ECF takeover potential

[Alex Holowczak]

A question someone just asked me, which seemed daft, but after a bit of thought...

The ECF in its current guise is a company, I believe? Does this mean that one could buy it, take over it, and do whatever one wants with it?

E.g. some multi-millionaire could buy it, and administer chess in England as they see fit?

[Richard Bates]

You can't buy something that isn't for sale.

[Alex Holowczak]

Of course, but hypothetically speaking...

[Richard Bates]

Of course, but hypothetically speaking...

Hypothetically, who is the seller?

[Alex Holowczak]

I don't know. This is what I'm asking.

[Richard Bates]

I assumed you were envisaging some sort of hostile takeover.

The membership could presumably agree to change the constitution and put it in the hands of some rich millionaire if they so wished, but it's somewhat unlikely. But it's not a question of "buying" because there is nothing to sell.

[Alex Holowczak]

The ECF does have some assets it can "sell"; e.g. the Office, the British Championship trophies, equipment...

[John Upham]

The ECF does have some assets it can "sell"; e.g. the Office

Rumour has it that The ECF Office (without Ricky Gervais) is currently operating a leasehold at The Watch Oak that is due to expire June(?) 2011. The company that currently shares The Watch Oak building is possibly going to take over the parts leased by the ECF.

Maybe someone else has more detail to provide than myself?

[Roger de Coverly]

The ECF does have some assets it can "sell"; e.g. the Office, the British Championship trophies, equipment...

Also the "rights" to be the official national chess federation for England. A while back the ex-CEO posted his vision of a more "commercial" ECF. This was so far removed from what the ECF is at the moment that you would probably start a new organisation. In a free market you could set up this commercial operation in competition with the ECF. It struck me though that there was little in the commercial operation that would make people want to join unless they were "compelled" to do so because it had the national chess monopoly ( you can only have one "official" chess federation per sports country ).

[Sean Hewitt]

The answer to the original question is simply no.

The ECF is a company limited by guarantee. This means that the company has no shares for the hypothetical millionaire to buy.

[E Michael White]

Also the "rights" to be the official national chess federation for England. ...............................In a free market you could set up this commercial operation in competition with the ECF. It struck me though that there was little in the commercial operation that would make people want to join unless they were "compelled" to do so because it had the national chess monopoly ( you can only have one "official" chess federation per sports country ).

Rogers facts are basically correct but I expect over a few years a rival national body could be set up and collate the information normally supplied under FIDE Handbook Regulation Chapter 2 section 2.4. The cheapest way to do this would be to set up an internet based organisation where players could register at no annual cost and state their allegiance would be with the new body if it became the English body recognised by FIDE.

When the section 2.4 figures look more impressive than the ECF's an application to FIDE could be made to become the national controlling body on the grounds that the ECF was no longer representative. Once accepted as the national body it would be difficult for the PIF and various other trusts and charities to function as required by their trust deeds and the Charities Acts specify that funds would need to be made available to similar organisations ie the new ECF. At that point member subscriptions could be requested to cover the expenses of FIDE membership.

In order to get impressive section 2.4 results it would be necessary to organise FIDE registered international events so players would need to remain ECF registered in the meantime unless they have dual national status. I suspect members would like a better grading system and various other enhancements that the ECF do not currently deliver well. It would also be necessary to trawl through English legislation to see if the ECF status is protected under English law or whether this can be easily transferred to a more representative body. Come to think of it if e2e4 and the 4NCL joined forces and John Upham provide free League management software feeding a better new grading system, what else would be needed to persuade players to defect ?

I trust this will concentrate the minds of the ECF powers that be, to look for continuous improvement.

[Simon Brown]

Actually the answer to the original question is yes. Just because there are no shares doesn't mean you can't buy the company, though there are potential legal issues about a corporate buying a charity in all but name. Buying the assets and assuming the liabilities, however, isn't complicated.

The problem is that the trustees would have to use the proceeds to met the aim of the original company, and more so that the ECF isn't worth anything. Despite having a quasi-monopolistic position it hasn't exploited it so others (notably Malcolm) have created businesses which are commercially superior. So any millionaire who fancies putting money into chess will not pay to buy the ECF, and so the trustees will be obliged not to sell.

The other problem is that the trustees don't have the ability to appoint and remove directors, I guess. So the only would still be subject to the vagaries of the Board and Council, because the chances of these people agreeing to amend the Articles smacks of turkeys and Christmas.

So nice idea. Setting up in competition however is perfectly possible, but might require a lot of capital to take over a problem you don't really want.