The EU's highest court has found that some of FIFA’s rules governing the transfer of professional footballers are contrary to EU law.

The Court of Justice of the European Union (CJEU) was giving its opinion on questions referred to it by a Belgian court, where FIFA’s Regulations on the Status and Transfer of Players (RSTP) are being challenged by a French player.

The player, Lassana Diarra, had signed for the Russian football club Lokomotiv Moscow, only to see that contract terminated by this club one year later for an alleged breach “and termination of contract without just cause”.

The player claims that a potential deal with a Belgian club fell through because of the RSTP conditions and sued for damages and loss of earnings of €6 million.

‘Seismic’ ruling

Solicitor Stuart Gilhooly SC, who acts for League of Ireland players, told Gazette.ie that the judgment was “seismic”.

“This is a seismic ruling but one which does not come as a surprise. 

“It has been clear for some time that FIFA’s transfer rules are not fit for purpose. 

“It will be necessary to study the ruling in depth before we can say what the exact outcome of the ruling will be, but this will have ultimately have an effect on how clubs do business and footballers move between them. 

“It is good news for the many players all over Europe who do not earn the huge wages that garner all the headlines,” he commented.

‘Just cause’

The FIFA rules apply in cases where a club considers that one of its players has terminated his employment contract without ‘just cause’ before the normal term of that contract.

In that case, the player and any club wishing to employ him are jointly and severally liable for any compensation due to the former club.

In addition, the new club may, in certain situations, be banned from registering any new players for a given period.

Legal and financial risks

In its judgment, the court held that all of those rules were contrary to EU law.

It found that they impeded the free movement of professional footballers wishing to develop their activity by going to work for a new club, established in the territory of another EU member state.

“Those rules impose considerable legal risks, unforeseeable and potentially very high financial risks, as well as major sporting risks, on those players and clubs wishing to employ them which, taken together, are such as to impede international transfers of those players,” the court stated.

It added that, although some restrictions on free movement could be justified by over-riding public-interest reasons, the FIFA rules seemed to go beyond what was necessary to pursue such objectives.

The court also found that the rules could restrict or prevent cross-border competition among EU clubs.

“The possibility of competing by recruiting trained players plays an essential role in the professional-football sector,” it stated.

The case now goes back to the Belgian court.