Football Transfers in Mexico: How to Do a Deal

Introduction

While the laws of the game are the same and well known world wide, when it comes to countries, each one has similarities but more importantly differences regarding legal documents, transfers, tax laws, etc. In this week’s newsletter we will be diving into the football market in Mexico. We will take a look at their leagues, the structure, closing a deal, the systems, the culture, and more.

The Main Differences

The Mexican market is a pretty unique one, being next to a country like the United States has influenced the way the league functions and this like everything in life comes with pros and cons. Before diving into specifics, let’s take a look at the structure and market. In 2020 the league made the polemic decision to eliminate promotion and relegation and instead have two leagues. The first tier is the Liga MX and the second tier is Liga Expansion. Both leagues have two short seasons per year known as “apertura” from June to December and the “clausura” from January to May rather than the European model of a long year season. In addition to this, the leagues are not purely point based, there are 17 matches and at the end the best six teams of the table go through to the play-off rounds, the spot seven to tenth have a play-in to see which will be the remaining two to go through to the play-offs and from there the tournament turns into knockout rounds similar to the Champions League or World Cup.

One thing to point out about the Mexican leagues is that multi ownership is permitted so you will see more than one club in the same league being owned by the same group. For example, Grupo Orlegi own Atlas and Santos, Grupo Pachuca own Pachuca and Leon. There’s also media companies that own clubs such as Televisa (Club America) and TV Azteca (Mazatlan & Puebla).

While there are many unpopular sporting decisions within the league, the commercial side of things is always booming. Liga MX more specifically is an extremely commercialised league and one that generates a bigger amount of revenue than even some European leagues through commercial deals. A big reason for this is the neighbouring country, the USA. Liga MX unlike many other leagues around the world has two main markets, Mexico of course but also the United States which is home to more than 40 million Mexicans giving the league a lot of power to negotiate commercial deals between brands in both countries as well as TV deals and more especially considering that even

to this day it is the most watched football league in the United States outdoing elite leagues such as Premier League and La Liga.

The Transfer System Structure

Mexico has two transfer windows per year. The winter transfer window which is from January to February and a longer summer window which begins in mid June and ends beginning of September. Like in the rest of the world, during these windows clubs will register new players but unlike many other leagues in Mexico it is always for a new season and never the middle of the season because of how the league is structured as previously mentioned.

Another crucial piece of information to know is that the Mexican leagues allow seven players (previously eight) on the field to be foreigners and nine in total. This has been a big topic for debate within the league because most of the clubs in the league will have the seven spots filled out giving way to only four Mexican players in the starting squad.

A common practice amongst agents is to bring South American players to Liga MX. Likewise, as in the Premier League, it is common for the Mexican market to buy, sell and loan players mostly internally. More often than not, Liga MX clubs are the ones paying the asking price amongst each other. This is important for agents to consider because if their clients play in Liga MX there are many possibilities for movement between the clubs internally.

Many of these deals are based on strong relationships with sporting directors of the clubs and reputation on past transfers. Furthermore, agents working with South American players will notice that Mexico is one of the best markets for them because of the high demand for such players and because of how lucrative the deals are in the first tier league, Liga MX.

Financial and Payment Details

As previously mentioned, Liga MX to be specific is a very lucrative league and the transfer fees as well as salaries are well above majority of leagues in The Americas and some European. The leagues average salary is $384,000 (6,500,000MX) US dollars per year with the best paid players earning up to five million (85,000,000MX) US dollars. While at first glance this doesn’t seem an extremely high average one must consider that the national currency in Mexico is the Mexican peso which makes the average salary extremely high and we still have to consider performance bonuses such as wins, goals, clean sheets, etc.

Due to the financial conditions of Liga MX it has become the go to league for many players who don’t make it to European football. Just like the players who are looking for a strong financial position look at Liga MX as an option, agents will also find that the transfer fees within the league are quite high compared to the rest of the continent. It is not uncommon to see fees between Mexican clubs to be eight, nine, ten, even 12 million dollars for one player which leads to high agent fees as well. It is paramount to point out that while the amounts might be shown in USD, after 2020 the league enforced the clubs to deal with players contracts in Mexican pesos.

Now that we have touched upon salaries and fees we have to touch upon the tax rates. Indifferently of the profession Mexico has tax rates based on a person’s earnings, there is not a specific tax rate for footballers. That being said, because players salaries are usually high in Liga MX, players are adhered to the highest tax rate which is 31.92% if they earn one million pesos or more monthly. Depending on how this money is used and allocated there can be deductibles and tax write-offs. Extremely important for agents to know that if their client is in Mexico with a work Visa which is the case for foreign players, there are additional taxes to be paid and it is the agents job to look into which additional taxes apply for their client. This also includes foreigners with a permanent permit such as the FM2 document (equivalent to a green card).

VISA Requirements

Unless the player is born in Mexico or receives the citizenship through family ties or length of stay, every foreigner who is making a move to the country and Liga MX will have to get a work permit (Visa) to be employed in the country long term. From the several types of Visa Mexico offers, perhaps the most important for an agent to be familiar with as simple as it sounds is the “visa de trabajo” since their clients will be performing as employees even as footballers. The agent needs to coordinate the help form the club to acquire de work visa for their client and also verify with the INM (Instituto Nacional de Migración).

In the past there has been some confusion as to where the player can apply for the Visa with more liberty to do it within the country or neighbouring countries in the past. To make this very important point clear, the players have to apply and go through the process of obtaining their visas from the Mexican embassy in their home country. This is something that was recently changed.

Additional Points to Note

Mexico is country a with 130 million people without counting the 40+ million living in the United States. Football is the biggest sport in the country and the Liga MX is highly followed with lots of fans from different clubs and cities. While there have been unpopular decision regarding the league, there is still a high demand for tickets, viewership, jerseys, and more.

An interesting note is that because of the demand for Mexican football in the USA, Mexican clubs play friendly games every single year in US territory as well as the Mexican national team which is one of the few if not the only national team worldwide that more often than not plays in the USA rather than in Mexico.

von Dr. Erkut Sogut und Luis Kircher

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