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Erling Haaland's Deal Includes $42 Million In Agent Fees
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Hey Friends,
Manchester City secured 21-year-old Norwegian soccer phenom Erling Haaland last week by activating his $62.6 million release clause from Borussia Dortmund. Haaland is one of the most coveted young players globally and will now earn nearly $500,000 per week for the next five years — that’s the same salary as Kevin De Bruyne.
But here’s the interesting part: The deal between Manchester City & Borussia Dortmund also included a massive $41.7 million agent fee that will be paid out and split between Haaland’s manager, Rafaela Pimenta, and his father, Alfie Haaland.
Still, this is considered by most to be a pretty good deal for Manchester City. Erling Haaland is just 21-years-old. And even after paying an agent & transfer fee that amounts to more than $100 million in total (+$500k in weekly salary), it’s still a fraction of the cost that any club would have been expected to pay on the open market.
Top 5 Most-Expensive Transfer Fees
Neymar — $263 million (Barcelona to Paris Saint-Germain)
Kylian Mbappe — $216 million (Monaco to Paris St.-Germain)
Philippe Coutinho — $144 million (Liverpool to Barcelona)
Joao Felix — $142 million (Benfica to Atletico Madrid)
Antoine Griezmann — $135 million (Atletico Madrid to Barcelona)
A shock factor comes along with seeing nearly $42 million in fees on a $62 million transfer, at least to Americans who aren’t as familiar with the inner workings of the game. But according to a recent report by The Athletic, these outsized, multi-million-dollar payments might soon be a thing of the past.
The Athletic says they have reviewed draft documents from FIFA that would place a cap on what agents, lawyers, family members, or whoever else might be acting as a player’s representative can charge as a commission on a transfer. Here are the details:
A 10% cap on the commission for agents representing players and clubs.
A cap on the amount that agents facilitating the sale of a club can earn.
A rule requiring everyone earning a commission to be licensed by FIFA.
The establishment of a clearing-house where all transfer payments must pass.
But The Athletic also included an example of how this might look:
“Consider, say, a £51 million move.
Under the new regulations, any agent acting on behalf of the selling club would have their commission capped at 10 per cent of the transfer’s value — so £5.1 million. By way of comparison, Raiola claimed a reported £41 million — a figure he disputed but never refuted — from Paul Pogba’s £89 million move from Juventus to Manchester United six years ago.
Representatives working on behalf of the player, or a buying club, will also have their commissions limited to 10 per cent of a player’s future annual earnings under $200,000 (£165,000) and at six per cent for anything above, for the duration of an agreed contract. If we consider Haaland is poised to be paid around £400,000 a week by City for five years, six per cent of that remains a hefty sum of money.
Also, these limits would all apply on a per-deal basis, regardless of how many individual agents are involved. There would be no situation, for instance, in which a cabal of agents, all operating on the same side of a deal, could each receive 10 per cent of a transfer fee. It’s an important distinction.
Perhaps the most interesting detail, though, is the effective ban on family members earning commission payments unless they are licensed agents.
In this instance, this rule would have prevented Alfie Haaland from earning any fee from his son’s transfer, unless he had passed the agent’s exam FIFA wants to introduce and complied with its eligibility requirements.”
So why are they doing this? Erling Haaland’s deal might be an extreme example, but agent fees have gotten out of control. For example, agents earned over $500 million in 2021, and despite transfers dropping by nearly 15% in 2020, agents actually brought in more fees than they did the previous year.
And this isn’t a one-off — these numbers have continued to increase every year since the Football Association started publishing them in 2015.
But these threats by FIFA are nothing new. The Athletic might have seen a draft document, but new rules (including the 10% number) have been floating around for several years now, and the world’s most powerful agents have promised to fight them.
So we’ll see what happens. Many clubs see the top agents as indispensable. They are masters at networking and maintaining relationships, and they hold an enormous amount of power over the game of soccer internationally. But I certainly think it’s something to keep an eye on.
Have a great day, and we’ll talk tomorrow.
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