International Sports Law: TRANSFER MARKET: TRUE OR FALSE

Image source: Fieldoo

With Deadline Day upon us once again, I'm taking a quick look at some of the most popular transfer market beliefs and explaining why they are true or false.

A CONTRACT OF EMPLOYMENT CAN BE MADE SUBJECT TO A SUCCESSFUL MEDICAL EXAMINATION

FALSE

Article 18 of FIFA's Regulations on the Status and Transfer of Players specifically precludes football clubs from entering into a contract, subject to a successful medical examination. Further, FIFA's Dispute Resolution Chamber has made it very clear in a number of cases that clubs must obtain all the necessary information to be able to make an informed decision with regards to a player's health and fitness, before concluding a contract of employment.

Cases include:-

Player X v Club Y

The Dispute Resolution Chamber in this case held that: "Art. 30 of the Regulations (now. Art. 18) gives clear and unmistakable indications with regard to the relation between medical examination and the validity of an employment contract, due to its unambiguous wording, the relevant clause does not leave space for interpretations, the said provision is mandatory and calls for a strict application, consequently, Art. 11 point 3 of the employment contract is null and void, since, contrary to what Art. 30 of the Regulations is requiring, it makes the relevant agreement conditional upon the positive results of a medical examination, the question of whether a medical examination were carried out prior to the signing of the agreements or not could remain open, in fact, the club would have had to make any necessary medical examination before concluding the agreements (cf. Art. 30 par. 2 of the Regulations), therefore, even if, for whatsoever reason, it had decided to have them carried out in February 2003 only ... it would have done so at its own risk - on account of the foregoing the two agreements concluded between the parties on 5 January 2003 are valid"

Player X v Club Y (2)

The Dispute Resolution Chamber held in this case that: "Club Y made the player concerned to undergo a medical test before signing the employment contract. Furthermore, it noticed that the club did not complete the test phase before signing the employment contract by receiving the test results. And finally, the Dispute Resolution Chamber noticed that the respondent club dismissed the employment contract after receipt of the test results, twelve days after the signature, based on the contract clause 6.5. According to Article 30(2) (now. Art. 18) of the above-mentioned Regulations and in the light of the above made explanations, the Dispute Resolution Chamber decided that by its conduct, the club Y made itself liable to bear the consequences of the signed contract. Furthermore, the Dispute Resolution Chamber had to consider the clause 6.5 of the employment contract between the parties involved, which says that the employment contract shall not be valid in case of negative test results. In this regard, the Dispute Resolution Chamber referred to Article 30(1) of the above-mentioned Regulations, according to which the validity of an employment contract cannot be made conditional upon the positive results of a medical examination. In this respect, the Dispute Resolution Chamber decided that the clause 6.5 of the employment contract does not hinder the validity of the employment contract and therefore does not release the club from its obligation to bear the consequences of the signed contract according to Article 30(2) of the mentioned Regulations."

Player A v Club B

In this case, FIFA's Dispute Resolution Chamber required to consider a clause "in fine" of the employment contract which read as follows: "It is understood that the player has to pass all the medical exams in the satisfaction of the club not later than 31 July 2005." The Chamber advised that Article 18 was applicable, in this matter, and clearly states that the validity of a contract between a professional and a club may not be made subject to a positive medical examination. As a result, medical examinations must be concluded by prospective clubs prior to concluding the contract of employment. In this particular case, the medical examination was to be undertaken after the date on which parties concluded the contract. In light of the above, the Chamber held that the Clause "in fine" of the employment contract was in breach of Article 18(4) and was therefore not legally binding.

A CONTRACT OF EMPLOYMENT CAN BE CONCLUDED SUBJECT TO A WORK VISA/PERMIT

FALSE

Given the international nature of football, players often require to obtain visas or work permits to allow them to play for a new club based in a country in which they are not a citizen. This is a task which may, in time, become more laborious for clubs based in the United Kingdom due to Brexit.

However, when a player signs for a new club that is based in a country in which the player requires a visa/work permit in order carry out his employment, the obligation is on the new club to provide the player with a visa. The player, however, must co-operate fully in assisting the new club to obtain the documents required to permit him to work.

Further, Article 18(4), clearly states that the validity of a contract must not be made subject to the granting of a work permit. The Court of Arbitration for Sport has also supported this position.

Cases include:-

Player X v Club Y

In this case, the Chamber referred to Art. 30(2) of FIFA RSTP (now Art.18) and stated: "the player’s new club is required to make any necessary investigations, or to take any appropriate action before concluding the contract in order to legalise the permanence of a player in the country, otherwise it will be liable to pay the full amount of compensation for the amount of salary due. In this particular case it was in the club’s responsibility to provide the entry visa, as well as the necessary working permit to the player." In this case, the Club failed to take "any action, or at least not the necessary ones, in order to prevent the execution of the deportation order, nor had it ever taken any steps in order to provide the player with the necessary visa by the time the employment contract was concluded. The Chamber held that it was this behaviour alone that "prevented the employment contract from being executed and by doing so provoked the breach of the contract."

