04 Sep 2013 16:53:46
Ed 002 I am not sure I understand release clauses. Is it true that Martinez had a £35m release clause as has been reported?
I know they want to increase that but as I understand it that hadn't happened prior to the deadline.
Bearing that in mind how were Porto able to ask for so much more?
Thanks

{Ed002's Note - This is a horribly complex area not least because they are written under individual national laws.

The "buy out" clause is legally binding between a club and a player. The "buy out" is effectively what it says - a means for the player to buy himself out of the contract. As an example, if a player wishes to buy himself out of a contract, he pays the applicable FA the amount of the "buy out" clause effectively becoming a free agent. The problem is that in most cases a player would need to obtain that money from the buying club - and this is fraught with issues regarding "tapping up" and, of course, taxation as it can be seen as income for the player and would therefore be subject to income tax. There was a test case about the taxation issue in Spain about three years ago.

A "release clause" is far more common in that it gives a figure that the club would accept for the sale of a player to another club - but it is not legally binding except where both parties are in the same country, and even then that only applies in certain countries - notably Spain and Portugal. These are normally unreasonably high figures (Messi at Barcelona for example) introduced to act as a deterrent for hostile bids - and even then the club could easily block a move. However, if a club does agree to match a release clause then the club would be obliged to ask the player if he is interested. Examples are Goetze who decide he wanted to move and Cavani who, regardless of two offers that were made in 2012 that matched or equated to his then "release clause" recognised Napoli did not sell and accepted a new package. Since then Napoli said they will listen to offers of €60M or so and indeed accepted a bid this summer.

There is then the becoming popular "termination clause" which is binding between the player and the club and if met would see an offer from anywhere accepted and the player given the opportunity to make a call on a move. This overcomes the issues associated with "buy out" clauses as the money would be paid by one club to another.}

1.) 04 Sep 2013
Absolutely fascinating Ed 002 thanks a lot.
So Martinez is in a similar situation to Cavani and will likely sign a new contract upping the figure to say £60m or more?
Is there a reason why Chelsea don't have a similar agreement with there players? {Ed002's Note - It is unusual in this country to have such clauses and it would mean paying them more as it is not to their benefit.}

2.) 04 Sep 2013
Ok thanks for all that Ed002.

3.) 05 Sep 2013
Well done Mr Ed002. Fascinating but as you say, complex stuff.

4.) 05 Sep 2013
Thanks ed for taking time to inform us on all of this, first time I've felt I'm beginning to understand complexities.