Lionel Messi: The Impossible Move – Possible?

In this guest piece, The Legal Pitch and solicitor Jack Taylor, explore the recent legal ramifications of the dispute between Lionel Messi and Barcelona Football Club. Over to The Legal Pitch for their insight!

Why Leave Now?

For FC Barcelona this was not meant to happen. A few years ago, the thought of Lionel Messi leaving Barcelona was incomprehensible. The notion of Messi leaving on a free would have been borderline farcical. Yet as we stand, Lionel Messi wants out of Barcelona.

Of course, a lot has changed in two years. On 10th April 2018, A.S. Roma overturned a first-leg three goal deficit, to knock Barcelona out of the Champions League. A year later, Barcelona were once again eliminated from Europe’s elite competition, this time courtesy of Divock Origi. Then, in August 2020, Barcelona succumbed to one of the most humiliating defeats in the club’s history. An 8-2 loss to Bayern Munich coincided with reports of boardroom conflicts, encapsulating the fall of the once formidable Barcelona. The Catalans have dealt with a plethora of issues, ranging from three unsuccessful managers in three years, numerous poor signings and an ageing squad, yet Messi leaving would be the embodiment of their demise.

The Basics of the Dispute

Messi’s current contract, signed in 2017, is due to expire in June 2021, but contains a clause that would allow him to immediately terminate the agreement providing the club was notified of his wishes on or before June 10th 2020.

This is where the central conflict of the case arises; it was not until August 25th 2020 that Messi sent a Burofax[1] informing the club of his desire to activate the clause and leave on a free transfer. In any normal season of football, the legal case would be ‘clear cut’ and Messi would be found guilty of breach of contract providing he exited the club after the deadline. However, the effect of the COVID-19 crisis on the conclusion of the 2019/20 season obscures the matter and may form the basis of Messi’s argument.

In terms of professional football, each season contractually ends on the 30th of June. Due to the temporary suspension of all football earlier this year, the Champions League final was not completed until the 23rd of August, some 54 days after the usual end to the footballing calendar.

Respective Legal Arguments

The legal dispute mainly revolves around a core theme of contract law – contractual intention. In Spanish Law this is governed by Articles 1281-1289 of the Spanish Civil Code 2013, which provides legal grounds for both Barcelona and Messi’s representatives.

Understanding Barcelona’s Argument

Barcelona have remained steadfast in their belief that Lionel Messi cannot legally leave for free. From reports, the express term clearly stipulates a deadline of June 10th. If a court case arises, Barcelona will likely point to the first half of Article 1281 Spanish Civil Code 2013. This states ‘if the terms of a contract are clear and do not leave any doubt as to the intention of the contracting parties, they shall abide by the literal meaning of its clauses.’ Barcelona could use this to demonstrate that June 10th sets an unequivocal and indisputable deadline, that Messi has failed to meet. Subsequently, because the deadline is clearly stipulated in the contract and is potentially independent of the season ending, the literal meaning of the clause should apply, which in turn, would indicate the deadline has expired, rendering the clause invalid and means Messi would not be able to leave for free.

Understanding Messi’s Argument

The second half of Article 1281 states ‘if the words seem contrary to the evident intention of the contracting parties, the latter shall prevail over the former.’ This means that the intention of the wording can sometimes be more important than the words themselves. Using this article, Messi’s representatives will attempt to persuade the court that both parties entered into the contract with a shared intention; that the player would be able to complete the season before deciding whether to leave the club. According to Messi’s legal counsel, the true intention of the clause allowing him to leave at the end of the season should be prioritised over the specific wording of June 10th, given the unique circumstances presented by COVID-19. Therefore, the Burofax sent on August 25th would lawfully allow him to leave the club.

But how likely is it that the Spanish courts will accept this line of argument? When looked at logistically, the Argentinian star’s argument begins to fall apart.

Analysing the Limitations of Messi’s Argument

The second half of Article 1281 is only applicable when there is ambiguity in the wording of the contract. If the contract contains the specific deadline of June 10th, then the court should have no reason to consider this precedent and therefore are likely to rule against Messi.

