Player agent: 'What are we getting from FIBA for paying them every year?' / News - Basketnews.com

Besides a usual flurry of off-season moves, the European club basketball saw the creation of the Euroleague Framework Agreement (EFA), the first collective agreement between the EuroLeague and the ELPA, the Euroleague Players Association. Such an agreement will undoubtedly improve player conditions, and teams will provide more clarity regarding contract details.

In addition, FIBA is implementing new rules for the FIBA licensed agents, which will go into effect on January 1, 2022. To better understand these changes and what they might mean for the entire international basketball industry, we spoke to Kevin Tarca, the founder of Kreation Talent Agency, an NBPA and FIBA certified agency.

Kevin, the EFA has only been approved recently but, so far, what's your general opinion about it? Do you think this will be the first step in the right direction for European basketball? - BasketNews asked Kevin Tarca during a video call.

Generally speaking, taking any steps towards a more organized and transparent industry is a good thing. It has been difficult to regulate the business of professional basketball in Europe for many years. Creating a framework that attempts to regulate the relationships between the EuroLeague, players, clubs, and agents is a step in the right direction. There are a lot of things in the EFA that were much needed. From establishing a minimum salary scale to holding clubs accountable for late payments to players' working and travel conditions and many things in between. Of course, when you create legislation or agreements as big as this, there will always be room for improvement, especially in the early stages. There are a few things that I believe will negatively impact agents. But as mentioned, it is a work in progress. So ultimately, yes, it's definitely a step in the right direction.

Some agents, including Misko Raznatovic of BeoBasket, complained that Euroleague and ELPA didn't involve agents in the conversation leading to the agreement. Do you feel like Euroleague and ELPA could have done more to keep agents in the loop?

Given that agents are one of the major stakeholders in the business of international basketball, of course, I think it would have been beneficial for both the EuroLeague and ELPA to hear as many agent voices as possible. Regarding Misko, he has established himself and BeoBasket as one of the most powerful figures in the business, facilitating the record number of deals done in the EuroLeague. So I can understand why it's important to him that agent voices are heard. Personally, I have been proactive over the past several months in educating myself as much as possible on the EFA before it was published. I appreciate the time that Bostjan Nachbar (managing director of ELPA) has allowed me to pick his brain about the entire topic. Although I didn't necessarily have a voice in creating the agreement's contents, I believe Bostjan and the ELPA staff had intentions to utilize the feedback from all parties involved.

Coming from the USA, do you feel this agreement was inspired by the CBA between the NBA and the NBPA?

Yes, I think the general idea of the EFA was inspired by the CBA. But it's important to note that the business models are not exactly the same. The nature of the way the NBA operates and the way the Euroleague operates are very different. Even though the NBA is played throughout many different states, the rules are followed entirely under one rule book. With international basketball, each national federation has its own rules. Each domestic league has its own rules. And the international competitions have their own rules. Not to mention the legal issues that come into play between different countries. But generally speaking, I think it's a great inspiration to draw from. The NBPA does a great job of supporting NBA-licensed agents. Even though the NBPA is the union for the players, they understand agents' important role in the business. So if that is what ELPA is striving for, I support it.

One of the main changes brought by the EFA is that players will have to pay the agents' fee and not the teams. Do you think that is a positive change?

That is one part of the EFA that I think will hurt the agents and possibly hurt the business as a whole. As mentioned previously, many people undervalue the importance of the role that agents play. The change to structure agent commissions coming entirely from players now will for sure hurts agents. With this change and the recent FIBA rule changes, the byproduct will specifically hurt American agents.

With the previous rules in place, the team had to pay the agent's fees. So if a player signs a €500,000 deal, the team had to pay €550,000 because they also needed to pay the agent's fee (€50,000). So in this case, the player was not invested financially. Meaning they didn't have to pay any portion of their salary towards the services of receiving a contract.

Moving forward, by shifting the responsibility to the player, theoretically, there could be a positive attribute. After all, that is the way agent fees are paid in the NBA, which seems to work out fine. But we have to remember that NBA and EuroLeague are two very different systems. The contracts are much different in size. And in length. And many other variables. Back to the previous example, with the new system in place, the team pays the player €500,000, but the player has to pay the agent €50,000, so he is making €450,000.

