Current MLS Agent Regulations Explained

Agents negotiating player contracts with MLS franchises faced huge changes in 2015. FIFA promulgated new regulations governing agents negotiating player employment contracts, which came into force on 1 April 2015. FIFA now defines agents representing clubs or players in negotiations related to player employment contracts (either individuals or organizations) as “intermediaries.” As a result, the United States Soccer Federation released a memorandum outlining its intermediary regulations effective April 1, 2015. Likewise, Major League Soccer and the MLS Players Association agreed to terms of a new collective bargaining agreement this past summer, which defines the scope and terms by which agents may operate when negotiating player employee agreements with MLS franchises.

FIFA Regulations on Working With Intermediaries

FIFA promulgated the Regulations on Working with Intermediaries (the “FIFA intermediary regulations”) with the intent “to promote and safeguard considerably high ethical standards in the relations between clubs, players and third parties, and thus to live up to the requirements of good governance and financial responsibility principles.”[1] The purpose of these regulations is to provide a minimum working standard for national associations to regulate intermediaries.[2]

The FIFA intermediary regulations require all national associations to implement a registration system for intermediaries.[3] To register, an intermediary must satisfy the national association that they are independent, hold no conflicts of interest, and have an “impeccable reputation.”[4] To that end, the FIFA intermediary regulations require intermediaries to sign an intermediary declaration (annexed to the regulations) certifying their agreement to comply with the regulations, that they do not hold any conflicts of interest, and have an “impeccable reputation” among other things.[5] As well, The FIFA intermediary regulations also require player’s intermediaries to be paid on a commission not exceeding 3% of the basic gross income for the duration of the contract.[6] Players must give explicit written consent for clubs to pay their intermediaries directly.[7] Otherwise, the club pays the player his salary and the intermediary invoices the player for remuneration.

There is a great article on all of the changes between the new FIFA intermediary regulations by Jonathan Himpe here.

U.S. Soccer Federation Intermediaries Regulations

In April 2015, the United States Soccer Association (USSF) issued its memorandum on intermediaries.[8] This memorandum adopts the FIFA intermediary regulations and outlines the procedures for intermediary regulation in USSF-governed professional leagues. The memorandum applies to any intermediaries negotiating employment contracts involving clubs or franchises in any of the professional leagues governed by the USSF: Major League Soccer, the North American Soccer League, the United Soccer League, and the National Women’s Soccer League. By the nature of how these leagues are organized, these regulations also regulate contract negotiations with clubs located in Canada and within other national association territories[9] who compete in those leagues.[10]

In addition to adopting the FIFA intermediary regulations, the memorandum requires all intermediaries pay an initial registration fee of $400.00, to be submitted with FIFA’s intermediary declaration.[11] Moving forward, intermediaries must pay an additional $50.00 registration fee every year to maintain their registration. As well, financial and violent crime convictions disqualify individuals from registering with the USSF.

MLS Agent Regulation

The MLS Collective Bargaining Agreement (“CBA”) governs employment relationships between players and clubs in Major League Soccer. Generally, collective bargaining agreements set out all employment terms, and act in place of individual contracts, with labor unions acting as the exclusive bargaining unit for the laborers.[12] However, the CBA (like the other major US sports league CBAs) allows players to negotiate some employment terms individually. As well, the union, in this case the MLS Player’s Association (“MLSPA”), carves out its monopoly on bargaining for employment contracts, allowing players to utilize “agents” to negotiate these individual terms. Therefore, in addition to following the FIFA and USSF regulations, intermediaries for players in the MLS also operate under the terms of the CBA, its standard player contract, and at the discretion of the MLSPA.

The MLSPA requires player representatives to register with the MLSPA. While other professional sports unions for leagues in the United States require the passage of an examination for agent registration, at the time of publishing this article, the MLS only require intermediaries to have a client playing in Major League to register.[13] You should note, that the MLSPA could decided to implement some sort of agent accreditation program or registration fee of its own, which would be separate from any accreditation program or fee implemented by the USSF or FIFA.

MLS Player contracts are limited to the terms of the CBA and its standard contract.[14] This standard contract sets the minimum available remuneration for agents (although this now cannot exceed FIFA’s prescribed 3% limit), and basic terms of employment. Likewise, player compensation is limited to the MLS roster rules and salary cap as outlined by the CBA.[15]

[1] See Preamble, FIFA Regulations on Working with Intermediaries, viewed at: https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=1&cad=rja&uact=8&ved=0CB0QFjAAahUKEwjb_fSoj4HIAhXEOz4KHan5DKI&url=http%3A%2F%2Fwww.fifa.com%2Fmm%2Fdocument%2Faffederation%2Ffootballgovernance%2F02%2F36%2F77%2F63%2Fworkingwithintermediariesenweb_neutral.pdf&usg=AFQjCNF3vT6OjB0ZQOKEmnaLx-mLs-I97w&sig2=bdzRNkWUTCApKi8vb_Mo5g

[2] Id.

[3] Id. at § 3(1).

[4] Id. at §§4(1)-(3), 8.

[5] Id. at § 3(2), Annex 1, Annex 2.

[6]Id. at § 7(1), (3)(a).

[7]Id. at 7(6).

[8] Memorandum on Intermediaries, http://www.ussoccer.com/~/media/files/federation-services/player-agents/intermediary-memorandum-2015.pdf?la=en

[9] Although no clubs in this category exist at this moment, the USL and NASL have had clubs in Antigua and Puerto Rico. As well, the NASL is planning to place an expansion club in Puerto Rico.

[10] You should also note that as of publishing Canada Soccer has not issued any document outlining its own provisions to regulate intermediaries. See http://www.canadasoccer.com/player-agents-intermediaries-s16804

[11]Id.

[12] Which technically means that the FIFA intermediary regulations require the MLS Player’s Association to register with the USSF per FIFA and the USSF’s regulations.

[13] See, http://www.mlsplayers.org/modules/accounts/public/agent_registration.php

[14] The MLS and the MLS player’s union recently ratified a new CBA effective for 2015. However, neither the MLS nor the MLSPA have published its terms. You can view the most recently published CBA terms (effective December 1, 2004, through January 31, 2010) here. Note, however this version still does not include the standard players agreement. You can also view the key changes for the 2015 CBA here.

[15] See, “Roster Rules and Regulations,” http://pressbox.mlssoccer.com/content/roster-rules-and-regulations

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