THE SCOPE OF THE FA REGULATIONS
The new A1 FA Regulations on Working with Intermediaries (the “FA
Regs”) states: “Only an Intermediary may be used and paid by a Player or Club
in relation to any Intermediary Activity”. To establish the scope of the
Regulations we should take into account the “Appendix I – Definitions”, where
is defined this concept.
“Intermediary Activity”
means acting in any way and at any time, either directly or indirectly, for or
on behalf a Player or a Club in relation to any matter relating to a
Transaction. This includes, but is not limited to, entering into a
Representation Contract with a Player or a Club.
This concept begs to consider the meaning of “Transaction” in the
context of these Regulations.
“Transaction” means any negotiation
or other related activity, including any communication relating or preparatory
to the same, the intention or effect of which is to create, terminate
or vary the terms of the player’s contract of employment with a
Club, to facilitate or effect the registration of a player with a Club,
or the transfer of the registration of a player from a club to a club
(whether on a temporary or permanent registration basis).
On the one hand, it can be seen that the field of action of an
Intermediary is all the matters related to the player’s employment contract and
the transfer of the player, such as negotiations to sign a new employment
contract or to conclude a signing of a player or a transfer; and always
respecting all the Obligatory Terms of the Standard Representation Contract
(form prescribed by the FA).
A. GENERAL PRINCIPLES
The main requirements of these Regulations are stated in this point.
The Intermediary must be REGISTERED at the FA as an Intermediary and
must be entitled to act under a valid REPRESENTATION CONTRACT. If he
does not fulfil these two basic requirements, he could not act on behalf any
Club or Player in the context of the scope of the Regulations.
Also, every relevant contracts and any document must contain the name,
the signature and registration number of the Intermediary. Also if the
Intermediary is a legal person, in this case the natural person representing it
shall sign on behalf the Organisation.
B. REPRESENTATION CONTRACT
The Regulations state the written Representation Contract as an
essential element to carry out Intermediary Activities.
At the Regulation B2 it is stated the minimum features of the
Representation Contract, which are:
·
The respect of the Obligatory Terms of the
relevant Standard Representation Contract (FA form).
·
The Parties may add other terms always if they
are suitable with the requirements stated above. (This allows the agreement in
relation to commercial services named above as well).
It is included the duty to lodge the Representation Contract between
them with the Association by all the
Parties. Time limit: 10 days of being executed. This duty shall be complied
also if the Representation Contract is early terminated, novated, varied or any
other event that affects its validity.
The assignment or subcontract:
·
What can be assigned or subcontract? The Intermediary
Activity duties or services or responsibilities in relation a player or a club
to another Intermediary.
·
How can they do it?
i.
Lodge a Representation Contract between the
Assigning or Subcontracting Intermediary and the Player or Club.
ii.
Record the terms upon which those obligations
are assigned or subcontracted and the written consent of the client in the same
document.
iii.
Lodge such document with the FA as well.
The represented Player, prior to the Transaction takes place,
could not to be represented by the Intermediary in a Transaction with a Club if
he provides a written request to the
Club with these guidelines.
The maximum duration of the Representation Contract: 2 years.
Minors at the Representation Contract:
·
The Intermediary cannot make any approach to, or
enter into any agreement with, a Player in relation to any Intermediary
Activity before the 1st day in January of the year of the Player’s
16th birthday.
·
The Minor’s parent or legal guardian must sign
the Representation Contract.
C. REMUNERATION
The Payment to the Intermediary by his Client must be made in
accordance the terms of the Representation Contract.
The C11 FA Regs is directly making reference to conclude an
employment contract and/or a transfer agreement. They payment should be made as
follows:
Payment by the Player to the Intermediary:
·
The Player may discharge his obligations on the
following way:
i.
The Player may pay the Intermediary directly.
ii.
Prior to a request in writing to the Club:
1.
Make a deduction in periodic instalments from a
Player’s net salary.
2.
Discharge the Player’s liability towards his
Intermediary on the Player’s behalf as a taxable benefit.
