The Summer of 2023 Could Well Be the Craziest of Transfer Windows – Particularly for Agents
14th June 2023
Football transfer windows often border on the realms of ‘crazy’, whether they be in the summer or winter, and with this it can safely be said that agents play their part in adding to the craziness and unpredictability, as do the clubs, players, managers, media and others. Yet, can we expect the 2023 summer transfer window to be a bit stranger if not more manic than usual, not least with the recent introduction of the new FIFA Football Agent Regulations (FFAR) ‘into the mix’?
With the FFAR scheduled to come into force ‘FULLY’ on October 1st 2023 (having been approved by FIFA in December 2022), these regulations are still subject to various legal challenges whether they be scheduled challenges for the future, those already underway or even those awaiting a judgement (with at the time of writing; an injunction already in place in Germany against the FFAR).
It is safe to say that there is a considerable amount of uncertainty caused by the changes to the agent regulations and the subsequent licensing heading into this summer’s transfer window. Whether this be in relation to existing agent related agreements, new agreements, agreements with former registered intermediaries or agreements with newly licensed agents; and that is without even starting to consider the outcomes from the aforementioned challenges to the FFAR.
Even those heavily involved with the FFAR are uncertain as to what the outcome(s) will be, although some would have you believe they know what will happen ……. the simple fact is they don’t, none of us do!
“Nah!!!!! The New Agent Regulations Won’t Affect Summer Transfer Window, as they aren’t Fully in Force until after it closes (for many)".
Many would be forgiven for making this assumption, that because the new agent regulations (FFAR) won’t be ‘fully’ in force until 1st October 2023, there will be little impact on the Summer 2023 transfer window, not least as the transfer window closes in many key FIFA jurisdictions prior to October.
Yet, this assumption is largely incorrect, and can be placed in the same bracket as the incorrect assumption that: ‘many transfers and contract signings (negotiations) are done in a matter of weeks, if not days. When the truth is, the ‘ground work’ for many such transfers and player registrations takes many months of planning, preparation and negotiation to formulate and complete. Plus, the higher up the ‘footballing-ladder’ these transactions are, the more complex and time consuming such matters generally become.
I think it is safe to say that many of the transfers, contract renewals, registrations etc for the summer have already been very much developed in the months following FIFAs ‘belated’ approval of the FFAR (in December 2022), if not even prior to that time. As such, agents, clubs and players would (or should) have been planning for the various outcomes of the new FFAR and the subsequent impact of the FFAR on their professional agent dealings for the summer transfer window.
It Isn’t All About the ‘Cap’ (on Agent Commissions)
Although much commentary on FFAR is focussed on the ‘cap’ that FIFA are trying to impose on agent commissions as part of the FFAR, and this matter is arguably the key area of complaint for many of the challenges to the FFAR; the planning of many agents heading into this summer transfer window extends well beyond just the subject of a ‘cap’.
I am not exaggerating by saying that the ‘cap’ is a vitally important consideration for most agents (as well as their clients – whether club, coaches/managers or players) heading into the summer transfer window, as come the 1st October there is an impact on any summer 2023 transfer window business for any agent (or intermediary), even moreso those agents:
1. Whose representation contract with a client (e.g., player, club, coach) was concluded after 16th December 2022, even if it was concluded between 9th January 2023 (introduction of FFAR in ‘part’) and 1st October 2023 (FFAR in ‘full’) or even thereafter,
AND/OR
2. Who does NOT hold a FIFA Agents License as of the 1st October 2023.
Many agents, agencies (and intermediaries) would have contingency plans for the FFAR, and ultimately restructuring their business operations to contend with the possible implementation of the cap and various other new FFAR stipulations and regulations. However, dare I say that in a lot of cases this would have had to include not only a plan B, but arguably a plan C, D, E, F and various other letters of the alphabet; because in all honesty no one (at the time of writing this article) really knows what is going to happen.
Even if we take the most basic assumption (NOTE: this is not one preferred or predicted, from my perspective) that the FFAR are implemented globally and unchanged from those approved by FIFA in December 2022, this would still mean added complexity in many of the contractual dealings of many agents and their clients, thus impacting on this coming summer’23 transfer window.
For example :
If a registered intermediary (agent) signed a new representation agreement (contract) with a client (e.g., player) in February 2023, that agreement would arguably have to have 2 sets of terms (instead of just 1) to facilitate both the regulations pre-October 2023 and also post October 2023 (and again I hasten to add this is unlikely to solely be in relation to the aspect of the ‘cap’).
Contractual Complexities May be ‘Good News’ for The Lawyers
On the advent of FIFA introducing the new FIFA Football Agent Regulations (FFAR) in January 2023 (approved in December 2022), part of the new regulations was the establishment of a FIFA Agent Working Group (AWG).The complexity and unpredictability surrounding these issues is arguably good news for the lawyers in many ways. Not least, as many agent related contracts and representation agreements would have arguably become more complex in the last 12 months (i.e., 2022-23), to contend with FFAR and its subsequent predicted variations and implementation.
