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LMC Licence Revocation: Origin, Details And Fallout

LMC
THEWILL APP ADS 2

Early on Thursday morning last week, reportedly acting on orders from the Federal Government, five truckloads of policemen sealed off the Abuja office of the disbanded League Management Company (LMC).

The incident, which took place as early as 5 am, was to ensure that the premises of 20 Osun Crescent, off IBB Way, Maitama, Abuja, where the LMC office is located, was not operational after the revocation of the company’s licence by the Nigeria Football Federation (NFF) on the charge of the Federal Ministry of Youth and Sport Development as instructed by the Federal Government.

As THEWILL reported last week, the decade-long existence of the LMC, the entity in charge of running the Nigeria Professional League, was abruptly cut when it was deemed as illegal by a Supreme Court judgement, about six months ago. It was a judgement that the Government was executing when it instructed the Sports Ministry to order the NFF to revoke the management company’s operating licence. The need for police presence was possibly linked to the recalcitrant stance of the leadership of the company, who, contrary to the judgement of the Supreme Court, was vehemently insistent that they were neither illegal nor fraudulent and look prepped for more legal tussle with the NFF, the Sports Ministry and the Federal Government.

Yet, the position of the ministry on the revocation extends beyond the illegality of the existence of the LMC. When Ismaila Abubakar, the Permanent Secretary in the ministry, revealed the decision to revoke the company’s licence in a press statement issued two Fridays ago, the government clearly placed the blame squarely on the NFF, which it directly accused of fraudulently establishing the LMC. The statement that Abubakar signed established that the NFF created the LMC in order to avoid and evade prior debts and other obligations owed by the company the LMC succeeded, the Nigeria Premier League (NPL) Limited, which was originally mandated by law to run the country’s domestic professional football league. In the eyes of the law, as the Supreme Court judgement made obvious, the LMC was an illegal body. The text of the Ministry’s statement was unambiguous and finished on the authority of the decision of the Supreme Court.

It read: “In view of the several unpleasant incidents regarding the management of the Football League, specifically, the declaration of the National Football League (NFL) as an illegal body by the Court; the status of the League Management Company (LMC), the NFL’s successor-in-title, being outside the purview of the Statutes of the NFF, the Federal Government is constrained to withdraw its recognition of the LMC as the operator of the Nigeria Professional Football League, with immediate effect. This decision has become necessary because of the obvious aberration (which is at variance with our football statutes or the laws of the land) whereby a private company is GIFTED the mandate to manage or run the league indefinitely, without the full involvement of and leadership by the clubs, and devoid of any process to monitor the progress and development of the game.

“Sequel to the above, and in order to rescue our domestic football from total collapse, the Board Of The LMC and the LMC as a body would no longer be recognised by the Federal Government as operator of the nigerian professional football league. To avert further chaos in our domestic football, the NFF is advised to immediately withdraw the Licence given to the LMC and, in the meantime, set up an Interim Management Committee (IMC), to include the current Chief Executive Officer and Chief Operating Officer of the LMC to oversee the affairs of the League until a proper Professional League Board is constituted in accordance with the Statutes of the NFF.”

The judgement of the Apex court upon which the Ministry acted was grounded on the circumstances leading to the establishment of the LMC and the legality of its existence. Prior to the LMC, the NPFL was run by the Nigeria Premier League Limited up until 2013, when the NFF created the LMC on the premise that there was a judgement delivered by Justice Okorowo of the Federal High Court in 2012 in suit No. FHC/AB/CS/179/2010, which instructed that the NPL close shop.

In the opinion of the Supreme Court delivered in March,2023 by the lead Judge, Justice Ejembi Eko, the process of winding down the NPL was not properly carried out and therefore the NPL was still in existence, albeit by name for the most part, when the LMC was created and began to function in place of the NPL to the point that there were two companies in existence tasked with the exact same responsibilities. This made the LMC an illegality in operation.

