- Oct 20, 2022
- 4,952
I started a discussion on this on the Mac Allister firsts thread but realised the discussion took the thread well off topic, so I’m moving my later posts to here - Release Clauses and Buy Outs are quite recent issues in English PL contracts and not a subject I (and I assume many others) know a lot about - so I thought a discussion would be interesting? Helpful What do they mean? Who do they really benefit? Should Brighton use them? Are they already? And would we know if they were?
So many questions
I’ve included a quote by Swansman (hope you dont mind? But there are difficulties with definitions of the terms with various sources too, using the two types of clauses interchangeably- in truth, a contract could have both a unilateral ‘buy out’ option for the player and a ‘release clause’ but the ‘release clause’ is the one we would be looking at in terms of discussing run of the mill club to club transfers.
According to the sources I quoted above, it is ‘buy out’ clauses that are mandatory in Spanish contracts (under article 13 of the FIFA Regulations on the Status and Transfer of Players) and that ‘allow for football contracts to be terminated unilaterally by the player in exchange for a compensation amount which is agreed in the contract’ - They are usually set at a higher amount than the market value - see my post #30 above and in the link below - although, admittedly, on the surface, arguing distinctions between ‘buy outs’ and ‘release clauses’ looks like semantics but a narrow definition of a ‘release clause’ is slightly different from the Spanish model I think based on the reading:
“Buy-out clauses are prevalent in Spain and are somewhat different to a release clause. They are a mandatory element of most Spanish contracts and are usually set at a very high figure which is not necessarily the true market value of the player. The player has to literally ‘buy out’ his contract at the stipulated amount, though in practice, it is the purchasing club who pays the amount via the player. This can be a complicated process because of the practical tax logistics of a purchasing club transferring the ‘buy-out’ fee to the player who will in turn buy out his contract. We saw this with Manchester United’s reported failed bid with Anders Herrera and Javi Martinez’s successful transfer to Bayern Munich.”
www.williamfry.com
I don’t claim to understand half of how the transfer market works nor the murky world of football contracts and my opinions are somewhat uninformed. FWIIW though, I think perhaps release clauses (ie as distinct from unilateral ‘buy out’ clauses) should be considered de rigueur in players contracts for clubs ‘like Brighton’ in the light of the Bosman ruling and vis a vis the current development stage of the club - (perhaps even more so, if we sign a talented and elusive young striker). With our impact signing and sell on financial model we will (are now, more often than not) be signing young ’undiscovered‘ foreign talent with our players becoming increasingly attractive to wealthier clubs. We are also developing high calibre academy players that (partly due to the success of our scouting networks) will struggle to find room in an increasingly talented first eleven and we can’t just sit on them - loans and other transfer modalities are therefore likely to factor more and more often as the squad gets younger so there might also be a role for release clauses in firming up loan contracts whilst also helping to mitigate the financial risk where new signings can’t get up to PL standard or Academy/PL2 players refuse to go out on loan, trying instead, sometimes inappropriately, to hold out for a first team place.
As far as permanent contracts, there is no reason why imo, release clauses in principle can’t be mutually beneficial for all parties - providing the value of the release clause is not prohibitive (ie effectively pricing the player out of the market) or so low as to invite the world and his wife to trigger a feeding frenzy - It guarantees a player gets to talk to any club once the minimum release figure stipulated in the contract is offered (therefore not restricting his opportunity to move on if and when the ‘big 6/7’ start transfer swooping). A release clause also helps the registered club in the meantime, sustain higher transfer values because it provides a bargaining chip to extend the player’s contract. Without the carrot of a release clause, there is greater chance a player who wants to bugger off and play for a Champions League club for example, may be tempted to run down his contract to ‘pressurise’ transfer out of the Club with the added personal advantage of near-end contracts being translated onto a more lucrative wage deals with an offering club than they may have had otherwise offered. There may be a big chunk of logic I’m missing from all the above of course.
So are they a ‘good thing’?!
Does anyone actually care ?
So many questions
I’ve included a quote by Swansman (hope you dont mind? But there are difficulties with definitions of the terms with various sources too, using the two types of clauses interchangeably- in truth, a contract could have both a unilateral ‘buy out’ option for the player and a ‘release clause’ but the ‘release clause’ is the one we would be looking at in terms of discussing run of the mill club to club transfers.
According to the sources I quoted above, it is ‘buy out’ clauses that are mandatory in Spanish contracts (under article 13 of the FIFA Regulations on the Status and Transfer of Players) and that ‘allow for football contracts to be terminated unilaterally by the player in exchange for a compensation amount which is agreed in the contract’ - They are usually set at a higher amount than the market value - see my post #30 above and in the link below - although, admittedly, on the surface, arguing distinctions between ‘buy outs’ and ‘release clauses’ looks like semantics but a narrow definition of a ‘release clause’ is slightly different from the Spanish model I think based on the reading:
“Buy-out clauses are prevalent in Spain and are somewhat different to a release clause. They are a mandatory element of most Spanish contracts and are usually set at a very high figure which is not necessarily the true market value of the player. The player has to literally ‘buy out’ his contract at the stipulated amount, though in practice, it is the purchasing club who pays the amount via the player. This can be a complicated process because of the practical tax logistics of a purchasing club transferring the ‘buy-out’ fee to the player who will in turn buy out his contract. We saw this with Manchester United’s reported failed bid with Anders Herrera and Javi Martinez’s successful transfer to Bayern Munich.”
"Buy-Out" and "Free Transfer" Clauses in Soccer Contracts– a "Messi" Affair
I don’t claim to understand half of how the transfer market works nor the murky world of football contracts and my opinions are somewhat uninformed. FWIIW though, I think perhaps release clauses (ie as distinct from unilateral ‘buy out’ clauses) should be considered de rigueur in players contracts for clubs ‘like Brighton’ in the light of the Bosman ruling and vis a vis the current development stage of the club - (perhaps even more so, if we sign a talented and elusive young striker). With our impact signing and sell on financial model we will (are now, more often than not) be signing young ’undiscovered‘ foreign talent with our players becoming increasingly attractive to wealthier clubs. We are also developing high calibre academy players that (partly due to the success of our scouting networks) will struggle to find room in an increasingly talented first eleven and we can’t just sit on them - loans and other transfer modalities are therefore likely to factor more and more often as the squad gets younger so there might also be a role for release clauses in firming up loan contracts whilst also helping to mitigate the financial risk where new signings can’t get up to PL standard or Academy/PL2 players refuse to go out on loan, trying instead, sometimes inappropriately, to hold out for a first team place.
As far as permanent contracts, there is no reason why imo, release clauses in principle can’t be mutually beneficial for all parties - providing the value of the release clause is not prohibitive (ie effectively pricing the player out of the market) or so low as to invite the world and his wife to trigger a feeding frenzy - It guarantees a player gets to talk to any club once the minimum release figure stipulated in the contract is offered (therefore not restricting his opportunity to move on if and when the ‘big 6/7’ start transfer swooping). A release clause also helps the registered club in the meantime, sustain higher transfer values because it provides a bargaining chip to extend the player’s contract. Without the carrot of a release clause, there is greater chance a player who wants to bugger off and play for a Champions League club for example, may be tempted to run down his contract to ‘pressurise’ transfer out of the Club with the added personal advantage of near-end contracts being translated onto a more lucrative wage deals with an offering club than they may have had otherwise offered. There may be a big chunk of logic I’m missing from all the above of course.
So are they a ‘good thing’?!
Does anyone actually care ?
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