In recent years, there has been a remarkable increase in the number of youth transfers within the Eredivisie, the highest Dutch football league. This trend reflects the growing competition among clubs to identify and retain young talent. Where in the past, youth players often completed their education entirely at one club, talents and their parents are now increasingly opting for a club with better development opportunities or a faster transition to the first team. At the same time, it is fair to charge a fee for the training of these youth players. Without such compensation, all talents would end up at the largest clubs, disadvantaging smaller clubs, which have invested a lot of time, effort and money in developing these players. These training allowances ensure that smaller clubs are rewarded for their contribution to Dutch football and can continue to invest in the development of new talents. This contributes to fairer competition and the sustainable development of football in the Netherlands. In this context, we are zooming in on a dispute about the training allowance in the event of a domestic transfer of youth players.
On 3 July 2024, the Arbitration Board ruled on a dispute regarding the payment of accounts sent by FC Utrecht to Feyenoord for taking over three youth players.
In the proceedings, an invoice was sent from FC Utrecht to Feyenoord, whereby Feyenoord was obliged to pay a sum of €520,000 for taking over three different players from FC Utrecht's youth academy.
One point of attention in this issue was the so-called gentlemen's agreement. The men's agreement is a mutual agreement between six clubs, namely PSV, Feyenoord, Ajax, AZ, FC Utrecht and Vitesse, which states that everyone pays €35,000 for each year of training if a player is taken over by one of the other clubs within the agreement. So if a player has played in AZ's training for 4 years and PSV wants to take over this player, this would involve a training allowance of €140,000 in accordance with the agreement. The idea behind this was that these clubs were not trying to persuade players in each other's youth schools to change clubs and, if they did, there would be a fee in return.
The discussion between Utrecht and Feyenoord focused mainly on the status of the men's agreement in relation to the KNVB's pool regulations. The KNVB Pool Training Regulations are a compensation system in which paid football organizations receive compensation for players they have trained, depending on the club's training costs and the years they have trained a player.
FC Utrecht was of the opinion that the men's agreement is completely separate from the pool regulations and therefore also claimed payment of the fee in accordance with the men's agreement. Feyenoord, on the other hand, stated that the men's agreement was just an idea to fill the gap before the entry into force of the KNVB's new Pool Rules. According to Feyenoord, the men's agreement was only a gentlemen's agreement and therefore not legally enforceable, now that it invokes the parties' honor.
Feyenoord therefore decided not to comply with FC Utrecht's claim. This decision was not without risk, now that Article 81 of the UEFA Financial Sustainability Regulations states that a club must not be in arrears with another football club. As a result, the UEFA Club Financial Control Body (CFCB) may impose a sanction, often in the form of a fine. For example, this also cost FC Porto 1.5 million euros.
To be sure of its case and to have the dispute settled, Feyenoord went to the arbitration board. On 3 July, the arbitration board ruled that the men's agreement was created to cause a change in behavior and that Feyenoord had failed to comply with the agreements. Nevertheless, the arbitration board said that it was a gentlemen's agreement and agreed with Feyenoord that this should be considered a moral agreement and not a legally enforceable agreement. Therefore, Feyenoord was not obliged to pay the fee of €520,000.
This arbitration board ruling not only provides an answer to the dispute between Feyenoord and FC Utrecht, but also serves as a precedent for explaining the men's agreement. It has appeared that the men's agreement is not legally enforceable and that the clubs cannot therefore be held to pay the agreed fee herein. The KNVB Pool Rules will therefore govern the fees for training players in domestic youth transfers.
This increase in legal certainty may also mean that there will be more pressure on the KNVB to further clarify these regulations and adapt them to the needs of the clubs. It is important to keep in mind that the differences between the professional clubs will not be too big, especially now that in the KNVB system, clubs that have more budget available for their youth education will also receive higher compensation.
This could lead to a more competitive environment where major clubs look more aggressively for talented youth players, knowing that the cost structure around transfers has changed. Clubs with strong youth schools may have an advantage over clubs that are more dependent on transfers, as they are not obliged to pay fees under the men's agreement. This only increases the possible inequality in the youth schools of professional football organizations. It will therefore be up to the KNVB to moderate this development and create a fair playing field that offers a future for all clubs.
If you have any further questions about this topic, please contact our office.
Mr. Stef van der Veldt
lawyer
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