Your premier partner in sports law & tax
#FootballAgents #YouthFootball #Minors #FootballParents
Monday, 20 January 2020 - In part due to fierce competition in the marketplace, football agents are increasingly targeting underage players. To protect minors against intermediaries, changes were made to the Flemish Decree on private employment mediation in 2019. For example, agents can no longer approach players under the age of 15 to have them sign a representation agreement and intermediaries cannot receive compensation for job placement services for minors. However, these changes are clearly insufficient to provide optimal protection for minors because, in practice, they are easily circumvented.
In recent years, there has been an explosive growth in the number of football agents. Some see the abolition of the FIFA-licence for agents as a direct cause. This seems to be only a part of the problem since prior to the abolition, many transfer negotiations were already carried out by agents who did not possess a FIFA-licence. Moreover, the exam for obtaining the FIFA-licence was fairly easy to pass and hence had a limited filter function only. Furthermore, stories broke on sports agents buying their FIFA-licence in exotic countries with even less stringent requirements. Others, finally, have attributed the increase in the number of intermediaries to the appeal of the profession and its bling-bling image.
“The growing number of agents is causing increasingly aggressive competition. Given the saturated market in professional football, more and more intermediaries focus on ever younger children.”
The growing number of agents is causing increasingly aggressive competition. Given the saturated market in professional football, more and more intermediaries focus on ever younger children. Agents and screeners hired by agents attend youth matches of Belgium’s top clubs. Intermediaries are regularly seen at U13, and even U11, fixtures, hoping to be the first to spot talent and to make contact with the parents.
Since 2019, in the aftermath of the fraud scandal that hit Belgian football in 2018, sports agents in Flanders can no longer, either directly or indirectly, approach players younger than 15 to have them sign a representation agreement. The age of 15 is the minimum age for signing a professional player contract in Belgium. In 2018, the legislator reduced this minimum age from 16 years to 15 years. However, the RBFA Regulations still prohibit fifteen-year-old boys - as opposed to fifteen-year-old girls - from competing in the first team. In Belgium, male youth players can therefore be bound by an employment contract with a club and a representation agreement with a sports agent before being entitled to play matches for the first team.
“Some sports agents contact children or their parents through social media platforms such as Instagram.”
Agents cannot approach children younger than 15 years “with a view to conclude an agreement to conduct job placement activities on behalf of the player”. Strictly speaking, agents can still approach youth players and their parents for matters other than job placement activities. In practice, agents approach younger players or their parents to provide "sporting assistance". Moreover, the provision does not address the situation where parents or children themselves approach a sports agent. The labour inspectorate bears the burden of proof of showing that the broker approached the player. In practice, this is difficult, especially for football agents making their approaches during football matches or through social media platforms such as Instagram, Twitter and Facebook. The mere fact of being ‘friends’ on social media or of being present at matches is not prohibited under the decree. Unlawful approaches by a sports agent may be brought to the attention of the competent authority.
Other countries have a stricter policy. In the Premier League, an intermediary cannot, either directly or indirectly, make any approach to, or enter into any agreement with, a player before the 1st January of the year of the player’s sixteenth birthday. An “approach” includes, but is not limited to, contact via email, telephone, SMS or mobile messaging applications (e.g. WhatsApp) or social media. It also includes a direct or indirect approach made by another person or organisation and any approach to another person or organisation connected to the player, such as a member of a player’s family or friends. The Belgian Pro League has not included this provision in its new regulations on intermediaries, which will enter into force shortly.
To protect minors, several national football associations have imposed an age limit. Below that age limit, intermediaries are not allowed to enter into a representation agreement with players. In Sweden, Denmark, the Czech Republic and Poland, among others, the age limit is 15 years and in England it is 16 years. In the Netherlands, the KNVB’s Regulations for Intermediaries provide that an intermediary must refrain from such activities and work as far as players younger than 15 years and 6 months are concerned. The Pro League has not introduced a similar age restriction in its new rules on intermediaries.
Agents are using increasingly aggressive methods to sign underage talent. Sports agents sometimes engage older players, coaches or club representatives to influence young players. In some cases, the influence is subtle. Some professional players develop their own intermediary activities and indirectly represent young players. Some engage players from the first team to approach youth players within the club to sign with a particular agent. Although the Pro League's new rules on intermediaries prohibit players from being an intermediary, in reality constructions are set up to circumvent this ban.
Football schools have emerged, promising training and guidance for youth footballers, but whose prime interest is to become the player’s agent.
Some clubs are known to present a “club agent” to youth players and parents, claiming that the intermediary would protect the players optimally and that the club “rarely has problems with this agent”. Such agents rarely act in the player’s best interest and rather act on behalf of the club. Due to a lack of transparency, parents sometimes do not know any better. In other instances, parents are frightened to ignore the club’s advice, fearing less favourable treatment for their son.
