Football players – Update on agent fees

The proposed new FIFA Football Agent Regulations (FFAR) were due to come into effect from October 2023 (see our previous article, Football players – new era for payment of agent fees , dated 12 September). However, agents in several countries, including the UK, took legal action to challenge some of the regulations, especially those around the cap on commission that FIFA wanted to introduce. Agents feared their income would decrease dramatically if the new limits on agent commission were confirmed. After many months of uncertainty and waiting, the Football Association (FA) finally confirmed on 21 December 2023 that the FA’s new Football Agent Regulations will enter into force on 1 January 2024 and will supersede The FA’s Working with Intermediaries Regulations.

However, just as everyone was gearing up to adapt to the new regulations, FIFA issued a Circular 1873 on 30 December 2023 . This confirmed that several crucial provisions within the FFAR would be temporarily suspended pending the outcome of an injunction granted by the Dortmund District Court in Germany. FIFA recommended that all national associations follow suit, so it was not surprising that the FA released an updated version of the FA Football Agent Regulations at around 8pm on New Year’s Eve.

Bearing in mind the opening of the transfer window on 1 January, the timing of these developments could not have been worse. Unsurprisingly, many people working in the football sector are finding it very difficult to keep up to date and understand which rules are currently suspended and which ones remain applicable.

Which rules are currently suspended?

• Restrictions on multiple representation - Agents may continue to represent multiple parties provided all parties provide prior written consent and can seek independent legal advice. Clubs can also pay more than 50% of the total service fee in dual representation arrangements.
• The client pays – Clubs can continue making payments on behalf of a player or a coach as a benefit in kind (see our article, Football players - taxation of agent fees , dated 17 August 2023).
• Service fee cap - The service fee cap will not apply to English transactions. FIFA’s announcement clarified that the cap will also not apply for the time being to international transfers.
• Other service payment rules - The other rules concerning service fee payments, including those governing timing and the mandatory use of the FIFA clearing house, are currently on hold.
• FIFA platform - Presently, there is no obligation to submit documents to the FIFA agents’ platform, and the rules in the FFAR concerning disclosure and publication are presently not in force.

Which rules remain in place?

• Licensing and Registration - Agents must possess a FIFA licence to conduct services worldwide and must be registered as an FA registered agent to perform football agent services in England. Players, coaches, and clubs are prohibited from engaging with an unregistered or unlicensed agent.
• Coaches - The FFAR and FA Football Agent Regulations will continue to apply to coaches as well as players.
• Agencies - Corporate agencies can no longer perform football agent services or register as an agent. While agencies can enter into representation agreements, an FA-registered agent (individual) must also be a party and the one performing the football agent services on behalf of the player/coach. Agencies already party to existing representation agreements must promptly inform the FA and their client which FA registered agent will perform the services going forwards.
• Minors - There are no changes to the strict rules on minors. Agents must obtain additional authorisation from both FIFA and the FA to work with minors and in England and agents cannot approach or enter into any form of agreement with a minor until 1 January in the academic year in which the minor reaches the age of 16 and after prior written consent has been received from the minor’s parents or legal guardian.
• Representation Agreements - The new rules in relation to representation agreements remain in place:
  • before entering into or amending a representation agreement, the agent must inform the player/coach that they should consider taking independent legal advice or advice from the Players’ Football Association or League Managers’ Association;
  • representation agreements (both new and existing) must be lodged through the new FA portal;
  • any clause that limits or penalises a player or coach’s ability to negotiate and conclude an employment contract without the involvement of an FA registered football agent will be null and void. This seems to prevent the practice of agents still being entitled to receive their agreed fee if a player or a coach negotiates and concludes an employment contract themselves;
  • the FA Football Regulations and FFAR will govern all transactions from 1 January 2024. Clauses in existing representation agreements that do not comply with the regulations will be unenforceable (except for representation agreements entered into prior to 16 December 2022). Any representation agreements entered into from 1 January 2024 must adhere to the regulations.
• Approaches - Agents remain prohibited from approaching, and entering into representation agreements with, players, coaches and clubs who are bound by an exclusive representation agreement with another agent except in the final two months of that exclusive representation agreement. The definition of an approach encompasses any means of contact, including electronic communication, indirect contact through individuals linked to the player, or using intermediaries on the agent's behalf. Clubs should also note that they are prevented from interfering in, or influencing, the freedom of a player or coach to select an agent.

How long will the existing rules remain in place?

FIFA claims that the suspension of the regulations is necessary to comply with the preliminary injunction issued by the District Court of Dortmund back in May 2023 which prohibits FIFA from enforcing the FFAR pending a preliminary ruling from the European Court of Justice. Notably absent from FIFA's statement is any acknowledgment of other successful legal challenges in countries like England, Spain, and Brazil, along with decisions by national associations in Italy, France, and the Netherlands to refrain from full implementation of the FFAR.