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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.

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

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 and $387,500 in 2014. 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

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

Year signed Player Nation Current club 2014 Guaranteed compensation [13]
2010 Landon Donovan  USA LA Galaxy $4,583,333
2010 Thierry Henry  FRA New York Red Bulls $4,350,000
2010 Álvaro Saborío  CRC Real Salt Lake $453,333
2011 Robbie Keane  IRE LA Galaxy $4,333,333
2012 Javier Morales  ARG Real Salt Lake $300,000
2012 Oswaldo Minda  ECU Chivas USA $168,750
2012 Marco Di Vaio  ITA Montreal Impact $2,600,000
2012 Oscar Boniek García  HND Houston Dynamo $258,742
2012 Jerry Bengtson  HND New England Revolution $150,840
2012 Tim Cahill  AUS New York Red Bulls $3,625,000
2012 Federico Higuaín  ARG Columbus Crew $744,000
2013 Claudio Bieler  ARG Sporting Kansas City $225,000
2013 Diego Valeri  ARG Portland Timbers $500,000
2013 Chris Wondolowski  USA San Jose Earthquakes $650,000
2013 Obafemi Martins  NGR Seattle Sounders FC $1,753,333
2014 Matías Laba  ARG Vancouver Whitecaps FC $300,000
2013 Juan Luis Anangonó  ECU Chicago Fire $175,000
2013 Clint Dempsey  USA Seattle Sounders FC $6,695,189
2013 Alexander López  HND Houston Dynamo $110,000
2013 Gabriel Torres  PAN Colorado Rapids $262,500
2013 Mauro Diaz  ARG FC Dallas $411,000
2013 Omar Gonzalez  USA LA Galaxy $1,250,000
2013 Erick Torres  MEX Chivas USA $152,004
2014 Osvaldo Alonso  CUB Seattle Sounders FC $400,000
2014 Gilberto  BRA Toronto FC $1,205,000
2014 Jermain Defoe  ENG Toronto FC $6,180,000
2014 Michael Bradley  USA Toronto FC $6,500,000
2014 Cristian Maidana  ARG Philadelphia Union $198,750
2014 Maurice Edu  USA Philadelphia Union $650,000
2014 Andrés Escobar  COL FC Dallas $647,000
2014 David Texeira  URU FC Dallas $338,000
2014 Pedro Morales  CHI Vancouver Whitecaps FC $1,410,900
2014 Eddie Johnson  USA D.C. United $613,333
2014 David Villa  ESP New York City FC $n/a
2014 Fanendo Adi  NGR Portland Timbers $593,300
2014 Liam Ridgewell  ENG Portland Timbers $1,200,000
2014 Kaká  BRA Orlando City $7,167,500
2014 Ignacio Piatti  ARG Montreal Impact $387,500
2014 Matt Besler  USA Sporting Kansas City $633,250
2014 Graham Zusi  USA Sporting Kansas City $631,389
2014 DaMarcus Beasley  USA Houston Dynamo $779,167
2014 Frank Lampard  ENG New York City FC $n/a
2014 Matías Pérez García  ARG San Jose Earthquakes $216,000
2014 Sebastián Jaime  ARG Real Salt Lake $216,000
2014 Jermaine Jones  USA New England Revolution $3,252,500
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.

