An EU court ruled on Friday that certain FIFA rules governing international football player transfers violate European Union law, potentially transforming the current system. The Court of Justice of the European Union (CJEU) determined that FIFA’s restrictions on a player’s ability to seek new employment after unilaterally ending a contract impede the EU’s principles of free movement and competition among clubs.
“The Court holds that all of those rules are contrary to EU law,” it stated.
This landmark decision originates from a case involving former French player Lassana Diarra and FIFA, the governing body of world football. If upheld, the ruling could enable players to leave clubs without the risk of legal entrapment.
The dispute traces back to a decade-old conflict between Diarra and Lokomotiv Moscow, his former club. In August 2014, Lokomotiv terminated Diarra’s contract, alleging breaches of agreement. The club then sought €20 million ($22 million) in compensation from him.
Diarra contested this demand, requesting compensation from Lokomotiv instead. Ultimately, FIFA mandated Diarra to pay €10 million to his former club, a decision upheld by the Court of Arbitration for Sport. Additionally, Diarra received a backdated 15-month suspension.
FIFA regulations stipulate that if a player unilaterally terminates their contract “without just cause,” they are required to pay compensation covering their salary and benefits until the end of the contract. Furthermore, the club acquiring the player could be held jointly liable for this compensation and, in some instances, may face a ban on signing new players for a specified period.
As a result, clubs were hesitant to sign Diarra after his departure from Lokomotiv.
On Friday, the CJEU ruled that these rules hinder the free movement of players and aim to restrict, and even prevent, cross-border competition.
