Big Move as MLS Looks to Claim Training Compensation

Posted By Peter Nolan on April 20, 2019 - Last Updated on April 21, 2019

On a busy Thursday night, Major League Soccer paired the news that the league would expand to 30 teams in the not too distant future with word that for the first time in its 23-year history the league will be collecting and paying Training Compensation and Solidarity Payments, a move the league sees as a boon to youth development in the United States.

Citing FIFA rules in a league statement, MLS declared that it will claim training compensation for any MLS academy produced player that signs his first professional contract with a non-MLS club outside the USA and Canada.

According to the MLS release:

“FIFA regulations only dictate that professional clubs pay training compensation when a player signs his first professional contract in a country other than the one in which he was trained. Since FIFA regulations don’t mandate domestic payments, MLS clubs will not seek training compensation for players who sign their first professional contract with non-MLS teams in the U.S. or Canada.”

That last assertion is backed by website Law in Sport, which states, “It (FIFA Laws) does not address the domestic rules that may apply to the movement of young players between clubs belonging to the same national association.”

As to solidarity payments, MLS announced that it will seek those payments “when players developed in MLS club academies are transferred, for a fee, between two clubs belonging to different international federations.”

MLS Players Association not on board

One group not too keen on MLS’ embrace of the two initiatives is the MLS Players Association (MLSPA) who have long opposed the payments as a tax on its members, a tax that the Players Union feels limits opportunities for its American players.

The MLSPA released a statement that called the move “a step backward for the development of soccer in the United States and Canada.”

As to the league pointing out that training compensation and solidarity payments are FIFA rules, the MLSPA calls the league self-serving, noting that MLS “routinely ignores regulations that protect players under contract to MLS.”

Under Training Compensation, whenever a professional player is transferred from a club in one FIFA member association (or federation) to a club in another federation during the course of his contract, up to five percent of the transfer fee is to be withheld and paid by the club receiving the player proportionally to the club or clubs involved in that player’s training during the years between his 12th and 23rd birthdays.

Training Compensation differs in that it is only paid for players who have not yet reached the end of their age 23 season. Solidarity Payments will be due for the duration of a player’s professional career, any time he is transferred between federations while under contract and a transfer fee is paid.

Under this system, Christian Pulisic’s youth club PA Classics could have raked in at least $548,000 from the young attackers $73.1 million transfer from Borussia Dortmund to Chelsea, by ESPN’s Jeff Carlisle’s reckoning.

So, it can be quite a windfall.

USSF is Switzerland on the issue

Oddly, the United States Soccer Federation has pronounced itself neutral on the issue of Training Compensation and Solidarity Payments with this rule change having come from MLS.

MLS has previously stood with the USSF against the payments but with MLS losing an increasing number of players they helped to develop Europe clubs in recent years, it is easy to see the impetus behind this move. Players like Weston McKennie, who played in the FC Dallas academy but never signed a contract with the senior club, have been lost with no compensation.

Meanwhile, the MLSPA concluded its statement with these ominous words: we will review these changes, including the Consent Decree, entered into by the U.S Soccer Federation on this subject, and will explore all options with our stakeholders.”

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Peter Nolan

Peter Nolan has been on the soccer beat for many years now, covering the United States Men's and Women's teams, from the SnowClasico to Azteca and back again. Along with the US national teams, Peter will provide insight into the MLS and NWSL, with a focus on the NY Red Bulls and NYCFC.

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