Past Designated Players

Year/s Played Player Nation Club/s Average Salary
2002–2012‡, 2012, 2013–present† Shalrie Joseph  GRN New England Revolution, Chivas USA, Seattle Sounders FC $599,333
2007–2012 David Beckham  ENG Los Angeles Galaxy $4,000,000
2007–2010, 2011, 2011–2012† Juan Pablo Ángel  COL New York Red Bulls, Los Angeles Galaxy, Chivas USA $1,630,700
2007–2010‡† Luciano Emilio  BRA D.C. United $516,043
2007–2008 Claudio Reyna  USA New York Red Bulls $1,250,008
2007–2009 Cuauhtémoc Blanco  MEX Chicago Fire $2,759,086
2007 Denílson  BRA FC Dallas $879,936
2007–2010‡† Guillermo Barros Schelotto  ARG Columbus Crew $463,750
2008 Marcelo Gallardo  ARG D.C. United $1,874,006
2008–2009, 2010† Claudio López  ARG Kansas City Wizards, Colorado Rapids $373,333
2009–2012, 2012 Julian de Guzman  CAN Toronto FC, FC Dallas $1,910,746
2009–2010, 2010 Freddie Ljungberg  SWE Seattle Sounders FC, Chicago Fire $1,314,000
2009–2010 Luis Ángel Landín  MEX Houston Dynamo $120,000
2009–2012‡ Fredy Montero  COL Seattle Sounders FC $706,000
2009-2013‡ David Ferreira  COL FC Dallas $548,000
2010 Blaise Nkufo   SWI Seattle Sounders FC $480,000
2010–2012† Branko Bošković  MNE D.C. United $528,978
2010–2012 Rafael Márquez  MEX New York Red Bulls $4,600,000
2010 Mista  ESP Toronto FC $987,338
2010 Nery Castillo  MEX Chicago Fire $1,788,061
2010–2011‡ Andrés Mendoza  PER Columbus Crew $417,917
2010 Geovanni  BRA San Jose Earthquakes $n/a
2010-2012, 2012-2013 Álvaro Fernández  URU Seattle Sounders FC, Chicago Fire $350,000
2011 Omar Bravo  MEX Sporting Kansas City $170,000
2011 Mustapha Jarju  GAM Vancouver Whitecaps FC $426,883
2011 Frank Rost  GER New York Red Bulls $545,460
2011 Jéferson  BRA Sporting Kansas City $484,996
2011 Milton Caraglio  ARG New England Revolution $54,000
2011–2012‡ Freddy Adu  USA Philadelphia Union $519,000
2011–2012 Torsten Frings  GER Toronto FC $2,413,667
2011–present† Fabián Castillo  COL FC Dallas $66,250
2011–present† Diego Chará  COL Portland Timbers $202,501
2011–2013‡ Dwayne De Rosario  CAN D.C. United $645,333
2011–2012, 2012, 2013† Eric Hassli  FRA Vancouver Whitecaps FC, Toronto FC, FC Dallas $650,759
2011–2013 Danny Koevermans  NED Toronto FC $1,546,655
2012 Federico Puppo  URU Chicago Fire $100,000
2012 Kris Boyd  SCO Portland Timbers $1,515,000
2012 Hamdi Salihi  ALB D.C. United $487,460
2012 Barry Robson  SCO Vancouver Whitecaps FC $596,500
2012–2013 Sherjill MacDonald  NED Chicago Fire $527,125
2012 Christian Tiffert  GER Seattle Sounders FC $625,000
2012-2014 Kenny Miller  SCO Vancouver Whitecaps FC $1,032,496
2013 Rafael  BRA D.C. United $284,625
2013 Arévalo Rios  URU Chicago Fire $768,000
2013 Kléberson  BRA Philadelphia Union $495,000
2013-2014 Hernán Bernardello  ARG Montreal Impact $250,008
Notes
  • ‡ – indicates players who originally signed with MLS at a salary lower than a Designated Player level but later had their salary increased to a Designated Player level.
  • † – indicates players who still continued to play in MLS but had their contracts negotiated below a Designated Player level.

Past and present Designated Players by country

See also

References

  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. {{cite news}}: Italic or bold markup not allowed in: |publisher= (help)
  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. {{cite news}}: Italic or bold markup not allowed in: |publisher= (help)
  5. ^ Goff, Steven (April 26, 2006). "Palencia Has Richest MLS Salary". Washington Post. Retrieved December 1, 2007. {{cite news}}: Italic or bold markup not allowed in: |publisher= (help)
  6. ^ Mickle, Tripp (November 26, 2007). "Debate highlights MLS salary cap split". Sports Business Journal. Retrieved December 1, 2007. {{cite news}}: Italic or bold markup not allowed in: |publisher= (help)
  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. {{cite news}}: Italic or bold markup not allowed in: |publisher= (help)
  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 July 5, 2014.
  13. ^ "2014 MLS Player Salaries" (PDF). 2014 MLS Player Salaries. Major League Soccer Players Union.
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