Player transfer regulations as per FIFA

Another so-called transfer window has passed in the world of football, both globally and in Europe. The commercialization of sports, and consequently the growing professionalism, have turned sports, particularly European football, into more than just a competition; they have become a separate branch of business, with increasingly large sums of money being invested. It is enough to say that transfers of players now evoke emotions as strong as the sporting results themselves. Considering that sports events and related activities are covered by people accustomed to following and reporting on competitions, the winner had to be pointed out even in this case of the transfer window.

Thus, industry specialists have a habit of putting on a pedestal the team that, in their opinion, has acquired players showing the highest sporting level, or alternatively, the team that has made the greatest improvement in quality by acquiring new players compared to the previous season. However, this year, it was widely accepted that the palm of primacy does not belong to a specific team, but to a specific person, namely Jorge Mendes – the Portuguese football agent who was involved in transactions related to changing the club colors of players, with a total sum exceeding 250 million Euros. Therefore, it is worth delving into the issue of a player changing clubs and the legal aspects of transfer agreements.

The so-called transfer agreement is colloquially referred to as a player purchase or sale agreement. This term is as misleading as it is inappropriate. Firstly, it leads to a certain objectification of the player, who, according to this nomenclature, is treated as a commodity in circulation. Indeed, this tendency to refer to many agreements as sales, even those explicitly named differently in the civil code or other legal acts, stems more from a general practice. However, considering the nature of this article, it is important to note that in the process of a player changing clubs, there is no actual sale, and the transfer agreement has an entirely different legal character.

The regulations concerning players changing clubs in the form we know today are a result of the famous case before the Court of Justice of the European Communities ¹⁾now the Court of Justice of the European Union, concluded with the judgment of December 15, 1995, the so-called "Bosman case" ²⁾Case C-415/93. Since discussing this ruling requires a separate study, for the purposes of this post, it should be noted that the Court questioned the regulations of sports associations that tied a player's ability to change employers (clubs) after the expiration of a contract to payment for the transfer, training, and promotion.

The Court also deemed the restrictions imposed by sports associations, according to which football clubs could field only a limited number of professional players who were citizens of other member states, incompatible with community law. This initiated negotiations between the European Commission, FIFA, and UEFA, which concluded with the signing of an agreement on March 5, 2001, regarding a new transfer system in football. The result of this agreement is the Regulations of October 13, 2003, on the Status and Transfer of Players (hereinafter referred to as the "RSTP") ³⁾Regulations of the Status and Transfer of Players.

So, what does a player's change of club look like? It is impossible to answer this question without at least briefly explaining the regulations related to player employment. Firstly, it should be emphasized that, according to Article 2(1) of the RSTP, footballers are divided into amateurs and professionals. A professional has a legal definition, as stated in Article 2(2) of the RSTP, which stipulates that a professional is a player who has a written contract with a club and receives remuneration for playing football that exceeds the expenses he actually incurs ⁴⁾A professional is a player who has a written contract with a club and is paid more for his footballing activity than the expenses he effectively incurs.

All other players are considered to be amateurs. Amateurs, on the other hand, are all other players who do not meet the above conditions, i.e., those who receive from the club only a reimbursement of the expenses they incur in connection with playing football. This is important because the further provisions of the RSTP differentiate between the legal status of amateurs and professionals. Due to the theme of this post, however, we will focus on the regulations concerning professionals.

As indicated by the cited provisions, a professional footballer has a signed contract with the club he represents. Importantly, according to Article 18(2) of the RSTP ⁵⁾The minimum length of a contract shall be from its effective date until the end of the season, while the maximum length of a contract shall be five years, a contract concluded with a club can generally only be for a fixed term, for a maximum of 5 years and not less than until the end of the season from the date of its entry into force. However, if the player has not reached the age of 18, the maximum period for which his contract can be concluded is 3 years ⁶⁾If the player is under the age of 18, the maximum period for which his contract can be concluded is 3 years.

A player who is bound by a professional contract with one club and wants to move to another club interested in his employment must therefore terminate the existing contract, as he cannot be a party to two valid player contracts. The process of making offers to players with club affiliations has also been regulated. A club wishing to hire a player under contract with another club must first submit a written request directly to the player's club, and only then can it make an offer to the player himself ⁷⁾Article 18(2) of the RSTP (unless the player has 6 months or less remaining on his contract). Naturally, a club that employs a player with a suitable sporting level, for whom a contract has been signed and payments have been made to another club and/or the player's manager, is not inclined to agree to the transfer and termination of the contract with the player without ensuring adequate benefits. These benefits include, among others, the transfer fee, which essentially constitutes a form of compensation for the club agreeing to terminate the player's contract. The transfer, therefore, proceeds in stages; first, the club interested in acquiring the player must submit a written request to the player's current club before engaging in discussions with the player himself.

Subsequently, the player and the potential new club negotiate the terms, including the financial aspects, of the player's future employment - it should be emphasized that the player's consent to the transfer is a necessary condition (sine qua non) for changing clubs. Then, if the parties (the player and the potential new club) reach an agreement, the club interested in employing the player and his current club enter into negotiations to determine the terms of the player's transfer, including the transfer fee. Once a compromise is reached, an agreement is signed between the new and old clubs, known as a transfer agreement, an agreement between the old club and the player to terminate the contract, and an agreement between the new club and the player outlining the terms of his employment.

In conclusion, it should be stated that an agreement concerning a player's change of clubs takes the form of a release and is mutually binding. The club employing the player undertakes to mutually terminate the contract with its player, in exchange for which the club acquiring the player undertakes to pay a transfer fee to the releasing club. In reality, there is no sale, partly due to the lack of a subject capable of being the object of a sales contract, but rather the termination of one contract concluded for a fixed term and the signing of another, with the releasing club receiving compensation for the termination.

Further posts will be dedicated to the process of a player changing clubs, and on this occasion, related issues such as training compensation and the solidarity mechanism will be addressed.

Photo by martha_chapa95 / photo on flickr  CC BY 2.0

1. currently the Court of Justice of the European Union
2. Case C-415/93
3. Regulations of the Status and Transfer of Players
4. A professional is a player who has a written contract with a club and is paid more for his footballing activity than the expenses he effectively incurs. All other players are considered to be amateurs
5. The minimum length of a contract shall be from its effective date until the end of the season, while the maximum length of a contract shall be five years
6. Art. 18. Paragraph 2. RSTP in fine
7. Article 18(2) of the RSTP