Monday 5 December 2016

Explained: What is third-party ownership and is it legal?

Published 27/09/2016 | 12:55

England manager Sam Allardyce
England manager Sam Allardyce

England manager Sam Allardyce is in hot water after being caught making unguarded comments in a sting by a British national newspaper.

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The most controversial comments made by Allardyce were about third-party ownership to undercover reporters from The Daily Telegraph.

Here are the key questions about the issue.

What is third-party ownership?

Third-party ownership is where a player's economic rights are owned wholly or partly by private investors, often in partnership with the club he plays for. The investors hope to make a profit when the player is sold on to another club.

Is it legal?

No. The practice was banned in England in 2008, with FIFA following suit in 2015 by instigating a worldwide ban.

Why is it controversial?

The practice has been compared to modern-day slavery and opens up ethical issues about potential influence of third parties over selection and transfers.

Does the Premier League have history.?

Yes. When Carlos Tevez and Javier Mascherano moved to West Ham from Brazilian side Corinthians in 2006, it emerged that third-party investors were heavily involved with both players. Although the practice was not then banned, West Ham were fined £5.5million by the Premier League for irregularities in their contracts.

After Tevez scored the goal that helped West Ham avoid relegation in 2007 at Sheffield United's expense, the Blades launched legal proceedings against both the Premier League and West Ham. They settled with the Hammers out of court. The Premier League's ban on third-party ownership was a legacy of the case.

What did Allardyce say?

Allardyce is filmed saying third-party ownership is "not a problem", adding "you can still get around it". He explains to the fake investors that they could employ a player's agent and then take a percentage of the agent's fee now third parties are no longer allowed to profit from transfer fees.

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