The Movement of Football Players between Clubs

Are there any laws which relate to transfers of players between football clubs?

Often various Government agencies both within the UK and abroad are loathe to interfere in the operation and running of the rules set down by sporting governing bodies. There are however, certain situations where these rules set down by the sporting governing bodies are said to infringe laws and the rights of the people within that sport. When that is the case the governing bodies will have to change their regulations in order to fully comply with the law.

The Bosman case in 1995 was one such situation where the European Court of Justice felt it necessary to require the European governing body of football, UEFA, to amend its rules concerning the transfers of players between clubs.

What were the FIFA rules prior to the Bosman case?

Before the Bosman decision in 1995 a football player could only move between clubs where both clubs were in agreement to this. The way that this agreement would be reached was by the two clubs agreeing on a transfer fee to be paid by one club to gain the services on that player.

This requirement for a transfer fee applied regardless of whether the player was still under contract with the first club. Therefore even players who were out of contract with their club were unable to sign a contract with a new club until a transfer fee had been paid or they were granted a free transfer by the first club.

Furthermore prior to the decision in this case quota systems existed throughout European football meaning that only a limited number of players from outside the country which the team is based in could represent their club in European competition. This was limited to three foreign players and two assimilated players being able to represent their club in European Competition. This did however not apply to the domestic leagues.

The Bosman Situation

The Bosman case arose because of the situation where a European footballer’s contract had run out with his current club and wanted to sign with another club in another European Union Member State. The club that held his registration would not however, release him unless the second club paid a transfer fee which they were unwilling to do so.

The player argued that this contravened the right to free movement of workers laid down by Article 39 of the European Union Treaty.

Article 39 of the EU Treaty provides for the following rights:

The argument in the case was that the conduct preventing the player from moving clubs violated the above basic rights which are provided to all European Union citizens.

The decision of the court

The European Court of Justice found in favour of the player and had the following to say regarding the previous system of transfers in football:

  1. That transfer fees for out of contract players were illegal where a player is moving between one European Union Member State to another
  2. That the quota system imposed by UEFA was also illegal meaning that club sides are now able to play as many players from other European Union Member States.

Does this effectively rule out the need for transfer fees completely?

Since Bosman clubs are still required to pay transfer fees for players which are still under contract with another club.

What is the case in relation to restrictions on the number of foreign players from outside the EU?

Limits placed on clubs in relation to how many players from outside the European Union can play in European competition and domestic European Leagues can still be imposed as the free movement of workers is simply a European based rule.

What happens if a player is from another European country but one which is not a European Union Member State?

Ten years later following the Bosman case the European Court of Justice further qualified the ruling by adjudicating on a case concerning a Russian player plying his trade in Spain. The Court held citizens rights and those of sporting association from countries which have agreements with the European Union will be offered the same protection as those from European Union Member States.

The decision of the case was found due to the 1994 Agreement on Partnership and Co-operation between the EU and Russia.

Has the decision in the Bosman case been a good thing?

The decision has undoubtedly had the desired effect in relation to enabling the free movement of players and has been a tool which has been widely used by some high profile footballers over the last 15 years.

As is often the case when the decision is made by a body which is outside the sporting realms many issues which may be individual to that particular sport are often not taken into consideration.

Affect on Clubs

The Bosman case has had the following implications for European football clubs:

  • Clubs are now required to sign players for longer contracts than previously as they do not want to run the risk of losing them to a Bosman type free transfer. This is therefore costing the clubs much more in player wages.
  • Smaller clubs cannot afford to sign players on long contracts. This is particularly the case in relation to young players who are not certain to fulfill their potential.
  • Smaller clubs often therefore lose young players who they have brought up through the ranks to bigger clubs on a free transfer

The affect that this has had on smaller clubs means that they have lost one of their biggest sources of income when they sell players they have developed to bigger clubs for large sums of money. This has had the effect of many smaller clubs going into administration or being forced to turn amateur.

Affect on Players

The ruling in the Bosman case has effectively worked out for the huge benefit of the football players. This means that due to the fact that a club will not have to pay a transfer fee for players who are out of contract the players will therefore be able to demand vast amounts of money in wages and signing on fees. Consequently the vast amount of power lies with the players as they can ensure that potential clubs enter a bidding war in relation to the wages to secure their services as a player.        

If a player is under contract with a club can be break that contract in order to join another club?

The European Commission stated in 2000 that it was to seek action again the football authorities as the current system for international transfers breached the right of free movement of workers even when they were under contract with their club. They felt that this was the case due to the fact that there was no right for footballers to break their contract with their club by giving notice as is the case with any other job in any other sector.

The Commission did not fully get its wish but an agreement between them and the football authorities led to new transfer regulations coming into place which apply to all players who have signed a contract after 1st September 2001 and who are involved in an international transfer. The Regulations state that unless all parties agree to the payment of a transfer fee no transfer fee is payable and provide for the following things:

  • Training compensation for players under 23 to replace the payment of a transfer fee
  • If a player unilaterally breaks his contract within the first 2-3 years then he will be suspended for a period of four months
  • Players shall only be able to move between clubs in two designated transfer windows

Will the homegrown players rule set to be introduced by UEFA infringe Article 39 of the EC Treaty?

UEFA are planning to implement, and to a certain extent have already implemented, a rule which states that you must have a certain amount of players in your squad which are homegrown – i.e. are from that country or have been in that country since a certain age.

This rule may infringe Article 39 but if it does so the infringement will only be indirect as it doesn’t state how many foreign players you are allowed to have. This may not fall foul of Article 39 if it can be shown to be justified in achieving its notion of improving the academy system for young players and thus improving international football.