The rules governing the termination of professional football player contracts and the consequences it produces are gathered in Chapter VI of the Directive on the Status and Transfer of Professional Football Players, headed "Termination of the Contract and Its Consequences". That chapter regulates together the automatic extinction of the contract, the just causes for termination available to the player and to the club, the procedure and time limits to be followed in terminating, and the consequences of termination for just cause.
Classified in general terms, professional football player contracts come to an end in three separate ways: expiry of the term stipulated in the contract or occurrence of a specific condition inserted into the text; the parties bringing the relationship to an end by agreement; and one of the parties extinguishing the contract by its own unilateral declaration of intent.
Nature of the Contract and Forms of Termination
The relationship established between the player and the club is a contract imposing obligations on both parties. In this relationship the player’s principal obligation is to play football on behalf of the club in matches, while the club’s principal obligation is to pay the consideration for that service. The parties are not, however, bound by the principal obligations alone; there are also ancillary obligations imposed as a matter of compulsion by the Directives of the Turkish Football Federation (TFF) and agreed by the parties in the contract of their own free will. The obligations arising from the contract are continuing in nature, and the parties are bound to perform them for as long as the contract remains in force.
Contracts giving rise to continuing obligations may come to an end automatically upon the occurrence of certain facts, such as death or expiry of the term. Beyond this, it is also possible for the parties to end the relationship by agreement, or for one of the parties to terminate the contract by legal transaction. The difference is this: where the grounds for automatic termination apply, the relationship ends without the parties needing to carry out any legal transaction, whereas the other routes require at least one party to make a declaration of intent to that effect.
Automatic Termination of the Contract
As regards professional football player contracts, automatic termination arises upon the occurrence of the following facts and upon the occurrence of a condition subsequent:
- Expiry of the term agreed in the contract
- Performance becoming impossible
- The club losing its legal personality or becoming bankrupt
- Death
Expiry of the Term
The most frequently encountered instance of automatic termination in practice is the completion of the contract term. Article 19 of the Directive on the Status and Transfer of Professional Football Players imposes an upper limit on the contract term: contracts of at most three years may be concluded with players who have not completed the age of 18, and contracts of at most five years with other players. It is furthermore compulsory for the expiry date of contracts to be fixed as 31 May; if official matches are still continuing after that date, the contract term is deemed extended until the end of those matches.
The conclusion to be drawn is this: as a rule, once the term expires the contract comes to an end without any further transaction being required. Where official matches are still under way, the term is deemed extended until the end of those matches, and the contract is automatically extinguished on the date the matches end.
Occurrence of a Condition Subsequent
Where the effects and consequences of a legal transaction are extinguished by the occurrence of a future event which may or may not come about, one speaks of a condition subsequent. This technique is frequently resorted to in football practice; professional football player contracts containing a condition subsequent to the effect that the contract will come to an end if the club is relegated or promoted to a higher division are widely drawn up.
Impossibility of Performance, Death and Dissolution of the Club
As regards performance of the agreed obligations becoming impossible, the situation most often encountered in practice is injury to the player. Here the duration of the injury is decisive; if the injury constitutes an obstacle to the player ever playing football again, the contract comes to an end.
The death of the player is likewise a fact which automatically terminates the contract. Since clubs are legal persons, death cannot be spoken of in their case; for them, the contract is extinguished where loss of legal personality or bankruptcy occurs.
With the date of termination, the mutual rights and obligations of the parties come to an end. The player, thereby acquiring the status of a free player, may sign a contract with another club without any transfer fee being paid. Rights and receivables relating to the period before termination, by contrast, continue to exist and may be claimed within the statute of limitations.
Termination of the Contract by Mutual Agreement
As set out above, continuing obligation relationships, and therefore professional football player contracts, may come to an end automatically, but may equally be brought to an end by termination or by agreement between the parties. The provision governing this route is Article 26 of the Directive; in practice the result is reached by means of a mutual termination agreement concluded between the parties.
