EU Court Ruling Says FIFA Transfer Rules Breach EU Law

The European Court of Justice (ECJ) has ruled that some of FIFA’s rules regarding player transfers violate European Union laws, specifically those related to free movement and competition.

This decision comes as part of a legal case involving former French international Lassana Diarra, whose transfer from Lokomotiv Moscow in 2014 sparked the dispute.

What was Diarra’s case?

Diarra left the Russian club a year into a four-year contract after a disagreement over pay cuts. FIFA’s regulations required the player to pay compensation for terminating the contract without just cause.

Additionally, any new club signing the player would have been jointly liable for that payment, a rule Diarra argued restricted his ability to move freely between clubs.

Diarra’s proposed transfer to Belgian club Charleroi collapsed when FIFA refused to issue the necessary International Transfer Certificate (ITC), preventing him from registering with the club.

ECJ find transfer rules unlawful

The ECJ found these rules to be unlawful, stating that they create significant financial risks for players and clubs, impeding their ability to make international transfers.

“The rules in question are such as to impede the free movement of professional footballers,” the court said in its ruling.

FIFA to review decision with stakeholders

FIFA has acknowledged the ruling, stating that it will review the decision with stakeholders, but stressed that only two paragraphs in its transfer regulations are affected.

“FIFA is satisfied that the legality of key principles of the transfer system has been re-confirmed,” a spokesperson for the organisation said.

However, FIFA now faces increased pressure to modernise its transfer regulations.

What does the result mean for transfers?

The case has far-reaching implications, as other players affected by the same rules could now seek damages.

Diarra’s legal team, represented by Jean-Louis Dupont and Martin Hissel, declared the ruling a “total victory” for their client and argued that it could reshape football’s governance structure.

“All professional players have been affected by these illegal rules and can therefore now seek compensation,” they said.

This decision may also have significant financial repercussions for clubs, especially smaller ones that rely on transfer fees. Ian Giles, an antitrust expert, explained that the ruling could lead to reduced transfer fees, allowing players to break contracts and sign with new clubs more easily.

“Smaller clubs who rely on transfer fees may well be the losers in this context,” he said.

Football’s global players’ union, FIFPro, welcomed the court’s ruling, calling it a major victory for professional players.

“This will change the landscape of professional football,” said Martin Terrier, director of FIFPro Europe.

He emphasised that Diarra wasn’t the only victim of the current system and expressed hope that the ruling would lead to compensation for other affected players.

The ECJ’s decision is expected to force FIFA to amend its transfer rules to comply with EU law. Although the exact impact of the ruling remains to be seen, it marks a significant shift in the power dynamic between players and clubs, and could lead to a more player-friendly transfer system in the future.