PLAYER CONTRACTS IN THE 21ST CENTURY: LEGAL CHALLENGES AND INNOVATIONS

Written by Kartik Tripathi

A. INTRODUCTION

Apart from the engaging gameplay on a football pitch, a footballer has other aspects to deal with on the field. One such aspect is the contractual situations and the 'player contracts' that have to be signed by a football. The legalities may look rudimentary and simple from a bird's eye view, but the process can be tedious and time-consuming due to the nitty-gritty. Since a footballer's primary purpose is to focus on the game and activities on the pitch, he or she should not concern himself with the happenings off the pitch. This is, on the contrary, not true. A footballer's reputation does not only consist of aspects such as his behaviour on the pitch but also his behaviour and conduct off the pitch. This means that even though a subject like 'contract' or 'extending a contract' may not be directly related to the primary role of a footballer, it can still affect the player off the pitch. 

B. BARCELONA'S TISSUE PAPER DEAL: THE UNCONVENTIONAL SIGNING OF LIONEL MESSI

As time has passed, player contracts have become a matter of complex understanding and execution. During the olden days, this was not the case. An infamous incident regarding a player signing a contract was elegantly mentioned in 'Messi' by Luca Caioli. After Lionel Messi's exploits during his early childhood were noticed by the FC Barcelona representative (Carles Rexach), a decision was made to sign the young prodigy. The challenge was that the FC Barcelona representative needed paper or any formal document to make the signing official. During that time, Messi's father suggested to the FC Barcelona representative to use a piece of tissue to seal the deal. At that point, Carles Rexach had previously served as a player and was working as a Scout for the club. Messi's first contract with the club was thereby signed on a tissue paper. 

C. EVOLUTION OF FOOTBALL CONTRACTS: FROM SIMPLE AGREEMENTS TO COMPLEX NEGOTIATIONS

A consensus among avid football followers has been the evolving nature of contracts, especially since the advent of the 21st century. Post 2000, there have been substantial changes to player contracts. During the olden days, there was a direct relationship between the player and the club. Scouting of players is an integral process during the same. Scouting is a process that involves a representative of a particular club who goes around watching football matches and identifying those players whom the club could sign. Unlike law school moot court competitions, where scouting is grounds for disqualification for a team from the respective moot court competition, it is an essential part of a club's transfer prospects. A stark contrast has also developed in how a club approaches players to sign the contract. The use of incentives has been prominent. Earlier, some incentives for players to sign the contract were a new kit, a pair of boots, etc. 

The nature of incentives has escalated, with players now being offered luxurious items like houses, cars, etc. An agent also is another person who makes the signing of a contract for a footballer easier. He or she aids the process by assessing the contract from a player's point of view. To further elucidate, the agent acts as a catalyst during the transaction between the player and the club. The concept of an agent has been a new revelation in football. The agent must ensure that the club offers the player the best possible contract regarding monetary compensation and the years' duration. During the early 2000s, this was not prevalent, but as legal complexities increased, so did the requirement for an agent. A simple contract before the 2000s would involve only two parties- the players and club representatives. A contract between two people is valid and legally binding by law. The player's representative would usually consist of the player's parents or guardians, while the club's representatives would ideally be those with a legal background. 

The contract would be signed, and the player would join the club. No intermediary would assist the player. This has changed, and there has been an increase in the legal intricacies involved. A player and his or her family are responsible for appointing an agent. The agent is renowned if he or she has many famous players. In the contemporary world, after a proposed contract, the agent scrutinises and analyses it with the player. The involvement of the player's parents has become subjective now. The transaction involves three parties: the player, the agent, and the club's representatives. Even though the nature of the contract has remained the same, there has been a substantial change in the signing process. 

