Designated Player Rule

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The Designated Player Rule, nicknamed the Beckham Rule,[1] was adopted as part of the salary cap regulations of Major League Soccer for the 2007 season. The rule allows each MLS franchise to sign players that would be considered outside of the team's salary cap (either by offering the player higher wages or by paying a transfer fee for the player), allowing MLS teams to compete for star players in the international soccer market. Clubs have the option to use allocation money against a players contract, so to avoid a player with a Designated Player level salary using one of the club's Designated Player slots.

The rule is informally named after soccer star David Beckham, in anticipation of MLS teams signing lucrative deals with internationally recognized players of Beckham's caliber.[1][2] Beckham was the first player signed under this rule, signing a five-year contract with the Los Angeles Galaxy with guaranteed annual salary of $6.5 million.[3][4]

History[edit]

The team salary cap was estimated to be around US$1.9 million in 2006,[5] was $2.1 million in 2007, and was raised to $2.3 million for the 2008 season.[6][7] As part of the 2010 Collective Bargaining Agreement between MLS and the MLS Players' Union, the 2010 salary cap was $2.55 million, with an automatic five percent increase each year until the expiration of the agreement at the end of the 2014 season.

Under the 2007 rule:

  • The rule expires at the end of the 2009 season, and must be renewed then or allowed to lapse.
  • For each Designated Player, $400,000[7][8] of his salary is charged to the salary cap and paid by the league, with any remaining salary being paid by the team's owner. This value was increased for the 2009 season to $415,000.
  • Prior to the 2007 season, there were three players whose salary exceeded $400,000. These players were Landon Donovan, Carlos Ruiz and Eddie Johnson. According to the rule, these players were grandfathered in for the 2007 season, and the exemption was extended after the 2007 season, with the league planning to review the issue at a future date. It was possible that the league would be required to renegotiate these players' contracts or consider them Designated Players. However, prior to the start of the 2008 season, Johnson moved to Fulham of the Premier League,[9] while following Dwayne De Rosario's signing by Toronto FC in January 2009, Ruiz was released by the club and left MLS to play for Olimpia Asunción. This left Donovan as the lone player whose 2009 salary remained grandfathered under the exemption provision. However, there were several more players whose guaranteed salary exceeded the Designated Player amount, but whose salary cap expense was actually lower than their true salary due to the allocation rule. These players include Shalrie Joseph ($450,000), Christian Gomez ($430,000), Dwayne De Rosario ($425,750), and Taylor Twellman ($420,000).
  • Each team initially had one Designated Player spot, but could trade their Designated Spot to another team; teams were allowed a maximum of two Designated Players.
  • Only $325,000 of a team's second Designated Player counted against the salary cap, which was increased to $335,000 in 2009.[7]

The 2010 changes:[10]

  • The rule has no expiration date.
  • For each Designated Player, $335,000 of his salary is charged to the salary cap and paid by the league ($167,500 for DP players joining during the MLS summer transfer window), with any remaining salary being paid by the team's owner. This amount is halved for Designated Players signed in the middle of the season. The salary cap value of Designated Players can also be reduced using allocation money. Finally, teams whose Designated Players transfer abroad in the middle of a season can recoup part of the Designated Players' salary cap value.
  • Landon Donovan is no longer grandfathered into the rule and must be considered a Designated Player.
  • Each team is allowed two Designated Player spots, and they can no longer trade their Designated Player spots. The New York Red Bulls will receive $70,000 in allocation money in return for the nullification of their 2007 trade with Chivas USA for an additional Designated Player spot. This means that both New York and Chivas USA will have two Designated Player spots for the 2010 season.
  • Teams can pay a $250,000 "luxury tax" for the right to sign a third Designated Player. This $250,000 would be distributed equally to all MLS teams that have not signed a third Designated Player in the form of allocation money.

The 2012 changes:[11]

Starting with the 2012 season, the rule was changed with respect to younger players. MLS announced the changes in August 2011 after clubs expressed concern about signing young international players with no guarantees that they would develop into stars.

