I’m writing this essay as much to try and sort my own mind out as much as try and shine a light on the Wolves and Radrizzani affair. I’ve uncovered few facts in this saga and my regular readers may decide to stop reading now!
What is all the hoo-ha about?
Cutting through all of the undergrowth, this particular issue seems to centre on the FA’s attempts to clean up football by prohibiting 3rd party ownership and in doing so scrapping the old registered agent system and introducing a new system of registered intermediaries.
These intermediaries must be registered with the FA and they can represent a player’s interests in negotiations with clubs when transfers or new contracts are being considered; they can also represent a club and be on the other side of the table when these negotiations are taking place.
Now the above paragraph doesn’t seem to contain anything to worry about so there must be more to discover and yes, there is! An intermediary can, quite legally, represent both the club and the player at the same time in these negotiations.
I’ve got to say that when I imagine this happening I think of the old music hall acts where a single comedian dresses half as a man and half as a woman and turns around to argue with himself – “I offer you wages of £5k per week to play for my club” turns “No, I want at least £20k per week” turns “Are you mad? That’s far too much, I’ll go to £7k per week max” turns… on so on.
Now, although some fans might be surprised, there are honourable people in football and it doesn’t necessarily have to be a problem having the same person doing the negotiations and that presumably is why the FA allow it.
So if all is Ok why is there a problem?
The FA introduced the new system in April 2015 and amended some rules in September 2017, one of the amended rules being the Conflict of Interest rule.
When the new system was introduced in 2015 various sports’ lawyers expressed concerns: It seems that, although the FA requires intermediaries to register annually there is not an apparent method for checking if intermediaries have stuck to the rules and deserve to be re-registered.
As part of this new system all transfers and contracts involving intermediaries must be registered with the FA disclosing various facts. Who the intermediary represents in the negotiations must be disclosed and David Conn found in his investigation in 2016 (see references) that in some cases in the EPL agents were claiming verbally or on their websites etc. to represent an agent yet this fact was not being declared.
It is not against the rules for an agent to be an intermediary to club and player if both agree they are happy there will be no conflict of interest, so it seems odd that full disclosure seems to have been withheld.
The sports’ lawyer Nick De Marco QC said in 2015 “So, for example, where there is a potential, but perhaps not proof of any actual, conflict of interest, but there has been non disclosure by an Intermediary, the FA may decide to take disciplinary action against the Intermediary…. Similarly, Clubs or Players may allege such non-disclosure amounts to a … breach of the Intermediary’s fiduciary duties to his or her principal.”
So it is clear that worries around this new intermediary system have existed for some time and the FA must have shared the concerns to issue new rules in September 2017.
What does that legalese mean?
This is the difficult bit for me to get a handle on. The changes to the system seem to stem from problems around 3rd party ownership.
To many people 3rd party ownership is acceptable and can benefit players and clubs especially in overseas markets. However, there exists within this system the potential for malpractice.
This malpractice is often easy for clubs, agents and 3rd party owners to hide and difficult for footballing bodies to discover and regulate.
So FIFA, and hence the FA, took the decision that to ensure the integrity of the game is not harmed all 3rd party ownership would be banned, whether it was the “good” type or “bad”.
What is this malpractice?
This again is difficult to track down, there are plenty of potential ways that the free market of players can be manipulated unfairly.
In 2016, Bill Wilson writing for the BBC about the new regulations, said that “However, some player agents are believed to have found ways around the regulations.
These include buying shares in a club, and then taking a cut of any transfer fee that is subsequently received by the club for their player.
Another loophole is to ostensibly give a loan to a club and then not only be repaid that sum, but also to receive a type of interest payment, but again the sum is culled from any transfer fee achieved by the club selling on the player.”
I’ve read of worries that the “super-agents” have so much influence within a country that they can force clubs to sell their best players at a knock-down price under the threat of not being able to deal with that agent in the future.
I’ve read of worries that when agents will get a portion of a future transfer of a player out of a club, they are willing to top up the player’s wages themselves to induce him to leave his current club.
This method of agents getting a portion of future transfer fees seems to be what Sam Allardyce allegedly was referring to when he apparently talked of loopholes in the 3rd party ownership rules which resulted in his sacking as England manger.
