The Football Lawyer: Neymar, third-party rights and the footballer as family business
With the World Cup approaching, Neymar was always going to be a name on everybody’s lips. However, rather than his form on the field, it is his controversial transfer to Barcelona that is currently attracting the most discussion. The Brazil forward was initially declared to have cost the Spanish champions a sum of €57.1m (£47.3m), a sum which they later revealed to be €86.2m (£71.5m). The fallout of this deal was severe indeed: it led to the resignation of Sandro Rosell, the club’s president, and an eventual payment of €13.5m by Barcelona to the Spanish authorities in response to tax fraud charges.
The anatomy of the deal, now that most of its details seem to have emerged, raises not only several eyebrows but also several interesting issues. One of them is the initial secrecy with which the transaction was conducted, which gave rise in itself to considerable suspicion. What may also seem remarkable to many is that, given such a sizeable outlay by Barcelona, only €17.1m of it made its way to Santos, Neymar’s former club. By contrast, €40m went to N&N, a company owned by Neymar’s parents. This deal is therefore the latest manifestation of a “third party rights” agreement, where a player is sold by a club but his economic rights are owned either wholly in part by someone else.
Some might argue that there’s no problem with third party rights: after all, the club treats players as assets to be bought and sold, so there’s no problem with anyone else treating them as such. Indeed, there are certain countries in Europe, most notably Spain and Italy, who are much more relaxed with this state of affairs than their Western European neighbours. The fear I have seen in Western Europe is that, when negotiating in such cases, the third party is actually bogus: that instead of being a consortium, the third party is actually the player himself, who is using an agent as a front (for a healthy fee, of course) and pocketing the transfer fee alongside his wage.
It seems extraordinary that a player, through posing as a third party, could end up not only with a contract worth hundreds of thousands of pounds per-week but also a windfall of many millions more. However, some might shrug and say, “so what? Agents use bogus interest from rival clubs to drive up prices all the time: how is this any different?” After all, this is the cut-throat world of professional football, where the hardest of bargains are driven all the time.
The answer to that, though, is not simply that clubs have a right to know who they’re dealing with: it goes further than that. In the event that the player breaches his contract, or there are other complications – say, if the player has a previously undisclosed medical condition that comes to light – the club can’t be sure who should be the subject of legal action, and will not be able to enfore its obligations effectively. In some of these third party rights cases, too, there are several third parties, with many individuals and groups entitled to a slice of the proceeds of the player’s sale, in a tier of ownership sometimes stretching back a number of years. In such situations, working out who to sue could be a logistical nightmare.
Third party rights first came to the fore in Europe in 2006, when Carlos Tevez and Javier Mascherano moved to West Ham United from South America. They do seem to be a tool for executives from “emerging market ” countries, although the uptake in Africa has been somewhat slower than in South America. This is because the majority of agents operating in Africa tend to be European; but, over time, this could well change. If, for example, the next great African footballer comes through the ranks, it is very possible that he will have a structure around him – rather like Neymar – of relatives who will have a controlling stake in his economic rights. With the globalisation of football, and the desire to maximise a player’s value growing ever more keenly, the era of the footballer-as-family-business may be upon us soon enough.Tagged in: Barcelona
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