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HMRC drop Portsmouth legal challenge

Portsmouth's fans deserve some good news after a nightmare season © Getty Images

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Portsmouth were dealt a rare piece of good news on Thursday as Her Majesty's Customs and Revenue announced its decision to drop the legal challenge against Pompey's fall into administration.

The troubled South Coast club went into voluntary administration on February 26, inevitably conceding to debts of over £60 million. Pompey had previously done everything within their power to find investment, which would have allowed them to avoid a mandatory nine-point penalty, but eventually administration was necessary to prevent the club facing a winding-up order from the High Court.

However, HMRC was far from satisfied by the outcome, leading to an official challenge over the decision to allow administrator Andrew Andronikou to take charge of the club's affairs.

That challenge has now been dropped, allowing Andronikou to continue with the task of making Portsmouth a viable business proposition, after he made 85 club staff redundant on Wednesday.

A spokesman for HMRC said in a statement: "Despite HMRC continuing to have a number of remaining questions and concerns around the relationships of various parties, and a lack of detail of financial affairs, HMRC has now advised the administrators that we will no longer challenge the validity of the administrator's appointment.

"This comes in light of the additional material now provided following the judge's directions of March 2, 2010.

"HMRC would expect that now that the issue of validity is no longer in question, the administrator will be able to make early and real progress with the administration in order to get the best and most equitable return for all creditors."

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