Young and in demand: The legality of buy-out clauses in Spanish football contracts

Published 27 October 2017 By: Lloyd Thomas

Football Practice

Undoubtedly the biggest story of the summer transfer window (or perhaps any transfer window ever) was the transfer of Neymar from FC Barcelona to Paris Saint-Germain for a reported €222 million.[1]

Before that, the largest transfer fee ever paid for a player was the €105 million[2] Manchester United paid Juventus for Paul Pogba in the summer of 2016.  The fee that Paris Saint-Germain paid to secure the services of the Brazilian captain was more than twice that amount.  As part of the deal, Neymar is reportedly paid €30 million a year after tax – equivalent to around £520,000 a week.[3]

Barcelona had previously stated that the player was not for sale.[4]  Yet the player’s employment contract contained a buy-out fee of €222 million, which Paris Saint-Germain agreed to pay on the player’s behalf.  A statement on the FC Barcelona website confirmed the position:

Neymar Junior, accompanied by his father and agent, has this morning informed FC Barcelona of his decision to leave the club during a meeting held in the club’s offices. Given this position, the club referred them to the buyout clause stipulated in his contract, which since 1 July stands at €222m and must be paid in its entirety.[5]

While the transfer was intriguing for a number of reasons, it is the application of the buy-out clause that has received the most attention. This article explains the use and legality of buyout clauses in football contracts in Spain.  Particularly focus is given to minors’ contracts, where buy-out clauses are widely used.  Specifically, we look at:

  • A brief recap of what buy-out clauses are and how they work;

  • The use of penalty clauses in minors’ contracts in Spain

  • The case of Fran Mérida and FC Barcelona

  • The case of Javier Fernandez Jusdado and Club Atlético de Madrid

  • The case of José Raul Baena Urdiales and FC Barcelona

 

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Author

Lloyd Thomas

Lloyd Thomas

Lloyd Thomas is an associate in Squire Patton Boggs’ Litigation department and is part of the Sports Law team based in its London office.

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