decoration

"Deregulation" of the football agent profession (part 1).

In April of this year, we are facing another deregulation. No, this time it's not about the infamous list of the former Minister of Justice, but about the football agents market. The designation for the concept of a football agent is a person who mediates in player transfers and negotiates their contracts. The term "football agent" (Players' Agent) was used in FIFA regulations, to the implementation of which national football associations were obliged. Thus, the Polish Football Association (PZPN), through a resolution, established its own regulations, in which the football agent was rebranded, this time as a Player Manager. However, attachment to this nomenclature is not essential, as according to FIFA guidelines, there will no longer be football agents and player managers. Instead, there will be intermediaries. In this part of the article, we will focus on the current regulations. Part two will cover the planned changes.

 

HOW IT IS?

 

To discuss the planned changes, we need to start by discussing the currently applicable regulations. As of today, to work as a Player Manager, one must have the appropriate license issued by national football associations. What are the conditions to apply for this license in the Polish Football Association (PZPN)? Firstly, a manager can only be a natural person who enjoys full legal capacity, has full legal capacity to perform legal acts, and holds Polish citizenship 1)more precisely, holds Polish citizenship and has not resided outside the borders of Poland for at least 2 years before submitting the application for admission to the exam, or holds citizenship other than Polish and has the right of residence in the territory of the Republic of Poland for at least two years, with the exception that for citizens of EU or European Economic Area countries who reside permanently in the territory of the Republic of Poland, the two-year residence requirement does not apply, has an impeccable reputation, especially has not been convicted 2)for crimes against property, economic turnover, money and securities turnover, bribery, salability, and paid protection or other offenses committed for financial gain, as well as for fiscal offenses or offenses related to participation in an organized group or association aimed at committing a crime (including fiscal offenses), or offenses against life and health, sexual freedom and morality, or other offenses involving violence or threat of violence. Additionally, such a person cannot hold a position in FIFA, UEFA, PZPN, a club, or any other organization related to these institutions.

 

A person meeting the above requirements must pass an exam to become a Player Manager, which takes place twice a year - in March and September, with a positive result. Furthermore, after passing the exam, one must sign and submit to the Association a code of professional conduct, which is an appendix to the resolution. Every Manager, to conduct activities, is also required to conclude a professional liability insurance contract, aimed at securing all claims related to the activities of a football agent. The minimum insurance amount is 100,000 CHF (Swiss francs, currently almost 357,000 Polish zlotys). Alternatively, conditionally acceptable is the submission of a bank guarantee in place of an insurance policy, for the same amount, but with the requirement that it must be issued by a Swiss bank (this is because FIFA's headquarters are located in Switzerland).

 

For comparison, lawyers practicing in the territory of the Republic of Poland are required to have an insurance contract with a minimum guarantee amount of 50,000 EUR. I mention lawyers here not by chance because the aforementioned resolution provides that players in negotiations with clubs may be represented exclusively by Player Managers, close family members 3)parents, siblings, spouse and also by lawyers and legal advisors. The question immediately arises: what will happen if, despite all the above limitations, a player or club decides to enter into an agreement with a person who does not have a license and is not listed above? Such a person faces no consequences, as both PZPN, FIFA, and UEFA regulations are internal regulations of associations and organizations, and therefore are effective only against their members. Similarly, contracts concluded between an unlicensed manager and a player/club would remain valid if they meet the criteria provided by the law of the respective country. However, sanctions can affect clubs or players if they decide to use the services of "unlicensed" individuals during negotiations.

 

The catalogue of penalties has been specified in the resolution and includes penalties such as:


– warnings or reprimands,
– a monetary penalty equivalent to at least:
a) 5,000 CHF (for players),
b) 20,000 CHF (for clubs),
– suspension of player rights for up to 12 months,
– domestic or international transfer bans for at least 3 months (for clubs),
– deduction of points (for clubs),
– relegation to a lower league (for clubs).

 

Sufficient for imposing a penalty is simply "using the services" of an unauthorized person. Additionally, the PZPN or FIFA (in the case of international transfers) may decide that a player who used the services of an unauthorized person will not be subject to legal protection from the PZPN concerning the player's situation after signing a contract.

Of course, penalties are also provided for the Player Managers themselves if they fail to comply with the regulations arising from the resolution.

 

The resolution itself contains a number of indications, principles, and limitations regarding the role of a manager. For example, the well-known rule among football enthusiasts is included, stating that a manager can only contact players regarding a contract with a sports club when the player is not under contract with any club or when there are 6 months or less left until the expiration of the player's contract. Under the currently applicable regulations, a Player Manager can enter into representation agreements only for a specified period not exceeding two years. The conclusion of such a contract in writing is a requirement for a player to be represented by a Manager, under penalty of invalidity.

 

The contract should under the penalty of nullity specify who is obliged to pay the Manager's remuneration, namely the player or the club, depending on whom the Manager represents. However, it is possible in a representation agreement between the Manager and the player to stipulate that the player will instruct his club to make payments to the Manager. The Manager's remuneration amount is determined as a commission 4)in practice, this is often around 10% of the player's negotiated contract, hence the Manager's name is disclosed in the player's contract. The representation agreement should specify whether the remuneration will be paid in a lump sum after the player signs a contract with the club or in annual installments at the end of each year of the contract. In case the agreement does not meet the requirements regarding the commission amount, the Manager representing the player is entitled to 3% of the player's negotiated contract.

 

If the Manager represents the club and not the player, the amount of remuneration must be agreed upon by the parties. A licensed football agent is required to conclude representation agreements according to a standardized model, which is an annex to the resolution. Such an agreement should be signed in four copies, one for each party and two for the PZPN, to which it must be delivered no later than 30 days after signing. An additional requirement is a provision for arbitration, meaning the player and the Manager are obliged to submit any financial disputes related to the contract to the football Arbitration Tribunal. This does not apply to agreements where the Manager and the player belong to different football associations 5)as I interpret the provision regarding "Agreements with a foreign element," then the appropriate jurisdiction is the FIFA Chamber of Dispute Resolution.

The planned changes will be described in the second part.

 

Photo credit: www.flazingo.com

 

  1. specifically, has Polish citizenship and has not resided outside the borders of Poland for a period of at least 2 years before submitting an application for admission to the exam, or has citizenship other than Polish and has had the right of residence on the territory of the Republic of Poland for at least two years, provided that in the case of citizens of EU Member States or the European Economic Area, who are permanently residing on the territory of the Republic of Poland, the requirement of a two-year stay does not apply
  2. for offenses against property, economic turnover, money and securities, bribery offenses, saleability and paid protection, or others committed for the purpose of obtaining financial benefits, as well as for tax offenses or offenses related to participation in an organized group or association aimed at committing a crime (including tax offenses), or for offenses against life and health, sexual freedom and morality, or others using violence or threat of its use
  3. parents, siblings, spouse
  4. in practice, this is often around 10%
  5. because this is how I believe the provision regarding "Agreements with a foreign element" should be interpreted