The Court of Justice of the European Union (CJEU) has passed judgement on key Fifa transfer rules describing them as a violation of EU law, a decision that could potentially impact future club football significantly. The case involved the footballer identified as “BZ”, also known as ex-Chelsea, Arsenal and Portsmouth midfielder Lassana Diarra, which has generated widespread unease within the sport. The court critiqued two central rules after determining that guidelines related to player transfer approvals infringe on freedom of movement, a fundamental EU principle, and that buying clubs being obligated to cover compensation costs for an unjust contract termination are considered anti-competitive.
The CJEU’s official statement explained that the transfer rules under consideration impede football professionals’ ability to expand their careers by signing with clubs in different EU Member States. The statement elaborated that these rules imposed significant uncertainties along with potential substantial financial and sporting risks for players and prospective clubs, which would significantly hinder players’ international transfers.
Moreover, the court pointed out that from a competition law perspective, the current rules were designed to restrict and even prevent cross-border competition achievable by all clubs within the EU through unilateral recruitment of contracted players or those who allegedly terminated their contract without a justifiable reason. The court concluded that these rules were not indispensable or necessary. The Belgian courts, where the case originated, are now expected to further scrutinise these vital judgements.
Fifa, the body governing global football, is now required to critically address its regulations for future situations or determine its capacity to do so. The likelihood of players having increased autonomy to violate their contract and transfer to another team, without the purchasing club being susceptible to compensation claims, has significantly increased. The Guardian has reached out to Fifa for their comments.
The roots of this situation trace back to 2014 while Diarra was engaging for Lokomotiv Moscow. The then-France representative was battling a salary dispute with the Lokomotiv. The club declared this as a breach of contract and hence cancelled it. They solicited damages from Diarra at Fifa’s Dispute and Resolution Chamber (DRC). Although Diarra filed a counter complaint, the DRC was in favour of Lokomotiv and fined Diarra €10.5m. Concurrently, he was proposed a contract by the Belgian squad, Charleroi, with a stipulation that Fifa certified Diarra’s clearance to relocate without any culpability of costs due to Lokomotiv.
Fifa, however, did not provide any such assurances as its regulations necessitate the issuance of an international transfer certificate by the league from which the player is departing before any transaction is possible. Since Lokomotiv hasn’t received any payments, they did not grant the permit. As a result, in December 2015, Diarra sued both Fifa and the Belgian football league for lost earnings, commencing a lengthy process that culminated in this week’s ruling.