"Every associate committee of a council has by law to consist of two-thirds council and one-third other and MJRC being a four-three set-up didn't meet that requirement.
"They have still been unable to advise the staff, who they met on Monday, what legal right they have to declare the staff will no longer be employed by MJRC but will become council employees.
"This is despite frequent ongoing discussions with the MJRC initiated by the BHA on the issues of concern since late in 2016.
"While discussions continue - and it remains open to the MJRC to reapply for a licence at any time - it is very much in the hands of the ."
However, these would not be drawn from the Lothian Racing Syndicate, which has until now provided the necessary racing expertise to the MJRC
's new chairman Councillor Willie Innes said: "The MJRC
has responded to the BHA timeously and is continuing to engage with the BHA to progress matters positively and constructively.
That licence was initially not renewed after the MJRC
failed to meet a BHA deadline for agreeing to an independent governance review.
John Prideaux, one of the LRS's three members on the MJRC, added: "The Lothian Racing Syndicate made clear from the outset we support the BHA requirement to hold a governance review and welcome the BHA's insistence the review be wholly independent and not simply commissioned by East Lothian Council, as Councillor Innes wanted.
"We are committed to working with other MJRC members to ensure the best possible outcome for hard-working racecourse staff and the racegoers, trainers and owners who have supported Musselburgh over the years."
East lothian council leader Willie innes, one of four councillors on the seven-seat MJRC
and chairman of the course, has said he will convene a meeting to consider the ultimatum next tuesday - five days after the deadline, almost certainly meaning the loss of the July 14 fixture.
was established in 1994 to manage Musselburgh and is made up of three representatives of the Lothian Racing Syndicate Limited and four representatives of east Lothian Council.
Despite describing the extra costs involved in an enquiry as "unwelcome", chairman of the MJRC
Pat O'Brien intends to put forward the committee's views on the many economic, social and sporting benefits of the scheme.