FIFA RSTP: Consequences of a ‘hard’ Brexit

By Frans de Weger & Thibault Dochy

BMDW Advocaten Haarlem The Netherlands

 

Introduction

Whilst the impact of Brexit on the FIFA Regulations on the Status and Transfer of Players (RSTP) 2018 Edition is not an issue at the top of the priority list of the UK and EU negotiators and policy makers, it is one which could have a significant impact on the world of football.

It is still not clear as to what will be the final deal between the UK and the EU; however, as it edges closer towards 29 March 2019, the date for leaving the EU, without any deal in place, the likelihood of a ‘hard Brexit’ becomes more likely and, therefore, it is critical for stakeholders in the football world to understand the potential implications of this.

This post examines specifically how the RSTP could be impacted by a ‘hard Brexit’ and the possible key consequences that this could have on European and UK clubs.

International transfers of minors

Pursuant to Art. 19.1 of the RSTP, international transfers of players are only permitted if the player is over the age of 18. However, according to Art. 19.2, three exceptions to this rule apply:

1.The player’s parents move to the country in which the new club is located for reasons not linked to football.

2.The transfer takes place within the territory of the European Union (EU) or European Economic Area (EEA) and the player is aged between 16 and 18. In this case, the new club must fulfil the following minimum obligations:

A.It shall provide the player with an adequate football education and/or training in line with the highest national standards.

B. It shall guarantee the player an academic and/or school and/or vocational education and/or training, in addition to his football education and/or training, which will allow the player to pursue a career other than football should he cease playing professional football.

C. It shall make all necessary arrangements to ensure that the player is looked after in the best possible way (optimum living standards with a host family or in club accommodation, appointment of a mentor at the club, etc.).

D. It shall, on registration of such a player, provide the relevant association with proof that it is complying with the aforementioned obligations.

3. The player lives no further than 50 km from a national border and the club with which the player wishes to be registered in the neighbouring association is also within 50 km of that border. The maximum distance between the player’s domicile and the club’s headquarters shall be 100 km. In such cases, the player must continue to live at home and the two associations concerned must give their explicit consent.

According to art. 19.3 of the FIFA RSTP, the conditions of this article shall also apply to any player, who has never previously been registered with a club and is not a national of the country in which he wishes to be registered for the first time and has not lived continuously for at least five years in that country. According to par. 4, every international transfer according to par. 2 and every first registration according to par. 3 is subject to the approval of the subcommittee appointed by the PSC (Players’ Status Committee) for that purpose.

In the light of the current Brexit debate, the authors of this post believe that, in the case of a hard Brexit (in the absence of a specific Brexit deal), the general exception under article 19.2, b) of the FIFA RSTP will cease to be applicable to the UK.

Hence, football clubs located in the UK will no longer be able to transfer young talented players between the ages of 16 and 18 from clubs affiliated to a national football association in the EU/EEA. Moreover, international transfers of minors to a UK football club will only be possible in cases where the player’s parents move to the UK for reasons not linked to football or under the specific conditions laid down in article 19.3.c).

Should clubs based in the UK no longer be entitled to make use of the exception under art. 19.2, b), they could see a positive impact on the development of young British players, since they will have to invest in their own youth players instead of transferring young players from European training clubs at the age of 16.

At first sight, one would assume that the training clubs, affiliated to a national football association in the EU/EEA, would also benefit from this, since clubs participating in the mid-sized leagues, such as the Belgian Jupiler Pro League and the Dutch Eredivisie, tend to lose their most talented players to the top clubs in the UK at an early stage in their career. However, in practice, this “measure” will likely benefit the top clubs in the other major European Leagues, since they would no longer face competition from the English clubs when attempting to transfer players between the age of 16 and 18.

Training compensation

Calculation of training compensation

According to Article 6.3 of Annex 4 of the RSTP, for players moving from one association to another inside the territory of the EU/EEA, the amount of training compensation payable will be established based on the following. If the player moves from a lower to a higher category club, the calculation will be based on the average of the training costs at the two clubs. For example, if a player moves from a Spanish category 3 club (EUR 30,000 training costs per year) to an English category 1 club (EUR 90,000 training costs per year), the average cost of training per year will then come down to EUR 60,000. However, it is also important to know that, in the RSTP, it is stated that, if the player moves from a higher to a lower category, the calculation is based on the training costs at the lower category club. In case of a hard Brexit (in the absence of a specific Brexit deal), when a player is registered for the first time as a professional, or in case of an international transfer of a professional football player before the end of his 23rd birthday, where a club based in the UK is involved, training compensation would, in any case, be calculated based on the training costs of the new club multiplied by the years of training with the former club. Consequently, European training clubs would receive higher amounts in cases where a player moves to a higher category club in the UK.

Entitlement to training compensation

With regard to the entitlement to training compensation, there is an extra requirement on whether or not training compensation is due within the EU/EEA. Pursuant to article 6.3 Annexe 4 of the RSTP, if the transfer is within the EU/EEA and the former club does not offer the player a contract, then no training compensation is payable by the new club, unless the former club can justify that it is entitled to such compensation (prove a bona fide interest in keeping the player).

The CAS and the DRC have decided in several cases that the obligation of a club having offered the player a contract when claiming training compensation is a requirement which only needs to be met within the EU/EEA. This means that, if the training club is not located within the EU/EEA, such as a club located in the UK, the above-mentioned provision is not applicable. The entitlement to training compensation in those cases, where a player is transferred to a team based in the UK, would thus no longer depend on the prerequisites of a contract offer referred to in art. 6.3. Annexe 4 of the RSTP or the existence of a bona fide interest in keeping the player.

Conclusion

Thus, a “hard Brexit” will likely have major consequences for the system of transfers of minors and training compensation in football.

In conclusion, with regard to the transfers of minors, on the one hand, the loss of the entitlement to make use of the exception under art. 19.2, b), could have a positive impact on the development of young British players, since UK clubs would have to invest in their own youth players instead of transferring young players from European training clubs at the age of 16. While on the other hand, the top clubs in the other major European Leagues would no longer face competition from the English clubs when attempting to transfer players between the age of 16 and 18.

As indicated, the calculation of training compensation would, in any case, depend on the training costs of the new club when a club based in the UK is involved in an international transfer. Secondly, in the authors’ view, when a player is registered for the first time as a professional, or in the case of an international transfer of a professional football player before the age of 23, training compensation would be due to the training clubs, regardless of the existence of a contract offer and the proof of a bona fide interest in keeping the player in accordance with art. 6.3 of annexe 4 of the RSTP.

It will be interesting to see what actually transpires!