The Court of Arbitration for Sport has ruled in favor of Andy Webster in his landmark contract case against Heart of Midlothian, in a decision that means players will be able to break their contracts after two or three years (depending on the age of the player) with no compensation due to the club except the remaining value of the contract.
Acting under Article 17 of FIFA’s transfer regulations, Webster left Hearts for Wigan in 2006 against the wishes of Hearts and with a year remaining on his contract. Hearts demanded £4.6 million in compensation, but yesterday’s ruling entitles them to just £150,000, the remaining value of Webster’s deal.
The ruling will have two important consequences. First, transfer fees should plummet. Why buy a player for an exorbitant sum when just a short while later you can have him for no more than the remaining value of his contract? As the Independent points out today, Cristiano Ronaldo and Cesc Fabregas will both be available for £12 million in 2010 under the new ruling, when the former is 25 and the latter is just 23. Dimitar Berbatov could leave Spurs next summer for as little as £1.3 million.
Second, player mobility should increase. Clubs will have a large economic incentive to limit the duration of contracts to two or three years. And since signing bonuses and fee-seeking agents will motivate players to move, we could be facing an unprecedented era of team fluidity.
Overall, the Webster ruling should mean a large shift in economic power (represented in terms of allocation of revenue as well as contractual freedom) to players and away from clubs. Paying top players enormous salaries now becomes a way for clubs to protect themselves from losing their stars to their rivals for next to nothing. Think of it as a kind of insurance.
This is the most significant development in player-club relations since the Bosman ruling in 1995, and its full impact will only be understood with time. Whether it’s for the good of the sport or not is a difficult question. Reining in transfer fees may be a good thing, but that will be no more an incidental byproduct of this ruling. And if “player power” swells to the point that teams have no stability and clubs are held hostage by their stars, then the cost will be felt in the fans’ relationships with players and in the erosion of team identities. Small clubs may suffer most of all, since their top prospects will be available to big clubs virtually for free.
I wonder about the timing of the decision, as well. Handing down the ruling so that it reaches the news the day before the transfer window closes guarantees that it will be overshadowed by last-minute transfer activity and not receive much attention from the media. Whether that was the CAS’s intention, or whether the CAS is too far in the clouds even to think of an underhanded tactic like that, is anyone’s guess.
UPDATE: FIFA, which is strongly opposed to the Webster ruling, has released a statement announcing that it may review its transfer regulations with the aim of finding a way to close the loophole. Sepp Blatter calls the ruling “very damaging for football.”
Read More: The Webster Ruling
by Brian Phillips · January 31, 2008
I’m glad you posted on this, Brian, as it seems to have flown under the radar somewhat — whether intentionally or not, I don’t know.
It’s not on the scale of Bosman, but it could take European football towards American sports in terms of the balance of spending.
It was actually the top story on the Gazzetta website an hour ago, and I was just about to say something about it on OTF.
But now Brian has spared me from having to think of something original.
Gee, that quote from TalkSoccer.net sounds awfully familiar . . .
I know this is somewhat late, and since I’m unsure of the etiquette in such situations, I’ll blunder on through anyway.
I think I’m right in saying that the clause that allowed Webster to do this arose out of negotiations between FIFA and the European Commission several years ago. So why is it that now someone has actually enforced this clause do FIFA want to change it?
Fredorrarci, that’s a great question. The rules behind the Webster ruling have been in effect since 2001, first under Articles 21 and 22 (if I remember correctly) of FIFA’s transfer regulations, then under Article 17 after the 2005 revisions. As I understand it, the transfer regulations always represented a somewhat uneasy truce between FIFA and the European Commission, rhetorically upholding both the principle of contractual stability (as FIFA wanted) and the contradictory principle of economic freedom for players (as the EC wanted).
Blatter has argued that the CAS’s ruling “distorts” Article 17 by disregarding what the regulations say about contractual stability and the exceptional nature of sport. Had the ruling gone the other way, I think the EC would have argued that it disregarded what the regulations said about freedom of movement for players.
In other words, I think there was always going to be a conflict between FIFA and the EC over Article 17 as soon as it was invoked and interpreted, which is one reason it took so long for anyone to try it—no one wanted to take the first step into the legal minefield.
The other reason it took so long is that clubs have been diligent over the last few years about renewing the contracts of players they want to keep before the players became eligible for an Article 17 move.
So the deeper question here is why FIFA and the EC signed off on transfer regulations that they understood in fundamentally different ways and were predestined to disagree about. I guess it’s just the nature of political compromise. Anyway, it should be interesting this summer to see whether any of the Webster-eligible players (Michael Owen, et. al.) try to follow in Webster’s footsteps, or whether the dramatic interpretation of the CAS ruling that I came to in the post above turns out to be a bit exaggerated.
It always was a compromise, but it is also fair to note that the FIFA of 2001 was considerably less strident on the issue of restricting player movement in the guise of protecting national teams than Blatter is today. It may also be the case that FIFA believes that the EC may be less “totally committed” to the principle of free movement of EU nationals within the Union than it was seven years ago, given the increase in political pressure on the concept from wholly non-football-related sources, such as the Berlusconi government’s current attempts to restrict immigration from countries like Romania and expel immigrants that are here legally.
One can view this particular battle as a skirmish in a larger conflict between FIFA (and its constitutent federations) and the wealthiest clubs over control of an essential elment of the game.
Good point about the pressure the EC’s facing from other quarters—you could say that FIFA’s become more strident about this issue just as the EC’s become somewhat less strident, and that may help to explain how the compromise was reached in the first place and how we got where we are. Though it’s still hard to say how FIFA might have reacted if a player had tried a Webster-like move in 2002 or 2003.
Actually, a couple of hours after I typed that comment, the European Parliament approved a motion by a Hungarian MEP for a full debate on the current treatment of Rom within the EU, with a particular focus on the recent proposals in Italy.
The number of forces influencing the ultimate result increases with the day (it is also worth noting that Berlusconi in his football club ownership role is all for freedom of movement).
My own guess is that the ultimate resolution of this issue, at least for top flight players, will be the extension of the Spanish concept of including a set price that has to be paid should a player wish to rescind his contract. Short of being able to prove duress, such an arrangement should hold up under the Webster principles.
I read a comment a few days ago from the agent of a Premier League player (can’t remember which one) saying something to the effect that his client would not stoop to using such a devious method to extricate himself from his current deal. So maybe a code of honour, an unspoken gentlemen’s agreement will prevail and things will carry on as before.
Of course, it was an *agent* who said this so, y’know…