/ Rugby

ERC ups ante by refusing to sanction payments

Updated: Thursday, 06 Feb 2014 14:32 | Comments

The future of the Heinken Cup continues to look bleak
The future of the Heinken Cup continues to look bleak

Premiership Rugby will seek advice on pursuing a potential breach of contract from European Rugby Cup, after the Heineken Cup organisers withheld overdue tournament appearance payments for at least another fortnight.

English clubs' governing body PRL believes ERC's refusal to release the second of five seasonal appearance-fee instalments "inflames the issues" surrounding a resolution to European rugby's conflict.

The ERC board voted unanimously to postpone any decisions, including releasing tournament appearance payments owed to clubs across the continent at a meeting in Dublin on Wednesday.

This latest move appears to plunge the future of top-flight European club rugby into an even deeper limbo.

The second instalment of five seasonal appearance payments is already overdue.

The ERC board will convene again on Wednesday, 19 February, and reconsider their next steps.

Premiership Rugby will now seek advice on whether ERC's decision constitutes a breach of contract.

"We believe this inflames the issues we have in coming to a European solution and the next step is for Premiership Rugby to take advice to see if this action represents a fundamental breach in the contract between ERC and its clubs," said PRL in a statement.

The Aviva Premiership clubs are owed €1.9 million in this batch of Heineken Cup appearances fees, with Wales' four regions awaiting €800,000.

Regional Rugby Wales is thought to have drawn an emergency bank loan after the ERC payment did not materialise.

This latest delay could leave the four regions unable to pay off that loan as early as anticipated.

"The Board agreed unanimously that further detailed legal and other professional advice was necessary"

ERC will end up defunct if a top-flight European club competition is organised and run by another body next season.

The English clubs want the Six Nations committee to assume European knockout rugby governance, and the Welsh regions and French clubs would accept that move.

The board of ERC is now understood to be withholding money as it seeks to clarify what liabilities it would suffer should the company be forced to wind up in the summer.

ERC confirmed this latest move in a statement following the Dublin meeting on Wednesday night.

The under-fire European body will now seek more detailed legal advice before making their next move.

"The vote to postpone any decision followed preliminary advice received by the Board, and was taken in the best interests of the company after lengthy discussions," the ERC statement read.

"The Board agreed unanimously that further detailed legal and other professional advice was necessary in order to facilitate the ongoing discussions in relation to the future of European club rugby tournaments and the distribution of funds deriving from the 2013/14 season.

"Each season, ERC makes five payments of its distributable funds from its central revenues to the six participant countries from October through to September.

"At the ERC Board meeting of 11 September 2013, it was decided that distribution payments should be approved by the Board before any funds are released. The first payment of €15 million was made in October 2013 following Board approval."

The ERC board comprises representatives from the six country unions and Premiership Rugby, Regional Rugby Wales and the Ligue Nationale de Rugby.

Neither Mark Dodson nor Ian McLauchlan, the Scottish representatives, attended the meeting.

Regional Rugby Wales did not send a representative either, ignoring the pleas from the WRU to have a presence.

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