The Legal Intricacies of European Soccer Contracts: Navigating the Complexities and Absurdities of Player-Club Agreements

Soccer is the most popular sport in the world, and it is filled with lots of excitement and thrills (Mamchii, 2024). The heart of soccer lies in Europe, with it having the most iconic and wonderful stories in the world of soccer, legendary players who found their rise to stardom in Europe, and clubs that are home to football heritage (“Why Does Europe Love Soccer?”). Besides the sport itself, a fascinating aspect of the sport for soccer fans is the type of players that play for their clubs of interest, specifically the contracts between clubs and players.

Image courtsey of Kenny @ unsplash

Like many contractual employees, soccer players are tied to contracts with the clubs they play for. Although the contracts are employment agreements between players and clubs, they are layered with various legal intricacies that shape the careers of players and the strategic positions of each club. These contracts range from regular contracts, which include salaries, contract duration, incentives in contracts, and performance-related bonuses, to contracts with absurd clauses and provisions. These contracts reflect a blend of player welfare, the competitive goal of the club, the club's reputation, and the player profile. An examination of the makeup of these contracts reveals the richness and complexity embedded within these agreements (Taylor, 2020).

Salary, Bonuses, and Clauses

Soccer players are one of the most highly paid athletes in the world. The base salaries received by the players are a fraction of what they receive; salaries and monetary compensation include the base salary and bonuses. The base salaries are fixed payments that are not affected by player performance or availability, although they can be affected by legal proceedings involving the player. 

The other parts of compensation are bonuses. The makeup of bonuses in a contract depends on the type of player, financial capacity of a club, competitive ambitions of the club, and financial ambitions of the player. The goal of the bonuses is to push players to exceed performance in their roles, align the player's needs with clubs’ competitive ambitions, and attract lucrative and highly sought-after players. Different types and multiple types of bonuses can be included in a contract. One of the most common bonuses in player contracts is signing on bonus. These bonuses can be used to leverage salary agreements. Incentive bonuses in soccer include goal bonuses, clean sheet bonuses, appearance bonuses, and other types of bonuses (Karlsen 2023).

Clauses in contracts are provisions or sections in a contract that outline specific terms, conditions, or obligations. One interesting clause that has been increasingly seen in contracts due to the recent pandemic is the force majeure clause. Kelly Jones, Senior Counsel for Marketing, Sports, and Entertainment at Under Armour, told us how this is an essential contract clause in today’s post-pandemic landscape.

The force majeure clause protects teams, brands, and companies from liability due to an unforeseeable and unavoidable catastrophe or event that makes the party unable to perform their contractual obligations (Hargrave, 2003). Some key contract clauses appear in player contracts because they are agreed clauses included in the league’s Collective Bargaining Agreement and are standard across the league.

Remy Cherin is a FIFA-Licensed Player’s Agent and the founder of Remington Ellis Management, a boutique sporting agency that specializes in representing soccer players. His journey to becoming an agent started from being a sales rep at Madison Square Garden and New York Red Bulls to running events at Vice Media to acquiring his FIFA Player Agent license. He now represents top U.S. men’s and women’s soccer players and players in Europe. Cherin’s invaluable insights, grounded in years of hands-on experience, have been instrumental in enriching this project. Mr. Cherin explained some key clauses and bonuses that he prioritizes when negotiating contracts for his clients.

Absurd Clauses

Absurd and unusual clauses are sometimes included in professional soccer contracts. These special situations are sometimes due to the players' requests and conditions for joining the club, including players requesting provisions for their families, hobbies, and pleasures. Players who include absurd bonuses in their contracts are top players who can leverage their talent according to their demands (Brophy, 2024). Absurd clauses can also be proposed from the club's side in order to make profits or achieve other outcomes. Mr. Cherin told us about an example of an absurd clause a club proposed to include in a player contract.

An interesting case is Dennis Bergkamp, a Dutchman who played for the Arsenal football club in the early 2000s. He was a star during his stint at the English giant club, but before joining Arsenal FC, he made sure to have a ‘No-Fly’ clause in his contract, which stated that he would never use a plane as his mode of transportation when going to Arsenal FC games due to his fear of flying (Hepburn, 2021). This clause got him the nickname “non-flying man.”

The video below shows a host of other absurd clauses that have been seen in soccer contracts

Moral Clauses

In player contracts, moral clauses are provisions that are included to keep players from acting outside the club's interest and having conduct that might tarnish the club's reputation (“Can Footballers Be Sacked?”). Moral clauses can lead to fines, suspensions, or even contract termination. Just as bonuses are like incentives to push players to exceed expectations on the field, moral clauses keep players from acting out of the club’s interests and give the club the right to terminate the athlete’s contract (Angulo, 2024). Moral clauses can be complex because they can straddle subjective grounds; things that can be considered immoral or inappropriate can vary depending on cultural norms, as different players from different backgrounds play for clubs in different countries.