So there seems to be lots of ways for the intermediary system to go wrong but little evidence yet of action being taken against clubs or agents. Santos of Brazil, Seville of Spain, club K St Truidense VV of Belgium, and FC Twente were all fined by FIFA for 3rd party breaches in 2016 after the practice was banned but I’ve not found specific cases yet of the FA taking action.
So what’s all this barney with Wolves?
Well, to me, it seems that it is acknowledged by Wolves and the EFL that a potential for a breach of regulation exists but Wolves have said they have stayed the correct side of the rules. This may well be the case and so I make no allegation against them.
In the Wolves case the same company that owns Wolves, Fosun, is also a part-owner of the “super-agency” run by Jorge Mendes. As I said above, in cases like this there is a worry that Fosun could be pumping money into Wolves to fund transfers and loans and may also be pumping money into the super-agency that facilitates the player movements and this might cause players to be paid twice by Fosun, or transfers to be made at below market price, or loans and transfers of players are denied to other clubs who would bid successfully if the market were fair. Paying the player twice would mean FFP limits do not get broken by the club alone, even if in total the limit should have been broken.
As I say, there does not appear to be evidence of this in the public domain and just why scouts and management from other Championship clubs have asked for this to be investigated is unclear.
Is FIFA happy with the current arrangements?
It would appear not.
The Guardian recently wrote, under the headline “Agents’ runaway gravy train set to be derailed in bid to curb excessive fees” that FIFA and UEFA are looking into how the market is working as they are aware of major problems.
The article reports that the UEFA President said clubs tell him the approach of some agents is: “Look, you will pay me 50% of the transfer or the player goes somewhere else”.
If FIFA and UEFA are getting reports of malpractice to the extent that they are willing to talk openly about it and start their own investigations, it would seem Andrea Radrizzani and the other Championship clubs have some powerful allies in their complaints.
Is Radrizzani trying to deflect fans away from our own problems?
I’ve certainly seen this suggested many times and I agree we have other problems to sort out as well but problems with agents seem to be worldwide with FIFA and UEFA investigating.
The scope of people at home who are unhappy with the agents’ rules at the moment seems to extend beyond clubs: Even Dan Chapman, the vice-chair of the UK’s reformist Society of Football Intermediaries and Agents, “agrees broadly that agents should act for only one party in a deal, usually negotiating for players”.
It also seems that FIFPro, the world players’ union, is critical of the current regulations and is supportive of reforms.
Could Leeds just ignore this and sign anyway?
Yes, of course, but only to a limited extent.
With money in the club Leeds could make offers to buy or loan players at market value and pay market wages.
However, if that player or club is under the undue influence of an agent the player will go elsewhere: Jonas Baer-Hoffmann, of players’ union FIFPro, believes agents’ fees “are now ‘very often’ a proportion of transfer fees rather than players’ salaries, and it is a ‘massive problem’ for agents to be acting as brokers for multiple parties in a deal. ‘They can have greater influence over where a player ends up than the player or the clubs,’ he said. ‘Their interest is not only where a player goes but which club will pay them the highest fee’.”
So it seems if we really, really, really want a player we have to pay the agent huge sums, sums of money that do not benefit the player or his current club and drain our own club of money for other players.
Could we lose players as a result?
Yes, if Jonas Baer-Hoffmann is right, any players who become under the influence of an agent will go where their agent orders and Leeds will have no option of keeping him.
I’ve seen many fans upset that Wood left us for more money in the EPL despite being offered higher wages and big bonuses to stay with us and I’m not suggesting an agent influenced him wrongly, but the helplessness we suffered in trying to keep him will only get worse if agents are allowed to influence players such as Jansson and Saiz. As far as I know there is no suggestion that these players have an agent likely to do that but it could occur in the future with different players.
Can we benefit by using the super-agent system?
Of course we can, and if it brings high quality players to Elland Road then fans will benefit by an increase in quality. Of course, we could only do this while it is legal and we stick to the same “red lines” that Wolves are sticking to.
How long it is before the world governing bodies change the system yet again remains to be seen but from my reading around the subject the Championship clubs asking questions of the EFL seem to have valid grounds for wanting clarification.
So in summary, my current feelings are there are undoubted problems with the transfer system worldwide which may be addressed and change implemented.
However, if it remains legal to operate an intermediary system the way Wolves have and it will bring quality players to Elland Road then we should embrace it to compete with other clubs who will no doubt be doing the same.
Mike Thornton 13th March 2018