Designated Player Rule

The Designated Player Rule, nicknamed the Beckham Rule, 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, allowing MLS teams to compete for star players in the international soccer market.

History

The team salary cap was estimated to be around US$1.9 million in 2006^[1], was $2.1 million in 2007, and was raised to $2.3 million for the 2008 season.^[2][3] As part of the 2010 Collective Bargaining Agreement between MLS and the MLS Players' Union, the 2010 salary cap will be $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^[3][4] 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^[5], 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.^[3]

The 2010 changes:^[6]

• 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, 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.

Starting with the 2012 season, the rule will be 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. Under the new rules, no new slots will be added, but international players age 23 and under signed under the Designated Player Rule will be subject to a reduced salary cap number:^[7]

• Ages 21 to 23: $200,000.
• 20 or younger: $150,000.

Background

The rule is informally named after football star David Beckham, in anticipation of MLS teams signing lucrative deals with internationally recognized players of Beckham's caliber.^[8] 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 for up to a $250 million increase in Beckham's total compensation over five years, with a base salary of $6.5 million per year in direct salary. The rest of Beckham's increased earnings would come from Beckham regaining the entirety of his image rights, which Real Madrid had owned fifty percent of, effectively doubling his existing endorsement income, as well as new endorsement deals, a share of jersey sales, bonuses, etc.^[9]

Current Designated Players

Year Signed	Player	Current club	2011 Guaranteed Compensation [10]
2007	Beckham, DavidDavid Beckham	Los Angeles Galaxy	$6,500,000
2007	Ángel, Juan PabloJuan Pablo Ángel	Chivas USA	$1,250,000
2009	de Guzman, JulianJulian de Guzman	Toronto FC	$1,910,746
2010	Donovan, LandonLandon Donovan	Los Angeles Galaxy	$2,300,000
2010	Bošković, BrankoBranko Bošković	D.C. United	$525,367
2010	Henry, ThierryThierry Henry	New York Red Bulls	$5,600,000
2010	Fernández, ÁlvaroÁlvaro Fernández	Seattle Sounders FC	$366,667
2010	Marquez, RafaelRafael Márquez	New York Red Bulls	$4,600,000
2010	Bravo, OmarOmar Bravo	Sporting Kansas City	$170,000
2010	Saborío, ÁlvaroÁlvaro Saborío	Real Salt Lake	$305,625
2010	Montero, FredyFredy Montero	Seattle Sounders FC	$636,000
2011	Hassli, EricEric Hassli	Vancouver Whitecaps FC	$900,000
2011	Ferreira, DavidDavid Ferreira	FC Dallas	$705,000
2011	Mendoza, AndrésAndrés Mendoza	Columbus Crew	$595,000
2011	Castillo, FabiánFabián Castillo	FC Dallas	$42,000
2011	Chará, DiegoDiego Chará	Portland Timbers	$143,758
2011	Frings, TorstenTorsten Frings	Toronto FC	$1,113,662
2011	Koevermans, DannyDanny Koevermans	Toronto FC	$1,413,319
2011	Jarju, MustaphaMustapha Jarju	Vancouver Whitecaps FC	$426,883
2011	Rost, FrankFrank Rost	New York Red Bulls	$545,460
2011	Jéferson	Sporting Kansas City	$484,996
2011	Milton Caraglio	New England Revolution	$54,000
2011	Robbie Keane	Los Angeles Galaxy	$3,417,243

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	Club/s	Average Salary
2007–2010‡†	Emilio, LucianoLuciano Emilio	D.C. United	$516,043
2007–2008	Reyna, ClaudioClaudio Reyna	New York Red Bulls	$1,250,008
2007–2009	Blanco, CuauhtémocCuauhtémoc Blanco	Chicago Fire	$2,759,086
2007	Denílson	FC Dallas	$879,936
2008	Gallardo, MarceloMarcelo Gallardo	D.C. United	$1,874,006
2008–2009, 2010†	López, ClaudioClaudio López	Kansas City Wizards, Colorado Rapids	$373,333
2008–2010‡†	Barros Schelotto, GuillermoGuillermo Barros Schelotto	Columbus Crew	$463,750
2009–2010, 2010	Ljungberg, FreddieFreddie Ljungberg	Seattle Sounders FC, Chicago Fire	$1,314,000
2009–2010	Landín, Luis ÁngelLuis Ángel Landín	Houston Dynamo	$120,000
2010	Nkufo, BlaiseBlaise Nkufo	Seattle Sounders FC	$480,000
2010	Mista	Toronto FC	$987,338
2010	Castillo, NeryNery Castillo	Chicago Fire	$1,788,061
2010	Geovanni	San Jose Earthquakes	$n/a

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.
• Player salaries include compensation from their MLS contract, not including any bonuses or compensation from contracts with individual teams or their affiliates.