I for one, am a great believer in developing more robust contracts and explicit representation agreements (contracts), rather than the ‘back of a fag packet’ approach that rarely serves in the best interests on many (if any) of those who are parties to the agreement. However, this is not always the case in football. Players for one ‘generally’ prefer simple representation agreements and this is understandable, unless they have an astute independent lawyer ‘in tow’ to check the finer details.
Hence, either during or in anticipation of a transfer window, players and clubs are understandably considering their own futures (e.g., contract renewals, transfers), yet with this transfer window we now have the added complication of the agents (and agencies) understandably looking to secure their own interests and establishing new contracts (representation agreements) with their clients – just to deal with the impact of FFAR. That is, unless the agent/agency had a ‘crystal ball’ and ‘hedged their bets’ on issues such as caps and FFAR matters prior to the approval of FFAR, and thus concluded a new representation agreement in late 2022.
This combination of agents looking to finalise new representation agreements or secure variations to existing ones, whilst their clients may be more concerned with securing contractual stability with clubs/players, arguably leads to a ‘perfect storm’. This will possibly create a climate of instability, uncertainty and speculative practices; and whilst it may give some leverage and advantage to some in a hugely competitive industry, there will also be a negative impact, potentially leading to the exploitation of others.
Cross Border Issues
As if this was not enough to contend with (and please note I have merely ‘scratched the surface’ on the impact and implications of FFAR in this article), there is the distinct and very realistic possibility that whilst the FFAR may be implemented in full in October 2023, the FFAR may not be applied consistently in all countries and territories.
This could ultimately lead to, amongst other things (i) 2 or more different sets of agent regulations being applied to a single international transfer/transaction, (ii) one set of domestic football agent regulations in one country being dramatically different to another territory thus arguably putting one set of clubs and agents at a competitive advantage.
Even on the relatively straightforward issue of the cap on agent commissions in the FFAR, this is even in doubt as to whether it is even legal in some countries. So, there is a realistic possibility that agent caps could be applied in one country but deemed unlawful elsewhere, and thus one part of an international transfer is capped, whereas another part of the same transaction isn’t?
Furthermore, this aspect further complicates the contractual complications referenced earlier; as it is perfectly possible that the representation agreement an agent has with a client (player, coach or even club) may have to accommodate further complex variations on the basis of the geographic variables affecting the agent services, clients and any related transaction.
"Don’t Worry, It Will Soon Be Over" …………. Or Will It?
Some may say that come the 1st October 2023 things will start to calm down and everything will sort itself out with regards to FFAR. Having been part of the FFAR process for over 2 years, and the overall football agent regulation debate for what must be in excess of 10 years, I would greet that news with ‘open arms’ …………. however, I find it difficult to share such optimism.
I sincerely hope that things do sort themselves out soon, and looking at the issue in a positive light, there are some proactive protagonists making strenuous efforts resolve the various issues and disputes over the FFAR.
However, I do believe that the uncertainty and ‘storm’ surrounding FFAR and what many perceive to be a rushed implementation process, will not be resolved any time soon. And with various legal complaints and proceedings against FIFA and the FFAR, I think the uncertainty and confusion will extend well beyond this summer 2023 transfer window.
Conclusion - 'Disputes and Confusion'
It was never going to be ‘plain sailing’ for FIFA with the development and implementation of the FFAR, and whilst I have big doubts and concerns about how they have gone about it, the problems for FIFA are no longer of any great concern for me ……… ‘they have made their bed, and now they have to lie in it’.
However, the ramifications for agents, agencies, players, clubs, coaches/managers etc, I personally see as being one littered with confusion and disputes for many years to come, and such disputes wont be just between FIFA and the agents this time.
Whether it be agents arguing with other agents about who represents a particular player, clubs arguing with clubs about who pays the agent, players arguing with agents over the amount they have been paid; the disjointed nature and uncertainty surrounding FFAR is nothing more than a minefield of confusion and distortion. Further analysis of how and where I see such disputes arising I will cover in a future article, where I will endeavour to look at how such disputes can be resolved in such a seemingly restrictive and prescribed dispute resolution mechanism in football (similar to such matters covered in the previous article : ‘Does Football Avoid ‘Airing it’s Dirty Washing in Public’ with Fixed and Prescribed Dispute Resolution Options?’ ).
The simple fact is that the summer 2023 transfer window I believe will be ‘interesting’ ……… and even if not immediately apparent, it may be even crazier and manic than usual ‘behind the scenes’ regarding agents and the impact of the new FFAR.