THE NEW FIFA FOOTBALL AGENT REGULATIONS
- John Wilson, FIFA Licensed Agent
The new FIFA Football Agent Regulations were approved by FIFA in December 2022, and officially came into operation on 1 October 2023.
The FFAR, as it is colloquially known, has caused somewhat of a stir in the footballing fraternity, particularly among football agents, most notably due to the requirements that FIFA have imposed on the operations of football agents and agencies. These requirements now expect of football agents to pass an exam, pay a licence fee, comply with continuing development and educational assessments, and to report their operations, both operationally and financially, whilst also imposing a mandatory cap on agent commissions.
FIFA has justified the implementation of FFAR on the grounds that the regulation of the football agent industry would lead to more ethical conduct and increased transparency.
In contrast, leading football agents have slammed the implementation of FFAR as a money-making scheme by FIFA, and have labelled the imposition of a mandatory cap on commission as contrary to European and national competition laws. The FFAR is currently facing legal challenges in a number of European countries, and only time will tell whether it passes European competition law muster.
For the time being though, the FFAR, and the equivalent national football agent regulations which each national association was required to pass by 30 September 2023, will remain in effect until we are informed otherwise. It is therefore important for us to consider some of the most pertinent themes of the FFAR.
WHAT AND WHO IS A FIFA AGENT?
A FIFA agent is an individual who has obtained a license from FIFA to conduct the business of an agent. This implies that such a person has passed the FIFA Agent Exam, paid the licence fee, and complies with the minimum requirements set by the FFAR, which includes not having a criminal record, and complying with the continual education requirements.
No person that is affiliated to a club, a league or association is allowed to be an agent, and no club or player is allowed to use the services of a person that is not a licenced FIFA agent. In order to ascertain whether a person is a registered and licenced FIFA agent, FIFA have created a directory of all FIFA licenced agents, which can be found on its website.
WHAT DOES AN AGENT DO?
In essence, a FIFA agent provides football agent services to a player or a club. Football agent services are defined by the FFAR as being such services, including negotiations and communications, with respect to a transaction. In layman’s terms, this means anything relating to the negotiation of an employment contract or transfer. For providing these services, an agent can charge a service fee (i.e. a commission), on condition he has a written representation agreement with a player, and he has in fact performed the services. An agent can also provide other services, such as legal, financial, scouting or consulting services, but these must be charged and agreed to separately.
WHAT CAN AN AGENT CHARGE?
A FIFA agent is entitled to charge his player 5% on the first USD200k per annum of the employment contract, and 3% on any amount thereafter. Also, if the agent procured the player for the new club, the agent can by virtue of the permissible dual representation, also charge the new club 5% on the first USD200k per annum of the employment contract, and 3% on any amount thereafter.
If an agent works for a selling club, the agent can charge as much as 10% of the transfer fee. However, an agent is not permitted to work for a player and a selling club in the same transaction as this is not permitted in terms of FFAR.
An agent will also now only be able to receive payment of his commission in quarterly payments, as opposed to an upfront lump sum, on condition that the player is actually paid by the club.
THE EFFECT OF THE NEW FFAR
There can be no doubt that the implementation of the new FFAR, and the national equivalent, will initially cause some teething problems. The regulations are complicated, and largely not geared for the landscape of several countries, where certain practices have developed that will now be construed as impermissible.
The imposition of a mandatory cap on commissions at 5% has caused significant consternation with agents, particularly in smaller markets worldwide, who argue that the cap will have a significant impact on their commercial viability.
However, despite this, the implementation of the regulations has been introduced to try and ensure that agents conduct themselves in line with the core objectives of FIFA and the football transfer system. The FFAR aims at ensuring the reduction of prohibited activities which will hopefully establish a minimum standard of professionalism and ethical conduct from agents, protecting players from unscrupulous agents as well as ensuring that agents provide a more transparent service to players, coaches and football clubs.
CONCLUSION
If the FFAR is able to survive the legal challenges in the European Courts, their can be no doubt that the entire football landscape will change.
Regulating agents and who is permitted to act on behalf of footballers is a positive change. The implementation of the FFAR will hopefully ensure that the careers of footballers are managed ethically and professionally, limiting “agents” looking after their own interests at the expense of footballers. The FFAR will undoubtedly enhance and uphold the integrity of the profession and the football industry as a whole.