From the archive ~ Would abolishing transfer fees benefit football?

With another transfer window almost done we look back to November 2000, when Pierre Lanfranchi and Matthew Taylor argued it was time for a new system

Imagine football without transfer fees. Journalists, financial analysts and sports lawyers – not to mention directors, managers and players – have apparently been doing little else since the European Commission’s “shock” announcement that the present system of clubs profiting from the movement of players must come to an end. In Britain at least, predictions have tended towards the catastrophic: take away transfer fees and small clubs would die, top players would earn even more and all manner of chaos would ensue.

The Commission’s intervention has been widely interpreted as a reaction to the spiralling fees in European football which culminated this summer in the deals involving Hernán Crespo and Luís Figo. More specifically, it was prompted by the action of Perugia in successfully objecting to the payment of a fee for the transfer of Massimo Lombardo from Grasshoppers Zurich. In truth, how­ever, the EC’s intervention is not really about Crespo, Figo or Lombardo. It is the latest – possibly the last – offensive in a long battle to force football to accept its status as an industry like any other.

Introduced in England in 1890, the transfer system was primarily intended to control the mobility of players. Where they had been free agents able to sell their labour to the highest bidder, footballers were now effectively the property of their employers. In order to prevent the poaching of players and ensure a stable workforce, the Football League created a system which deprived footballers of the basic right to freedom of movement.

Clubs as well as players were often critical of the system but preferred to curb its excesses rather than abolish it. In 1908, the FA imposed a maximum limit of £350 on fees but this was easily evaded by the purchase of makeweight players and lasted only three months. Between the wars, Arsenal and Everton led a series of unsuccessful campaigns by the richer clubs to cap transfers in an attempt to reduce costs.

By the 1960s, there was a general feeling that the transfer market was out of control. Incensed by the vast sums changing hands for transfers in Britain and abroad – specifically the £250,000 which Roma paid Mantova for Angelo Sormani in 1963 – World Soccer called for urgent legislation, even putting forward its own s suggestion of a surcharge on all transfer fees which would then be divided among clubs of the appropriate national league.

France alone rejected the need for a formal transfer system. In 1969, an agreement between the players’ union and the national league abolished the “life contract” which had bound players to a club until the age of 35. New regulations stipulated that at the end of a contract “whose duration was agreed by both parties”, the player was free to sign for whichever employer he chose.

Unless it was the player’s first move – in which case “development compensation” was paid – his former club was entitled neither to oppose the transaction nor ask for compensation. Transfer rules in other European countries became less rigid in the control of player movement, but the legitimacy of the system itself was rarely questioned.

One reason the transfer system has survived unchallenged for so long is the idea that it is fundamental to the survival of football as we know it. This rests on a number of related assumptions. The sale of players from smaller to larger clubs, it is argued, allows the former to stay afloat, while the redistribution of income ensures the economic viability of the competition as a whole.

Transfer payments are also believed to act both as a reward for, and a stimulant to, the development of young talent, and the system is assumed to guarantee a certain amount of continuity in playing personnel. Without it, in the words of PFA boss Gordon Taylor, “Football clubs would become like Euston station, with different players arriving, staying for a short while and leaving again almost non-stop.”

We tend to accept all this because the football authorities have been telling us as much for over 100 years. From the beginning, the transfer system was defended as a means of maintaining some degree of competitive balance between teams by preventing the wealthier clubs snapping up the best talent.

As early as 1906, the England and WBA forward William Bassett, later to become a director at The Hawthorns, was convinced that without the sums received from selling players, clubs like his would be forced out of business. Such assertions have been repeated so often over the years that they have come to be regarded as established facts.

Yet there is surprisingly little evidence that the transfer system has ever done what its defenders say it has. Recent studies have called into question the “common sense” view that it has operated to the benefit of football as a whole.

Transfer money has rarely simply trickled down from the top to the lower divisions. Most trade has always been confined to bigger clubs and even when funds have filtered down, they are often concentrated at a small number of selling clubs. Some smaller clubs may have used the transfer system as a means of survival, but many others have consistently shown a transfer deficit, spending more on players than they receive in return.

If the transfer system has been ineffective in redistributing wealth, then its abolition might actually be beneficial by convincing the authorities to consider more explicit means of subsidising the poor. It was less than 20 years ago that schemes existed for sharing revenue from gate receipts and television contracts. The greed of the top clubs and then the creation of the Premier League put an end to that, but if we are genuinely interested in the fate of the small fry there is no reason why something similar cannot be put in place.

It is much too easy to be suspicious of the EU and its alleged attempts to “interfere” with football. Such an attitude is in keeping with the arrogance of an industry which has chosen to ignore European law for decades. National federations have remained convinced that community law did not apply to sport, despite the fact that two cases which reached the European Court of Justice in the 1970s confirmed it was illegal to restrict movement on the basis of nationality.

The Bosman ruling should have put an end to all this. Yet we continue to hear about football’s right to be seen as a special case. The sooner we realise that football is not a world within a world, the sooner we can search for a system which will guarantee the rights of players and secure the financial future of clubs. Or is that asking too much? Pierre Lanfranchi & Matthew Taylor

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This article was originally printed in WSC 165, November 2000. Subscribers get free access to the complete WSC digital archive – you can find out more details here