Deal breaker

The FA have introduced regulations for agents, reports Neil Rose

The summer 2007 transfer window may have been the most bountiful ever, but for agents it may be the last off-season of plenty. The FA’s new Football Agents Regulations came into force on September 1, but agents should be grateful that they at least had this summer – only the threat of legal action stopped the changes going live in May. It is a sign of the disquiet over agents that the FA have revised their rules – which came into force as recently as January 2006 – so quickly. A review began shortly afterwards and its proposals went through several redrafts in an effort to reach an agreement. But the FA eventually realised that some would object whatever.

Many of the changes seek to ensure that players’ agents are not paid by clubs – probably the main bone of contention. Central to this is an end to dual representation, meaning an agent will be able to act for only one party in a transfer. This was originally going to be in the 2006 regulations but was apparently dropped under pressure from the Premier League. The FA estimate that more than half of all transfers involve some form of dual representation, which they said in a report in May “gives rise to a clear and unmanageable conflict of interest” on the part of the agent. “At worst it is the mechanism by which substantial sums of money are wrongly diverted by agents away from players, players’ careers are dictated by the interests of agents, and clubs secure players on the basis of what they are prepared to do for agents, rather than players.”

But Mel Stein of the Association of Football Agents does not agree. He says there is no reason a player should not get someone else to pay on their behalf, adding that the player is fully aware of what is going on because he has to declare the amount paid as a benefit in kind for tax purposes. He also argues that players have not been sufficiently consulted, and sports lawyer Paul Fletcher of Manchester solicitors IPS Law says players are unlikely to appreciate being directly responsible for paying their agent’s fees. The cost may just end up being built into higher salaries or signing-on fees.

The reforms also aim to stop arrangements where an agent appears to be working for a club, but in reality remains the player’s agent, again so as to get paid by the club. So, for example, an agent can now only act for a club if they have not acted for the player in any capacity in the preceding two transfer windows (the switching rule). There are also new nepotism provisions, banning agents from any deal that involves a club where a close family member is employed; a blanket ban on agents owning any kind of interest in a player’s registration rights (something of a response to the Tévez affair); and a rule subjecting foreign agents to the FA’s jurisdiction when involved in a transfer in England.

While these changes may look like a major step forward, how they are enforced will be key. Despite beefing up their compliance team, on past form the FA still have to prove they can effectively police the game. A report last year from independent think tank Sports Nexus – whose trustees include top agent Jon Holmes – pointed out that the FA previously chose to interpret the FIFA rule that an agent could represent only one party when negotiating a transfer in such a way as to separate the various elements of the deal. This meant Wayne Rooney’s agent could be paid by Manchester United for doing the deal with Everton and by the player (via United) vfor negotiating the terms of his contract.

John Devine, a sports lawyer at Newcastle solicitors Watson Burton, says the new rules should prevent situations like this, and welcomes them for increasing transparency (although they are not as transparent as the Football League’s rules). Devine adds that the FA have been willing to listen: the two-transfer-window limit in the switching rule was three years in a previous draft. Stein says it should be just one window.

Many agents remain unhappy – Stein believes the FA want to “kill off” their industry – and as yet no decision has been made on taking legal action. But if the FA really wanted to clean everything up, perhaps they should go for the radical solution provided by Sports Nexus: as in the USA, agents should act only for players, and not clubs, and then most of the problems go away. Or is that too simple.

From WSC 248 October 2007