In my mind, this creates a handful of problems. First, you have almost the opposite problem because the teams are the ones who are not invested financially. If teams don't have to pay anything for the service of procuring a player, my main concern is that this will lead to more poaching of clients. Why? Because without a rule in place to hold other agents accountable for stealing clients (thanks FIBA), what is stopping them from trying to convince players to switch agencies? It's been an issue in the past, but now it will become even more of an issue.

There's also another main issue: I believe this change in payment structure will also lead to the dilution of the agents' commission percentage that players will want to pay. Back to price cuts. If there is no consequence for agents stealing players, then here's what might happen. Maybe there is a local agent who knows Team A wants a specific player. They can then approach that player (with no consequences from what was previously an illegal action) and tell that player they can get a contract with Team A, but instead of paying a 10% agent fee, they only need to pay them a 5% agent fee. Hence my concern for diluted agent fees.

This is also a reason that teams might not have an issue with the poaching of players. If they are delivered the player they want, then what's stopping them from looking the other way? Or worse, aiding in the process? And lastly, agents will need to negotiate a higher salary with teams (which is tough enough as it is), in order to make the same amount of money as before. In other words, if the player wants to make the same amount as they expect to make in the situation that we pictured before, the agent will need to factor in a 10% increase in salary and get the team to agree.

Since the birth of the Euroleague Players Association, do you feel like the conditions of the players around the European market have improved? And, on a personal level, did you feel like you received the right level of collaboration from the ELPA?

I think it's way too early to judge the overall change in the condition of the players in the European market. The fact that the ELPA is conducting annual team meetings with each EuroLeague team and hosting two additional in-season educational sessions for players, you'd like to think that the momentum is shifting positively. I think the existence of this new landmark agreement is the biggest game-changer. Because now people can be held accountable (teams and leagues), if all goes well, conditions for players will improve. But only time will tell. Personally, as mentioned before, I feel good about my relationship with ELPA and the access I've had to learn from Boki and their staff. I hope they continue to involve agents as we move forward to make sure we have a voice at the table.

It could be time for change as FIBA is now set to change its agent licensing rules. Some of these changes haven't been disclosed yet, but speaking with a couple of other agents, they didn't appear particularly happy about this whole situation. Some of them believed that the habit of 'stealing' clients from other agents would only become more frequent. Do you share the same reservations?

I don't think FIBA made much of an effort at all to consider the voice of agents. And that is very disappointing. I have never had much success communicating with the office, and quite frankly, I am starting to question why I am paying 1,000 Swiss francs every year to this organization. I don't think it's asking much to simply be heard.

Regarding the rule changes, we were notified by FIBA that the Central Board already approved the rules, and they go into effect starting January 1, 2022. So here is my first issue. Not a single agent (at least that I know of) was aware of these amendments, which is a big problem. You would think wording from FIBA like "SUBSTANTIAL AMENDMENTS" and "important impact" would mean that all stakeholders had a say in this, right? One would think that agents, whom these rules allegedly govern, were the main participants and voice during these conversations, right? Unfortunately, not. I think it's very unprofessional and a bit disrespectful for FIBA to announce such important changes and willingly admit that not a single agent was involved.

There are a handful of changes, but I'll just go over a few. The first change is that the representation of a player by more than one FIBA-licensed agent is no longer a disciplinary offense. Now I don't see a huge issue here with the first part, simply because this has been happening already. One agent would be on the contract, and another would receive 50% commission due to the partnership. The main issue here comes with non-exclusivity. How will this be regulated? Will the player need to identify which markets each non-exclusive agent covers? How is that going to work? I imagine there will be no specifics on this regulation, which means - complete chaos. If that's the case, is it okay for a player to sign a contract with five agents, all non-exclusive, and then whoever brings that player a deal first wins? That's not necessarily the path that will create order or transparency, in my opinion.

The second change is that a player or agent can terminate the agent contract at any time with a thirty (30) day notice. Now, this is very silly. What is the point of having two-year contracts? I'll answer that. There is no point. To reiterate my confusion, I'll share with you the direct lines from the new rule book: Clause #320 states that the agent contract shall not exceed a period of two years. Then the very next sentence states that anyone can get out of it if they terminate, they simply need to give 30 days of notice.

The third change is a stricter conflict of interest rule for all FIBA licensed agents. Agents will not be allowed to represent the club in case he/she represents a player or coach from the same club. I think this one just came from glancing over at the NBA and thinking it would be good to have the same rule overseas? I don't necessarily agree with the rule in general, although in some cases, I can see why representing multiple clients within the same organization could potentially lead to a conflict of interest. But I also believe there are situations where it is mutually beneficial to all parties involved for an agent to represent multiple parties from the same organization.

