BHS liquidator wades into business rates row with refund demand

The liquidators of BHS have waded into the escalating row over business rates by launching a bid to recover part of the multimillion pound bill incurred by the collapsed high street chain.

Sky News has obtained a copy of an update to creditors produced by FRP Advisory which discloses that it has hired an agent - said to be Hilco Profit Recovery - to "review the business rates paid by the company and to ascertain whether there are refunds available".

The move comes weeks after BHS was transferred from administration to liquidation amid expectations that unsecured creditors will receive just 2p in the pound once its estate is wound up.

Sources said that the annual business rates bill for BHS, which traded from 164 stores until its collapse last April, ran to several million pounds, although they acknowledged that only a fraction of that sum was likely to be recovered.

"The joint (Frankfurt: 1JO.F - news) liquidators will continue to co-operate with the appointed agent and local authorities in order to receive any refunds due," the FRP report said.

High street retailers have become increasingly bellicose over the newly calculated rates hikes that many are now facing, forcing the Government to hint that concessions could be forthcoming in the Budget of Philip Hammond, the Chancellor, next month.

Although far too late to salvage a future for BHS, the business rates row is being cited by other high street bosses as a factor in the potential demise of other struggling retailers.

The report prepared by BHS' liquidators also discloses that FRP is intensifying the pressure on two of the chain's former international franchisees - understood to be its partners in Gibraltar and Russia.

"The joint liquidators are prepared to seek judgement in the UK (as prescribed by the franchise agreement) and then enforce this judgement in the relevant overseas territory," the FRP update said.

Its report outlines progress in a number of investigations arising from BHS' collapse, including "into the disposal of certain properties that appear to have advantaged certain parties at the expense of the company" and "a funds transfer to a related company within the wider BHS group in respect of a freehold property purchase that was not recorded appropriately in the company's internal management accounts".

A spokesman for FRP declined to comment further on the details of these investigations or other matters contained in the update to creditors.

The latest report comes almost 10 months after BHS was plunged into administration, little more than a year after Sir Philip Green, the billionaire tycoon, sold the company to Dominic Chappell, a former bankrupt.

Nearly 11,000 jobs were lost, with Sir Philip and Mr Chappell facing legal action from pension regulators over a deficit in the retailer's retirement schemes said to have soared on one basis to more than £600m.

The TopShop owner was said last month to be on the brink of agreeing a settlement with watchdogs that would cost him approximately £350m, and he has since told associates that a deal is close.

A non-binding vote in the House of Commons last year suggested that he should be stripped of his knighthood.

FRP was drafted in to act as the joint administrator, and now liquidator, of the high street chain, at the behest of BHS' largest creditor, the Pension Protection Fund (PPF (Shenzhen: 300258.SZ - news) ), the lifeboat now responsible for retirement payments to thousands of the chain's former employees.

The FRP report discloses that it estimates its work will cost just over £2.4m in the year to 1 December 2017.