It’s important to stress at the outset that compensation is not due in lieu of the transfer fee that would be payable if the player were under contract. The compensation is of an entirely different nature and the player’s perceived ‘market value’ and transfer fee comparables are irrelevant. Instead, the compensation is payable solely to compensate the former club for its training and development of the player, the rationale being that clubs should be rewarded for bringing through talent and incentivised to continue doing so.

The compensation fee payable by the new club is such sum as is agreed between the two clubs or, in default of agreement, “such sum as the Professional Football Compensation Committee on the application of either Club shall determine.” The PFCC considers nine factors – eight under Regulation 3 of the PFCC’s Regulations plus, under Regulation 4, the costs incurred by both clubs in the training and development of players. It is important that a club makes detailed submissions to the PFCC regarding each of those factors.