Clubs’ Essentials

Clubs’ Essentials

• What is a Solidarity Contribution?

  The Solidarity contribution mechanism stipulates that when a player moves to a new club permanently or loan, during the period of the contract, for a fee agreed between the new club and former club, then 5% of that fee is designated as a solidarity contribution, and each of the player’s training clubs will receive a portion. The apportionment varies depending on what age the player was registered with the training club.
  The entitlement is due only in transfers between clubs from different associations, as well as when a transfer takes place within the same association, but a training club of the player is affiliated to another association.

• What is a Training Compensation?

  Training Compensation encourages, through financial compensation, clubs to invest in the training of athletes. Art. 2nd of Annex 4 of the FIFA rules provides that there will be conditions for compensation when: i) The player is registered for the first time as a professional and ii) each time the professional player is transferred between clubs of two different associations until the end of the season referring to his 23rd birthday.
  The amounts owed to a training club determined on the new club's category (1-4) and continent. The obligation does not arise if a former club terminates a player’s contract without just cause, when a professional reacquires amateur status in moving clubs, or when a player transfers to a category 4 club.

• What is a "Bridge Transfer"?

  A bridge transfer consists of two consecutive and connected national or international transfers of the same player, with the registration of the player with the intermediate club undertaken to circumvent the application of relevant regulations or laws and/or defraud another person or entity.
  the only legitimate reason for registering a player: to play organised football (i.e. for sporting reasons). There is only one exception to this principle, described above as a ’technical registration’.
  If the same player is transferred twice within a period of 16 weeks, both the clubs and the player involved in the two transfers concerned are presumed to have participated in a bridge transfer. It is then up to the clubs and the player to rebut this presumption by providing convincing evidence to the contrary, when requested to do so by FIFA.
  If two consecutive and related transfers of the same player occur within a period of more than 16 weeks, it is still possible that the clubs and the player involved in these transfers could be deemed to have participated in a bridge transfer. However, the regulatory presumption that a bridge transfer has occurred will not apply.
  Sanctions can be imposed in accordance with the FIFA Disciplinary Code on any party deemed to have been involved in a bridge transfer.
  

• What is a TPO?

  ”FIFA defines Third Party as "a party other than the player being transferred, the two clubs transferring the player from one to the other, or any previous club, with which the player has been registered.”
  TPO (Third Party Ownership) can consist of agents and agencies, funds, bank entities and investors outside of football clubs whose main responsibility is to fund transfers of players to football clubs that cannot afford these operations.
  In the case of transferring a player using a TPO, the club does not own all the economic rights of the player in question (however, it owns the federative rights), so the club loses the right to receive 100% of the corresponding amount in a future transfer of the player.
  As a result, FIFA itself decided to end these types of signings, because it considers that the integrity of the competition was compromised. Therefore the FIFA regulations states that “No club or player shall enter into an agreement with a third party whereby a third party is being entitled to participate, either in full or in part, in compensation payable in relation to the future transfer of a player from one club to another, or is being assigned any rights in relation to a future transfer or transfer compensation."
  

• What is a Financial Fair Play?

  Financial Fair Play (FFP) is what’s known as the “break-even requirement”. UEFA permits football clubs to spend no more than €5 million over what they earn in each three-year assessment period. There is, however, a limit of 30 million euros if the ownership of the club or a related party can cover these losses. A club's costs in the area of transfers, employee benefits (including wages), amortization of transfers, financial costs and dividends will be included. FFP will not include revenue from gate receipts, TV revenue, advertising, merchandising, or money spent on infrastructure, training facilities, or youth development.
  Clubs found to have breached the UEFA’s FFP regulations will face punishments varying from warning to exclusion from future competitions.
  Due to Covid 19 UEFA introduced new measures stating that the 2020 financial year will not be assessed at all under FFP procedures, and will instead be rolled up into 2021, and the two years assessed together as a single financial period.

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