PSL’s best option in Royal mess may be to amend constitution, expel club: expert

A respected legal expert with vast experience in football management says the Premier Soccer League's (PSL) best option to resolve the mess surrounding Royal AM may be to expel the club, but the league would have to alter its constitution to do so.

Royal AM owner Shauwn Mkhize owes the South African Revenue Service (Sars) more than R40m, resulting in the club’s affairs being put under a curator since December after they obtained a preservation order over their assets. 

Last week, a court application by Royal against the PSL to return to action failed and this has left them in limbo as they continue to miss league and cup fixtures.

The expert, who specialises in football law and administration and asked not to be named, said the ‘easier’ way out for the PSL will be to continue the 2024-25 Betway Premiership campaign with 15 teams. He said there would have to be sufficient consultation with the rest of the clubs before the constitution is amended to allow for an expulsion of Royal.

While Sars might want to sell Royal to recoup outstanding tax money owed by Mkhize, this might be problematic as it could run through to the 2025-26 season, and the PSL might have little say or vetting power over who the buyer is.

The expert said the PSL executive committee would be the body to amend the constitution and agree the second-tier Motsepe Foundation Championship (MFC) would then promote three teams and demote two from the Premiership at the end of the season. Given there are promotion-relegation playoffs in the PSL, if the top-flight club survives via those, as often can be the case, then two teams would go up from the MFC.

“It’s not something new, we had a similar situation before. You must remember the situation involving Zola Mahobe, Snowy Moshoeshoe and Mamelodi Sundowns,” the expert said.

In the 1980s, Standard Bank seized Mamelodi Sundowns when owner Mahobe was prosecuted for defrauding the bank, which sold the franchise to brothers Abe and Solly Krok.

“Zola owed Standard Bank some money, the bank attached the club, and they later sold it. The difference here is that Sars or the Hawks attached the assets of the lady who owned Royal AM.

“There are two things that can happen. The first is either the lady can go to court and appeal against the decision, or Sars can be successful and sell the assets to whoever wants to buy.

“Or they can control it the same way Standard Bank did [for a period], but I can’t see Sars running a football club. That’s not going to happen and that’s from a legal point of view.

“As far as the league is concerned, the executive will have to make a decision because the constitution will have to be changed. The constitution currently says there are 16 teams, with two going up and two going down.

“If the constitution says two go up and two down, you can’t all of a sudden find a situation where there are only 15 clubs because the other club failed to fulfil its fixtures.”

The lawyer said the headache for the PSL is that the legal process between Royal and Sars may take a long time, throwing next season's fixtures into chaos.

If the owners of Royal AM are going to go to court [against Sars], it may take a long time and that can put the season in serious jeopardy. This is a big problem for the league, but it is not something they could have foreseen. At the start of every season, the league asks every club to furnish them with sufficient confirmation that they have enough money to fulfil all their obligations.

—  Legal expert

“The executive has to make a decision — do they kick them out or what do they do with them? If they can’t fulfil their fixtures, probably the most sensible thing will be to expunge all their games.

“That will mean you probably have one team from the PSL going down and two from the NFD going up to get back to 16 teams. The league must be consulting legal people to make a decision, but only the executive can decide what to do going forward.

“If the owners of Royal AM are going to go to court [against Sars], it may take a long time and that can put the season in serious jeopardy. This is a big problem for the league, but it is not something they could have foreseen.

“At the start of every season, the league asks every club to furnish them with sufficient confirmation that they have enough money to fulfil all their obligations.

“It looks like the lady [Mkhize] has assets, but the league did not know she had problems with Sars. The league will have to have an emergency meeting with all the clubs to change the constitution and determine how many go up and go down; [or] to decide whether the club will remain in the league; or that no points will be lost by the clubs that have already played them.”

The expert said the Nedbank Cup is not a big problem because Milford FC will progress to the last 16 to play against Sekhukhune if Royal is booted out of the PSL.

Royal general manager Richard Makhoba could not be reached for comment at the time of publishing.