·
The commission could be paid in a lump sum
or by instalments and it shall be calculated on the basis of the Player’s
Basic Gross Income for the entire duration of the contract.
·
RECOMMENDED commission benchmark:
i.
The commission should not exceed 3% of the Player’s Basic Gross
Income.
Payment by the Club to the Intermediary:
·
Payments in relation to any Intermediary
Activity for or on behalf of a Club must be made by the Club and through the FA
(using the relevant designated account).
·
The commission could be paid in a lump sum
or by instalments and it shall be calculated on the basis of the Player’s
Basic Gross Income for the entire duration of the contract, when an
employment contract is concluded. And when a transfer between clubs is concluded
on the basis of the eventual transfer compensation paid by the Club to
another Club (The Intermediary must not have any interest of the rights or
economic rights of a Player).
·
RECOMMENDED commission benchmarks:
i.
The commission should not exceed 3% of the Player’s Basic Gross
Income (in relation to an employment contract).
ii.
The commission should not exceed 3% of the transfer compensation
paid (in relation to a transfer agreement).
If the Player and the Intermediary have agreed periodic instalments to
remunerate the latter and the employment contract lasts longer than their
Representation Contract, the Intermediary will be entitled to the agreed
instalments after expiry the Representation Contract until the Player’s
employment contract expires, unless the Players signs a new employment
contract without the involvement of that Intermediary.
Except assignment or subcontracting, the Intermediary cannot pass any
remuneration relating to an Intermediary Activity to any other person or third
party. The same for a Club who is paying the amount related to a transfer, this
payment just may pay to the other Club.
Any payment to an Intermediary concerned a Transaction with a Minor is
prohibited.
This is the
most controversial point is related to the 3%
remuneration ‘cap’ (which is a recommendation). But, why the Intermediary and the Client
could agree, in my opinion, a percentage over this recommendation?
·
First of
all the agreement over this percentage should not be an “off-market”
percentage. It shall be on the scope of the football market uses and customs.
·
We are
in the context of a good faith and individual negotiation.
·
Also a
balanced and loyal negotiation between the parties.
·
The
Player or the Club is not a consumer. The parties are on the same step during
the negotiation of the terms. So the principle of equivalence is respected.
·
The FIFA
Regs are made according the Swiss Law, therefore the principle of freedom or
choice or party autonomy would be applied.
·
And also could be outside the legal scope of the
article 101 Treaty on the Functioning of the European Union 2008 (“TFEU”), and
constitute an abuse of dominant position (article 102 TFEU). Consequently these
provisions could generate a distortion of competition, namely an anti-competitive
rule and therefore unenforceable.
·
In
conclusion, in UK a percentage between 5 and 10% was the most typical
commission applied to the Representation Contracts in football and I do not see
why a 5% should not be applied with the new Regulations.
D. DISCLOSURE AND PUBLICATION
The Association shall be entitled to publish:
·
Name and registration number of every
Intermediary (or the name of the Organisation).
·
A list of every Transaction in which any
Intermediary has been involved.
·
The total consolidated amount of all payments
made by all Players to Intermediaries and by each Club to Intermediaries.
·
Any decision pursuant to these Regulations, for
instance disciplinary decisions.
E. CONFLICTS OF INTEREST
Dual/Multiple Representation
An Intermediary may undertake Intermediary Activity for more than one
party in relation to a Transaction. They have to comply with the following requirements
in full prior to start to act on behalf his Clients:
·
The Intermediary has a pre-existing
Representation Contract with one party to the Transaction.
·
Intermediary obtains all parties’ prior written
consent to provide them his services.
·
Once the terms are agreed, and prior to enter
into a Representation Contract, the Intermediary shall inform all parties the
proposed fee to be paid by them to him (in accordance the form prescribed by
the FA).
·
Reasonable opportunity to take independent legal
advice.
·
Having given such opportunity, all parties’
express written consent to enter into a Representation Contract.
If any party does not provide the written consent in accordance above
requirements:
·
The Intermediary:
i.
Is not permitted to proceed with the provision
of services to the other party(ies).
ii.
Neither, to receive any remuneration from the other
party(ies).
