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Premier League – High Court to Rule on £8 Million Secret Commissions Claim

Football is a highly regulated sport and disputes arising between clubs, players and their agents are generally submitted to arbitration under the aegis of the Football Association (FA). However, in one case concerning alleged secret commissions paid on the transfer of a player to a Premiership club, the High Court retained jurisdiction.

Football StadiumThe player had launched proceedings against two agents and their companies who, whilst ostensibly acting on his behalf in negotiations concerning his contract of employment with the club, were alleged to have received without his knowledge commissions in excess of £8 million from the club. One of the agents was also alleged to have induced the player to enter into an image rights agreement with his company by fraudulent or negligent misrepresentation.

In a preliminary hearing, the agents and their companies argued pursuant to Section 9 of the Arbitration Act 1996 that the proceedings should be stayed, on the basis that the dispute should be determined by arbitration under FA rules. It was submitted that those rules had been drafted in broad terms in order to comply with the requirement of the sport’s international governing body, FIFA, that disputes between ‘members of the football family’ should be resolved by arbitration. The application was, however, rejected by a judge.

In dismissing an appeal against that ruling, the High Court noted that none of the written agreements under which the player did business with the agents or their companies had made reference to the arbitration provisions of the FA rules. It was neither necessary nor appropriate to imply arbitration clauses into the agreements and, in those circumstances, the judge had been right not to stay the proceedings.