  • Designated Players over the age of 23 will carry a salary budget charge of $350,000, unless the player joins his club in the middle of the season, in which case his budget charge will be $175,000.
  • Designated Players 21–23 years old count as $200,000 against the club’s salary budget.
  • Designated Players 20 years old or younger count as $150,000 against the club’s salary budget.
  • The budget charge for the midseason signing of a young Designated Player (23 years old and younger) is $150,000 and this amount cannot be lowered with allocation funds.
  • Clubs will not have to buy the third DP roster slot to accommodate Designated Players 23 years old and younger.
  • Age of player is determined by year (not date) of birth.

The maximum budget charge for Designated Players over age 23 was increased to $368,750 for 2013, $387,500 in 2014, and $436,250 in 2015. The budget charge for those who join during the midseason transfer window has remained at one-half of the full-season cap charge since the inception of the rule. The budget charges for younger players have not changed since 2012.[12]

Background[edit]

The rule is informally named after soccer star David Beckham, in anticipation of MLS teams signing lucrative deals with internationally recognized players of Beckham's caliber.[1][2] As it turned out, Beckham was indeed the first player to be signed under this rule, signing a lucrative contract with the Los Angeles Galaxy worth up to $250 million over five years, with direct guaranteed compensation from MLS and Galaxy at $6.5 million a year.[3] The rest of Beckham's increased earnings would come from Beckham regaining the entirety of his image rights, of which Real Madrid had owned fifty percent, effectively doubling his existing endorsement income, as well as new endorsement deals, a share of jersey sales, bonuses, etc.[4]

Current Designated Players[edit]

Year signed Player Nation Current club 2015 Guaranteed compensation [13]
2011 Keane, RobbieRobbie Keane  IRL LA Galaxy $4,500,000
2012 Higuaín, FedericoFederico Higuaín  ARG Columbus Crew $1,175,000
2013 Valeri, DiegoDiego Valeri  ARG Portland Timbers $550,000
2013 Wondolowski, ChrisChris Wondolowski  USA San Jose Earthquakes $675,000
2013 Martins, ObafemiObafemi Martins  NGA Seattle Sounders FC $3,000,000
2014 Laba, MatíasMatías Laba  ARG Vancouver Whitecaps FC $325,000
2013 Dempsey, ClintClint Dempsey  USA Seattle Sounders FC $4,605,492
2013 Diaz, MauroMauro Diaz  ARG FC Dallas $442,400
2014 Alonso, OsvaldoOsvaldo Alonso  CUB Seattle Sounders FC $789,687
2014 Gilberto, Gilberto  BRA Chicago Fire $1,145,000
2014 Bradley, MichaelMichael Bradley  USA Toronto FC $6,500,000
2014 Maidana, CristianCristian Maidana  ARG Philadelphia Union $217,250
2014 Edu, MauriceMaurice Edu  USA Philadelphia Union $768,750
2014 Morales, PedroPedro Morales  CHI Vancouver Whitecaps FC $1,410,900
2014 Villa, DavidDavid Villa  ESP New York City FC $5,610,000
2014 Ridgewell, LiamLiam Ridgewell  ENG Portland Timbers $1,000,000
2014 Jaime, SebastiánSebastián Jaime  ARG Real Salt Lake $266,667
2014 Kaká, Kaká  BRA Orlando City $7,167,500
2014 Piatti, IgnacioIgnacio Piatti  ARG Montreal Impact $400,000
2014 Besler, MattMatt Besler  USA Sporting Kansas City $683,250
2014 Zusi, GrahamGraham Zusi  USA Sporting Kansas City $682,102
2014 Beasley, DaMarcusDaMarcus Beasley  USA Houston Dynamo $813,333
2014 Pérez García, MatíasMatías Pérez García  ARG San Jose Earthquakes $240,000
2014 Jones, JermaineJermaine Jones  USA New England Revolution $3,052,500
2015 Wright-Phillips, BradleyBradley Wright-Phillips  ENG New York Red Bulls $660,000
2015 Castillo, FabianFabian Castillo  COL FC Dallas $160,000
2015 Róchez, BryanBryan Róchez  HON Orlando City $279,500
2015 Accam, DavidDavid Accam  GHA Chicago Fire $720,938
2015 Torres, ErickErick Torres  MEX Houston Dynamo $425,000
2015 Rivero, OctavioOctavio Rivero  URU Vancouver Whitecaps FC $890,850
2015 Gerrard, StevenSteven Gerrard  ENG LA Galaxy $6,332,504
2015 Lampard, FrankFrank Lampard  ENG New York City FC $6,000,000
2015 Altidore, JozyJozy Altidore  USA Toronto FC $4,750,000
2015 Giovinco, SebastianSebastian Giovinco  ITA Toronto FC $7,115,556
2015 Espíndola, FabiánFabián Espíndola  ARG D.C. United $175,000
2015 Maloney, ShaunShaun Maloney  SCO Chicago Fire $1,586,000
2015 Emeghara, InnocentInnocent Emeghara   SUI San Jose Earthquakes $1,040,000
2015 Aristeguieta, FernandoFernando Aristeguieta  VEN Philadelphia Union $350,004
2015 Ramírez, JuanJuan Ramírez  ARG Colorado Rapids $75,000
2015 Rivas, CarlosCarlos Rivas  COL Orlando City $60,000
2015 Beckerman, KyleKyle Beckerman  USA Real Salt Lake $700,000
2015 Plata, JoaoJoao Plata  ECU Real Salt Lake $150,000
2015 Doyle, KevinKevin Doyle  IRL Colorado Rapids $1,170,000
2015 Pirlo, AndreaAndrea Pirlo  ITA New York City FC $2,315,694
2015 dos Santos, GiovaniGiovani dos Santos  MEX LA Galaxy $4,100,008
2015 Melano, LucasLucas Melano  ARG Portland Timbers $1,000,000
2015 Drogba, DidierDidier Drogba  CIV Montreal Impact $n/a
Notes
  • Chart indicates when players signed their Designated Player contract, not necessarily their first year in MLS.
  • Player salaries include compensation from their MLS contract, not including any bonuses or compensation from contracts with individual teams or their affiliates.

