Fifa facing multibillion-pound compensation claim from former players

Fifa is facing a multibillion-pound claim for compensation from a group of former players after last year’s ruling by the European court of justice (CJEU) that its transfer rules are unlawful. The Justice for Players foundation, a Dutch group that has the former England assistant manager Franco Baldini on its board, has served notice of its intention to file a class action against Fifa and the football associations of France, Germany, the Netherlands, Belgium and Denmark.

Justice for Players is seeking compensation on behalf of players who have lost income because of Fifa’s transfer rules since 2002. It says the legal case will involve about 100,000 players.

The claim will be filed in the district court of Midden Nederland, with the Netherlands chosen as the jurisdiction because Dutch law permits claims from anyone who has worked within the European Union and the United Kingdom.

The Football Association is understood to have been sent a copy of the letter before action. Although not named as a defendant, it could be added later. Fifa and the five domestic FAs have been given until September to respond.

The compensation claim is the result of the CJEU judgment last October in the case brought by former Chelsea and France midfielder Lassana Diarra, who sued Fifa after the world governing body refused to issue him with an international transfer certificate (ITC) to join the Belgian club Charleroi in 2016 after he was found to have breached his contract with Lokomotiv Moscow two years earlier.

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Fifa fined Diarra €10.5m and suspended him from football for 15 months for breaching his contract, in a ruling upheld on appeal at the court of arbitration for sport. After blocking his registration at Charleroi, Fifa was then hit with a counterclaim from Diarra, with the CJEU ruling that its transfer regulations were unlawful.

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The CJEU found that the Fifa regulations on the status and transfer of players infringed EU competition law and the right to free movement of workers. Fifa has amended its transfer regulations, although the new rules have not been accepted by the international players’ union, Fifpro.

The Justice for Players foundation is understood to have been set up this year with the intention of bringing a mass legal action.

Diarra’s lawyer, Jean-Louis Dupont, who won the landmark case at the CJEU on behalf of Jean-Marc Bosman that established the principle of free movement for players out of contract, in 1995, is advising Justice for Players.

The legal letter sent to Fifa makes reference to the class action being a multibillion claim. This figure is understood to be based on independent analysis from economists at Compass Lexecon, who have estimated that players would have earned about 8% more over their careers since 2002 had Fifa’s transfer regulations not been unlawfully restrictive.

The CJEU judgment ruled that Fifa’s regulations restricted free movement by establishing unlawful criteria for determining compensation to be paid by a player who breaks their contract, allowing the national federation of the former club to withhold a player’s ITC, making the player’s new club liable for the compensation to be paid to the former club and allowing Fifa to impose disciplinary sanctions on the player and their new club.

Fifa has been contacted for comment.

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