreed criteria. In the same way that, for example, judo can impose weight restrictions, or barla can age restrictions, the rfl can impose restrictions on player compensations (or in the actual case, combined player compensation) so long as they don't aim to collude with barla, the nrl or any other body to determine the fair price of player compensation. (For further info look up the trade case of electrical engineers vs agreements made by Google and apple.)
And tribunal would simply say, break the rules of the competition and don't like the sanctum brought down? Don't register for the competition.'"
You are not correct. A salary cap is a restraint of trade. A quick search on google found this piece from a leading barristers' chambers:
www.monckton.com/docs/library/Salary%20Caps.pdf
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