FACT-SHEET ONE: THE BOSMAN CASE
WHAT IS THE BOSMAN CASE?
The Bosman Case was a legal decision made by the European Court of Justice in 1996. The case determined the legality of the system of transfers for football players and the existence of so-called 'quota systems', whereby only a limited number of foreign players were allowed to play in a club match. The decision binds all football governing bodies that are based in the European Union, and indirectly affects all UEFA competitions even though UEFA is based in non-E.U. Switzerland.
WHAT WAS THE SITUATION BEFORE BOSMAN?
Before the Bosman case, the situation in European football was very different with regard to player transfers and quotas. Prior to Bosman, a football player could only move to another club with the agreement of both clubs. Usually this agreement was only reached by the setting of a "transfer fee", whereby the buying club actually purchased the player from the selling club. This applied regardless of whether or not the player’s contract with the selling club had ended. Hence, out of contract players were not allowed to sign a contract with a new team until a transfer fee had been paid, or they had been granted a free transfer.
Secondly, prior to the Bosman case, quota systems existed in many national leagues and also in the UEFA club competitions. The quota systems meant that only a limited number of foreign players could play in a particular match. For example, in the UEFA club competitions, only 3 foreign players (plus 2 ‘assimilated’ foreign players) could play for a team.
WHY DID THE BOSMAN CASE COME ABOUT?
The Bosman case arose because of a Belgium player called Jean-Marc Bosman. Bosman’s contract with Belgium club side RFC Liege had run out and he wanted to be transferred to French club Dunkerque. Liege, however, refused to let Bosman leave without the payment of a transfer fee which Dunkerque were unwilling to pay. Bosman claimed that as a European Union citizen, he possessed the right to "freedom of movement" within the European Union if he wished to find work (then Article 48 of the Treaty of Rome). The transfer system prevented him exercising his right to freedom of movement and Bosman argued that the system should be changed so that players who were out of contract with their club could move to another club without the paying of a transfer fee.
WHAT WAS THE DECISION IN THE BOSMAN CASE?
The case was heard at the European Court of Justice, and the court found in favour of Bosman and against RFC Liege, the Belgium Football Association and UEFA. There were two important decisions:
1. Transfer fees for out-of-contract players were illegal where a player was moving between one E.U. nation and another. From now on only players still serving contracts with their teams could have transfer fees paid for them.
2. Quota systems were also held to be illegal. Club sides are now able to play as many foreigners from other European Union states as they liked (although limits on players from outside the E.U. could still be imposed).
WHAT ARE THE IMPLICATIONS OF THE BOSMAN CASE?
The implications of the Bosman case are far-reaching for football across Europe. Clubs now need to sign players for longer contracts than before, otherwise they will risk losing their players on free transfers. Unfortunately smaller clubs cannot afford to sign longer contracts with players (especially young players) who may not fulfil their potential. Therefore, the good players at smaller clubs will usually be able to move to a bigger club on a free transfer. The money small clubs used to make from transfer fees is rapidly drying up because a buying club will prefer to ‘buy’ out of contact players. In the long run, the Bosman case may well lead to smaller clubs either going to the wall or being forced to turn amateur.
Secondly, the Bosman case has worked to the players' benefit. Because out of contract players are so sought after, the players can demand higher wages, and move to the club that offers the best wages. If effect, the Bosman case has increased ‘player power’ considerably. Now, as in all other industries, the best employees will have control over their own career, and will be able to demand wages that many would argue reflect their skills.
WHAT IS THE FUTURE FOR FOOTBALL UNDER EUROPEAN LAW?
Recent attempts to exempt football from European Competition and Employment law have failed. Football is an "economic activity", and as such it is an area of E.U. ‘competence’ (although a declaration made with the Treaty of Amsterdam that acknowleged the specificity of sport). Therefore the football industry must comply with European Union Law a similar way to any other industry. It is clear now that the Bosman case was just the tip of the iceberg with regard to E.U. law’s affect on football, a point backed up by the stance of the European Commission on this issue.
The freedom of movement for out of contract players introduced by Bosman is being extended to many non-E.U. states in Eastern Europe and North Africa that have association agreements with the E.U.. Recent cases involving Valery Karpin (a Russian playing in the Spanish League) and Tibor Balog (a Hungarian playing formerly with Belgian side Charleroi) make it likely that citizens of these associate countries will be given rights to freedom of movement similar to their E.U. counterparts.
In addition, the European Commission have recently announced that they will be taking action against the current transfer system, which breaches the right to freedom of movement between E.U. states under the Treaty of Amsterdam. This makes it likely that transfer fees for in-contract players may soon be a thing of the past as this often bars their E.U. rights. According to the Treaty, football players should be able to walk out on contracts with a term of notice, as employees in other sectors can do, with only a relatively small amount of compensation being paid in return. At present a compromise is being sought between the Commission and the football authorities that would extend footballers’ rights without allowing them to swap clubs at will. It remains to be seen how such a compromise will work and whether it will be immune from further legal challenges at the European Court of Justice. It is clear, therefore, that for the foreseeable future, E.U. law will probably be one of the dominant factors in the shaping of the game in Europe and beyond.
Belgian FA v Bosman  All ER [EC] 97
CONTACT: Dr Geoff Pearson, Football Research Unit, University of Liverpool
This fact-sheet has been put together with the kind co-operation of Liverpool FC.