Pegasus and Happy Valley barred from playing due to overdue payments


Get up to speed on the developing story involving Pegasus and Happy Valley as both clubs try to get back on the pitch.

Hong Kong football fans waited 80 days to watch live football again.

They only needed to wait two days for the next crisis in local football.

On Monday, the Hong Kong Football Association announced that Pegasus and Happy Valley would be barred from playing as punishment for non-payment of insurance premiums. Neither club will be allowed to play again until seven days have passed since the date of payment. By rule, all matches in the intervening period involving either club will be declared as forfeits.

This announcement spells greater chaos for the Premier League, which can ill-afford more negative publicity. Over the past year, two clubs have self-relegated from the top flight due to financial problems and one club decided to fold less than two weeks before the start of this season.

The result is that the Premier League was down to eight teams this season, the fewest since the top flight was fully professionalized in 2014.

With the story rapidly developing, here is the latest on the situation.

What happened?

On Monday evening, the HKFA’s Disciplinary Committee met to discuss the non-payment of insurance premiums by Pegasus and Happy Valley. The DC announced, via press release, that it had ruled both clubs to be in violation of Section B, Article 11 of the Premier League Rules and Regulations which pertains to insurance coverage for all players and staff. Without insurance, there is no compensation to players and staff for any medical damages suffered on the job.

All clubs agree to participate in a collective insurance scheme as a condition of their Premier League License, with a vote held at the beginning of each season to decide upon the insurance policy. The clubs are then obliged to pay their annual insurance premium no later than 14 days prior to their first match of the season. As Valley and Pegasus kicked off their campaigns on 24 and 25 October respectively, the deadline for payment should have passed on 10 and 11 October.

Neither club have denied that these dates are accurate. Further, it is believed that the HKFA and the insurance company have issued multiple oral and written reminders, even warnings, to the two clubs since the original deadline had passed.

As punishment, the DC barred Pegasus and Valley from playing any matches until the payment of insurance premiums could be confirmed. Any matches involving either club would be forfeited and declared 3-0 victories for their opponents. In addition, the DC announced that both clubs would be ineligible to play until seven days after premiums were paid, owing to “fairness” and to give their opponents “proper time to prepare”.

The judgments took effect on Tuesday at noon, and both clubs were given until Thursday at noon to lodge an appeal. The Appeals Committee is responsible for handling all appeals, however, the DC made clear that all judgments would remain in effect until the AC makes its decisions.

Happy Valley had been off to a strong start, with only one loss in eight matches across all competitions. (Credit: Happy Valley)

How have the clubs involved responded?

Pegasus immediately sprung into action, paying their outstanding premiums at or before 9:55 a.m. on Tuesday morning. The Horsemen received official confirmation of receipt of payment from the insurance company at 11 a.m. – an hour ahead of the judgment’s effect – and remain confident that they will play Rangers on Sunday, as scheduled.

The HKFA have been in contact with the insurance company to confirm that payment has been received, but the organization have yet to rule on whether it the match will go ahead.

Happy Valley issued a statement on Tuesday afternoon claiming that the club were “dealing with the insurance related matter” and hoped to “resolve the matter shortly.” They did not state whether their premium had been paid.

Later in the evening, the HKFA confirmed that they had received Valley’s appeal. Crucially, the organization appeared to soften their stance, carefully stating that the club’s Sapling Cup semi-final against Lee Man on Wednesday night “will not be held”.

The DC’s judgment had implied that the match would be declared a walkover for the Bees, but the HKFA’s statement opens for the match to be rescheduled.

Although the HKFA’s Board of Directors is not involved in adjudicating the matter, the Board plan to discuss the matter during their meeting on Friday. According to reports, the Board were not notified in advance that a decision was forthcoming from the DC.

Pegasus’ restart had already been off to a poor start with the news that marquee player Bernando had terminated his contract with the club. (Credit: Pegasus)

What are the clubs saying?

Both Pegasus and Happy Valley were surprised to receive news on Monday night regarding the DC’s decision, but neither club refuted the claim that they had failed to pay their premiums.

Peter Man, one of Pegasus’ directors, even tried to downplay the seriousness of the issue.

“Because of the severity of the pandemic and the subsequent suspension of the Premier League for several months, there was uncertainty as to when the season would resume,” he said. “Sometime during the New Year break, there was a misunderstanding between our accountants and the HKFA.”

HKFA chairman Pui Kwan-kay, who is also the chairman of Happy Valley, called the judgment “sudden” and was surprised by its immediacy. However, he stressed that the DC was independent of the Board of Directors and could not comment further due to conflict of interest.

Valley’s Director of Football Poon Man-tik told reporters on Tuesday night, “The insurance company and we have reached an acceptable agreement. We will resolve the situation within a certain period of time, and they will notify the HKFA once they’ve OK’ed this agreement. It will be up to the HKFA to decide how to go forward.”

Like Man, Poon did not deny that the situation had been lingering for several months but was still stunned when the DC moved to punish the clubs on Monday night. He admitted that the DC were “not wrong” about the facts but wished that they could have been more flexible.

“Well, bluntly, the state of the economy has limited how clubs can operate,” he said. “We hope that the HKFA can exercise discretion and give our club and our players the opportunity to continue playing until our appeal is considered. If the punishment cannot be delayed, and we are barred from playing, then the damage is already done.

“We hope that there can be some flexibility, so that we can arrive at a proper solution and not lose even more opportunities to play in an already condensed season.”

Pegasus director Peter Man (Credit: inmediahk)

In an unexpected twist, Rangers’ director Philip Lee issued a statement on Tuesday night in defence of the two clubs, agreeing with Poon’s call for flexibility in light of a difficult period for professional football.

“Of course, I felt disappointed when I received the news because it meant that we would’ve taken three points from our opponents without beating them on the pitch. This would’ve been an extremely meaningless victory,” he wrote.

“Since the beginning of the pandemic, the sport has been paused several times. It was hard enough for the HKFA to gain approval to resume play. From a fairness perspective, I hope that the match (on Sunday) will go ahead because I don’t want to undermine the integrity of the competition.

“The HKFA needs to manage the public relations aspect (of the decision) more carefully. The fact that there are even eight (professional) clubs who are willing to carry on should be valued.

“No one wants to read more negative stories because it’ll only further damage the reputation of Hong Kong football. This news affects everyone in the Premier League to some extent. I urge the upper management at the HKFA can deal with this situation more carefully.”

Was it really a surprise?

Short answer – no.

Last April, it was revealed that Happy Valley had encountered salary arrears dating back to February 2020. At the time, Poon claimed that the club’s boss, Chen Zhishi’s, funds had “dried up” due, in part, to the pandemic’s effect on the boss’ mainland business.

When Valley resumed training in July, the club fell behind again in paying salaries. Poon’s excuse at the time was that daily limits on remittances from China were to blame for the delay in disbursing payment.

According to sources, many players have not been paid since June or July and the club are having difficulties in reaching Chen.

Happy Valley director Poon Man-tik (Credit: Happy Valley)

As for Pegasus, the Horsemen encountered financial difficulties during the most recent suspension of the season. Players at the club reportedly did not receive their salaries on time and in some cases, were asked to accept pay cuts.

What happens now?

The HKFA released its revised 2020-21 season schedule on Wednesday afternoon and both clubs continued to have matches scheduled. The organization noted in the accompanying press release that they are handling this incident “in accordance with the regulations.”

Neither of the clubs’ matches scheduled for this weekend have been postponed at the time of writing. The HKFA promised in their press release that updates on the matches would be announced “in due course.”

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