For more than twenty years, FIFA’s Regulations on the Status and Transfer of Players (“RSTP”) have sought to balance the stability of football teams with player mobility. That balance was fundamentally challenged by the European Court of Justice (“ECJ” or the “Court”) in Case C-650/22 FIFA v Diarra (“Diarra”).
Less than two years later, on 10 June 2026, FIFA approved a new version of the RSTP due to officially enter into force on 1 January 2027.
The reform represents the most comprehensive overhaul of the transfer system since the introduction of the modern RSTP in 2001. While it responds directly to Diarra, it also reflects the ECJ’s insistence – primarily expressed in Superleague – that sports governing bodies must pursue legitimate objectives through rules that are transparent, objective and proportionate. Moreover, alongside the substantive amendments to the RSTP, FIFA introduced a new governance model under which future changes to the RSTP will be developed through structured social dialogue among players, clubs and leagues.
This blog examines the key EU competition law and free movement implications of the new RSTP. In particular, it considers how the revised rules reflect the principles identified in previous ECJ case law and how they reshape the competitive and regulatory framework governing player transfers.
Key takeaways
- A comprehensive redesign of the football transfer system. Rather than making limited amendments to the provisions criticised by the ECJ in Diarra, FIFA undertook a comprehensive redesign of the RSTP, reshaping both the substance and governance of the international transfer system.
- The new rules are designed with Diarra in mind. FIFA aimed to implement the principles articulated in Diarra by replacing automatic mechanisms with more individualised assessments, increasing legal certainty, proportionality and reducing barriers to player mobility.
- The most significant long-term change may lie in governance rather than substance. Alongside the substantive reforms, FIFA has fundamentally changed how future transfer rules will be developed. Through the Global Social Dialogue Platform, it has moved away from unilateral rule-making towards a more participatory governance model involving players, clubs and leagues, which may also strengthen FIFA’s position under EU law.
- The reforms may have significance beyond football. By embedding social dialogue and stakeholder participation into the rule-making process, FIFA provided a template for other sports governing bodies seeking to make their regulations more resilient to competition law challenges and judicial scrutiny.
The Diarra judgment
The dispute which led to the Diarra judgment arose following the unilateral termination by Lassana Diarra of his employment contract with FC Lokomotiv Moscow. Belgian club Royal Charleroi was prepared to sign Diarra, but the transfer ultimately fell through because the RSTP then in force created significant uncertainty regarding both his eligibility to play and the club’s potential exposure to liability for compensation owed to Lokomotiv Moscow. Diarra subsequently brought damages proceedings against FIFA and the Belgian Football Association, alleging that those rules had prevented his move to Charleroi and caused him financial loss. In the context of those proceedings, the Cour d’appel de Mons referred a number of questions to the ECJ for a preliminary ruling.
In its judgment of 4 October 2024, the Court held that certain provisions of the RSTP were contrary to both Article 101 TFEU regarding anticompetitive agreements and Article 45 TFEU on free movement of workers.
Specifically, the Court identified three main shortcomings:
- Compensation criteria. The ECJ took issue with the RSTP compensation mechanism insofar as compensation payable by a player who terminates an employment contract without just cause could be determined on the basis of imprecise, discretionary or disproportionate criteria.
- Player registration. It objected to the rule whereby the existence of a dispute concerning the termination of the employment contract could prevent the issuance of the International Transfer Certificate (“ITC”) (i.e., the document required for an international transfer to be completed and for the player to be registered with a new club), thereby preventing the player’s registration with the new club and participation in competitions. The ECJ considered that mechanism disproportionate, notably because it did not provide for an adequate individual assessment of the circumstances of the case.
- Club sanctions regime. Lastly, it also objected to the rule under which a club recruiting a player during the protected period was presumed to have induced the player to breach the contract. That presumption exposed the new club to joint and several liability for compensation and, in certain circumstances, to a registration ban unless it could prove otherwise. In the Court’s view, the absence of criteria ensuring a genuine case-by-case assessment rendered the system incompatible with EU law.
