Welcome back to the 14th Update, a Newsletter curated by 14 Sports Law, where the world of sports law unfolds with the rhythm of a well-struck penalty kick.
We’re pleased to bring you this special edition of the 14th Update, dedicated to FIFA’s Transfer System Reforms 2027. This edition examines the principal changes announced by FIFA, the rationale behind the reforms, and their potential practical impact on clubs, players, and other stakeholders across the international football ecosystem.
Our mission remains unwavering: to decode the complexities of sports law and present them to you in an engaging format. 14th Update is your passport to the latest developments in the arena of sports law, business, and technology.
As always, we invite you to share your thoughts, feedback, and questions with us at [info@14sportslaw.com].
Best,
Luis Cassiano Neves
Founding Partner, 14 Sports Law
The 14 Sports Law team recently came together in Lisbon for a team-building week, bringing together colleagues from three continents, multiple time zones and diverse professional backgrounds, all united by the same spirit: work hard, play hard.
With the international transfer window in full swing, the team has been working at full speed, assisting clients with several moves already completed and more on the cards. A detailed report on these matters will feature in the next edition of the newsletter. Stay tuned, and until then, enjoy the updates below.
We’re absolutely delighted to announce that Frederico Bensimon is back with the the 14 Sports Law team after 5 years with Casa Pia! More on that very soon.
FIFA Transfer System 2027: What Changes and Why It Matters?
From 1 January 2027, the January 2027 FIFA Regulations on the Status and Transfer of Players (hereinafter referred to as the “FIFA RSTP”) will come into force, marking a structural reform of the international transfer system. It’s goal is to make rules on contractual stability, player mobility, compensation and enforcement more predictable, proportionate and legally robust. The reform, presented as the most significant overhaul of the transfer system since 2001, follows the CJEU’s ruling in Diarra and reflects a broader shift towards social dialogue between FIFA, player representatives, clubs and leagues. While the amendments respond to the legal concerns raised in Diarra, they go beyond a mere revision of Article 17 and introduce wider changes to the rules governing contractual stability, player mobility, compensation for breach, transfer-related entitlements and enforcement.
A new model of social dialogue: The new FIFA RSTP reflects an agreement between players and their unions, clubs and leagues, and FIFA. Except for Annexe 1 (Release of Players to association teams) future amendments will require agreement between these groups. This gives players, clubs and leagues a more formal role in shaping the transfer system, although the FIFA RSTP remains a FIFA regulation rather than an international collective bargaining agreement.
Protected period redefined: The protected period as per the amended Definition 7 of the FIFA RSTP will now be divided into four categories: (i) under 23: four seasons or four years; (ii) 23 to 28: three seasons or three years; (iii) 28 to 32: two seasons or two years; and (iv) 32 and above: one season or one year. This reform gives clubs greater contractual protection over younger players while increasing mobility for older professionals.
Definition of Yearly Fixed Remuneration: FIFA has also introduced a new Definition 44 of yearly fixed remuneration, which includes gross fixed salary and allocates sign-on fees proportionately across the contract. Loyalty payments and similar bonuses are attributed to the year in which they fall due. This definition is important because it determines whether the new USD 150.000,00 and EUR 150.000,00 thresholds apply under Article 17 and the newly introduced Article 21bis.
Abusive conduct expressly identified: The general test for just cause remains unchanged. However, Article 14 will now specifically prohibit clubs from: abusing a player’s registration or deregistration; abusively separating a player from team training; withholding a player’s passport; and unduly evicting a player from accommodation. These situations already appear regularly in employment disputes and are already enshrined under jurisprudence, but their inclusion in the FIFA RSTP gives players a clearer basis for terminating with just cause.
Article 17 rebuilt: The most significant reform concerns compensation for breach of contract. Article 17 of the FIFA RSTP has been completely restructured. Parties may expressly agree in advance on the compensation payable in the event of breach and it is clarified that these clauses do not have to be reciprocal. The Football Tribunal should only reduce an agreed amount with restraint where it is excessively high and may disregard it where it is manifestly unfair. For players earning up to USD 150.000 in yearly fixed remuneration, compensation payable to the player must generally be at least equal to the residual value of the contract, unless exceptional circumstances justify less. Where no compensation clause exists, both players and clubs will be entitled to full compensation for the damage caused.
