Transfer rules back in the spotlight after Diarra case

By Brian Homewood

(Reuters) - Football's transfer system is back in focus over a clause in FIFA's regulations that the players' union said would not be accepted in any other profession and which a Belgian court suggested could contravene European labour law.

The international transfer system, which processes hundreds of millions of dollars each year in player sales and has existed in its current form since 2001, is overseen by FIFA, soccer's world governing body.

The latest controversy has arisen over a paragraph in FIFA's regulations which states that if a player breaches his contract, which is then terminated by the club, his new team is jointly liable with the player to pay compensation to his old one.

Earlier this month, French midfielder Lassana Diarra successfully claimed in a Belgian court that FIFA's rules had blocked him from moving to a new club after his contract was terminated at his previous team.

Players' union FIFPro, which has already made a legal challenge against the system at the European Commission, said the Diarra ruling, by a commercial court in the town of Charleroi, backed its argument that the system needed reform.

Diarra, a former Chelsea, Arsenal and Real Madrid midfielder, was sacked by Lokomotiv Moscow in August 2014 for disciplinary reasons one year into a four-year contract, the court ruling said without giving the reasons for his dismissal.

In April 2015, FIFA's Dispute Resolution Chamber (DRC) ordered Diarra to pay 10 million euros ($10.79 million) to the Russian top-flight club.

As the Frenchman was then without a club, it ruled that any future employer would not be jointly liable to pay compensation.

In the meantime, however, Diarra, said he had received offers from Inter Milan, Celtic, West Ham United and Charleroi, who all backed out of a deal because of the risk that they would have to pay compensation to his former club.

Eventually, he joined Olympique Marseille in June 2015, having missed a whole season.

After an appeal by Diarra against the DRC's compensation award was rejected by the Court of Arbitration for Sport (CAS), he took his case to the civil court which awarded him 60,000 euros in damages related to the three months' salary he would have earned if Charleroi had signed him in March 2015.

"There is no doubt that the European Commission would have never validated such a system, which amounts to preventing a worker dismissed by his employer from finding a new job," the court said in its 22-page ruling.

FIFPro, meanwhile, said that "cases like these illustrate the need for reform of the transfer regulations so that professional players are no longer treated as assets whose destiny is controlled by football clubs."

FIFA said it had noted the court's ruling and would consider "the appropriate legal steps" but would not comment further.

Antoine Duval, a researcher at the Dutch-based Asser International Sports Law Centre, told Reuters "the fact that the future club is held accountable for that compensation could be contrary to EU law.

"It highlights the peculiarity of the regulation of the labour market in football and the uncertainties regarding the compatibility of that regulation with our labour laws at national and European level," he said.

"It's a very weird system -- in particular the fact that it is not only the player owing the money but also his future club," he added. "It's unlikely to fly in another profession."

($1 = 0.9267 euros)

(Writing by Brian Homewood; Editing by Toby Davis)