Article 26 makes the recording of a mutual termination in the TFF’s registers conditional upon the submission of a number of documents. The documents which must be submitted to the TFF together with the termination agreement are as follows:
- A notarised signature circular showing the club officials who are to sign the termination instrument
- A declaration of signature belonging to the player, drawn up no earlier than thirty days before the date of signature
If these documents are not completed, the mutual termination cannot be entered in the TFF’s registers; the direct consequence of this is that the contract the player has signed with his new club cannot be registered.
A further problem encountered in practice is that players are pressed into waiving certain receivables in order to be able to sign the mutual termination instrument. A detailed assessment of the collection of receivables which have thus had to be given up is set out in the note entitled Collection of Receivables Players Are Forced to Waive.
Termination of the Contract by the Player
The player’s power to terminate for just cause is regulated in Article 28 of the Directive. The provision, in circumstances specific to certain situations, confers on the player the right and power to bring his contract to an end unilaterally without facing any sanction. Whether the termination may be regarded as being for just cause depends, however, on the step being carried out within the framework of certain rules. A detailed examination of those rules has been made in the note entitled Termination of a Professional Football Player Contract by the Player.
In the opposite scenario, the conclusion is reached that the player has terminated the contract without just cause, and sanctions of both a financial and a sporting nature come into play against the athlete. For an assessment dealing one by one with the legal sanctions a player who terminates his contract without just cause may face, reference may be made to the note entitled Termination of a Contract Without Just Cause by a Professional Football Player.
Termination of the Contract by the Club
Where at least one of the grounds for termination for just cause listed in Article 27 of the Directive occurs, the club may bring the contract to an end relying on just cause. That said, having regard to the particular circumstances of the individual case, it is possible to reach the conclusion that the club’s termination rested on a just cause even in a situation not included in the Directive.
In certain cases the player’s acting contrary to a number of his obligations affords the club the opportunity to terminate for just cause. The obligations in question of the player are expressly listed in Article 25 of the Directive.
Looking at the provisions on termination for just cause in FIFA and CAS practice, a different technique is to be seen: there the grounds are not listed one by one, and it is envisaged that the rule will be interpreted according to the features of the case encountered in practice. Moreover, as is the case for players, there are also certain rules which must be complied with for a club’s termination to be regarded as being for just cause. Those procedural steps have been examined in detail in the note entitled Termination of a Professional Football Player Contract by the Club.
Independent Legal Assessment
Correctly characterising the route by which the contract has come to an end determines the whole of the parties’ subsequent rights and obligations. In a relationship ending with the expiry of the term, no question of damages or sporting sanction arises for the parties, whereas in a unilateral termination the dispute over just cause produces both financial and sporting consequences. For this reason the first step to be taken in practice is to establish on documentary evidence whether the termination occurred automatically, by agreement, or by termination.
Mutual termination instruments call for particular care. Since their entry in the TFF’s registers depends on the documents being submitted in full, a technical deficiency such as a signature circular or an out-of-date declaration of signature may prevent the player’s registration with his new club and in effect cause the loss of a season. The scope of any waiver clauses inserted into the text must also be separately assessed before signature.
The points to be brought to the fore in termination processes are as follows:
- Structuring the contract term in conformity with the upper limits in Art. 19 of the Directive and with the rule fixing 31 May as the expiry date
- Drafting condition subsequent clauses clearly and beyond argument as regards their consequences tied to the club’s divisional position
- Supporting impossibility of performance in cases of injury with medical reports and evidence of duration
- Having available, on mutual termination, a notarised signature circular and a declaration of signature drawn up within thirty days
- Calculating in advance the loss of receivables in termination instruments containing a waiver
- Pursuing receivables relating to the period before termination within the statute of limitations
Independent Legal advises clubs and athletes at every stage of professional football player contracts, from formation through to termination, and takes on the conduct of disputes arising from termination.