For players, the residual value of the contract remains central, and the new position does not follow the old formula of residual value, minus mitigation, plus additional compensation for overdue payables. It is replaced by a fuller damages framework. Players and clubs are both entitled to full compensation for damage caused. For clubs, the Tribunal may consider: the value of the player’s services; a lost transfer value; replacement costs; and other proven damage. This makes evidence of market value, transfer negotiations, replacement expenses and lost opportunities far more important. The reference to lost transfer fee or lost transfer value may become a key issue in practice. From the club perspective, it preserves the economic logic of the transfer market. From the player perspective, the question will be whether the new methodology is sufficiently predictable.
As a general rule, compensation awarded to either party should not fall below the residual value of the breached contract. Mitigation remains relevant, but it is now expressly subject to this residual-value floor. The former concept of additional compensation for overdue payables is also replaced by a broader penalty payment of up to six monthly salaries in cases of abusive conduct. This remedy may be awarded to either a player or a club.
Joint & several liability vis-à-vis Inducement: A player’s new club will only be jointly and severally liable where it is established, on the balance of probabilities, that it induced the breach. However, where the player signs a new contract within 45 days of the breach, inducement will be presumed. The new club may rebut this by demonstrating, to the comfortable satisfaction of the Football Tribunal, that it did not cause or induce the breach. Recruiting clubs will therefore need to keep clear evidence of the timing of negotiations, the advice received and the circumstances surrounding the player’s departure.
Sanctions: Clubs that breach contracts during the protected period will be sanctioned through a two-year recidivism system: first breach: warning and fine; second breach: maximum of five new registrations during one window, plus a fine; third breach: one-window registration ban; fourth breach: two-window registration ban. Stronger sanctions may be applied immediately in aggravating circumstances. The position remains stricter where a new club induces a player’s breach during the protected period: a two-window registration ban will still apply. Player sanctions remain largely unchanged, with a four-month playing restriction, extendable to six months in aggravating circumstances.
Certain under-18 players may sign five-year contracts: The normal maximum term under Article 18 for a professional contract signed by a player under 18 remains three years. An exception will now allow a club to sign such a player for up to five years where the player has already been registered with that club for at least 20 months or two consecutive competition periods, whichever is shorter. Unless national law or a domestic collective bargaining agreement provides otherwise, a club may sign no more than five such contracts per season. The fourth and fifth years must also include mandatory salary increases, partly linked to first-team appearances. The aim is to give training clubs greater security while ensuring that young players receive improved remuneration as they progress.
Player participation in transfer fees: New Article 21bis creates a mandatory economic right for lower-paid players. A player earning less than EUR 150.000 in yearly fixed remuneration that is permanently transferred internationally, must receive 5% of the fixed transfer fee actually received by the releasing club. Where the transfer fee is paid in instalments, the player’s share must also be paid proportionately after each instalment is received. The player may only partially waive this entitlement. The protected minimum is the higher of: the player’s final-year fixed remuneration; or 2.5% of the total fixed transfer fee. The rule will not apply where national law, domestic regulations or a valid collective bargaining agreement prohibits it or already provide a similar right. FIFA will have jurisdiction over disputes concerning this entitlement where the transfer is between clubs from different associations.
Late-payment interest rises to 8%: In cases involving overdue payables or outstanding remuneration, the Football Tribunal will award standard interest at 8% per annum, provided that the claimant expressly requests it. A contractual interest rate may still apply, and the Tribunal may reduce the rate in exceptional circumstances.
Registration will be completely separated from compensation disputes: The ITC response period will change from 72 hours to five calendar days as per the amended Annexe 3 Article 11. When issuing the ITC, the former association may state that the former club reserves financial claims against the player or the new club. However, this reservation cannot prevent the player’s registration and does not affect the merits of the dispute. If there is no response within five days, the player may be registered. FIFA may also permit registration within one working day where necessary to prevent irreparable harm. This is one of the clearest responses to Diarra: contractual disputes should be resolved through compensation and sanctions, not by blocking the player’s ability to register and work.
