Transfer system on brink of meltdown

Football's world governing body, Fifa, meets in Zurich today to thrash out proposals designed to head off the threat by the European Commission - suddenly alarmingly urgent - to plunge football into chaos by abolishing the transfer system for players. The EC, which has accused Fifa of being slow to respond, emphasised this week that while it is prepared to discuss "constructive" proposals aimed at rewarding smaller clubs for youth development, it retains the option to rule the current system illegal.

Football's world governing body, Fifa, meets in Zurich today to thrash out proposals designed to head off the threat by the European Commission - suddenly alarmingly urgent - to plunge football into chaos by abolishing the transfer system for players. The EC, which has accused Fifa of being slow to respond, emphasised this week that while it is prepared to discuss "constructive" proposals aimed at rewarding smaller clubs for youth development, it retains the option to rule the current system illegal.

"That would be the worst-case scenario," said Christophe Forax, an EC spokesman. "After a long delay, we hope to receive Fifa's proposals soon. But if we do not, we are prepared to act. Our view is that the current system breaches EU law on free movement of labour, is not fair to players or smaller clubs, and should therefore be abolished."

The football authorities here and world-wide have shown rare unity over the issue, reacting with horror at the prospect of a free-for-all, in which players would be free to leave clubs while under contract without transfer fees having to be paid. Fifa said the prospect would wreak "irreparable damage on football everywhere".

The Premier League, Football Association and Football League have established a joint working party urgently looking for solutions. The Chelsea chairman, Ken Bates, has warned of "total anarchy" and called on the Government to oppose the Commission. Arsenal's vice-chairman, David Dein, said this week that abolition of the transfer system would be a "disaster", arguing that smaller clubs would be particularly hurt.

Yet behind such feverish forecasts of doom beats the steady drum of financial self-interest. Premier League clubs are increasingly signing ready-made overseas stars rather than filtering money down to smaller Nationwide League clubs. Neither Chelsea nor Arsenal, both laden with expensive foreign players, have proved themselves benefactors to smaller clubs via the transfer market. Since Arsÿne Wenger took over as Arsenal manager in September 1996, he has signed only two Nationwide League players: Matthew Upson from Luton and Jermaine Pennant from Notts County, both for under £2m.

The net amount paid in transfer fees by the Premiership to the Nationwide League last season was only £27m; around half the £53m Arsenal have received for the sales of Nicolas Anelka, Emmanuel Petit and Marc Overmars alone. While big clubs plead publicly their concern for the smaller clubs, privately Premiership sources concede they are horrified at the prospect of being unable to cash in by selling expensive players themselves.

The EC sees this acutely, arguing that the current system operates largely to the benefit of the rich clubs, and provides unpredictable reward to smaller clubs for youth development. Forax said the Commission had received five official complaints, three from clubs and two from players' associations, and many smaller clubs have expressed dissatisfaction. "The current system works largely to make profits for the big clubs. We don't want to destroy football. We want to see a sound system, which genuinely maintains solidarity between clubs and encourages them to train young players."

Even on football's side, the argument is not clear cut. Following Luis Figo's corporate acquisition-sized £37m transfer from Barcelona to Real Madrid this summer, few wholly defend the current system. "We do think spiralling fees are a huge problem for the game," said a Fifa spokesman. "Clubs are taking on debts, and their hunger for more money puts pressure on the game at large. We are keen to find a more manageable solution."

Fifa is expected to propose a system of compensation to smaller clubs for developing players, involving different payments at different ages. They are known to favour outlawing transfers, particularly internationally, before players are 18, following the unsavoury cases recently of young Africans brought to Europe en masse in the hope that some might make the grade at football.

Gordon Taylor, chief executive of the Professional Footballers' Association and of FIFPRO, the international players' body, part of Fifa's working party, believes different levels of compensation should be payable at 21 and 24 years of age. Forax suggests the EC will be amenable to such proposals, but the battle will be in the detail. The EC wants a system to provide standard compensation for the cost of training players. The football authorities will argue that account must be taken of the player's ability, and "market value". If not, the amounts paid to the smaller clubs, particularly compared to the wealth of the big clubs, could be pitifully small.

Taylor does not believe Fifa will argue that transfer fees for older players should be maintained in their present form. Instead, he believes it will propose a set system of compensation and measures, such as players having to serve a minimum 12 months of their contracts and "transfer windows", after which players will not be able to move, designed to preserve stability. "We have to have some certainty," he says, "or football will become farcical. Clubs will become like Euston station, with players continually coming and going."

This latest crisis has served only to confirm for many the need to make a special case for sport, outside the EU's free-movement, free-market provisions. In Lisbon in May, a huge majority of European sports ministers proposed that a protocol be established, which could allow sport to act collectively, exempt from the normal rules applying to commercial industries. Remarkably - and embarrassingly - the only countries to oppose it were the supposedly football-friendly British Government and Denmark.

Last weekend Chris Smith, Minister for Culture, Media and Sport, pronounced his firm support for transfer fees, which he described as a "vital lifeline for smaller clubs, giving them an incentive to invest in nurturing home-grown talent." His intervention, welcomed by the football authorities, suggests that the Government is moving towards a more mature approach, and away from the pure free-market view, which football insiders believe emanates from DTI and Foreign Office officials rather than Smith himself.

The domestic football authorities are expected to back the call for players to be exempt from some EU law, which would allow the maintenance of a substantial transfer system. This, however, is the long game. For now, the current crisis with the EC must be faced, working to a 20 September deadline. Although Fifa denies it has dragged its feet, the Premier League is looking for an extension. The EC, however, remains adamant that proposals must come imminently if "doomsday" is to be avoided.

Behind the stark headlines, the EC's intervention could yet result in a saner, fairer system, particularly for smaller clubs. But there is a clear risk that too little time will be taken, and a new system rushed through, throwing out the old without producing a constructive alternative. This could indeed result in a free-for-all, which would see players moving rapidly to the highest payers clubs, concentrating power even further in the hands of the big clubs.

davidconn@freeuk.com