Most Designated Players per country

• 5 Colombia: Juan Pablo Ángel, Fabián Castillo, Diego Chará, David Ferreira and Fredy Montero
• 5 Mexico: Cuauhtémoc Blanco, Omar Bravo, Nery Castillo, Luis Ángel Landín, and Rafael Márquez
• 4 Argentina: Guillermo Barros Schelotto, Milton Caraglio, Marcelo Gallardo, and Claudio López
• 4 Brazil: Denílson, Luciano Emilio, Geovanni and Jéferson
• 2 France: Eric Hassli and Thierry Henry
• 2 Germany: Torsten Frings and Frank Rost
• 2 United States: Claudio Reyna and Landon Donovan
• 1 Canada: Julian de Guzmán
• 1 Costa Rica: Álvaro Saborío
• 1 England: David Beckham
• 1 Gambia: Mustapha Jarju
• 1 Ireland: Robbie Keane
• 1 Montenegro: Branko Bošković
• 1 Netherlands: Danny Koevermans
• 1 Peru: Andrés Mendoza
• 1 Spain: Mista
• 1 Sweden: Freddie Ljungberg
• 1 Switzerland: Blaise Nkufo
• 1 Uruguay: Álvaro Fernández

See also

Association football portal

• Allocation (MLS)

References

1. ^ Goff, Steven (2006-04-26). "Palencia Has Richest MLS Salary". Washington Post. http://www.washingtonpost.com/wp-dyn/content/article/2006/04/26/AR2006042602276.html. Retrieved 2007-12-01. 
2. ^ Mickle, Tripp (2007-11-26). "Debate highlights MLS salary cap split". Sports Business Journal. http://www.sportsbusinessjournal.com/index.cfm?fuseaction=article.main&articleId=57143&requestTimeout=900. Retrieved 2007-12-01. 
3. ^ ^{a b c} Bell, Jack (2009-03-18). "In M.L.S., Designated Players Do Not Guarantee Great Expectations". New York Times. http://www.nytimes.com/2009/03/18/sports/soccer/18soccer.html?ref=soccer. Retrieved 2009-03-18. 
4. ^ "Galaxy, Milan, Inter wait on Becks". CNN. 2009-02-24. http://sportsillustrated.cnn.com/2009/writers/soccer_america/02/24/aeg.beckham/. Retrieved 2010-05-01. 
5. ^ "Fulham complete Johnson signing". BBC Sport. 2008-01-23. Archived from the original on 2008-01-27. http://web.archive.org/web/20080127164821/http://news.bbc.co.uk/sport2/hi/football/teams/f/fulham/7202841.stm. 
6. ^ Mayers, Joshua (April 1, 2010). "Major League Soccer adds second DP slot, can purchase a third (league release)". The Seattle Times. http://seattletimes.nwsource.com/html/soundersfcblog/2011498898_major_league_soccer_adds_secon.html#continue. Retrieved April 2, 2010. 
7. ^ Associated Press (August 16, 2011). "MLS alters designated player rule". ESPN.com. http://espn.go.com/sports/soccer/news/_/id/6867113/mls-changes-rule-bring-more-young-international-players. Retrieved August 17, 2011. 
8. ^ Lansley, Pete (2007-04-13). "Becks could be the next American idol". The Telegraph. http://www.telegraphindia.com/1060413/asp/sports/story_6093255.asp. Retrieved 2007-12-01. 
9. ^ "Beckham hopes to make US history". BBC. 2007-01-12. http://news.bbc.co.uk/sport2/hi/football/6256125.stm. Retrieved 2007-12-01. 
10. ^ "2011 MLS Player Salaries". 2011 MLS Player Salaries. Major League Soccer Players Union. http://www.mlsplayers.org/files/May%201,%202011%20Salary%20Information%20-%20By%20Club.pdf. 

External links

• Designated Player Rule passed