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How sell-on clauses work and the 15 transfers Liverpool can benefit from

Liverpool received a seven-figure windfall when former striker Taiwo Awoniyi joined Nottingham Forest, benefiting from the inclusion of a sell-on clause.

Transfers are rarely straightforward.

While the entire fee may be announced by either club, or through the media, that will not typically be paid in full as is perhaps expected – instead, it would be paid over a series of annual instalments.

Furthermore, there could be a number of add-ons involved in a deal, with payments made when a player reaches a certain number of appearances, scores a certain number of goals or wins a specific trophy or award.

Then there come additional clauses, which effectively serve to protect the selling club in the event the departing player increases in value exponentially in the years following their exit.

A buy-back clause is relatively straightforward, and has been documented with deals for the likes of Rhian Brewster and Jordon Ibe in recent years.

BURNLEY, ENGLAND - Tuesday, December 29, 2020: Sheffield United's Rhian Brewster during the FA Premier League match between Burnley FC and Sheffield United FC at Turf Moor. Burnley won 1-0. (Pic by David Rawcliffe/Propaganda)

In short, a club could buy the player back for a set fee at any point over an agreed period of time.

Sell-on clauses, however, are slightly more nuanced, and when assessing Liverpool’s finances with regards the transfer market it is always worth acknowledging their presence.

That is certainly the case with Awoniyi, who never played a minute for the Reds during his six years with the club, but has now twice landed them a profit with two moves in two years.

Twelve months on from a £6.5 million switch to Union Berlin, the Nigerian has now arrived at Forest for a club-record £17.5 million, with Liverpool receiving 10 percent of that fee due to a sell-on clause.

 

So how do sell-on clauses work?

LIVERPOOL, ENGLAND - Sunday, January 9, 2022: Liverpool's Julian Ward during the FA Cup 3rd Round match between Liverpool FC and Shrewsbury Town FC at Anfield. (Pic by David Rawcliffe/Propaganda)

In basic terms, if a sell-on clause is inserted into a deal for a player, the selling club would then be owed the agreed percentage of any transfer fee if the player moves again.

The clause could be agreed to expire after a certain period of time – for example, the length of the player’s first contract with his new club – after which it will no longer be in effect.

With Awoniyi, by including a 10 percent sell-on clause during the sale to Union, they guaranteed themselves £1.75 million from the £17.5 million the German club received from Forest.

Clubs can also negotiate a sell-on clause for a percentage of the profit made by a player’s next move.

That was the case with Darwin Nunez‘s switch to Liverpool, with former club Almeria owed 20 percent of any profit made by Benfica – the Spanish club stands to land up to £13 million.

 

Which Liverpool deals have included sell-on clauses?

2ECF3YJ Dragao Stadium, Porto, Portugal. 13th Feb, 2021. Portuguese Championship Football, FC Porto versus Boa Vista; Marko Grujic of FC Porto chases the through ball Credit: Action Plus Sports/Alamy Live News

While the details of every transfer are not widely reported, Liverpool agreed sell-on clauses for the following players:

The club have either already benefited from or seen terms expire on sell-on clauses for Ibe, Sergi Canos, Brad Smith, Tiago Ilori, Bobby Duncan and Mario Balotelli.

 

How else could Liverpool benefit?

BRADFORD, ENGLAND - Saturday, July 13, 2019: Liverpool's Rhian Brewster (L) celebrates scoring the third goal with team-mate Harry Wilson during a pre-season friendly match between Bradford City AFC and Liverpool FC at Valley Parade. (Pic by David Rawcliffe/Propaganda)

Another way Liverpool could look to take advantage of the sell-on clauses agreed with various clubs is in the rare instance of a bid to re-sign a player.

For example, if Tottenham were negotiating a deal worth £25 million for Harry Wilson in the future, Liverpool could look to sign him for 15 percent less at £21.25 million.

This would be due to Fulham owing Liverpool 15 percent of any sale regardless.

However, this remains highly unlikely – though the club will certainly monitor the progress of certain players with such deals, including Wilson himself.


* A version of this article was first published on July 7, 2021.

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