Fifa transfer rules: What the ECJ ruling means for world football

The verdict of Europe’s highest court in the case of former French professional Lassana Diarra has caused an enormous response in world football. In terms of its dimensions, it had already been compared to the Bosman judgment published in 1995. At that time, Jean-Marc Bosman argued that players should be allowed to move for free after their contract ends. While the affected world association Fifa now sees its statutes essentially confirmed with regard to the transfer rules, the critics of the regulations see far-reaching changes coming. Who is right?

What does the ECJ ruling say?

The European Court of Justice ruled that “some Fifa regulations regarding international transfers of professional football players” violated EU law. Specifically, it concerns the case when a player terminates his employment contract prematurely “without a valid reason” – this was what Diarra was accused of by his former club Lokomotiv Moscow. According to FIFA rules, a fine will then be due and a ban is also possible. Diarra was supposed to pay 10.5 million euros back in 2014. A crucial point: The club that wants to sign the player is currently also liable for the fine.

According to the ECJ, these regulations go too far. Specifically: “These provisions burden these players and the clubs that want to employ them with significant legal, unforeseeable and potentially very large financial and significant sporting risks.” This is inconsistent with both the player’s right to freedom of movement as an employee and with competition law, as the court ruled according to the press release.

“It’s not about the player no longer being able to be subject to sanctions, but about the liability for the new club,” said Paul Lambertz, lawyer and specialist in sports law, to the German Press Agency. A possible consequence: FIFA must change the paragraph in its statutes, according to which the new club is also held liable.

What do FIFA and those involved say?

Diarra and his lawyers got the case rolling and sued FIFA and the Belgian Football Association for damages and loss of earnings amounting to six million euros. His move to Belgium to Sporting Charleroi did not take place after the falling out in Moscow. The case has preoccupied world football for years; Diarra moved to Moscow in 2013, and the break followed a year later.

According to a press release, the former national player’s lawyers celebrated a “big victory”. The law firm “Dupont – Hissel” was once the main participant when a ruling in the case of Jean-Marc Bosman overturned the transfer fee at the end of the contract term. The players’ union Fifpro, which also supported Diarra, said the ECJ had made an “important ruling on the regulation of the football labor market, which will change the landscape of professional football.”

Fifa wrote, however, that it was “convinced that the legality of the most important principles of the transfer system has been reaffirmed by today’s ruling.” Only two paragraphs of two articles of the FIFA regulations would be called into question. The judgment would now first be analyzed. A total of 29 articles are listed in the 102-page FIFA transfer document.

What impact does the ruling have?

“I don’t see Bosman 2.0. The sanctions for the player are still fine if contracts are terminated without good reason,” said Lambertz. In England, the Guardian newspaper wrote about a groundbreaking ruling. FIFA will “now have to seriously ask itself how it can adapt its rules in the future, or whether it can do so at all”. The Italian “Gazzetta dello Sport” said the ruling could cause a revolution and lead to players leaving a club regardless of the length of the contract.

The specific case surrounding Diarra will now initially be returned to the Belgian court, which had referred the matter to the ECJ. The ruling of Europe’s highest court, which was not published in full on Friday, is binding.

It remains to be seen whether the contracts in football, which are temporary and rarely contain clauses for a proper reason for termination, will be fundamentally changed. The court also ruled that restrictions on the freedom of movement of professional football players can be justified by the aim of making the competitions work – by maintaining a certain degree of stability in the teams of professional football clubs. However, in the present Diarra case, “the provisions in question (…) appear in several respects to go beyond what is necessary to achieve that objective”.

The German Football League announced that the “attacked Fifa regulations, which are viewed as not compliant with European law, only directly affect international transfers.” According to German labor law, fixed-term employment contracts can generally only be terminated for good cause. FIFA is “now required to develop changes to the international transfer regulations based on the reasons for the judgment and in consultation with leagues and players’ unions.”