Even if the court is sympathetic towards the Barcelona captain, due to the circumstances created by COVID-19, and find ambiguity in the wording of the key clause, then Messi faces another hurdle in the form of Article 1282. This states that ‘in order to judge the intention of the contracting parties, their acts at the time of and subsequently to the contract shall be mainly taken into account’. If Messi understood that the clause referred to the end of the 2019/20 season rather than June 10th, his representatives should have taken action to indicate this, for example renegotiating a new deadline that takes into account the effects of the prolonged season.

Messi’s case is further weakened due to the aforementioned point that a normal season ends contractually on June 30th, thus leaving a 20-day period (from June 10th) whereby Messi was required to inform Barcelona of his intentions to leave. It is possible that the Spanish courts will use this 20-day gap and apply it to the circumstances created by COVID-19, meaning that Messi should have sent the Burofax by August 3rd to meet the 20-day requirements from the actual end of the season (August 23rd). However, the player failed to meet this hypothetical deadline by sending the document 2 days after the conclusion of the season.

As discussed, Barcelona would be unlikely to lose the legal dispute; but with the player refusing to train, will they keep a disenchanted Messi to fulfil his final year of his contract to ultimately release him for free or should they sell him this season?

(Image courtesy of Manu Fernandes/Reuters)

Performance, Politics and Economics

The most obvious reason for keeping Lionel Messi is his output on the pitch. Not only is Messi indisputably Barcelona’s greatest ever player, accumulating 34 major honours, scoring 634 goals and registering 285 assists in 731 appearances, at 33-years of age, he is still widely regarded as the best footballer in the world. Besides his output, Messi may be the last bastion of the ‘Barcelona way’. FC Barcelona pride themselves on their motto ‘Més que un Club’. Translating to more than just a club, Barcelona perhaps more than any other club in world football, cherish their history and value their philosophy. Messi is not only the figurehead of the most successful period in the club’s history, but also a La Masia Academy graduate and the embodiment of tiki-taka and total football.

It is for these reasons that the already unpopular Barcelona President, Josep Maria Bartomeu, will be extremely keen to keep Messi for the remaining year of his contract. With Bartomeu entering the final months of his tenure and the presidential elections scheduled for March 2021, selling Barcelona’s most influential figure would further tarnish his reputation.

Whilst keeping Messi would clearly be beneficial for both the performance and political unrest at FC Barcelona, the economic consequences are more complex. If Barcelona are more than just a club, then Lionel Messi is more than just a footballer. With a legion of loyal fans, superior to many football teams, and endorsements with Pepsi, Adidas and Mastercard, the Messi brand is a financial juggernaut. When combined with his trophy winning pedigree, it is easy to see why Messi is Barcelona’s most valuable asset.

However, the value Messi brings to the club must be compared to how much he costs Barcelona. Messi was placed as the third highest paid athlete in the world, in 2020 by Forbes[2], earning an estimated $72million for the year through salary/winnings. Considering the current economic uncertainty surrounding football, paying out €35million a year in wages, could be problematic even for one of the wealthiest clubs in football.

Paired with Barcelona’s need to restructure their squad, selling Messi may be the solution needed to fund a rebuild.

Messi’s European Move

In order for a move to occur, the Argentine’s €700 million release clause would need to be met. As widely reported, Manchester City seem in the lead to gain Messi’s signature, yet do they have the financial capabilities to complete the move, and will UEFA allow it?

Financial Fair Play (FFP)

The current FFP regulations[3] aims state that the rules are in place to introduce ‘discipline’, promote ‘sustainability’ and to encourage clubs to ‘operate on the basis of their own revenues’. Current rules limit club losses to a maximum of €30 million over a 3-year period, so long as 80% of this loss is covered by the owners. Thus, there is around a €5 million leeway for clubs to ‘break-even’ under the FFP standards. This would suggest a move by any club for Messi at the price point of €700m be ludicrous and seemingly off the cards.

However, FFP regulations only cover specifics; outgoing transfers, wages, amortisation of transfers and dividends, leaving any money earnt from TV revenue, advertisement, transfer sales etc. to cover lost earnings. As per, ‘breaking-even’ to meet the above standard, many expenses are not included in this calculation, or are left out of UEFA club accounts, allowing room for greater purchases, especially for bigger clubs.

Therefore, if Manchester City (or another European Giant) attempted a €700m move for Lionel Messi, including around €35m per year in wages, would FFP play a factor?

