Nowadays, there are two recognized forms of player ownership rights. Firstly there is the “federative right”, granted by the Federation to a player in order for him enable him to practice his sport, and secondly, there is the “economic right” which can generate future profits in the case of a player being transferred. An economic right is appealing to those people who have an interest in earning money from player transfers.
“Economic rights” are especially attractive not only to investors (who might be a simple agent, an investment group or a company), but also to clubs, particularly those rated smaller or less powerful. Sharing “economic rights” with investors can provide a great opportunity to hire high-value players who would otherwise be out of reach due to the high cost involved. Moreover, from the investor’s point of view, the acquisition of these “economic rights” could potentially generate in a significantly profitable future economic gain, and allow them to influence decisions about which club a player should sign for.
The practice of sharing “economic rights” between a club and an investor, is known worldwide as TPO, Third-Party Ownership, and is being strongly criticized for the lack of autonomy that clubs have in relation to their players given the investor’s ability to influence a player’s future. It can be appreciated that this sharing of “economic rights” may be too risky for a club. It is easy to imagine a player being pressurized or forced into accepting a transfer in such a way that the club with which he has a working relationship might be seen as being in a weak situation having had to accept the transfer of the player, or by having had to accept the risk of devaluing the market value of the player’s pass.
There are many known media cases. In 2006 the former English manager Sam Allardyce was investigated for his investor fund involvement at the time of the transfer of two Argentine players, Carlos Tevez and Javier Mascherano, from Brazil to West Ham United. There were also the transfers of Mangala from Porto to Manchester City, Marcos Rojo from Sporting C. Portugal to Manchester United, Markovic from Benfica to Liverpool, as well as many other cases.
In 2007, Joseph Blatter, the FIFA President at the time, promised new rules by the end of that year and the Premier League, stating that TPO raised questions about “the integrity of competition”, decided to ban TPO at the beginning of the 2008-09 season.
FIFA decided to limit this. In December 2014, with a transitional regime from January to April 2015, two regulations concerning player transfer status were introduced (in Regulations on The Status and Transfer of Players), one prohibiting the conclusion of club contracts with third parties which could limit the club’s independence in recruitment and/or transfer of players besides calling into question the performance of the respective football team (Article 18bis); the other prohibiting players and clubs from entering into contracts that might alienate (wholly or in part) any “right” that may arise from a future transfer between two clubs (Article 18ter).
However, these regulations are not sufficient, since the practice clearly continues, merely in other forms. As recently as 2016, several clubs (Santos Futebol Clube of Brazil, Sevilha FC of Spain, FC Twente of the Netherlands) were sanctioned for breach of TPO influence .
In fact little has changed and TPO has been described by Sporting Clube Portugal’s President, Bruno de Carvalho, as a “monster”, that “locks clubs in a vicious cycle of debt and dependence”. And things could get worse if the TPO scheme coincided with a match-fixing epidemic throughout Europe. The risks of overlap between the two are huge, and “many times there are ‘common’ owners amongst the funds and gambling companies, so match-fixing is now the worst fear for football”, said Bruno de Carvalho.
It seems to me that the role of an agent in football is welcome. They provide an important point of contact between players and clubs, and must obviously be rewarded for this, but with due respect for the laws which prohibit the sharing of “economic rights”. The TPO issue will continue to generate much discussion for a long time to come.