Brexit Map with Red Line Drawn

Has Brexit Affected Football Transfer Deals?

The UK’s decision to leave the EU has brought about a series of changes across industries, with football being absolutely no exception. This is particularly true when looking at transfers, as Brexit means that some deals that would have been fine pre-2021 are no longer allowed under current rules. Although the changes will not block big name stars from moving across to the Premier League, the regulatory impact is far from insignificant.

The Impact on Transfers So Far

We will start by looking at some of the more immediate changes brought about by Brexit, all of which were implemented from January 2021 following the end of the transition period.

No Foreign Youngsters

Under 18 Prohibited SignThere are active FIFA regulations in place that prevent players under the 18 being transferred abroad. Internal transfers have long been permitted but generally speaking, foreign clubs cannot poach very young talent from overseas. There are a few exceptions to this rule however, one being that under 18s are eligible to be transferred between two EU nations. The reason for this particular exemption is the legally enshrined freedom of movement EU citizens enjoy.

Premier League clubs had long benefitted from this full exemption as they acquired some of the hottest young talent from all over the continent. If you take the 2018/19 season for example, you can see numerous examples of such transfers taking place. Chelsea brought in Pierre Ekwah from Nantes, Man Utd agreed a deal with another French side, Amiens, for Noam Emeran, Southampton bought Alexandre Jankewitz from Swiss outfit Servette and Brighton took Peter Gwargis from Jönköpings Södra IF. These are just some of the many examples of some 16- and 17-year-olds moving to the UK from Europe.

Such deals are simply no longer possible and as such, Premier League clubs are signing far fewer youth prospects now. Deals do occasionally happen still but they are always internal, such as Harvey Griffith’s switch from Man City to Wolves or Max Alleyne’s £1.5m transfer that saw the then 15-year-old go from Southampton to City. It is worth making clear that there is full freedom within the UK, so English clubs are not limited to those players residing in England. Wolves, for instance, purchased 17-year-old Scottish starlet Kerr Smith from Dundee United in a move reportedly worth up to £2m.

Under 21s

Blue Number 3 Football ShirtWe have discussed the ban on signing any foreign player under the age of 18 but the restrictions do not suddenly end once a player has celebrated their 18th birthday. New post-Brexit regulations that were introduced limit Premier League and Football League clubs from signing a maximum of three overseas players aged under 21 players in a single transfer window. This means that no more than six can be signed during a full season. Overseas again means anywhere outside the UK, so that includes anywhere in Europe as well as the rest of the world.

The FA, backed by the Home Office, moved quickly to implement this as soon as the transition period was over. The reasoning it behind it was so it would help safeguard the future of the national team by “ensuring opportunities for homegrown players”. Rather than Premier League clubs simply acquiring lots of European talent aged between 18 and 20, they are now in a position where they are more likely going to have to utilise and develop their own youngsters. On the face of it, this new policy appears to be good news for homegrown academy players, as they will face less foreign competition in their attempts to break into the first team.

It should also help UK clubs get a little more money when bigger clubs poach their brightest names. With big clubs perhaps unable to look abroad having already filled their quota, lower league teams will find themselves in a stronger selling position. Thanks to this one rule they instantly have a more valuable commodity and they know clubs will be willing to cough up the extra fees, given the limited alternatives.

Work Permit Rules

Person Stamping Permit

Although the rules talked about so far only impact young players, work permits are required for any player, regardless of age wishing to move to the UK. This system has long been in place but it did not apply to any players moving from within the EU. Now though, any player wanting to move to (most often) England from the likes of France, Germany or Italy will need to acquire enough ‘points’. Scoring 15 points is automatic qualification while collecting 10-14 points is enough for further consideration by the Exceptions Panel.

There is also an automatic pass for any established international stars. If a player has featured in 30% of matches for a 1-10 FIFA ranked nation (within the relevant time period) this is enough for an automatic entry to the UK. The less prestigious the team, the greater the involvement has to be so for a 21-30 ranked team, this means playing 60% or more of available matches. For countries outside of the top 50, players can only earn points (a maximum of two), not a pass. An automatic pass is something a considerable number of Premier League targets meet, but not all, especially those coming from big footballing nations like France.

When the automatic route is not an option, a sufficient number of points must be collected as explained above. Points are based on domestic match minutes, cup minutes, final league position of the selling club, continental cup performance of the club and league quality of the selling club as well. If a Premier League team wishes to sign a La Liga talent, the player will get 12 points providing they were in the squad for one domestic or European cup match. They will gain an extra six if they played a least 30% of the available time.

This is just one example but basically there is an obstacle for EU players to overcome now, the same one a player from Argentina, Japan, Russia or any non-EU nation previously had to face. The impact of this is perhaps biggest felt at the lower end of the Premier League and in the Championship, as realistic targets are more likely to fall short of the points threshold.

For example, take a look at deal a then-struggling Leicester made for Riyad Mahrez in 2014. Despite being a pivotal player in the Foxes’ title winning season the winger was previously uncapped for Algeria and was playing in Ligue 2 (so no European football). Had this move been blocked, which is a distinct possibility, Leicester would have been forced to look elsewhere, quite probably completely changing the course of their history.

Potential Future Impacts of Brexit

On the plus side, no longer bound by EU laws and regulations, the UK does find itself with more flexibility to make its own rules. Although we have already seen several significant changes, outlined above, there is potentially more to come in the years ahead.

Homegrown Quotas

Football Training Ladder

Under current Premier League rules, each club can have a maximum of 17 non-homegrown players in the squad. So, in order to have a maximum squad of 25, a minimum of eight players need to have homegrown status. For those unfamiliar with the term ‘homegrown’, it applies to any player that spends at least three seasons at an English or Welsh club before the age of 21.

Perhaps a little confusingly it often has nothing to do with nationality, which is why the Spanish-born Cesc Fabregas was considered homegrown, as he joined Arsenal when he was 16-years-old. Conversely, English born Eric Dier does not have homegrown status because he spent his teenage years in Portugal, playing for Sporting CP.

The reason homegrown status is not linked to nationality is because nationality-based discrimination would have been illegal under EU law. No longer bound by this, the FA would be able to change the definition of homegrown to mean ‘British-born’. There are no immediate plans to do this but should they change their approach, English and Welsh players would suddenly become even more valuable, boosting their price in the market. It could also result in fewer English players moving abroad because foreign clubs would struggle to justify the added premium.

Renewed Focus on Academy Talent

Flags of EU and UK Facing Opposite Directions

For the big money transfers of established European stars, Brexit really has no impact. If Erling Haaland wishes to move to Man City or Alexander Isak to Arsenal, these moves will happen without any issues, at least from a regulatory perspective. When attempting to sign youngsters or low-profile players however, Brexit makes things a fair degree harder for British clubs. Not only are Premier League and other UK clubs unable to sign European players under 18, but they are limited on how many they can sign aged between 18-21.

With European players subject to the same work permit requirements as players from further afield too, some transfers that would have happened before are simply no longer possible. The overall impact of this is that in the years ahead we should see more academy graduates given an opportunity in the first-team. Additionally, expect to see a higher proportion of transfers taking place that involve two UK clubs. This will help see more of the Premier League (and Championship) riches trickle down into the lower leagues, although to what extent remains to be seen.