The Supreme Court opinion held that “the very adumbrated judgment of Justice Okorowo claimed by the respondents to have declared the incorporation of the 1st. respondent, (NFL) illegal and void was executory, as it clearly placed a further duty on a third party, the Corporate Affairs Commission to wind up the 1st. Respondent, NFL. There is no evidence that at all times material to the decision appealed, the winding up order had been carried out or duly execute. Fresh and additional evidence, the bundle of documents (comprising the various Union Bank of Nigeria Plc cheques) filed in this appeal by the appellants on the orders of this Court made on the 18th. December, 2020, clearly shows that in spite of the decision of Justice Okorowo and the order made in suit No: FHC/AB/CS/179/2010 on the 20th January, 2012 , the 1st. Respondent (NFL) was very much around and on ground transacting businesses as reflected by the 50 cheques which various sums of money were paid into its account no. 0321530771 held at the Union Bank of Nigeria Plc.

“It is curious that after the judgement of the lower court presided over by Justice Okorowo on the 24th of June 2016, the Nigeria Premier League Limited received bank drafts to the tune of N244,000,000.00 (Two hundred and fifty four million naira) issued by Total Promotions Nigeria Limited which it took value in and subsequently transferred to Club owners.

“Of note is the fact that Okorowo’s judgement is not the dissolution order within the purview of the provisions of section 454 (1) of the company and allied matters act (CAMA). I must say straight away that there is a world of difference between the winding up of a company and the dissolution of a company. A company dies when a court orders the dissolution of the company. The revocation of a company and order of court winding up, some do not indicate its death. A company under winding up proceedings has not died. It is still alive but perhaps sick,” Justice Eko clarified before ordering the LMC to pay the sum of NGN 3m to the appellant, Emmanuel Oboh and Emmanuel Oboh & associates.

In their reaction, the LMC immediately faulted the basis of the Supreme Court decision. In defense of the legality of its existence, the company stated that “the LMC Ltd was duly and properly formed in 2013 with all due processes adhered to and in line with both Football laws/regulations and Nigeria’s Corporate Affairs Laws (Companies and Allied Matters, Act – CAC Act). The participating clubs of the NPFL were part and parcel of these processes in line with the stipulations of the NFF Statutes (article 18 of the NFF Statutes). The LMC Ltd Supplementary Regulations (Governance Structure) was agreed with the NPFL Clubs in accordance with the NFF Statutes on 6th September 2013, and duly filed at the CAC with CAC approval appropriately issued on 2nd June 2014

“Subsequently, the NFF Executive Committees at its meeting of 8th October 2014 in Abuja and the NFF Congress (the Supreme Legislative body of the NFF) at its meeting of 23rd November 2014 in Lagos duly approved the LMC Supplementary Regulations/Governing Structure pursuant to the powers vested on the Congress under the NFF Statutes (article 18 and article 78 subsection 2 and 3) as well as FIFA Statutes (articles 17 and 18) to delegate the right to an independent/subordinate body to manage/ organise its competitions (NPFL inclusive) and to make regulations and or approved regulations for the management of the domestic leagues.”

While citing a January 20, 2012 case, when the Federal High Court via judgement in Suit No: FHC/ABJ/CS/179/2010 declared the NPL to be illegally constituted, the LMC defended its own existence by further distancing itself from the accusation of operating as a private organisation claiming to be “a not-for-profit company duly formed by the NFF and the participating NPFL clubs in accordance with their powers as enshrined in the extant NFF Statutes.” It went further to argue that the Apex court, by its judgement, acted to affirm “the legality of LMC as the only body recognised to operate and run the NPFL by ruling for LMC to be responsible for the judgement debt of the NFL Ltd” before including world football governing body FIFA with the statement that “the LMC Ltd structures was actually endorsed by FIFA which had reasons to invite the LMC to discuss the process with other jurisdictions.”

It is obvious that they cannot overturn the judgement of the Supreme Court but they appear ready to argue for their existence and the legality of their operation of the NPFL. The Interim Management Company, which will temporarily run football management in the company for the time being is yet to be constituted and it is certain that the last has not been heard of the issue given the widely positive responses from the domestic football scene that greeted the revocation of the LMC license.

Dissatisfied football owners have, through the auspices of their organisation, Club Owners Association of Nigeria, asked the Sports Ministry and the NFF to allow them run the League themselves and there are indications that the handling of the NPFL by the LMC for the past decade will be investigated. The stiff-necked stance of the LMC to the judgement and these issues from the fallout of the revocation of their license is indicative that this, long stretched legal tussle is anything but over.