Taken together, the ECJ found that these rules exposed both players and recruiting clubs to significant legal, financial and sporting risks, making cross-border transfers considerably more difficult in practice. While preserving contractual and team stability constitutes a legitimate objective, the Court considered that the mechanisms employed appeared to go beyond what was necessary to achieve that objective.
In light of these shortcomings, the Court concluded that the above rules were by their very nature harmful to competition (i.e., were a restriction of competition by ‘object’) within the meaning of Article 101 TFEU, as they were liable to deter – and in some cases effectively prevent – clubs from competing for players who had terminated their contracts, producing effects comparable to no-poach arrangements. Those same mechanisms were also found to restrict the free movement of workers under Article 45 TFEU by discouraging players and clubs from engaging in cross-border transfers.
Importantly, however, the ECJ did not question FIFA’s role in regulating the transfer system or the legitimacy of preserving team and contractual stability. Rather, it objected to the specific mechanisms through which those objectives were pursued.
FIFA’s response to Diarra: the new RSTP
FIFA initially adopted an interim framework with targeted amendments to the RSTP. After negotiations involving the International Federation of Professional Footballers (“FIFPRO”), clubs, leagues, UEFA and the South American Football Confederation (“CONMEBOL”), on 10 June 2026 FIFA approved an entirely new regulatory framework for the international transfer system, reflecting the principles identified in Diarra while also introducing broader changes.
Specifically, among the most significant changes to the RSTP affecting players are:
- Compensation criteria. The new compensation regime is based on more structured and transparent criteria. These include, depending on the circumstances of the case, factors such as the residual value of the breached contract, the value of the player’s services and any lost transfer fee. Moreover, where the parties have contractually agreed in advance on the amount of compensation, the Football Tribunal is empowered to reduce the agreed amount where it considers it manifestly excessive, and a minimum compensation threshold has been introduced for players earning up to USD 150,000 per year.
- Player registration. The reform also addresses the ECJ’s concerns regarding the ITC procedure. Under the revised framework, disputes relating to contractual termination no longer prevent the issuance of the ITC, thereby removing a significant restriction on player mobility.
- Clubs sanction regime. Under the revised rules, a club that signs a new player within 45 days of a breach of contract is presumed to have induced the player to breach the contract. However, the revised rules make it easier for clubs to rebut the presumption, requiring them only to demonstrate that they did not encourage or induce the player to terminate the contract. In addition, the new framework is less punitive and introduces a gradual system that takes account of the nature and number of the infringements. For example, a first infringement may result merely in a warning and a fine, rather than an immediate registration ban.
As mentioned, FIFA went beyond the issues identified in Diarra, introducing measures aimed at modernising the broader transfer framework. For example, clubs that have trained players before the age of 18 may – subject to specific conditions – conclude contracts of up to five years, rather than being subject to the general three-year limit. This may be seen as reflecting the ECJ’s recognition in Royal Antwerp of the need to preserve adequate incentives for clubs – particularly smaller ones – to invest in the training and development of young players (para. 147).
Last but not least, alongside the revised transfer rules, FIFA and FIFPRO signed a Memorandum of Understanding strengthening players’ role in football governance and established a Global Social Dialogue Platform, institutionalising stakeholder participation in future reforms. As a result, future reforms of the RSTP will be developed through structured social dialogue among the recognised representatives of players, clubs and leagues, with FIFA acting as custodian of the framework rather than its sole architect, incorporating elements reminiscent of collective bargaining. This governance model draws inspiration from the European Sectoral Social Dialogue for Professional Football and forms part of a broader settlement between FIFA and FIFPRO aimed at resolving longstanding governance disputes.
Assessing the new RSTP against the principles established in Diarra
The new framework is carefully designed to ensure compatibility of the RSTP with EU competition law and EU free movement provisions. It attempts to recalibrate the transfer system around the principles emphasised by the ECJ in Diarra: legal certainty, transparency and proportionality.
The revised RSTP abandons several automatic mechanisms in favour of more individualised assessments and seeks to make the consequences of contractual termination both more predictable and more proportionate. It does so by introducing structured criteria and placing greater emphasis on case-by-case analysis, thereby reducing barriers to player mobility and mitigating the deterrent effect on clubs.