Player X v Club Y (2)

In this case, the Dispute Resolution Chamber considered a player's allegation that the club of which he concluded a contract of employment failed to take the necessary steps to secure a visa for him. The Chamber stated that "it is a basic principle of labour law that an employer has to provide his employees with a work permit, if need be. If an employer does not undertake the necessary to provide his employees with a work permit, and if this compels the player to leave the country where he is employed, and therefore to quit his work, this is basically to be considered as an unjustified breach of the employment contract by the employer." The Chamber advised that the visa which allowed the player X to stay in the country concerned, had to be considered as the equivalent of a work permit for that country. The Club had allowed a month to lapse without the player having a visa and thus he was residing illegally in the country. The player argued he had no option but to leave, as a result. As such, the Chamber held that "the behaviour of the club Y has to be considered as a breach of contract without valid reasons."

FK Senica, A.S v Vladimir Vukajlovic & FIFA (CAS 2013/A/3089)

In this case, the Sole Arbitrator considered the issue of work permits and advised as follows: "Regarding the Player’s lack of work permit, article 18.4 of the FIFA RSTP provides that: The validity of a contract may not be made subject to a successful medical examination and/or the grant of a work permit. Therefore, in accordance with the above mentioned provision, the Sole Arbitrator considers that it was up to the Appellant (the Club) to procure to the Player the relevant work permit to play for its team."

PROSPECTIVE CLUBS WISHING TO CONCLUDE A CONTRACT WITH A PROFESSIONAL PLAYER MUST INFORM THE CURRENT CLUB, IN WRITING, FIRST OF ALL

TRUE

As a result of strict transfer windows, negotiations are often fast-paced in order to conclude agreements before the deadline of each registration period. However, before entering into a contract, parties must be aware of the rules under FIFA's Regulations on the Status and Transfer of Players. In particular, Article 18(3) specifically bars parties from entering into a contract of employment with a professional player, without having notified his current club in writing, first of all. This provision is binding on a national level as well as an international level, according to Article 1(3)(a) of the Regulations. **It should be noted that Article 18 (in its entirety) is binding at national level**

FIFA Commentary goes on further to state that the current club requires to explicitly agree to the discussion between parties and without such an agreement, the prospective new club may risk being found to have induced the player to breach his contract with his current club if negotiations continue regardless.[1]

AN EMPLOYMENT CONTRACT CANNOT BE MADE CONDITIONAL ON THE ISSUANCE OF AN INTERNATIONAL TRANSFER CERTIFICATE

TRUE

The jurisprudence of the FIFA Dispute Resolution Chamber is firm in the view that an employment contract cannot be made subject to an international transfer certificate being issued. The international transfer certificate is the sole responsibility of the player's new club and the relevant national association.

Player A v Club B

In this case, the Chamber held that as a general rule, the issuance of the international transfer certificate was the sole responsibility of the player's new club and the respective national association. It went on further to state that "the validity of an employment contract cannot be subjected to the issuance of the player’s ITC and therefore, considered as valid and binding the relevant employment contract signed between the parties."

DEADLINE DAY - WHEN THE CLOCK STRIKES, TIMES UP!

TRUE WITH A SLIGHT EXCEPTION

The current system imposes strict rules in relation to transfers and once the deadline expires for the relevant association, FIFA TMS stops processing transfers with no exceptions.

Some examples of failed deadline day transactions include

David de Gea
Roberto Soriano
Pajtim Kasami
Peter Odemwingie

However, some countries do exercise some flexibility and the English Premier League is a prime example of this. The PL introduced some flexibility into the deadline day process with use of what is known as the "Deal Sheet". The Transfer Deadline Day Deal Sheet allows a club to confirm that a deal has been reached within the deadline time-frame, while obtaining additional time to submit any missing documentation. [2]

Image source: Premier League

The Deal Sheet itself carries its own rules and clubs may only benefit from it if the transfer has been agreed within the immediate two hours prior to the deadline expiring, and can only be submitted to the Premier League and the FA between 9pm and 11pm. The rules allow for clubs to have an extra two hours after the window closes (if domestic transfer) or up until midnight (if international transfer) to submit the full paperwork (this may include employment contract, transfer agreement and permission to work in the UK documents).[3]

Examples of deal sheet transactions include Darren Fletcher's move from Manchester United to West Bromwich Albion, Radamel Falcao's move from Monaco to Manchester United and Dame N'Doye from Lokomotiv Moscow to Hull City. [4]

For further insights into football's transfer market and deadline day click here and here.

IMPORTANT: This post is not intended to be a legal briefing, it is not intended to be a statement of the law and no action should be taken in reliance on it without specific legal advice.