Agents in the sporting field: a law and economics perspective

Abstract

While agents have been active in the sporting field since the late 1800s, sports agents and their activities have grown in prominence only in more recent times, particularly as a result of typically adverse headlines. Agents are generally considered to be necessary (or some might say a necessary evil) for the sporting industry, in the representation of sportsmen and women, the consultation of sports clubs and franchises, or the facilitation of employment contracts and transfer deals. In contrast to players and clubs (not to mention sports federations and governing bodies), however, sports agents are not engaged in sporting endeavour. Rather, the essence of their role is an economic one for the provision of services. This peripheral position of sports agents implies that their interests are likely to be quite different from those of other stakeholders in the sports industry – but it also gives rise to a significant regulatory conundrum. This conundrum has become especially apparent in the sport of football in recent years, where various attempts at regulation of access to and the performance of the profession of football agent have been made at national and international level. The field of sports and football in particular clearly has a great societal impact and a large economic value. Yet, sports law is remarkably absent so far from the economic approach to law. From a law and economics perspective and in the light of regulation theory, therefore, our main research questions are whether there is a need to regulate the profession of sports agent and, if so, what type of regulation is needed.

Keywords: Agency problem, contract regulation, asymmetric information, adverse selection, externalities, regulatory models