Third Party Ownership (TPO) – PART ONE
Third Party Ownership is a controversial topic which although banned by FIFA in 2015, was already banned by The Football Association (England) in 2008 after the Tevez-Mascherano-West Ham FC saga which cost West Ham £5.5m (a sanction from the FA) and an out of court settlement with Sheffield United of £20m. Quite frankly all sorts of rules were broken in this transfer deal and it was riddled with secrecy and mentions of “undisclosed fees”. It was a complete and utter catalogue of errors ❌. I won’t go into it as it is long and complex, however, if you are interested there are many articles online.
I have listened attentively to various discussions on TPO, and it’s interesting to note that people’s opinions on TPO are very closely aligned to where they are based and where they operate. A few of those in the developed world (where things work properly and where there are grants for youth development) call it “modern slavery” 🤔, whereas those in the developing world call it a “lifeline” ❤️🩹. Honestly speaking, I’ve been in the industry for quite a while and having experienced both the pros and cons of TPO, it’s difficult to stand firmly on either side of it. However, I definitely agree it should be banned in England (and some of the other bigger leagues) but, I would have preferred it if FIFA regulated it for the smaller, less wealthy leagues/clubs rather than an outright global ban. You will understand after reading Scenario One in the second post next week 😉.
First of all…. What is TPO?
In Association Football (Soccer to the Americans 😁), TPO is a practice whereby a third party invests in the economic rights of a football player, with hopes of receiving a share of their future value.
So… I guess the first thing we need to establish is who a third-party is. Let’s dive into the FIFA RSTP… (Hopefully you know what this stands for by now. Writing it in full takes up too much of my word count 😥😆) 👇🏾
According to FIFA RSTP, a third party is any party other than:
* The player being transferred
* The selling club
* The buying club
* Any of the player’s previous clubs (who many be entitled to training or solidarity compensation)
Many players and clubs in South America and Africa (used to) benefit from these arrangements. In fact, I even remember being at a conference where FC Porto in Portugal spoke in favour of TPO. However, it was banned by FIFA because it “undermines the integrity of competitions and contractual stability between players and clubs”.
According to the Manual on “TPI” and “TPO” in football agreements published in 2021, it was reported that 13 clubs had been sanctioned for violating TPO rules, 11 from Europe – Switzerland, Spain, Czech Republic, Germany, Italy, Slovakia, Portugal(x2), Belgium(x3); two from Asia – Qatar and interestingly, only 1 from Africa -> Cameroon.
Part 2 next week 👉🏾
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