D. FIFA FINANCIAL FAIR PLAY

FIFA, the apex governing body for all football-related activities, has made dedicated guidelines regulating club transfer practices. The aim and objective for doing the same is to reduce the financial gap between clubs. Financial powerhouses like Real Madrid and Manchester City have often exerted their financial influence to sign players. Since Todd Boehly's ownership, Chelsea has spent over $1 billion on transfers. In the current English Premier League (EPL), Everton was given a 10-point deduction for breaching the Premier League's Financial Rules. The winter transfer window was instead a quiet one as there was a lack of lavish spending by the clubs. Since the Saudi Pro League started drawing players towards the league by exerting financial prowess, clubs have become more vigilant while entering into contracts with teams associated with the Saudi Pro League. 

E. CONTEMPORARY RULES AND PRECEDENTS

Clubs competing in the Conference League, Europa League, and Champions League are subject to Financial Fair Play regulations set down by UEFA. Each organisation must demonstrate that it has no outstanding indebtedness to its workers. This action is meant to accomplish the following goals:

· Ascertain that a resolution is reached concerning the responsibilities of its workers, with the proviso that wages cannot account for more than 70% of the club's revenue.

· Spread the word about prudent spending to help football.

· Maintain sustainability and long-term viability.

· Maintain balanced financial regulation.

Therefore, the goal of Financial Fair Play (FFP) is to enhance clubs' financial health and eliminate economic disparities. Article IV concerns the maintenance of contractual stability between professionals and clubs. Clause 18 deals with the "Special provisions relating to contracts between professionals and clubs". To elaborate further, a player's contract can only be as long as 5 years. However, FIFA allows a contract to be lengthier, provided the local rules of a given nation allow it. A player (or agent) bound by a contract cannot just walk into contract negotiations with a team. The team must give the player's present team written notice before further action. Furthermore, the player can sign a new contract with the new team once he is in the final six months of his current one. The player is free to sign with a different team if his contract has ended since FIFA's regulations align with widely accepted principles of contract law.

There have also been some landmark cases to fortify the position of the contract signed between the club and the player. A standard football contract must clearly state when the beginning and closing dates of the agreement will occur. Since a professional player's employment contract cannot last forever, it must be determinable as to the day, month, and year in order for it to be legitimate and enforceable. In the German case of Heinz Muller v. Fsv Mainz 05 (4 Sa/202/15), the Labour Court of the Federal Land of Rhineland-Palatinate held that: 

"A football club is forced to enhance the efficiency of its team season-after-season by recruiting and signing new player. If contracts with indefinite terms were the norm, the club could not regularly end a contract with a player through an ordinary termination". 

Clubs held the upper hand in contract negotiations with players until the mid-1990s. In some regions of the world (especially Europe), they could keep players from signing with another club after their contracts had expired. Nevertheless, some court rulings have turned this unfair situation around. A case at hand is Union Royale Belge Des Societes De Football Associatio Asbl v. Jean-Marc Bosman (1995) C-415/93, wherein the European Court of Justice banned restrictions of foreign EU members within the national leagues and allowed professional football players in the EU to move freely to another club at the end of their term of contract with their present team.

F. CONCLUSION

Signing a contract can often take time and effort for a player. Players are often spotlighted for indecisive decision-making in modern football, which portrays a fast-moving transfer market. Agents have tried to assist the players to the fullest, but ultimately, the decision rests on the player's shoulders. The complex legalities have yet to do the footballers a favour either. Often, familial intervention creates a new challenge for the player. The players must consider their situation and the transfer's impact on their families. Minor factors like transport, weather, etc., can often have a monumental effect. Looking at this from a club's perspective, stricter adherence to the FIFA Fair Play Rules has restricted the transfer activity in the transfer market and has, in some instances, hindered the club's transfer plans. FIFA and UEFA have done a commendable job in curbing gigantic powerhouses from exercising their financial superiority. The German league, Bundesliga, follows the 50+1 ownership model, meaning that 50% of ownership will reside with the fans and the remaining with the external owners. According to the DFL Rules (German Football League), clubs with a majority investor influence shall be barred from participating in the Bundesliga or the second division. This model ensures that external investors do not exert their influence. This may be a stepping stone for the future. 

*The Author is a legal Scholar from India

(The Image used here is for representative purposes only)