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Rugby Union doing a ‘Neymar’

There has been something in the water this summer, in the parallel transfer markets of rugby union and football.

In the latter, Neymar Jr. transferred to PSG in a deal worth an eye-watering £370m, a sum of money inconceivable within world rugby. For context, Sunderland A.F.C, currently have their entire football club for sale, including squad and stadium, for £170m.

Traditionally, rugby union players in England’s professional leagues have moved between clubs by way of ‘free transfers’. Something commonplace in football, which had not previously been seen in rugby union, is a release clause triggered upon promise of a certain transfer fee by the buying club. It was this mechanism which facilitated Neymar’s move away from the Nou Camp. His £199.1m release fee was supposed to act as a deterrent, but Qatari

Sports Investment, the financier of PSG, instead saw it as an affordable opportunity to generate publicity and revenue. Leicester Tigers earlier this summer shrewdly used a largely unknown regulation in the Premiership code of conduct which allowed a player to be bought out of their playing contract by another club for a set fee. This fee was a one-off payment of a season’s earnings for what the player was being offered by the purchasing club or his current salary for a season, whichever was the higher.

The regulation was in place with the view to protect the interests of backroom staff and had not been drafted with players in contemplation. The 12 Premiership clubs unanimously supported that the regulation be amended to prevent such transfers being triggered again in the future.

There has been an emerging global trend of rugby players moving clubs before the end of their contracts. Perhaps the clearest illustration of this shift in culture is Louis Picamoles of Northampton Saints signing a pre-contract agreement with Montpellier, despite having three years left on his existing deal. The compensation sum required from Montpellier to free him from his Saints contract would take the form of a seven-figure sum, making him rugby’s first £1million player, and rugby’s equivalent of football’s Trevor Francis 38 years earlier.

Within the last year we have seen Carl Fearns backtrack on his contractual agreement to return from France to Gloucester because of Lyon’s willingness to foot the bill of his U-turn, and perhaps more incredulous was Denny Solomona ‘retirement’ from rugby league in order to walk away from his contract with Castleford Tigers and join rugby union side Sale Sharks. This left his former club without any compensation immediately following his departure and the ‘League Leaders’ were left with no recourse but to issue legal proceedings. The outcome was a hefty out of court settlement for the Tigers who had lost the services of Super League’s top try scorer from last season with two seasons left to run on his deal.

These behaviours are symptoms of a market desperate to follow the precedents set by the round ball game following the hike in the salary cap ceiling and the surge in TV revenue. Rugby players and their agents are now acutely aware of not only the enlarged salaries on offer, but of other clubs’ willingness to swoop in and free them from the contracts they are currently bound to.
Contribution from Tom Grahamslaw

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Blacks Solicitors LLP