FIFA votes to eliminate third-party ownership

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In a move that should have been done years ago, FIFA has finally outlawed third-party ownership in soccer.

It’s a fantastic move to finally snuff out something that has been a blight on team finances and transfers for years around Europe and beyond.

Third-party ownership has been outlawed for years in England, but outside it has run rampant in countries like Spain, Portugal and Italy.

It has inflated transfer fees with all parties looking to cash in on a switch as much as possible, and can rob clubs out of profit when a sale goes through.  Sometimes third parties also insist on harmful clauses in player contracts, such as a timeframe in which the player must be sold, a minimum transfer fee that could hurt negotiating

“We took a firm decision that TPO should be banned but it cannot be banned immediately. There will be a transitional period,” said FIFA president Sepp Blatter.

With the English FA being the first to outlaw the practice, FA president Geoff Thompson was put in charge of organizing the transitional period and eventual outlaw of the practice.

“I am very happy for football and I am very happy for players that Fifa has followed Uefa’s initiative and recommendation to outlaw the practice of third-party ownership,” UEFA president Michel Platini added on the decision. “I have been constantly warning for years that this practice – which is becoming increasingly widespread – is a danger to our sport.”

According to FIFA secretary general, it would likely be two to three years before third-party ownership is completely banned.

A report done by audit firm KPMG found that third parties have a stake in approximately 1,100 players across Europe. Financial analytical company Bloomberg said a company Doyen Sports Investment Ltd. had invested $101 million in player ownership, including Manchester United’s Radamel Falcao back when he played for FC Porto.