[14]

Past and present Designated Players by country[edit]

See also[edit]

References[edit]

  1. ^ a b c Wahl, Grant (November 28, 2011). "Hollywood Ending: If this was indeed David Beckham's final game in MLS, he went out in style, carrying the Galaxy to a championship and affirming the value of star power in America". Sports Illustrated. Retrieved November 25, 2011. In the first four seasons of MLS's Beckham Rule, which allowed clubs to sign up to three designated players outside the salary cap, .... 
  2. ^ a b Lansley, Pete (April 13, 2007). "Becks could be the next American idol". The Telegraph. Retrieved December 1, 2007. 
  3. ^ a b "PlayersUnion". Mlsplayers.org. Retrieved April 25, 2012. 
  4. ^ a b "Beckham hopes to make US history". BBC. January 12, 2007. Retrieved December 1, 2007. 
  5. ^ Goff, Steven (April 26, 2006). "Palencia Has Richest MLS Salary". Washington Post. Retrieved December 1, 2007. 
  6. ^ Mickle, Tripp (November 26, 2007). "Debate highlights MLS salary cap split". Sports Business Journal. Retrieved December 1, 2007. 
  7. ^ a b c Bell, Jack (March 18, 2009). "In M.L.S., Designated Players Do Not Guarantee Great Expectations". New York Times. Retrieved March 18, 2009. 
  8. ^ "Galaxy, Milan, Inter wait on Becks". CNN. February 24, 2009. Retrieved May 1, 2010. 
  9. ^ "Fulham complete Johnson signing". BBC Sport. January 23, 2008. Archived from the original on January 27, 2008. 
  10. ^ Mayers, Joshua (April 1, 2010). "Major League Soccer adds second DP slot, can purchase a third (league release)". The Seattle Times. Retrieved April 2, 2010. 
  11. ^ "2012 MLS Roster Rules". mlssocer.com. 
  12. ^ "Roster Rules and Regulations". Major League Soccer. Retrieved May 11, 2015. 
  13. ^ "2015 MLS Player Salaries" (PDF). 2015 MLS Player Salaries. Major League Soccer Players Union. 
  14. ^ http://www.empireofsoccer.com/nycfcs-payroll-making-29106/

External links[edit]