·
The other party(ies):
i.
Are not
permitted to receive any services from the Intermediary.
ii.
Neither, to make any payment to him.
Restriction on Conflict of Interest
Intermediary (or Intermediary’s Organisation) shall not have interest in a Club.
Player, Club, Club Official, or Manager shall not have interest in the business or affairs of
an Intermediary (or Intermediary’s Organisation).
Interest is defined on the following way:
·
Beneficial ownership of more than a 5% of an
entity through which the activities of the Club or Intermediary are conducted.
·
Being in a position to exercise any influence
(material, financial, commercial, administrative, and managerial or any other)
over the affairs of the Club or Intermediary.
Also includes the interest of:
·
Spouse, child, stepchild, parent or sibling of
the Intermediary, Player, Club Official or Manager;
·
Company in which any legal or beneficial
interest or any proportion or share is held by the Intermediary, Player, Club
Official or Manager (or their relatives named above). Save for a holding of
less than 5%.
·
And a company controlled by the Intermediary,
Player, Club Official or Manager (and their relatives above) which can exercise
other influence over the affairs of the Club.
It is prohibited that an Intermediary has any interest in relation to a
registration right or an economic right. This includes interest in transfer
compensation or future transfer value of a Player.
Duty to Disclose
A Player, Club, Club Official or Manager must disclose to the FA any agreement or contractual or other
arrangement between them and the Intermediary, in 10 days of the entering into
such agreement/arrangement and in any event no later than at the time of the
registration of a Transaction by the Association.
The Intermediary must also disclose any agreement or contractual or
other arrangement between him and a Club, Club Official or Manager in
respect a Club Official or Manager, in 10 days of:
·
The entering into such agreement/arrangement.
·
An individual becoming a Club Official or
Manager and having a pre-existing agreement or contractual or other arrangement
with an Intermediary.
·
A person registering as an Intermediary and
having a pre-existing agreement or contractual or other arrangement with a Club
Official, Manager or Club in respect of a Club Official or Manager.
The last paragraph is stating the duty as an Intermediary to disclose
the agreements/arrangements in respect a Club Official or Manager; therefore
we can affirm that the Intermediary is just obliged to submit the
Representation Contract to the FA (Regulation B3), but not all the agreements
or contractual or other arrangements named above.
All of them (Intermediaries, Players, Clubs, Club Officials and
Managers) shall disclose to the FA in writing any actual or potential
conflict of interest and obtain
the express writing consent of all the parties involved. It should be
disclosed in 10 days of being completed.
REGISTRATION
Any natural or legal person who wishes to act as an Intermediary shall
register with the FA. The registration shall be valid for 1 year.
A fee will be payable on initial Registration and for any
renewal of this Registration. The initial fee will be waived for FA Licensed
Agents (renewal fees payable).
A Test of Good Character and Reputation for Intermediaries must be
submitted to the FA by the natural person or the natural persons acting on
behalf an Organisation to contrast his “impeccable reputation”.
The designation of an Intermediary to use it in business relations once
he completes his Registration will be: “FA Registered Intermediary”.
REQUIEREMENTS RELATING TO MINORS
Authorisation from The FA will be necessary to work with Minors.
This authorisation shall be valid for 3 years.
This can be applied for during an initial Registration or throughout
the Registration period.
A legal person registering as an Intermediary cannot apply to deal with
Minors.
REGULATIONS APPLICABLE TO LEGAL PERSONS
REGISTERED AS INTERMEDIARIES
A legal person can only be registered as an Intermediary by a
natural person already registered as an Intermediary.
Also the legal person shall declare the natural persons registered as
Intermediaries who are authorised to conduct Intermediary Activity on behalf a
legal person. His name, signature and registration number must appear on the
relevant paperwork of the Transaction.
The natural persons carrying out Intermediary Activities on behalf the
legal person must meet the requirements above.
Luis Torres
(*Translated version of "El nuevo Reglamento sobre Intermediarios de la Federaci'on Inglesa" / IUSPORT.com / 19 February 2015 / By: Luis Torres)
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