Modern football transfer agreements rarely involve just a simple fee. Contracts often contain several clauses, with sell-on clauses being among the most common, particularly in deals involving younger players.
On this page, we will explain what a sell-on clause is, why clubs use them, and how they work in practice. We will also look at notable real-world examples where sell-on clauses have generated significant revenue for former clubs.
Sell-On Clauses – The Basics
A sell-on clause is an agreement inserted into a transfer contract that entitles the selling club to receive a percentage of a future transfer fee if the player is sold again. In simple terms, Club A sells a player to Club B. As part of the deal, Club A negotiates a sell-on clause worth, for example, 20%. If Club B later sells that player to Club C, Club A receives 20% of the agreed fee.
This arrangement is popular because if the player thrives, the selling club can potentially receive a big additional payout years later, provided the player moves clubs again. For the buying club, agreeing to a sell-on clause can help reduce the upfront cost of a deal, which can help short-term finances.
Percentage of Profit vs Percentage of Total Fee
Not all sell-on clauses work in the same way. There are two main structures:
Percentage of Total Transfer Fee
The original club receives a percentage of the entire future sale price. If the clause is 20% and the player is sold for £50m, the former club receives £10m.
Percentage of Profit
The original club receives a percentage of the profit made on the future sale. If Club B bought the player for £10m and later sells him for £50m, the profit is £40m. A 20% sell-on clause would then generate £8m.
Both are common and percentages can vary, although it is normal to see them within the 10% to 25% range. Percentage of profit deals tend to come with a larger percentage though as they are less valuable than a total transfer fee clause.
High-Profile Examples of Sell-On Clauses
Sell-on clauses have generated millions for former clubs across Europe. Some notable examples include:
| Player | Move | Sell-On Clause Value | Clause Paid To |
|---|---|---|---|
| Moises Caicedo | Brighton to Chelsea | £23m | Independiente del Valle |
| Ousmane Dembele | Dortmund to Barcelona | £22m | Rennes |
| Tino Livramento | Southampton to Newcastle | £17.5m | Chelsea |
| Hugo Ekitike | Frankfurt to Liverpool | £15m | PSG |
| Antoine Semenyo | Bournemouth to Man City | £11m | Bristol City |
| Kevin de Bruyne | Wolfsburg to Man City | £10m | Chelsea |
| Harry Maguire | Leicester to Man Utd | £9m | Hull |
| Wesley Fofana | Leicester to Chelsea | £9m | Saint-Etienne |
Exact figures can vary as transfer fees often include performance-related bonuses. Note that clubs only receive the sell-on fee for one transfer, not all future transfers. If Hugo Ekitike were to move clubs again, for example, PSG would not be owed anything.
Do Sell-On Clauses Affect Transfer Strategy?
Buying clubs must consider potential future deductions before agreeing to sell a player. If a club owes 20% of any future fee to another side, their net profit shrinks. This can impact asking prices and overall willingness to sell. Across 2019/20, Crystal Palace demanded an inflated £80m for Wilfried Zaha because there was a 25% sell-on clause from any profit.
In some cases, clubs attempt to buy out sell-on clauses believing that a player’s valuation will rise in future, and they want to be able to cash in more if/when they depart. This involves paying a negotiated sum to the original club to remove the percentage obligation.
A notable example involves Gareth Bale. Southampton originally agreed a 15-25% sell-on clause when he joined Tottenham back in 2007. However, due to financial pressures, they later agreed to remove it for around £3m. So, when Bale joined Real Madrid in 2013, Southampton missed out on a much larger payout.
Most Sell-On Clauses Never Pay Out Big
While there are famous success stories, many sell-on clauses generate little or no money. This can happen when a player ends up retiring at their next club, flops and is sold for a very low fee, or leaves the club for free when their contract expires. Other players may move for a decent price, but less than the original sum paid, which makes any profit-based sell-on clause entirely worthless.
Clubs accept this risk because the upside can be substantial. Even one successful clause can fund academy upgrades, stadium improvements or future recruitment. It is particularly important for lower league clubs when a rising star of theirs is poached by a bigger club.
Huge Impact on Lower League Clubs
Sell-on clauses can be transformative for lower-tier teams and this has proven the case for many years. In 2016, then League One Barnsley pocketed £7.1m when Everton sold John Stones to Man City for £47.5m. Similarly, League Two Exeter enjoyed a £4m boost when Brentford sold their former striker, Ollie Watkins for £28m in 2020. This is a huge sum for a club in the fourth tier to receive.
These handsome financial boosts are not just limited to English clubs, to be clear. Amateur Irish side Ringmahon Rangers earned around €3m when Caoimhín Kelleher moved to Brentford. Elsewhere, Swedish third-tier club, Västerås SK, managed to stave off bankruptcy when Victor Nilsson Lindelof joined Man Utd, courtesy of a 20% sell-on clause.
Sell-On Clause vs Solidarity Payments
Sell-on clauses are separate from FIFA solidarity payments. Solidarity mechanisms distribute a small percentage of transfer fees to clubs involved in a player’s development between ages 12 and 23 (a maximum of 5%). These are entirely separate from privately negotiated sell-on clauses and are enforced by FIFA regulations.
When Gareth Bale moved to Real Madrid, although there was no sell-on fee, the Saints did end up receiving a fee in the region of £1m-£2m. Financially larger examples include Neymar’s move to PSG, which saw Brazilian club Santos given around €9m (4% of the fee). These payments can go to several teams if a player spent time at multiple clubs at youth level.
The Loan Loophole?
Sometimes clubs try to reduce sell-on obligations by structuring a transfer as a loan with an option/obligation to buy. This is because loan fees are often excluded from sell-on calculations, and as such, the selling club ends up receiving more money, at no extra cost to the buying club.
In 2019, this is what happened when Giovani Lo Celso moved from Real Betis to Tottenham. The Londoners paid €16m for an initial season-long loan and €32m to make it permanent. PSG, who held a sell-on clause, claimed Betis acted in bad faith and demanded the sell-on fee cover the combined €48m cost.
The case went to the Court of Arbitration for Sport who ruled that the loan fee paid by Tottenham should not be included in the sell-on calculation, and that Betis did not act in bad faith. Their decision means that loans can be used to reduce sell-on clause payments, provided that any loan agreement is of reasonable value and not a blatant attempt to beat the system.