How could the Brexit impact the Bundesliga?

It is official, Britain will be leaving the EU. To the surprise of pollsters and commentators, the British public have narrowly voted for a Brexit.

It may be years before the impact of the Brexit is fully felt in the footballing world of England.  One thing is for sure, though. The Brexit will have significant consequences for British football as a whole, and its relationship with other European leagues.

This could particularly be pertinent for the Bundesliga. The Premier League and Bundesliga are direct rivals, being ranked 3rd and 2nd in the current UEFA Coefficient respectively. Furthermore, clubs from Germany and England frequently buy and sell players from each other.

Harder for English clubs to acquire European players

Work permit rules put restrictions on foreign footballers joining British clubs. Players from a top-10 ranked nation need to have played 30% of games for their country in the last two years to qualify. Those from nations ranked 11 to 20 need to have played 45% of international matches. Players from lower ranked nations are often ineligible altogether.

EU players, however, are completely exempt from this. Hence the massive number of European players in every Premier League club. Once Britain does renounce its membership, EU nationals will be considered foreigners, and may have to go through the same work permit process. There are around 332 players in the Premier League at the moment who would not qualify. It seems unlikely that those already playing in the country would be retrospectively banished, but the flow of future EU nationals could be stemmed.

There are similar implications for the recruitment of young players to club academies. FIFA Article 19 decrees that international transfers cannot be completed until a player turns 18. This does not apply for inter-EU transfers though, where the minimum age is 16. Arsenal acquired Cesc Fabregas under this rule. This arrangement also allows British clubs to register their young EU players as homegrown, helping them circumvent UEFA homegrown quota rules.

Therefore, the loss of EU status could seriously hurt the ability of English clubs to buy in the best players. This could lead to Bundesliga clubs facing less competition in the race to acquire talent. Furthermore, given how dependent the Premier League is on foreign players, English clubs could struggle to keep up with German clubs in European competition. Expect the coefficient gap to widen.

It is worth noting that these permutations depend largely on what kind of post-exit relationship Britain carves out with the EU. It is plausible that Britain remains in the European Economic Area. This would mean that the country is still part of the common market. Iceland, Lichtenstein, and Norway currently occupy this position, and they are obliged to follow the same labour laws as a regular EU member. This would negate the need for work permits.

We may not know the outcome for a while. Britain’s EU membership will still apply for the next two years, so we will not see any effects take place overnight.

Higher Costs for English Clubs

While the situation around work permits may not become clear for a while, the impact of the devalued Pound Sterling could be more immediate.

The currency began to dramatically slump as soon the results of referendum poured in. The fallout from the Brexit and continued uncertainty over the next few years could see the value of the Pound compared to the Euro reach new lows.

The exchange rate makes it more expensive for English clubs to buy players from abroad. This initially sounds like good news for the Bundesliga. The Premier League enjoys the most lucrative TV deal in football, meaning English clubs have been able to outmuscle German clubs financially in the transfer market. The currency devaluation could act as a leveller, dampening England’s economic clout.

Furthermore, the Premier League has often snapped up some of the Bundesliga’s finest talent, such as Kevin de Bruyne and Roberto Firmino. With the Premier League having to tighten its belt, Germany could be able to hang on to more players.

Although this is a double-edged sword. ‎The Bundesliga received €220 million from English clubs in the form of transfer fees last season. Clearly, this trade is incredibly lucrative and has become an important dynamic of the economic stability of several German clubs. Deprived of their wealthy English suitors, some Bundesliga clubs may feel a financial hangover.

While the Brexit impact on British football may not really be known for quite awhile, the Premier League was against the exit from the EU.  Premier League chairman Richard Scudamore commented

There is an openness about the Premier League which I think it would be completely incongruous if we were to take the opposite position.  Ultimately you can’t break away, you can’t just pull out, you have to get in and negotiate and try and organise and try and influence

For once, the wealthy Premier League was on the losing end off the pitch.  How the Brexit effects English football,and subsequently the Bundesliga, will be intriguing.

The following two tabs change content below.
Sathesh is a History graduate from the University of Southampton, and is now a football writer based in London. He has a particular interest in European football culture and the historical development of the game. Follow him @sathesh1992

Latest posts by Sathesh Alagappan (see all)