Following the COVID-19 pandemic, UEFA have made changes to FFP in order to ‘neutralise adverse impact [of the pandemic] by allowing clubs to adjust the break-even calculation for revenue shortfalls reported in 2020-21’, seemingly allowing bigger clubs to spend more. This would provide clubs with the opportunity to spend big on Messi. However, it is also important to recognise that there are a variety of different legal outcomes;

a) A club pays the €700m and bypasses the FFP regulations. This scenario is unlikely, yet possible due to the commercial value Messi will bring to both the concerned league and club, alongside sponsorships, increased marketing and all additional revenue.

b) The club fails to meet the FFP guidelines and are handed up to a two-year transfer/Champions League ban but gains the player.

c) If, under FFP a club cannot buy Messi and his legal stance under the Spanish Civil Code fails, he may be liable to pay Barca the €700m release clause in order to force a move away, which may see a 6 month ban for the player. This scenario is subject to Spanish law stating Messi’s attempted move away (for free) was unlawful.

A Renegotiated Release Clause

Thus, there remains a debate as to whether a club could afford this release clause under FFP regulations and whether the contract would be frustrated if Messi attempts to leave for free.

A re-negotiated release clause could be the best outcome for both parties and may be the most likely avenue that sees Lionel Messi leave his club this transfer window. Barcelona will not want to lose their largest commercial asset without compensation, and Messi’s tenure at the club seems over following several missed training sessions and COVID tests. Therefore, The Legal Pitch believes a €150-200million move seems plausible; with this additional transfer budget, and €35m freed up on the wage bill, Barcelona could begin their restructuring programme under Koeman.

Conclusion

With new developments emerging, and still no official word from either party over the specific wording of the contract, how the situation will play out is still not definitive. However, whether this be on a free next season or for a ground-breaking fee this year, with each passing day it seems more and more likely that Lionel Messi will leave Barcelona, making the impossible move – possible.

The additional legal opinion for this article is provided by Jack Taylor of Blackhurst Budd Solicitors. Jack graduated from the University of Sheffield in 2019 with a 2.1 in LLB Law.

Firstly, it is noteworthy that there is vast dispute as to the actual wording of the contract. La Liga have released a statement dated 30th August 2020 stating that Lionel Messi’s contract is still valid and the only way for him to be freed from it is if a club exercises the €700m release clause. This stance contrasts to a widely reported media point of view that this clause has expired, with the reputable Alfredo Martinez stating that ‘the key clause in Messi’s contract does indeed state the player can leave at the end of the 2019/2020 season if he wishes, without the need of a release clause’.

From a legal standpoint, clearly there is a limited analysis without sight of the aforementioned contract. Strictly, if there is a clause in his contract which stipulates Messi can leave for no consideration at the end of each season, if that is indeed what the player wants, he should be able to walk away for nothing. If the contract specifies dates in which this clause expires, and the time has passed, Barcelona will have the legal standing to hold firm and keep Messi against his will, should the club wish for that to happen.

Barcelona and La Liga have already confirmed their stance; they have held firm that this clause has expired due to the season being due to finish in May. As all football fans will be aware, the season has only just finished due to the outbreak of COVID-19, and this is what the proponents of a Messi departure will argue, thus giving legal effect to the clause which entitles Messi to leave for free. Given the enormity of Messi’s status, both in a commercial and a footballing sense, a transfer will not be without rigorous negotiations. An array of top international Lawyers will be deployed by all parties in this saga, and various arguments will ensue on the validity of such clauses and the potential frustration due to COVID-19.

How Jack sees the situation playing out:

Again, without sight of the contract it is difficult to predict an outcome with any degree of certainty. I think Messi will leave the club as Barcelona will be keen to preserve their reputation and not stand in the way of the ‘best player of all time’. I do however think Manchester City (or any other club attempting to sign Messi), will have to pay some consideration, as I believe Barcelona will refuse to accept no recompense for their best player, and from a financial sense, their most prized commercial asset.

This article was co-written by Adam Smith, Nathan Davis and Fin Piper.

[1] A Burofax is a service provided by Spain’s postal service that, in this case, allows Messi to prove that the contents of the document spelling out his intention to leave was delivered and subsequently received by Barcelona. The process is similar to that of ‘recorded delivery’ in English law.

[2] https://www.forbes.com/profile/lionel-messi/#447288dc5e9f, accessed 1st September, 2020.

[3] UEFA Club Licensing and Financial Fair Play Regulations (2015 edition).

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