These principles are reflected, for example, in the gradual system of sporting sanctions and in the revised compensation regime, which accords greater weight to the parties’ autonomy while introducing additional procedural safeguards. Collectively, these changes strengthen FIFA’s argument that the restrictions inherent in the transfer system do not go beyond what is necessary to preserve contractual stability and the integrity of sporting competitions.
Taken together, the reforms demonstrate FIFA’s attempt to recalibrate the transfer system in light of the principles articulated by the ECJ, while continuing to pursue the legitimate objectives of contractual and team stability alongside player mobility.
Assessing FIFA’s new participatory governance model under EU law
The process by which the reforms were adopted is almost as significant as their substance.
FIFA has fundamentally changed the governance of future reforms through the establishment of the Global Social Dialogue Platform. This shift has significant implications and may have broader consequences under EU competition law and rules on free movement.
Why stakeholder participation matters
Going forward, amendments to the international transfer system are intended to be developed through consensus among the recognised representatives of players, clubs and leagues.
This matters for several reasons.
- First, a stakeholder that participated in negotiating a transfer rule without objecting to it may find it more difficult – both legally and practically – to argue subsequently that the same measure is unjustified or disproportionate. Therefore, involving the principal representatives in the design of the framework is likely to reduce the risk of future legal challenges and enhance the overall acceptance and stability of the regulatory regime.
- Second, a negotiated framework arguably strengthens FIFA’s position in any assessment of whether the restrictions inherent in the transfer system are necessary and proportionate. While stakeholder participation is not itself determinative, it may support the argument that the rules reflect a balanced compromise between the competing interests of players, clubs and leagues, making it easier to justify any resulting restrictions under both Article 101 TFEU and Article 45 TFEU.
- Third, the new framework reflects a broader shift towards a more participatory model of sports governance, consistent with the principles underlying the European Sports Model and Article 165 TFEU. While the latter does not shield sporting rules from competition law scrutiny, it recognises the specific nature of sport and supports governance based on dialogue and cooperation among the various stakeholders of organised sport.
Taken together, these developments may become a relevant element in future assessments of the compatibility of FIFA’s transfer rules with EU competition law and EU free movement provisions.
Could the new framework be viewed as collective bargaining?
The consultative process raises an interesting legal question as to whether future FIFA regulations could benefit from an additional layer of protection under EU competition law. Because parts of the reform process involved negotiations with representatives of players, clubs and leagues, the framework incorporates elements that resemble collective bargaining. Whether that is sufficient to attract any protection under the Albany line of case law, which excludes certain collective agreements between employers and employees from the scope of Article 101 TFEU, is far from straightforward.
That doctrine protects measures resulting from collective bargaining between employers and employees that directly contribute to improving workers’ employment and working conditions. On the one hand, the RSTP are intended to govern the employment contracts of professional players, which, as the ECJ recognised in Diarra, define their working conditions (para. 80). On the other hand, these regulations remain regulatory rules adopted by FIFA rather than a conventional collective agreement between employers and employees, not least because the regulations themselves allow for deviations through collective bargaining agreements concluded at domestic level.
Conclusions
The revised transfer rules represent FIFA’s most comprehensive reform of the transfer system following the ECJ’s judgment in Diarra. FIFA appears to be in a significantly stronger position to defend the compatibility of the transfer system with EU competition law and the EU free movement provisions than under the previous regime.
More generally, the reforms demonstrate the growing role of litigation in shaping sports regulation. Diarra, like the Seraing judgment before it (which prompted UEFA to establish a new arbitral seat in Dublin following the ECJ’s judgment), shows how legal challenges can act as a catalyst for broad regulatory reform. Looking beyond football, the reforms may also have broader implications. By institutionalising stakeholder participation and social dialogue in the rulemaking process, FIFA has embraced a governance model that reflects broader trends in sports regulation and may serve as a blueprint for other governing bodies seeking to modernise their governance structures and adapt their regulatory frameworks to the requirements of EU law.
Special thanks to Fabio Pirozzi for contributing to this blogpost.
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