An intermediary, whether a natural or legal person, acts on behalf of clubs or players and/or clubs in negotiations to finalise a transfer agreement or represents clubs in negotiations to do so, for a fee or without charge. In this article, Fifa Regulations On Working With Intermediaries, we take a look at the mechanism and process involved.
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What are the basic points on working with intermediaries?
A Player or Club may only utilise and remunerate an intermediary for any intermediary activity. In contrast, either a Club or a Player may opt to represent themselves in all proceedings pertaining to a Transaction.
A Player or Club may only employ or compensate an individual for Intermediary activity if that individual is duly registered as an Intermediary and possesses the legal authority to act in accordance with a valid Representation Contract. With the exception of being authorised to do so by the Player and/or the Club, an intermediary is prohibited from performing any intermediary activity on their behalf, in lieu of, or in representation of any individual other than the Player and/or the Club (except as permitted by Regulation B6).
It is also unlawful for any club, player, Intermediary, or other participant to manipulate or obscure the truth or nature of any matters pertaining to a transaction.
What are the rules governing agent player (representation) contracts?
Prior to the Intermediary performing any intermediary activity on behalf of a player or club (as applicable), a validly executed written Representation Contract must exist between the Intermediary and said parties. It is imperative that the Representation Contract encompasses the complete agreement between the parties concerning the intermediary activity. At a minimum, it must include all obligatory terms from the applicable Standard Representation Contract. Other provisions may be included by the parties, provided they adhere to the obligatory provisions of the Standard Representation Contract, the FIFA Regulations on Working with Intermediaries, and the stipulations of these Regulations.
It is the responsibility of all parties involved in a Representation Contract to deposit with The Association copies of every Representation Contract to which they have consented, in a manner that may be specified from time to time. It is also mandatory for Representation Contracts to be deposited within ten days of their execution, and in any case, no later than the moment The Association records the transaction.
It is strictly prohibited to include any provision in a representation agreement that breaches the rules of these Regulations or the FIFA Regulations on Working with Intermediaries. In such situations, The Association shall have the authority to notify the involved parties of any breach, at which point they shall rectify the breach by implementing the amendments that are specified in the notification. Inadequate rectification of any breach shall comprise an additional and distinct breach of these regulations. All parties to a Representation Contract are required to provide written notice to The Association within ten days of the occurrence of any event that impacts the contract’s validity or status (excluding its natural expiration), including early termination, novation, variation, or any other event of a similar nature.
How are intermediaries paid?
An Intermediary may receive compensation from the Club or the Player on whose behalf he acts. In order to register the transaction, payment must be made in accordance with the provisions of the Representation Contract between the parties or the pertinent documentation submitted to The Association. In cases where an intermediary acts on behalf of a player, the player may only discharge his financial obligations to the intermediary in one or more of the subsequent ways, as specified in the relevant documentation submitted to The Association to register the transaction or the Representation Contract between the parties:
- The Player may make a direct payment to the Intermediary; and/or
- Only where the Player makes a request in writing to the Club, the Club may:
(i) deduct an amount from a Player’s net salary in periodic instalments, with the amount being paid to the Intermediary in fulfilment of the Player’s obligation to the Intermediary as stated in the applicable Representation Contract or the pertinent documentation submitted to The Association; and/or
(ii) Release the Player’s obligation to pay his intermediary, as specified in the applicable representation agreement or the pertinent documentation submitted to The Association, as a taxable advantage on the Player’s part.
In the event that the Representation Contract between the Intermediary and the Player stipulates a commission to be paid (either in a lump sum or in instalments) for a transaction, the commission shall be calculated using the player’s basic gross income as specified in the employment agreement where the player was represented by the Intermediary. In cases where the Intermediary and the player reach a mutual understanding regarding periodic instalments and the Player’s employment contract continues to extend beyond the duration of the Representation Contract, the Intermediary shall be entitled to the agreed-upon instalments subsequent to the expiration of the Representation Contract, until the player’s employment contract reaches its termination, or earlier if the player signs a new employment contract without the Intermediary’s involvement.
Any compensation or payments, regardless of their form, origin, or manner of occurrence, and whether made directly or indirectly, to any individual in connection with an intermediary activity conducted on behalf of a Club, must be issued solely by the club, and duly documented in its accounting records. In accordance with Regulation B6, this does not impede an Intermediary acting on behalf of a Club from remunerating another Intermediary with whom he has subcontracted or assigned any Intermediary activity duties, services, or responsibilities.
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Disclaimer: This article provides general information only and does not constitute legal advice on any individual circumstances.
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