The fourth change is the obligation for national Federations and clubs, in the framework of a player's international transfer, to provide the correct name of the player's agent(s) to FIBA. I'll throw in a positive one just to keep the conversation flowing. I think this should be another positive layer of accountability to make sure the name of the agent matches up with an offer from another country. In other words, if one agent is representing a player in Italy, and they bring an offer to the table from Spain, this should guarantee that nothing fishy happens during the transfer (for example, a local agent from Spain claiming to bring the contract to the table).

Finally, I am very disappointed to see that FIBA omitted a very important clause regarding the duties of agents. Section E of the previous regulations stated that an agent must "never approach a player who is under contract with another agent so as to persuade him to break his contract or not to adhere to the rights and duties contained in that contract." That line was completely removed. And to my knowledge, it wasn't moved to another section of the document. And it was not discussed using different wording. That is very problematic for the future of this industry. That opens the door to an even wilder "wild, wild, west." Not only did FIBA update these regulations without giving agents an opportunity to voice their opinions, but one might ask, what exactly is it that we are getting in return for paying them every year?

Based on your experience, what are the main issues you deal with when negotiating with teams and their executives?

For me, a lot of times, it comes down to trust issues. Everyone always has an agenda, and money is powerful overseas. Agents don't have to worry about these types of things here in the States because most of the information we need is public information. And there is never too much discrepancy when negotiating contracts. Team salary caps and financials are publicly available and easily accessible to every NBPA certified agent. If I had access to every European team's salary cap, it would be a game-changer. I would understand the make-up of the roster. Which players are making how much? How many years are left in specific positions? And on and on… So without all that information, it gets really shady.

One of the bad habits of European teams is being late with payments or not paying salaries at all due to some circumstances. Have you ever experienced something like that as an agent? And do you feel like FIBA does enough to protect the players in these situations?

Yes, I have. I don't think I know a single agent who has not experienced that in some capacity (either late agent fees or late player salaries). I know FIBA BAT has gotten more efficient over the years. They have improved from where they were ten years ago. But there seem to be more disputes than there should be every year.

What is the main suggestion you'd give to a player who's about to experience the European market for the first time?

I don't claim to know what's best for every person, but I'm more than happy to offer some insight based on both my personal and my clients' experiences. Since this is a nice opportunity for exposure on a respected platform, I'll take advantage and share three suggestions:

#1 – Be Humble. I don't care how good of a college career you had. Most of the professional basketball world doesn't necessarily care either. Because at the end of the day, that's in the past. And you need to realize there are many other attributes that go into your success as a pro outside of putting the ball in the basket. Even if you scored a lot of points in college. Even if you came from a high major. Even if you had access to the best facilities 24/7. Even if you were a celebrity on campus. Even if you're on draft boards! Even if you scored 30 on an NBA player in a summer league (that one is the worst)… Be humble. There's a difference between being confident and humble… and being confident and a jerk.

#2 – Educate Yourself. Understand that the world of professional basketball is widespread and difficult to keep up with. There are almost 200 countries in this wonderful world of ours. And almost every single country has some sort of professional league. Many of them have multiple pro leagues. And every single market is different. There are different league rules. Different import rules. Different salary expectations. Different coaching styles. Different cultural norms, etc. Scoring 15 points per game in the American East conference does not translate the same to every league overseas. Suppose you averaged 8 points per game in Spain LEB Gold. In that case, that is very different than averaging 8 points per game in Italy A2, which is very different than averaging 8 points per game in the Basketball Champions League, which is very different than averaging 8 points per game in the Chinese CBA.

#3 – Understand This is A Business. Being a professional basketball player is not a hobby. I've seen way too many aspiring pros hurt their chances for an opportunity at the next level because they failed to realize that this is a grown man's job. Like a real job. This is not something that you can kinda-sorta like. This is something you have to love. You have to be willing to battle through more adversity than you can probably imagine. You have to be willing to be paid way less than what you think you are worth. And probably do that for multiple years before you make it to a more "sustainable" level. You have to realize that you might get an opportunity to play in a country that you've never heard of, for a coach who doesn't speak your language, in a gym that is smaller than your high school gym. And if you think that's not up to your standards, then they'll go to the next guy in line. Why? Because it's a business. Treat every opportunity like it's a job interview because, in reality, that's exactly what it is.

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