Football transfers can be extremely expensive, and a lot of money is being ‘thrown around’.
However, does the selling club actually receive the entire transfer fee?
Here’s a breakdown of the possible stakeholders that will get a share of the transfer fee.
Who gets the money during a football transfer?
When a transfer fee is quoted for a player, there are usually a number of parties considered and involved. Transfer fees are not always solely received by the clubs that sell players, as they often have to pay certain sums to those involved with the players in question.
Some of the recipients involved in transfer deals and their roles are explained below:
#1 Selling club
When a player that is contracted to a club completes a transfer, it is mostly done in exchange for a transfer fee. A club decides on the valuation for their players and whenever such players move, they always receive the entire transfer fee or a significant percentage of the transfer fee the player commands.
In addition to the basic transfer fees, some clubs insert performance-related clauses and milestone clauses which can fetch them more money. For example, Chelsea have received over £20 million in additional fees from their 2019 sale of Eden Hazard to Real Madrid. The club had inserted clauses that stipulated that Real Madrid had to pay certain amounts if Hazard won the Spanish League and the UEFA Champions League.
Moreover, When Barcelona signed Philippe Coutinho from Liverpool, a clause was inserted that the Spanish side had to pay Liverpool a sum of money if he won the Champions League while he was on their books.
The Brazilian midfielder won the competition while he was on loan at Bayern Munich and Barcelona were forced to pay up!
These are instances of how previous clubs receive payment for transfers.
#2 Clubs that receive due to sell-on clauses
Oftentimes, when players are identified as top prospects, their clubs include a clause known as a sell-on clause in their contracts. This sell-on clause is one way a club manages to ensure that they do not lose out completely on their players.
Another way clubs do this is by inserting buyback clauses in contracts when they want to sell players.
The sell-on clause means that the club is entitled to a percentage of whatever fee gets paid for the player. In essence, the club is able to recoup some more money from the player whenever he changes clubs for the first time.
In 2010, Queens Park Rangers sold teenage English winger Raheem Sterling for £600,000 to Liverpool after he impressed with their youth team.
Five years and multiple Premier League appearances later, the winger completed a move to fellow English Premier League side Manchester City for a sum of £49 million. QPR inserted a 20% sell-on clause in his initial sale to Liverpool and received up to £7.8 million from the deal following its completion.
Also, in 2014 when Liverpool signed Adam Lallana, Bournemouth received £6.25 million from the £25 million the Reds paid Southampton. Bournemouth had included a 25% sell-on clause when they sold Lallana to Southampton as a 12-year-old.
In the past, many clubs have been left to rue their failure to include a sell-on clause in their players’ contracts as it prevented them from enjoying part of the windfall from player transfers by other clubs. Southampton, for example, had negotiated a reported 25% sell-on clause when they sold Gareth Bale to Tottenham Hotspur in 2007.
Six years down the line, the Welsh winger moved to Real Madrid for a world-record fee and Southampton was left to rue missing out on around £20 million in free money!
#3 Agent fees
In many transfer deals, agents play a key role in getting the deals completed. Agents often serve as intermediaries between players and clubs, and they are the ones who handle negotiations on behalf of their clients, the players.
In some cases, agents can step in to play an active role in negotiating a transfer fee for their players. In many transfers today, agents earn a small percentage of the total transfer fee, usually within the range of 5-10%.
For example, Portugal U-21 midfielder Fabio Vieira completed a move from FC Porto to Arsenal for around £34 million in the summer of 2022.
His agent, Jorge Mendes, played a direct role in negotiations and was able to negotiate with the Portuguese club to allow Arsenal to sign the player for less than his release clause. Mendes also negotiated a 10% commission in the contract, making him entitled to about £3 million of the transfer fee.
Also, in Neymar’s transfer from Barcelona to Paris Saint-Germain in 2017, Neymar Sr., the father of the superstar, received 10% of his €222 million transfer fee, amounting to €22 million.
In 2021, FIFA introduced a permanent 10% cap on the amount of money agents received from transfer deals.
In some instances, a player’s family receives part of his transfer fee because some players are represented by members of their family. For example, Antonio Rudiger’s agent is his brother Sahr Senesie, and he would be entitled to a commission whenever his client/brother moves clubs.
#4 Players fees
It has been established that free transfers are not actually free as they sound, as they involve a significant sum of money. This money is known as a signing-on bonus and is paid directly to the players when they sign for clubs as free agents.
The amount players get varies from one player to the other according to their personal demands. However, the certainty is that free agents always receive a signing-on fee when they join a new club.
For example, Chelsea were said to have been unwilling to pay a substantial signing-on bonus to German defender Antonio Rudiger, causing the defender to move to Real Madrid instead.
Upon agreeing to move to the Spanish club, the defender became entitled to receive a significant amount of money as his signing-on bonus.
#5 Other affiliated parties
Until 2019 when FIFA banned it, there was a condition known as third-party ownership of footballers. Third-party owners were those who invested in the economic rights of a player with a view to receiving a percentage of whatever fee the player is sold for in the future.
These third-party owners were not football clubs but individuals or corporate bodies. An example of this was the transfer of Javier Mascherano and Carlos Tevez to West Ham United via their third-party owners, a company based in Brazil. Part of the transfer fee went to the company in question.
Similarly, some players are under co-ownerships, meaning that two or more clubs own their economic rights, but they are usually contracted to play for only one of these clubs.
The practice was common in Italian football until 2014-15.
As long as a player is co-owned by two different teams, both teams are entitled to receive a percentage of whatever amount the player is sold for on the transfer market.
Conclusion
Transfer business can be quite confusing when you’re involved from the outside. Various stakeholders are entitled to money from a football transfer, including the players themselves and their representatives. These and more are what are considered when players decide to move from one club to another.
You can find out more about transfers here, and check out which sources are reliable when you are looking for transfer news!
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