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Brazil outlaw footballer third-party ownership

The Brazilian Football Confederation (CBF) has introduced new rules outlawing third-party ownership (TPO) of players, ahead of FIFA's ban on the practice which is set to be implemented on May 1.

third-party-ownership

The CBF's move is significant, given that Brazil is one of the major markets for the controversial practice of TPO.  In September, FIFA agreed to ban TPO following a "transitional period" of 3 to 4 years; with the ban coming into force on May 1 2015.  However, existing agreements shall continue to be in place until their contractual expiry, while new agreements made between January 1 and April 30, 2015 will be subject to a time limit of one year maximum.

 

The practice of TPO is widespread in Brazilian and Argentinian football, along with 10 eastern European countries - where investors are said to hold about 40% of the market value of league players.  It has been increasing in Spain, Portugal and the Netherlands, but is a contentious subject with the English Premier League, French Ligue 1 and Polish Ekstraklasa banning funds owning stakes in the economic rights of players.

percentage-ownership

The CBF's rules on transfers published on January 13th say that contracts signed between January 1 and April 30 will be valid for a maximum of one year, with the practice outlawed as of May 1.  The CBF has also ordered clubs to declare details of existing contracts, including the names of third-party investors and expiration dates.

 

"As far as I'm concerned it's the first national association that's brought in domestically FIFA regulations," Marcos Motta, a Rio de Janeiro-based lawyer specialising in football transfers, told the Bloomberg news agency.

 

Buying stakes in the transfer rights of players has been a prevalent feature in Brazilian football for more than 15 years.  In June, FIFA said that from January 2011, Brazilian clubs were involved in 5,003 transfers, making the country the most active market in the $4.1bn (€3bn) global transfer market.

neymar-3rd-party-ownership

Motta, who acted in the controversial transfer that took forward Neymar from Santos FC to FC Barcelona in 2013, said the ban on investors is already having an impact in Brazil.  "For sure there has been a big decrease in the market," he added.

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