Preventing money laundering in professional football: New obligations for professional football clubs and football agents

Under the new EU Anti-Money Laundering Regulation (AML Regulation), ‘professional football clubs’ and ‘football agents’ will, for the first time, be subject to anti-money laundering obligations. From 10 July 2029, when conducting business with investors, sponsors and agents, as well as in player transfers, they will have to meet compliance requirements similar to those already in place for banks today – ranging from risk analysis and the verification of business partners to the reporting of suspicious activity.

New entities subject to obligations in the football sector

The AML Regulation applies directly in all Member States. Whilst other obliged entities must comply with the new requirements from 10 July 2027, the football sector benefits from an extended transition period until 10 July 2029 (Article 90 of the AML Regulation). Three types of entity are covered: professional football clubs, football agents and, in some circumstances, their holding companies.

Who is considered a professional football club?

A professional football club is any legal entity that is a football club or the owner or manager of a football club (Article 2(1)(52) of the AML Regulation). Further requirements are:

• The club has been granted a licence or authorisation (e.g. by the DFL or DFB).
• At least one team participates in a national league played across the country.
• Players and staff are employed on a contractual basis and are remunerated.

In Germany, this is likely to cover all clubs from the Bundesliga down to the 3rd Liga. 

The entity subject to the obligation is the legal entity that organises match operations. If match operations have been outsourced to a company (e.g. an AG or GmbH), the ‘football club’ is the company itself. Due to the ‘50+1’ rule, other parties liable may include the parent club (e.V.) as well as (holding) companies that hold the majority of shares in the professional football company.

Obligations apply only to certain transactions

However, professional football clubs are not subject to anti-money laundering obligations in every business activity, but only in the following transactions, which have been classified as particularly high-risk:

• Transactions with investors,
• Transactions with sponsors,
• Transactions with football agents or other intermediaries,
• Transactions for the purpose of a player transfer. 

The sale of tickets or fan merchandise such as shirts is not covered.

Who is considered a football agent?

Football agents will also be subject to anti-money laundering obligations in future. This refers to any natural or legal person who provides agency services for a fee and represents players or professional football clubs in contract or transfer negotiations (Article 2(1)(53) of the AML Regulation). In German, the term ‘Spielervermittler’ (player agent) is more commonly used in this context. Unlike in the case of professional football clubs, the AML-VO does not impose any restrictions on specific transactions in this regard.

What lies ahead for professional football clubs and football agents

Essentially, the obligations under anti-money laundering legislation can be divided into three areas:

• Organisational requirements: The basis is a documented, organisation-wide risk assessment, which professional football clubs and football agents must use to identify the risks they face in relation to money laundering, terrorist financing and breaches of financial sanctions (Article 10 of the AML Regulation). Building on this, internal strategies, procedures and controls must be established to manage and minimise the identified risks (Article 9 of the AML Regulation). In addition, a member of the management board must be appointed as compliance manager and an anti-money laundering officer must be appointed (Article 11 of the AML Regulation). Furthermore, staff must receive regular training (Article 12 of the AML Regulation) and internal reporting channels must be established so that breaches of anti-money laundering obligations can be reported (Article 14 of the AML Regulation).
• Due diligence obligations (KYC checks): In addition, professional football clubs and football agents must comply with due diligence obligations towards their business partners. These include, in particular, establishing and verifying the identity of the business partner, identifying and verifying the beneficial owner, conducting sanctions list and PEP checks, and obtaining information about the business relationship or transaction. In cases of heightened risk, such as complex or unusual transactions or those without an apparent economic purpose, enhanced due diligence obligations apply (Articles 19 et seq., 34 et seq. of the AML Regulation).
• Obligations to report suspicions: Furthermore, obliged entities must report immediately to the Financial Intelligence Unit (FIU) if they are aware of, or suspect, that funds originate from criminal activities or are linked to terrorist financing (Article 69 of the AML Regulation). Professional football clubs and football agents must therefore be able to identify anomalies and require clear internal reporting and escalation procedures.

Practical guidance

Even though the new obligations will not apply until July 2029, the transition period should be used to establish the necessary compliance structures and processes and to familiarise oneself with the future requirements. The first step should be to carry out a review: which companies within the group will be subject to anti-money laundering obligations in future, and where are there gaps in the existing compliance organisation (gap analysis)? For recurring business partners, it is advisable to prepare standardised KYC checks in good time so that they can be carried out even under the time pressure of a transfer window. In addition, staff in transfer, sponsorship and finance departments should be made aware of the requirements and trained at an early stage.