“Parents and youth players are frequently confronted with an unconscionable contract with illegal clauses in which the sports agent, for example, unfairly demands exclusivity or compensation for any job placement for a minor.”
Agents often try to ‘seduce’ youth players with a sponsorship contract with a clothing or boot sponsor. However, major sports brands have their own scouts and are happy to offer the player a deal directly. A clothing or boot contract is often sold as the fruit of protracted negotiations but in reality the agent’s added-value is in many cases limited.
Also, there are cases where sports agents pay parents for a prospective talent to sign a representation agreement or surety undertaking (i.e. a promise, in return for money, that the parents will make sure that the youth player will sign his first professional contract through the agent). Parents and youth players are frequently confronted with an unconscionable contract with illegal clauses in which the sports agent, for example, unfairly demands exclusivity or compensation for any job placement for a minor.
In Belgium, a debate rages on the added-value of agents in general and for minors in particular. Some intermediaries try to make a difference by selling their alleged expertise in data analysis, relocation advice, dietary requirements and social media training to (the parents of) youth players. However, most - if not all - of this assistance is already part of a (top) club’s service offering. In addition, specialist service providers are on the market that, more often than not, are more skilled than agents. The core business and revenue model of the majority of football agents remains job placement. This is all the more problematic regarding underage players. In practice, agents often do not meet the legal requirements to carry out private employment mediation. More than 200 of the agents registered with the Belgian Football Federation are not registered with the Flemish administration. Likewise, in Brussels and Wallonia, too, there is a registration requirement for sports agents ignored by several agents registered with the RBFA. This means that many agents are not legally entitled to carry out job placement activities.
The Flemish Decree on private employment mediation contains a prohibition for a sports agent to charge a fee for job placement services for an underage sportsperson. The Belgian Pro League's new regulations on intermediaries contain a similar provision, as do the current RBFA regulations. This should come as no surprise, as FIFA imposes this obligation on football federations. Agents receiving compensation for the private employment mediation of minors risk a prison sentence of between 8 days and 1 year and a fine of between EUR 125 and EUR 1250. In France, article L222-5 of the Code du Sport provides for a similar prohibition and criminal penalties can also be applied.
“The bigger the agent's share of the ‘cake’, the less of the club’s overall budget remains for the player.”
The fact that football agents work free-of-charge for minors of course does not mean that this is charitable work. It happens that football agents invest time and resources in young players to get fees from clubs without the player being aware of it, through parallel agreements (e.g. a scouting agreement). Fees paid are at the expense of the underage player. The bigger the agent's share of the ‘cake’, the less of the club’s overall budget remains for the player.
Another method used in practice is granting an increased fee for services provided by the agent in other transactions. As an example, imagine an underage player, called X, who signs a contract with club Y via an agent. That same agent later then acts in the transaction of a player, called Z, at the same club. That agent may not be remunerated for his services for player X, but the club will give the agent an increased fee for player Z, part of which will serve to indirectly remunerate the job placement activities in player X’s transaction. In such scenarios, the transparency towards the player is usually poor because clubs and sports agents know that they are operating illegally.
Registered agents must - as explained above - provide private employment services for minors free-of-charge. Some agents ask clubs to pay their agency fee when the player turns 18. Competent authorities have already decided that such circumvention is unlawful.
A recent European Commission-funded study argues that it is unrealistic to expect free work to be provided by competent agents. Free services generally involve risks and do not guarantee good service and quality. Does the agent carry out his or her free services thoroughly? Does the intermediary inform the player about all offers? Does the sports agent go the ‘extra mile’ for the player during contract negotiations with a club, knowing that he or she also negotiates with that club on other transfers on which he or she can earn money?
“Does the sports agent go the ‘extra mile’ for the player during contract negotiations with a club, knowing that he or she also negotiates with that club on other transfers on which he or she can earn money?”
A joint research project of several high-profile European universities has concluded that the regulatory framework concerning intermediaries does not guarantee that agents are sufficiently professional and competent. Regulators and legislators continue trying to regulate the market, but do so in a very fragmented way. As a result, the intermediary market for underage players is still very much a wild west.
We regularly advise youth players and their parents on all legal and tax aspects, as well as on contracts and issues with agents. Do you need independent advice, a contract revision or benchmarking? Feel free to contact us.
Sven Demeulemeester (This email address is being protected from spambots. You need JavaScript enabled to view it.)
Niels Verborgh (This email address is being protected from spambots. You need JavaScript enabled to view it.)
Tour & Taxis
Havenlaan/Avenue du Port 86C B414
BE-1000 Brussels
T +32 2 421 94 94
info@atfield.be