Covid-19 FIFA Regulatory Issues – An Overview

13th April, 2020 - 4:41 pm Categories: Sports Law 0 Comments

The International Federation of Association Football (FIFA), on the 7^th of April 2020, published guidelines on certain prominent issues and made recommendations to address the consequences of the unprecedented disruption caused by Covid-19 to the Football community. The guidelines were framed by a task force chaired by the Vice-President of FIFA, Vittorio Montagliani, alongside various other stakeholders like representatives of clubs, players, national associations etc.

There are three core issues that the task force considered relevant to address in the guidelines:

• Expiring Contracts (due to end at the end of the current season) and New Contracts (due to commence at the start of the upcoming season)
• Contracts that cannot be performed as the parties had originally anticipated
• Appropriate timing for the registration period i.e. transfer windows

Expiring Contracts and New Contracts

FIFA has addressed the issues that would impact the new and expiring contracts of players and managers owing to the suspension and postponement of the football leagues. Generally, in majority of the football leagues, the new season starts on the 1^st of July and ends on the 30^th of June, and has two registration periods/transfer windows where players and managers are signed on a full term or loan based contract. However, due to the unprecedented postponement of football leagues and the overwhelming desire of the member associations (MAs) and leagues for the ongoing season to be completed, the current season would go on well beyond its original end date i.e. 30^th of June 2020. This would also mean that the players and managers who have already signed a new contract starting 1^st of July and those whose existing contract ends on the 30^th of June would be affected by such delay. Hence, FIFA has proposed the following guidelines:

• The Contracts which are due to expire on the original end date of the 2019-2020 season, should be extended to the new end date of the season i.e. until the existing season actually ends.
• The Contracts which are due to start in beginning of the upcoming 2020-2021 season, shall now commence at the new start dates of the 2020-2021 season i.e. when the upcoming season actually begins.
• In case of an overlap between the start and end dates of different football leagues, and where a player is moving from one club/league to another, priority should be given to the former club to compete and finish the season with all the members of its original squad, before the player’s or manager’s new contract with his new club starts.
• For international transfer agreements, for both permanent and loan transfers, any payment that contractually falls due, prior to the new commencement date of the contract, should be delayed until the new season actually commences or the opening of its amended registration period/transfer window.

Contracts unable to be performed as anticipated

FIFA acknowledges that the suspension and postponement of football leagues globally, due to the Covid-19 outbreak, might lead to certain situations wherein the contracts cannot be performed as originally anticipated by the parties to it. Since there won’t be any football games, players, coaches, managers will be unable to work and their clubs will be unable to provide them work and because of this a lot of contracts would not be performed as anticipated and hence, there will be issues relating to salary and other financial gains. To tackle this, FIFA has recommended the following guidelines in order to provide a fair solution for both clubs and its employees to deal with the financial impact.

i. It is proposed that there is a need of a mutual agreement between the Clubs and its employees to find a solution regarding employment conditions until the time the competition is suspended and delayed. The agreements should address issues such as remuneration, conditions during contract extensions, government aid programmes and other such benefits as they deem fit and necessary.

ii. Any unilateral decision made by the clubs to vary contracts shall only be recognized if they are in line with the national laws of the country of the respective league or falls under permissible collective bargaining agreement (CBA) structures.

iii. If there is no mutual agreement reached by the clubs and its employees or the national law does not address this situation or there is no CBA, then any unilateral decisions to vary terms and conditions of an existing contract shall only be recognized by the FIFA Dispute Resolution Chamber (DRC) or Players’ Status Committee (PSC) when they are made in a reasonable and proportionate manner. The DRC and PSC shall consider the following points while assessing such decision to vary contracts:

• whether the club had attempted to reach a mutual agreement with its employee(s);
• the economic situation of the club;
• the proportionality of any contract amendment;
• the net income of the employee after contract amendment; and
• whether the decision was applied to the entire squad or only specific players. 

iv. FIFA also proposed that all agreements between clubs and employees should be suspended as long as the football competitions and activities are suspended, provided that the employees are given proper insurance coverage and adequate alternative income support arrangements until the period of such suspension.

Registration Periods a.k.a Transfer Windows

There are two registration periods/transfer windows in a football season and as per Article 6 of the FIFA Regulations on the Status and Transfer of Players (RSTP), players can only be registered with a club during one of two annual transfer windows as fixed by the relevant MA. In general sense, the first registration period starts immediately after the completion of a season and could be for a period of 12 weeks maximum. The second registration period occurs in the middle of the season and cannot exceed more than 4 weeks. However, owing to the suspension of leagues, the transfer windows of the upcoming season are going to be affected and hence, FIFA has proposed that the transfer windows shall be adjusted as per the actual end date of the current season and the start of 2020-2021 season.

The guidelines have made certain proposals in this respect that include:

• All requests for an extension of the current season finishing date should be approved.
• All requests to extend or amend registration periods that have already commenced be approved, provided that their duration complies with the maximum limit (i.e. 16 weeks) as established in the RSTP.
• All requests to amend or postpone registration periods that have not commenced be approved, provided that their duration complies with the maximum limit (i.e. 16 weeks) established in the RSTP.
• FIFA Member Associations (MAs) shall be permitted to amend season dates and/or registration periods, either within the FIFA Transfer Matching System for international player transfers (TMS) or by notifying FIFA.
• As an exception to article 6 paragraph 1 of the RSTP, a professional whose contract has expired or been terminated as a result of COVID-19 has the right to be registered by an association outside a registration period, regardless of the date of expiry or termination.

Author: Sudhansu Sahoo, Legal Associate, at Khurana & Khurana, Advocates and IP Attorneys.  In case of any queries please contact/write back to us at sudhanshu@khuranaandkhurana.com.