Procedural Rules: The 2027 Procedural Rules Governing the FIFA Football Tribunal introduce a much clearer hierarchy of applicable law before the Football Tribunal. The current wording of Article 3 requires the Tribunal to apply FIFA regulations while also taking into account national laws, domestic arrangements, collective bargaining agreements and the specificity of sport. From 2027, the position will be simpler, and under the updated Article 3, FIFA regulations will apply primarily, and Swiss law will apply subsidiarily. This brings the Football Tribunal’s approach closer to that generally followed before CAS. National law and collective bargaining agreements will remain relevant where the FIFA RSTP expressly recognises them, or where mandatory law and public policy are directly engaged. However, they will no longer form part of a broad general instruction to the Tribunal. In practical terms, parties will need to begin with the applicable FIFA provision, identify any regulatory gap and only then rely on Swiss law. Arguments based on domestic law will require a clearer legal basis.
Disciplinary Code: The amendments to the FIFA Disciplinary Code, particularly Article 21 therein, strengthen the enforcement of decisions issued by FIFA-recognised national dispute resolution chambers. At present, an NDRC decision is ordinarily enforced by the relevant national association. Where that association fails to act, FIFA may sanction the association itself. From 2027, if a recognised NDRC decision has not been enforced within 60 days, the FIFA Disciplinary Committee will automatically become competent to enforce it directly against the club or natural person concerned. This applies to decisions against clubs as well as players, coaches, officials and other individuals falling within the disciplinary framework. The amendment gives recognised NDRC decisions significantly greater practical value. A successful party will no longer remain entirely dependent on domestic enforcement where the national association delays or fails to act. The new mechanism is, however, limited to decisions issued by FIFA-recognised NDRCs. Decisions of non-recognised domestic bodies will not benefit from the same automatic enforcement route.
The Balogun Case - A Red Card, a Reprieve and a Rulebook Problem
One of the biggest controversies of the 2026 FIFA World Cup concerned United States forward Folarin Balogun, who was allowed to face Belgium in the round of 16 despite being sent off in the previous match. Under the FIFA Disciplinary Code and the World Cup Regulations, a red card automatically results in suspension from the following match. However, FIFA’s Disciplinary Committee relied on Article 27, suspended the implementation of Balogun’s one-match ban, placed him on probation for one year and cleared him to play. The controversy was further fuelled by allegations that US President Donald Trump had personally intervened with FIFA President Gianni Infantino.
The case exposes an apparent conflict within FIFA’s own rules. Article 27 gives FIFA’s judicial bodies a general power to suspend disciplinary measures. Article 66, by contrast, states that a red-card suspension is automatic and must be served. The legal question is whether Article 27 applies to all disciplinary measures unless expressly excluded, or whether the specific and mandatory wording of Article 66 prevails under the principle of lex specialis. The decision also appears to extend Article 27 beyond its previous use. In cases involving Cristiano Ronaldo, Nicolás Otamendi and Moisés Caicedo, suspensions were deferred across the gap between qualifiers and a final tournament. Balogun’s case involved a sanction arising during the knockout stage itself, with an immediate effect on the competition.
Balogun’s red card was an on-field decision and therefore generally protected from review under the Field of Play (FOP) doctrine. The resulting suspension, however, affected a future match and arose as a regulatory consequence of the red card. FIFA did not appear to overturn the referee’s decision. Instead, it modified the sanction flowing from it. The real issue was therefore not whether the tackle could be reviewed, but whether FIFA could suspend a consequence expressly described as automatic. The Royal Belgian Football Association requested the decision, its reasons and clarification of Balogun’s eligibility. FIFA treated that communication as an appeal. The FIFA Appeal Committee then declared the challenge inadmissible because Belgium had not been a party to the original disciplinary proceedings and therefore lacked standing to appeal.
The Appeal Committee did not therefore determine whether Article 27 could lawfully override the automatic suspension under Article 66. The absence of a published reasoned decision remains the most significant concern. Without knowing how FIFA reconciled the two provisions, it is difficult to understand the limits of its discretion or whether comparable cases must now be treated in the same way. The Balogun case is therefore about more than one player’s eligibility. It concerns the meaning of an “automatic” sanction, equal treatment and the need for transparent reasoning in decisions capable of affecting the integrity of a major competition.
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