R.I.P. TPO: a guide to FIFA’s ban on third party ownership

Football and Dollars
Published: Friday, 23 January 2015. Written by Richard Berry No Comments

Born: c.1990s (Somewhere in deepest South America).

Died: 22 December 2014 (FIFA Headquarters, Zurich).

Stop all the clocks, cut off the telephone,
Prevent the dog from barking with a juicy bone,
Silence the pianos and with muffled drum
Bring out the coffin, let the mourners come.

Auden, Funeral Blues

 

22 December 2014. The day that FIFA finally killed third party ownership.1

Three months earlier, at its meeting on 25 and 26 September 2014, the FIFA Executive Committee2 passed a decision of general principle3 outlining its plan to ban the ownership of player’s economic rights by third parties (“TPO”).4

In the period since, a dedicated working group laboured to draft technical regulations to implement the ban.5

On 18 and 19 December, the FIFA Executive Committee approved new provisions6 to be included in the Regulations on the Status and Transfer of Players.7

TPO has been a hot and evocative topic for some time.8 It is now almost nine years since Carlos Tevez and Javier Mascherano brought their South American flair to the Premier League - leading to the much publicised dispute when they helped to keep West Ham in the Premier League and the subsequent knee jerk ban on TPO by the Premier League and the English FA.9

Described in characteristically understated style by PFA Chief Gordon Taylor as “like trading in human beings10 and by Premier league Chief Richard Scudamore as comparable to “indentured slavery”,11 TPO is already outlawed in England, France and Poland. The rest of the world has now been ordered to follow suit.

THE NEW REGULATIONS

The ban

New Article 18ter (1) provides that:

No club or player shall enter into an agreement with a third party whereby a third party is being entitled to participate, either in full or in part, in compensation payable in relation to the future transfer of a player from one club to another, or is being assigned any rights in relation to a future transfer or transfer compensation.”12

A “third party” is defined as any party other than the two clubs transferring a player from one to another, or any previous club, with which the player has been registered.

Transitional provisions

Agreements covered by 18ter (1) that predate 1 May 2015 may continue until their contractual expiration, though their duration may not be extended.13

New economic rights agreements may continue to be entered into until the end of April 2015; however, they may not have a contractual duration of more than one year.14

Registration requirement

New Article 18ter (5) provides that all existing agreements must be recorded within FIFA’s TMS system by the end of April 2015. This includes details of the third party involved, the name of the player and the duration of the agreement.15

Breach

New Article 18ter (6) provides that FIFA’s disciplinary committee may impose disciplinary measures on clubs and players that fail to observe the new obligations on TPO.16

National effect

The new regulation is included in the list of provisions that are binding at national level and must be included in regulations produced by national football associations.17 

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About the Author

Richard Berry

Richard Berry

Richard is an associate in the Sports Group at City law firm Lewis Silkin LLP. An employment lawyer with particular expertise in contractual issues, disciplinary proceedings and regulatory matters.

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