With the European Championships Football about halftime now, this is a blog about football, football players, football players' contracts and the increasing influence of money in professional football.
First of all I have to mention the so-called transfer system; in professional football, a transfer is the action taken whenever a player under contract moves between professional clubs. In the famous Bosman ruling on 15 December 1995, the European Court of Justice ruled that this system, as it was constituted, placed a restriction on the free movement of workers and was prohibited by Article 39(1) of the EC Treaty. Bosman and all other EU football players were given the right to a free transfer at the end of their contracts.
In 2001 the European Commission and football’s governing bodies FIFA and UEFA have reached agreement on a new transfer system. The agreement will create one main transfer window per season and a new compensation framework to reward the “training effort” of smaller clubs. (see e.g. the ECJ Bernard case). There is also provision for sporting sanctions and financial punishment for unilateral breaches of players’ contracts.
Let's have a closer look at the FIFA Regulations for the Transfer and Status of Players.
- Upon expiry of the term of the contract
- By mutual agreement, with or without ‘buyout’ clause
- In case of a just cause
- In case of a sporting just cause
- After a unilateral breach of contract within the protected period.
The protected period is a period of three entire seasons or three years, whichever comes ﬁrst, following the entry into force of a contract, where such contract is concluded prior to the 28th birthday of the professional. For players older than 28 years the protected period is two years. FIFA has the intention to guarantee the contractual stability between football clubs and players.
Without prejudice to the right of any player or club to seek redress before a civil court for employment-related disputes, arising disputes can be brought before the FIFA Dispute Resolution Chamber (DRC). FIFA has established the DRC for the purpose of resolving disputes regarding the international status and transfer of players. The DRC has since then developed into a major and influential alternative resolution body, with an impressive and ever increasing caseload.
Now, what’s the difference between a just cause and a sporting just cause from the point of view of the FIFA DRC?
A just cause for a football club to terminate a contract unilaterally:
- Use of doping or drugs (see e.g. CAS Mutu case: Romanian football player Mutu has been suspended and fired by football club Chelsea after using cocaine)
- an ‘uncooperative attitude’ of the player from the start of the contract
- a long period of absence of the player without any reason.
A football player has a just cause to terminate a contract unilaterally in case his salary has not been paid for at least three months.
A football player has a sporting just cause to terminate a contract unilaterally:
- in case he has, in the course of the Season, appeared in less than 10% of the Ofﬁcial Matches in which his club has been involved
- in case he is fully trained and ready to play on a regular basis, but is not playing at all during matches.
A sporting sanction for a football player is for instance a restriction of four months on his eligibility to play in Ofﬁcial Matches. In the case of aggravating circumstances, the restriction shall last six months. In all cases, these sporting sanctions shall take effect from the start of the following Season of the New Club. For a football club a sporting sanction means that a particular player is not allowed to register and therefore not eligible to participate in national or international football competitions.
One of the landmark cases about (termination of) players' contracts before the DRC and the Court of Arbitration for Sport (CAS) is the Webster case. Webster ended his contract with Hearts, a Scottish football-club, unilaterally outside the protected period. The FIFA Dispute Resolution Chamber decided Webster would have to pay £ 625,000 compensation for the residual value of the contract and the fact Hearts contributed to the development of Webster into a ‘high profile footballer’.
Webster, Hearts and Wigan lodged an appeal with the Court of Arbitration for Sport (CAS). Hearts believed Websters ‘market value’ to be £ 4 million. The CAS decided Webster would have to pay £ 150,000 as compensation, based on the amount of remuneration to which Webster would have been entitled between the moment he breached his contract unilaterally and the time at which the contract should have ended. The CAS was clear about the market value : “There’s no economic, moral or legal justification for a club to be able to claim the market value of the player as lost profit” and concerning the 'specificity of sport' CAS stated there should be a “reasonable balance between the needs of contractual stability, on the one hand, and the needs of free movement of players, on the other hand, i.e. to find solutions that foster the good of football by reconciling in a fair manner the various and sometimes contradictory interests of clubs and players.”
During the last two decades there has been a substantial raise in transfer sums and salaries of ‘high profile’ football players. Cristiano Ronaldo has the honor of the transfer record when he moved from Manchester United to Real Madrid for £80 million (see Transfer record list Wikipedia).Football players’ agents have made football players more aware of their financial position and supplied them with a better bargaining power raising their market value. Players are tempted to stay longer with clubs after clubs are offering a unilateral extension of the contract (maximum 5 years) and a raise in salary will help too.
Football clubs have more to spend because media- or businesstycoons are bringing in huge sums of money (Abramovic to Chelsea) or clubs are floated on the stock market, like Manchester United and Ajax Amsterdam or sponsoring contracts and TV broadcasting rights are very lucrative.
Professional football is under a serious threat of sports betting and corruption scandals. In the (under)world of sports betting is about 200 to 300 billion euro involved. In comparison, the total revenue of all European professional football clubs together is about 20 billion euro. Gamblers or gambling syndicats are wealthy enough to bribe individual football players to get a yellow card in the first 15 minutes of a football match (spotfixing) or to influence the results of the match (matchfixing).
Scandals in Italy have reached the national team on the eve of the European Football Championships. Who knows whole Europe is infected with this betting virus? Dutch Labour MP Recourt said there's a real chance of matchfixing in Holland too. Recourt wants the football association to tighten up the rules covering betting and ban players from betting on matches in the same division. At the moment the Ministry of Sports is carrying out an investigation together with the KNVB football association the NOC*NSF athletics federation and gambling organisations. The FIFA has considered the corruption in football as a serious problem too and has asked war crimes prosecutor Moreno Ocampo to help tackle the problem.
Fortunately there are a lot of high profile football players who spend their money in a noble cause. A few examples : the Clarence Seedorf Foundation, Ryan Giggs (Manchester United) is ambassador for UNICEF, the Johan Cruyff Foundation helps children in their physical education by building Cruyff courts in cities, Dutch goalkeeper Van der Sar is helping patients with brain damage, and many more..
Thank you for your attention and enjoy the European Football Championships!
A selection of relevant publications from the Peace Palace Library collection
- ANDERSON, P.M., BLACKSHAW, I.S., SIEKMANN, R.C.R. and SOEK, J., Sports Betting: Law and Policy, 2012
- NIEMANN, A., GARCIA, B. and GRANT, W. (eds.), The Transformation of European football : towards the Europeanisation of the National Game, 2011
- WEGER, F. de, The jurisprudence of the FIFA Dispute Resolution Chamber, 2008
- WILD, A., CAS and Football: Landmark Cases, 2012
- BLACKSHAW, I., "The CAS Appeal Decision in the Andrew Webster Case", International Sports Law Journal, 1-2 (2008), pp. 14-20
- DIXON, D., "The Long Life of Bosman: a Triumph of Law over Experience", Entertainment and sports law journal, 6 (2008), No.2, pp. 1-23
- WEATHERILL, S., "Bosman Changed Everything : the Rise of EC Sports Law", in Miguel Poiares Maduro and Loic Azoulai (eds.), The past and future of EU law : the classics of EU law revisited on the 50th anniversary of the Rome Treaty, 2010, pp. 480-487