Home Football PA Explains: Third Party Ownership In Football & Doyen Sports

PA Explains: Third Party Ownership In Football & Doyen Sports

Alex Kirwan discusses the controversial issue of third-party ownership in football, and in particular the actions of Doyen Sports.

Marcos Rojo and Carlos Tevez – what do they have in common?  Both hail from Argentina and both are or were Manchester United players. However, they also have something in common that is seldom an issue in English football or, if it becomes an issue, tends to get “swept under the rug” by the F.A.  This article will explain third party ownership (TPO) or third party investment, the issues involved and why it causes problems.

For the most part TPO is a South American phenomenon, but players such as the aforementioned Rojo have dragged this practice into the Premier League which is why it warrants discussion.

In simplest terms, TPO is where the football club does not own 100% of a player. They are therefore not entitled to 100% of any future transfer value of this player. Although technically anyone can own a player, in these arrangements it tends to be companies, businesses and/or actual individuals who provide clubs with capital to buy a player in return for a percentage of that player or they may also own the player outright. When the player in question is sold, the investors receive the percentage value of the transfer.

The Premier League, Football League, Football Association, the Polish league and the French league have all implemented rules and regulations to try to ban TPO. What is the issue you may ask?

The original prohibition regulations in the Premier League came as a result of the Tevez affair where a third party owner had the contractual right to force West Ham to sell the player if a suitable bid was received. This is taking power away from football clubs and putting it into the hands of ‘investors’ who, as the name suggests, are only interested in lining their own pockets and not the welfare of the player, the club or the fans.

This may not be the only issue. The illegal drug trade is big business in many South American countries.  If an investor whose business practices are ‘questionable’ and the player they have invested in has had interest from Europe, what big clubs are going to do business with them? FIFA are in the process of banning TPO or at least regulating it worldwide in an attempt to eliminate this.

Let’s discuss Doyen Sports. They are an investment agency who attempt to bend the rules a little to suit their needs. Take the Tevez case for example – he was owned by a third party, but as this is not allowed in most football associations anymore, they have found a way to get around it.

If we look at Marcos Rojo.  He signed for Manchester United from Sporting Lisbon for £16 million this summer, but Sporting didn’t technically own the player outright. They had borrowed money from Doyen Sports in order to purchase the player from Spartak Moscow, so when United bought the defender they were paying Doyen Sport the majority of the money.

This is how Atletico Madrid, who were deep in debt at the time, paid the £37.4 million for Radamel Falcao. When Falcao subsequently made to move to Monaco for £51 million Monaco bought him outright.

Although this practice is frowned upon in most European clubs, some like FC Porto encourage it and do not want to see it banned.  This is because they struggle with limited funds to attract big players and use TPOs.

It appears FIFA will put in place a ban on TPO players in the Champions League and Europa League in the near future, but it will remain up to each domestic league to implement and oversee it themselves.

The current position held by FIFA is set out in Article 18bis:

“No club shall enter into a contract which enables any other party to that contract or any third party to acquire the ability to influence in employment and transfer related matters its independence, its policies or the performance of its teams.”

Although this is not a specific ban on TPOs, it would prevent what happened in the Tevez saga from happening again.

But if FIFA/UEFA were to ban TPOs across the board, what implications would this have? Simply put, it would be impossible to implement because each club would have to buy the full economic rights to the players in question, and in order to do this, they would probably have to turn to companies like Doyen Sports, an action that would not solve this problem.

TPOs are common practice in Spain, Portugal and South America (all big footballing regions) and this writer cannot imagine FIFA/UEFA actively trying to alienate them by banning TPOs.

Third part ownership or third party investments in players is not often spoken about but seems to be more common practice than one would think.  Doyen Sports is believed to have over £100 million invested in players at any one time and they are just one company.  However, there are several at the top who invest in economic rights to players.

Doyen claimed a third of Mangala’s transfer to Manchester City, having assisted Porto with his move in 2011, and are owed 75 per cent of Rojo’s transfer although a dispute with Sporting has broken out and no money has been handed over to date.

On Doyen’s website, names such as Alvaro Negredo, Alvaro Morata, Steven Defour and Jose Antonio Reyes are listed but it is not stated in what capacity the company are involved or what percentage they own.

Doyen are keen to show that their arrangement is different than a TPO which may mean Premier League fans seeing more of it in the future.

It goes to show talent is money and those with money will always attract talent.

Alex Kirwan, Pundit Arena.

 

 

About Alex Kirwan

A Law graduate with an interest in all things sport, Alex has ambitions of being a sports agent purely just to shout “show me the money”. Follow him on Twitter for regular sports law updates @AlexKirwanLaw