New Regulation

New Regulation Slows Summer Transfer

The month of July marks the beginning of transfer season for Ethiopian football players. The period is usually marked by the active movement of players from one club to another. However, this year is different, because of a directive, that was adopted by the Ethiopian Football Federation (EFF) that no longer allows players to receive lump sum payments for transfer deals; instead, they receive their payments in monthly installments. The EFF says this action was taken to ensure players are accountable to their new teams, as some players in the past have taken their money and disappeared. Players, however, say the directive unfairly penalizes players. EBR’s Ashenafi Endale delved deeper into the debate to learn more about the effect the directive has had on Ethiopian football clubs summer transfer.

In Ethiopia, the beginning of July usually signals the opening of the transfer window, which allows football clubs from all divisions the opportunity to sign players at bargain prices and begin to restructure their squads ahead of the new season. Players whose contracts are ending may also begin exploring their options.
This season, however, things have changed because of the new directive put forward by the Ethiopian Football Federation (EFF) that governs the transfer of players from one club to another. The long-awaited directive, which was introduced four months ago, put an end to the long-standing tradition of paying the player the total transfer money agreed upon with the new club upfront. Instead, any player who signs a new contract will be paid the agreed money in installments, as a monthly salary.
Although many club managers say this requirement will give assurance for their investment, players are currently refusing to negotiate and sign deals like they did in the past. In fact, some of the players submitted a letter to the EFF stating their stand against the directive.
Despite their efforts, however, officials of the EFF are resolute in their adoption of the new regulation. “The directive will be implemented and there will not be any amendments,” says Solomon Gebresellassie, director of the competition department at the EFF.
Solomon says the new directive is introduced to tackle problems clubs have been facing for a long time. “The fact that players receive the transfer money in advance has been negatively affecting the performance of some players,” he says. “A few players even used to disappear after receiving the money. Now the government will also benefit from the income tax it will collect from players.”
However, players argue that the intention of the directive is not justified. “A player performs better because of the love he has for the game, not for the money,” argues Seyoum Degefa, a player of Dedebit FC, who is currently in negotiations for new contract. “Just because some players did wrong in the past it doesn’t mean we all have to be penalized.” In addition, players like Seyoum fear that managers of clubs might penalize players by unnecessarily raising the issue of performance or other topics before new contracts are signed.
Such players’ dissatisfaction is slowing the rate at which they sign contracts. “Although the directive is good, we are facing difficulties in signing contracts with players [as compared to previous years],” says Gezahegn Wolde, general manager of Ethiopian Coffee Football Club. “This is even more difficult for the Club, since 18 of its players have contracts that are set to expire [soon].”
Ethiopian Coffee planned to sign three new players from Ethiopia and three players from abroad during this transfer window. But the Club has only managed to recruit Abdulkerim Mohamed, 19, for ETB1.4 million, which is the highest transfer fee offered in the history of the Club, on July 22, 2015, 40 days after the transfer window opened.
Such an inflated transfer price, according to those who are close to the issue, is one of the outcomes of the directive. “Because income taxes will be deducted from the relatively large salary of players, they will ask for more,” explains Mensur Abdulkeni, a football analyst. “The prices will rise even more in the near future.” In fact there has been news around that ETB1.7 million has been paid for a recent signing fee.
In Ethiopia, the amount of money spent on football transfers has risen sharply in recent years. And with the adoption of the new directive, stakeholders stress that spending will increase even higher than the current rate in the near future.
“We anticipated such a price rise when the law was under preparation,” argues Gezahegn. “But since the directive enabled us to expect higher performance from our players, the transfer price hike is justifiable. We can also sell the best performers at higher prices.”
Ermias Ashine, communication officer of St. George FC, which is currently trying to transfer at least four players, says money will not be an issue as long as players work better. “Although we are negotiating with players, some prefer to wait to see if officials of the Federation might change their mind,” he says.
Although big football clubs like St. George and Ethiopian Coffee have the capacity to transfer players for high prices, Mensur fears that young and cash-strapped clubs might not bear the pressure. But Habtamu Zewale, team leader of Fassil Kenema FC, which participates in the national league, says it is the sacrifice that must be paid for the progress of football.
“We do not have [any] complaints about the directive,” says Habtamu. “We believe this is the only way to grow the football [league] and this will give us the energy to focus on nurturing our own players from a young age.”
Gezahegn agrees. “Clubs can earn good money by investing in young talent and selling [them later] to other clubs.”
Mensur also says that if football in Ethiopia is to grow it has to adopt accepted international practices. But as for the relatively low level of player transfers that is currently taking place, Mensur says it will return to its normal level soon. EBR

3rd Year • August 16 – September 15 2015 • No. 30

Leave a Reply

Your email address will not be published. Required fields are marked *

Ethiopian Business Review | EBR is a first-class and high-quality monthly business magazine offering enlightenment to readers and a platform for partners.

2Q69+2MM, Jomo Kenyatta St, Addis Ababa

Tsehay Messay Building

Contact Us

+251 961 41 41 41