Kelly Jones discussed the importance of moral clauses in contracts from the company’s or brand’s standpoint. Regardless of how decent or non-controversial the athlete might seem, moral clauses are included in the contracts to safeguard the company’s or brand’s interests.

Remy Cherin explained how moral clauses are standardized and the influence players or agents representing the players have on the makeup of the moral clauses.

Mario Balotelli is a soccer player known as an outlandish player who does bizarre and crazy things on and off the field, which sometimes bring bad attention to him and his club. When Mario Balotelli was signed by Liverpool FC in 2014, a ‘good conduct’ clause was added to his contract This clause ensured Mario Balotelli was entitled to a bonus payment of £1 million from Liverpool if he wasn’t ejected on three separate occasions during a season for violent conduct (Pierce, 2016). This clause did a good job of preventing the player from acting outside the club’s interest, as he was not sent off during his first season. This is one way clubs use moral clauses to safeguard their interests.

Moral clauses are not unusual in other sports or levels of sports (college level, semi-pro, and pro level). They are common across different kinds of sports where a team, brand, or company will try to protect its reputation by clearly stating the actions taken if an athlete’s actions bring a bad reputation to the club. Below is an excerpt from an agreement for a campaign between an undisclosed athlete and an undisclosed company, which was provided by sports attorney Jamie Miettinen of Miettinen Law PLLC, the acting secretary on the College Football Players Association (CFBPA) Board of Directors.

Termination Disputes

Termination disputes arise when a club or player seeks to end their contractual relationship before the agreed-upon period of the contract ends. This is often due to disagreements or changes in circumstances that render the continuation of the contract infeasible. Termination disputes in soccer are complex because contracts contain strict stipulations for early termination and usually involve substantial financial, legal, and reputational stakes for the club and/or player. 

Termination disputes could be a result of employment-related disputes that stem from disagreements between the club and player, and termination disputes could also be a result of disciplinary disputes that are sometimes beyond the player and club but the sport’s governing body and disciplinary committee of the sport (“Football Disputes”).

The termination of a contract before its agreed-upon end date can be mutual termination, which is a mutual agreement between the club and player to terminate the contract, or unilateral termination, which is when one party (club or player) decides to terminate the contract for reasons such as personal gain, club reputation, interests, and other factors. Unilateral termination disputes often have extensive legal and financial repercussions. Arbitrations are usually used to settle disputes and come to a settlement on the termination (“Arbitrate or Litigate?”). The governing body of soccer worldwide (FIFA) has established a relationship with the Court of Arbitration of Sport (CAS) that resolves disputes by making sure both sides are heard and using established laws, guidelines, and codes to come to a judgment on the existing disputes (“Court of Arbitration for Sport”).

Notable Contracts

Neymar Jr. and Barcelona (2017)

Neymar Jr.’s PSG contract and the Barcelona situation in 2017 were among the most interesting stories in European football. The dispute stems from Neymar Jr.'s record-breaking transfer to Paris Saint-Germain (PSG) for €222 million through the activated release clause included in his contract with FC Barcelona. The video below explains how the Neymar transfer unfolded and the aftermath of the transfer.

After Neymar JR transferred to PSG, FC Barcelona sued Neymar Jr. for breaching his contract with Barcelona, which he signed a year prior in 2016. The breach of contract claimed by Barcelona was due to a loyalty clause that was included in Neymar Jr.'s contract with Barcelona, which would earn him a payout of a certain amount if he stuck with FC Barcelona. FC Barcelona had paid a substantial part of the payment to Neymar, and he switched teams, so they sued Neymar Jr. for the amount paid. A court ruled in favor of FC Barcelona since Neymar did not hold to the loyalty aspect of the clause and he had to pay back around €7.5 million (Lowe, 2017).

Bosman Ruling

Jean-Marc Bosman vs. RFC Liege in 1995 is one of the most consequential disputes in world football. It shaped the landscape for future transfers. This was a legal case that established the Bosman ruling, which granted European soccer players the freedom in transfers when they were out of contract with their current club, so they could move freely to another club without their club having any claim to them. Jean-Marc was a Belgian midfielder who was playing for RFC Liege. When his contract was over, RFC Liege sought a transfer fee from his desired French club, but the clubs were not able to agree to the payment of the transfer fee. As a result, Jean-Marc, although he was out of contract with his current club, was effectively trapped. His salary was reduced by 75%, which was for out-of-contract players, so Jean-Marc challenged RFC Liege, the Belgian Football Association, and UEFA legally (Brand, 2015). Jean-Marc claimed RFC Liege violated his free movement ability that was granted within the European Union. He also claimed unfair restraint of trade as well as salary reduction.

Bosman prevailed in court. The outcome of the ruling was freedom for out-of-contract players, allowing them to move freely after their contract with their current club ends, which also meant having more leverage on their career decisions. In turn, there was increased mobility for free players across Europe. One of the biggest impacts of the ruling on soccer was its economic impact; higher salaries were offered to players to incentivize and keep them from leaving.

References

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