Big money permanent transfers are usually the headline grabbers but there have been some significant loan moves this window… Tanguy Ndombele from Tottenham to Lyon, Adama Traoré from Wolverhampton Wanderers to Barcelona, Antony Martial from Manchester United to Sevilla, and Aaron Ramsey from Juventus to Rangers, to name just a few of the international loan deals to feature this January.
During the next transfer window, clubs must pay heed to a new regulatory framework when negotiating such loan moves. FIFA has announced that its new regulations on player loans are ready for implementation, with the stated aims to develop young players and promote competitive balance. Whether the perceived problems with the current system are fair or not, there will be significant changes to the current regulation of international loans. Although domestic loans are outside of the new regulatory framework, implications are on the horizon as member associations will have until 2025 to ensure their own rules on loans are in line with FIFA’s principles.
The new framework has been in the stocks for several years as one part of the larger FIFA transfer system reform packages developed and endorsed by the Football Stakeholders Committee (“FSC”). In 2020, FIFA postponed the anticipated introduction of the new rules due to the Covid-19 pandemic. However, following fresh endorsement by the FSC and subject to the final approval of the FIFA Council, the regulations are set to enter into force on 1 July 2022.
Content and changes
Although the new regulations have not yet been published, FIFA has provided details of their content.
Some of the key provisions are as follows:
- The maximum duration of international loans will be one year
Currently, FIFA prescribes a minimum duration for international loans (i.e. the period between two registration windows, see Article 10 FIFA RSTP) but not a maximum duration. Some domestic league regulations already stipulate maximum durations in respect of member clubs loaning out players, including internationally. For example, subject to certain circumstances, the Football League (“EFL”) restricts loans by its member clubs to non-member clubs to a maximum duration of two years (EFL Regulation 54.5.3).
- Prohibition on the sub-loaning of players
This is a reversal of the current FIFA regulatory position, which allows sub-loans as long as the player and the player’s ‘home’ club provide written authorisation (Article 10(3) FIFA RSTP). As flagged by the Council of Europe’s 2021 expert report on the FIFA transfer system (“Report”), FIFA’s removal of sub-loans are aimed at improving transparency and contractual stability in the loan market.
- A phased-in restriction on the number of international loans in and out during each season as follows:
- Season 1 July 2022 to 30 June 2023: maximum of 8 players
- Season 1 July 2023 to 30 June 2024: maximum of 7 players
- Season 1 July 2024 to 30 June 2025: maximum of 6 players
Before now, FIFA has not stipulated a maximum number of international loans in or out. Clubs will be under some limitations already due to domestic competition rules. For example, the Premier League rules provide for a maximum of four loans in per season with no more than two registered at any one time (Premier League Rules V.7.5 and V.7.6). However, unlike the new FIFA regulations, the current Premier League rules do not apply to loans from overseas clubs and do not affect the number of outgoing loans a club can make.
One point to note is that the FIFA definition of ‘international transfer’ is “the movement of the registration of a player from one association to another association” (Definitions, FIFA RSTP). Therefore, unless FIFA include an exception, loans between English and Welsh clubs who may operate in the same league system will be caught by the new regulations.
- Players aged 21 and under and club-trained players will be excluded from the maximum numbers
The Report highlights that the average age of players subject to loans between 2013 and 2017 was 21 years. According to FIFA’s 2021 Global Transfer Report, loans and returns from loan made up 31.5% of all transfers for under 23 year olds but only 18.1% of transfers for those aged 23 and over. These figures suggest that most of the loans that clubs wish to make will not be subject to the new cap.
- Maximum of 3 players loaned out to a single club and 3 loaned in from a single club during a season
Although FIFA has not prescribed such a cap before, some domestic leagues already have one in place. The Premier League rules, for example, contain a similar but more restrictive provision, stating that clubs cannot take on loan more than one player from one club at any one time (Premier League Rules V.7.5). However, currently this rule does not apply to international loans.
- Member associations will have 3 years to implement regulations in line with the FIFA principles
As is apparent from the examples already provided, many domestic leagues will already have rules in place regulating loans to or from member clubs. It is up to national associations to ensure that these rules are in line with the FIFA principles. The Report identifies that loans “are not regulated in all member associations”. In some cases, new regulations will need to be implemented; in others, amendments will need to be made to existing regulations in order to satisfy this requirement.
It is fair to say that the new measures will have an impact on those clubs with very developed loan programmes. However, the effect of the new cap on loans may not be overly significant given that many clubs predominantly loan younger or club-trained players not captured by the new regulations. With clubs operating within financial constraints imposed by various financial fair play regulations, the loss of loan fees may have an impact on some clubs.
The exception FIFA has detailed for players aged 21 and under recognises that loans have a place in helping the progress and training of young players, providing them with valuable game time and experience in a new environment at an appropriate level for their development. At the same time, a view has been expressed that loans can hinder player development and the principles of competitive integrity, transparency and contractual stability.
Whatever the view on loan transfers, clubs and national associations will obviously have to comply with the new loan regulations. Whether the new regulations are effective in achieving the stated aims will be measured over the next few years.