Buy-Out & Release Clauses in football contracts: The basics
Published 02 April 2014 By: Daniel Geey
This is a brief blog on the issue of buy-out and release clauses in football player contracts. There appears to be some confusion between the two concepts and the aim of this blog is to set out the basics with the aid of a few recent examples.
For more detail on this topic, I would highly recommend Ian Lynam’s excellent blog on this topic.
What is a release clause?
It is a clause in a player’s contract that, subject to qualifying conditions (i.e. a particular transfer window or non-participation in the Champions League), automatically requires a club to accept an offer of a pre-determined contractual amount expressly set out in the contract from the offering club. If the minimum amount stipulated in the contract is triggered by a the purchasing club, the player will be entitled to speak to that club.
Examples of release clauses
Only a few Premier League transfers have been reported to have included release clauses. This was the case with the Demba Ba transfer from Newcastle to Chelsea and Joe Allen from Swansea to Liverpool In the case of Allen, reports were that the bid could only trigger the release clause if it came from one of five clubs that included Liverpool.
What is the difference between buy-out and release clauses?
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Daniel is a Partner in the Sport Group.
Daniel’s practice focuses on helping clients in the sports sector, including rights holders, leagues, governing bodies, clubs, agencies, athletes, sports technology companies, broadcasters and financial institutions.