Author: lucy-aitchison

FIFA's new transfer regulations come into force in January 2027, introducing major changes to player contracts, compensation, youth development and transfer negotiations. We break down the key reforms and what clubs, players and agents need to do now to prepare.

From January 2027, FIFA will introduce significant reforms to its international transfer regulations. The changes to the Regulations on the Status and Transfer of Players (RSTP) will affect how clubs negotiate contracts, handle breaches, retain young talent and structure transfer deals.

The coming months provide an important transition period for clubs, players and agents to understand the reforms and ensure they are prepared for the new regulations when they come into force.

Article 1 – Scope and Joint Agreement
The reforms establish a Global Social Dialogue Platform which (subject to a narrow list of exceptions in Annex 1 of the RSTP) prevents FIFA from unilaterally altering the regulations without the agreement of key representatives, including FIFPRO (the global representative body for professional football players), the EFC (representative body for European Football Clubs) and the WLA (representative for professional football leagues). The changes represent a shift towards increased collaboration between FIFA and other key stakeholders.

Definitions – the ‘Protected Period’
The 2027 RSTP replaces the previous two-tier ‘protected period’ with a four-tier approach: the protected period is now four seasons/years for contracts concluded before a player’s 23rd birthday, three seasons/years for players aged 23-27, two seasons/years for players aged 28-31, and one season/year following a player’s 32nd birthday.

Article 14 – Terminating a contract with just cause
The 2027 RSTP reiterates the interim changes that came into effect from 1 January 2025 following the ruling of the Court of Justice of the European Union in Lassana Diarra v FIFA in 2024, and parties continue to have ‘just cause’ to terminate contracts where they can ‘no longer reasonably and in good faith be expected to continue a contractual relationship’. Whilst helpful, it remains to be seen whether the addition will meaningfully affect how the ‘just cause’ standard is applied in practice.

New Article 14.3 also lists examples of abusive conduct and prohibits clubs from abusing registration or deregistration as a means of pressure, separating a player from team training in an abusive manner, withholding a passport or unduly evicting a player from their home.

Article 17 – Consequences of a breach of contract
The most significant changes relate to breaches of contract by clubs or players.

Article 17.1 – Agreed compensation
Players and clubs may now agree in advance the compensation payable in the event of a breach. The Football Tribunal may reduce agreed compensation if it is ‘excessively high’, or disregard it if it is ‘manifestly unfair’.

For players earning yearly fixed remuneration of up to $150,000, agreed compensation must, as a minimum, equal the residual value of the breached contract, unless exceptional circumstances justify a lower amount.

This change only applies to contracts concluded after 1 January 2027. The old regulations will apply to breaches of contracts concluded before this date.

Article 17.2 - 17.6 – Calculation of compensation and penalty payments
Where compensation is not agreed, players shall be awarded, as a minimum, an amount equal to the residual value of the breached contract, less any amount paid to the player under their new contract.

Clubs will also be awarded at least the residual value of the contract, with compensation also taking into account the value of the player’s services, lost transfer fees, replacement costs and other damage caused.

In the case of abusive conduct, clubs and players may be awarded a penalty payment of up to 6 months’ salary.

Article 17.9 - Joint and several liability
Under Article 17.9, clubs will only be joint and severally liable for a player’s breach where it is established, on the balance of probabilities, that the new club induced the breach. A rebuttable presumption of inducement will apply where the player signs for the new club within 45 days.

Clubs signing players who have terminated previous contracts may do so more confidently, provided they did not encourage the breach – though records of discussions and the circumstances of termination will remain important to rebut any allegation of inducement.

Players may benefit from being able to move more quickly following termination, but are also more likely to be fully liable for any damages ordered.

Article 17.10 – Sporting Sanctions against Clubs
The new Article 17.10 introduces a sliding scale of sanctions based on repeated breaches within a two-year period: clubs will face a warning and a fine for the first breach, a five-player registration limit for the second, a one-window registration ban and a fine for the third, a two-window ban and a fine for the fourth, and additional discretionary sanctions for any further breach. Sanctions may jump straight to a one or two-window registration ban in aggravated circumstances.

Clubs found to have induced a player to breach a contract during the protected period will face a two-window registration ban immediately.

A first breach now carries a lower cost for clubs than under the previous regulations, enabling them to take a commercial view in an isolated dispute.

Article 18 – Special provisions relating to contracts between professionals and clubs
The 2027 RSTP introduces an exception to the rule that clubs cannot sign professional contracts with under-18 players for longer than three years.

Article 18.2(b) permits contracts of up to five years, provided that:

-The player has been registered at that club for 20 months or two consecutive competition periods, whichever is shorter.
-In the 4th year, remuneration increases by at least 10%, or 30% if the player makes 10 or more first-team appearances during year three.
-In the 5th year, remuneration increases by at least 20% if the player makes 10 or more first-team appearances during year four.

The change may help clubs retain home-grown talent and invest earlier in youth development, while giving young players greater contractual certainty and salary progression. Clubs are limited to signing five of these contracts per season.

Article 21bis – Player participation in transfer fees
New Article 21bis expressly permits players and clubs to agree that the player will receive a specified percentage of any future transfer fee.
For players earning less than €150,000 per year, an international transfer will require the releasing club to pay 5% of the fixed transfer fee to the player directly.

As with Article 17.1, this provision only applies to contracts concluded after 1 January 2027.

Practical considerations
As the implementation date approaches, clubs, players and agents should review their contractual arrangements and transfer strategies. The FIFA Football Law Annual Review in October 2026 will also discuss the framework in greater detail, and enable players, agents and clubs to prepare accordingly.

Brandsmiths works closely with clubs, players and agents on drafting and negotiating contracts, and acting where contracts have been breached. For guidance on navigating the changes, please get in touch.