The transfer system in football wasn’t always the way it is today – a free market in the true sense of the phrase. In fact, for most of the 20th century, it was quite the opposite. Admittedly, we still retain some core features of the old transfer system.
For example, contracts generally lasted anywhere between one and five years back then, and would normally expire on June 30th of any given year, which is more or less how it works today.
Some rules though, were downright draconian; with players being subject to the whims of their clubs at all times.
According to UEFA’s rules in 1990, a player whose contract had expired was free to enter into a new contract with a club of his choosing; but, the old club was entitled to receive compensation from interested parties as an acknowledgement of its efforts to train and develop the player.
While this fee was usually left to be settled between the two clubs, on the off-chance that the clubs failed to reach an agreement, UEFA was authorized to step in and decide the amount of compensation payable. If the clubs didn’t agree with UEFA’s valuation, the player was forced to remain with his old club.
Alternately, if the player rejected his club’s contract offer, or if the club received an offer from another club which it considered inadequate, it was the player who was punished, often with arbitrarily imposed suspensions extending to a period of two years – during which time he wouldn’t be allowed to play anywhere unless he agreed to sign a contract with his club, or was transferred to another.
If the player himself desired to move to a new club, he was required to submit a written transfer request, which was liable to be turned down at the club’s discretion.
UEFA also stipulated a quota, designed to restrict the maximum number of foreign players eligible to play for a club. Accordingly, only three foreign players (plus two other “assimilated” foreigners, who had lived in the host country for five years), were allowed in each squad.
Also, at any given time, a team could field only two foreign players. These rules imposed unreasonable restrictions on footballers on the basis of their nationality. Consequently, teams largely consisted of players who were citizens of the host country.
It was hailed by many as crucial for the protection of the domestic game. Still, it violated EU Law on more than one ground.
This structure aimed at maintaining financial and competitive equilibrium in football as well as preventing the richer clubs from securing the best players, which could potentially threaten the existence of the smaller and poorer clubs.
However, these objectives were often fulfilled at the cost of impinging on the fundamental rights of footballers.
Football witnessed a significant and necessary shift from this archaic regime twenty years ago. When juxtaposed with the gargantuan extent of this change, the person responsible for it is not only given little recognition, he’s also almost forgotten; or worse, unheard of, in many parts of the world. This man was Jean-Marc Bosman.
Bosman, a former Belgian footballer, was never among the world’s elite players. He possessed a decent amount of talent but struggled to make a name for himself on the pitch.
The highlight of his career was captaining Belgium’s U-21 side. Before the start of the 1988 season, he signed a contract with RFC de Liege, a club in the Belgian first division.
This contract expired in 1990, and Liege decided to slash his annual salary from 120,000 Belgian Francs to 30,000 Francs which was, incidentally, the statutory minimum annual wage in Belgium.
The idea was to steer clear of lawsuits while remaining in a position to command a respectable fee for the player, despite not being overly inclined to retain him.
Naturally, Bosman was unwilling to accept this wage cut, and he began looking for a new club. He discovered that a club in France’s second division – USL Dunkirque – was interested in him.
The only glitch was, Dunkirque didn’t possess the monetary ability to match its desire for the Belgian, and Liege had suspected this, so they suspended Bosman in accordance with the rules of the Belgian FA. It was during this time that Bosman moved the courts.
Over the next three years, Bosman filed three separate lawsuits, starting at a Belgian court, and going all the way to the European Court of Justice.
These cases were registered against his club (for lost wages); against the Belgian FA (on the legality of the suspension); and against UEFA for violating the “freedom of movement” and “discrimination based on nationality” clauses under Article 48 of the Treaty of Rome.
The ECJ derived its jurisdiction to hear the case from Article 234 of this Treaty, which allows any party to request a preliminary ruling from it on any matter under EC Law.
Although it initially only dealt with judicial questions in the area of coal and steel, the ECJ’s remit gradually widened to the point where it became the supreme court of the European Union, with the authority to conduct hearings on any matter under EU Law, and to even overrule national courts in some parts of the Union.
This brings us to the question of whether the ECJ was allowed to adjudicate in the present matter. In the case of Walrave and Koch (1974), the same court had ruled that sport is subject to EU Law only in so far as it constitutes an “economic activity”.
So to be able to rule on this case, football would have to constitute an economic activity – which it did. But, UEFA posited that only the “super clubs” of Europe can possibly be said to be involved in an economic activity — an argument rejected by the court as “the size of the activity is immaterial”.
Bosman’s lawyer, Jean-Louis Dupont, argued that his client’s freedom to move freely within the European Union had been violated by the hard-line stance adopted by his club and the Belgian association, and also by the nationality restrictions, which would potentially affect his chances of playing in Europe in the future.
The ECJ deemed unacceptable any rules placing European citizens at a disadvantage when they wished to pursue an economic activity in the territory of another member state within the union.
It averred that citizens of EU member states have the right to leave their country of origin, enter the territory of another member state and reside there for the purpose of pursuing economic activity.
The court then discussed UEFA’s and Belgian FA’s arguments as well as the applicability of European law on the nationality restriction clauses. It asserted that even though the transfer rules in question did not directly discriminate on the grounds of nationality, they still affected players’ ability to access the markets in other EU member states and could thus obstruct the freedom of movement of workers.
Then, on 15 December, 1995, the ECJ ruled in favour of Jean-Marc Bosman, on the advice of Advocate General Carl Otto Lenz. It declared the old transfer system and the “three-plus-two” (nationality) rule illegal under European Law and invalid as on the day of the ruling. It is reported that Bosman emerged, delightedly, from the courtroom, to announce, “The law of the jungle has been abolished.”
As a result of this decision, players within the EU were allowed to move to other clubs as soon as their contracts expired, without payment of any transfer fee.
Additionally, the ruling lifted the cap on the number of non-EU players a club could contract. This instantly opened up the market for foreign players, marking the beginning of a journey that has seen football grow into the diverse and multicultural activity it is today.
Only 5% of non-British players were in the starting lineups for the 22 top English clubs in 1992; contrast this with Inter Milan winning the final of the 2010 Champions League without a single Italian in the starting line-up. As a society, we’ve come a long way.
Keep an eye out for Part 2 tomorrow discussing the fallout from the Bosman decision.