The Most Obvious Problem With the Football League's Standard on Club Ownership is That It is Applied Only Retrospectively

Revelations about Russell King's involvement at Notts County have prompted concern at Football League headquarters but the League may nevertheless pass the takeover of the world's oldest professional football club as "fit and proper" at its 8 October board meeting.

The "fit and proper persons test", which the League introduced in June 2004, does not do what many fans probably think it should. It does not bar people from owning football clubs, or being involved in senior positions, if they are unsavory or if they have business collapses and unpaid debts behind them.

While the League is certain to seek more information from the club about King's dealings, it is bound by the tight wording of its own test and is coming under pressure from the club to ratify the takeover.

The League's test itemizes categories which bar somebody from being a director or "holding a majority interest" in a club. King is not a director and Notts County say he has no interest in Qadbak, the investment fund of "middle eastern and European families who wish to remain anonymous". Even if he were a director or major shareholder, there is no sign that his business record would make him fall foul of the test.

People are barred if they have a recent, unspent conviction for fraud or dishonesty; have been imprisoned for 12 months or more; or are on the sex offenders register. Anybody who is bankrupt or disqualified from a professional body or from acting as a director of a UK company is also barred. Another stipulation, that a person cannot be a football club director or major shareholder if he or she has been banned by another sport's governing body, is now to be tested for the first time in the case of the Queens Park Rangers director Flavio Briatore. The league is to study closely last week's ban applied to Briatore by the governing body of Formula One, the FIA, in the Renault Crash gate scandal.

A person whose past is littered with business collapses and debts unpaid to creditors is allowed to be a director or majority owner of a football club, if he or she is not barred on those other grounds. The only insolvencies which count against people are those of football clubs – if they have been directors of two clubs which have collapsed into insolvency, or of the same club which has been insolvent twice.

The Notts County takeover is now under the spotlight almost three months after its completion but the process highlights general weaknesses in the fit and proper persons test.

First and most obviously, the test begins only after a club is taken over and the new owners have become involved in a club's business. Lord Mawhinney, the League's chairman, told the government this summer that he would be "happy to work with the FA and Premier League" to see how the rules could be "strengthened appropriately, including how they might be applied prospectively". The Notts County takeover will increase the pressure for that to happen. The Premier League has already committed to applying its test before, not after, deals are done.

Secondly, football club directors declare themselves to be "fit and proper", filling the relevant forms in themselves. At Notts County the new directors – Peter Trembling, Peter Willett, Sir John Walker and Alex Clemence – are not yet registered at Companies House, which the club said yesterday was a matter only of procedure. There is no suggestion that any of those people fall into any of the categories which would bar them but being able to declare yourself to have passed a test does not seem the world's most robust application of that test.

The other weaknesses are in the contents of the test itself. It was brought in so that football clubs, beloved community sporting institutions, could not be taken over by people with dubious records, no money and nasty plans. Yet although it is to the League's credit that it has such a test, it is a glaring omission to allow in people with a litany of business failures behind them and to bar them only if such insolvencies were at football clubs. The League also does not see or vet the plans for a club and check that real money is there.

The four Notts County directors are understood to have certified themselves as not convicted fraudsters or people who have run two football clubs insolvent – under the League's rules that makes them fit and proper. It will be more difficult to pass those who "hold a majority interest" in Notts County, because the investors want to remain anonymous. In Switzerland, where Qadbak is administered, the law protects the identity of investors.

The club have now said that Willett and his son Nathan are Qadbak's directors and the League is thought to have been seeking proof that they control Qadbak's decisions at the club. On that basis the League is likely to pass Notts County's ownership as fit and proper.

The League has asked the government for help in getting behind anonymous offshore structures and the government has said it is willing to discuss it. Such powers, however, are a long way off.

"We are very comfortable with the ownership of the club and the directors," said a spokesman for a club which, in its record-breaking 145 years, has now seen just about everything.