Case Diarra: FIFA Suspends Sanctions Against Players and Coaches Who Terminated Contracts

FIFA with a new Circular dated 25 November 2024 has suspended sanctions against players and coaches who have terminated their contracts. This is the first effect of the European Court’s decision, compelling clubs to revolutionize the market.

The revolution has already begun and is likely to shake the football market to its core, possibly as early as January. FIFA has effectively decided to halt disciplinary procedures against players and coaches accused of violating existing regulations, which, however, have been rendered obsolete by the European Union Court’s ruling in the Diarra case.

In October, former French midfielder Diarra, after a lengthy legal battle, proved that the current FIFA regulations are incompatible with the free movement of persons, one of the fundamental principles of the EU. For the European Court, the rules imposed by FIFA, under the leadership of Gianni Infantino, which impose joint liability on another club, are deemed “disproportionate,” and the unilateral ban on registering a new player is considered “unregulated.” In effect, this was a push towards the liberalization of the market, accelerated by today’s decision from FIFA not to impose sanctions on those who did not comply with, particularly, Articles 6 and 17 of the statutes and transfer regulations.

In the absence of sanctions, the issue of compensation in the event that a player or coach decides to unilaterally terminate their contract with a club remains completely uncertain. This prospect is now possible also because federations are required to grant permission for potential transfers to other clubs, unlike in the past. In short, under a more liberal interpretation of the new scenario, players and coaches may change teams at any time during the season, without any risk of sanctions or obligations to pay compensation.

FIFA, which has opened a new phase of discussions with all representatives of the football world regarding the update of regulations, warns that the suspension of disciplinary procedures does not preclude future sanctions. Meanwhile, smaller clubs are at the greatest risk, as larger clubs can more easily attract young talents without any quid pro quo services. However, wealthier clubs find it harder to conflict with each other, considering that a significant portion of budget costs consists of club assets.