What Did Newcastle Pay For Gutierrez? – Not Much

The Chronicle is saying today that reports in Spain are suggesting Real Mallorca will be claiming £12M from Jonas Gutierrez.


Jonas Gutierrez – looks like we may have got a great deal on the player

This follows comments made to the press today by the club’s Sporting Director Nando Pons.

The claim comes after the Jonas Gutierrez legally bought his way out of his contract, by activating Article 17 of the FIFA transfer regulations.

That article allows players under the age of 28 to buy out the remainder of their current contracts, as long as they have served at least 3 years of the contract.

Mallorca’s Sporting Director Nando Pons said today:

“We have claimed 15M euro (about £12M) for the unilateral termination of the contract “without just cause.’”

“Mallorca will defend their interests.”

We assume the article allows a player to terminate his contract for any reason, so we’re not sure what legal precedent the Mallorca club have on their side with all of this.

But it’s also clear they’ve lost out big time on the transfer, because Jonas was essentially a free agent, and all Mallorca got for the transfer was the remaining amount on his contract, which we don’t think was very much.

Last year offers from Portsmouth and other clubs for the Argentine were in the region of  £10M, but Mallorca will have received only peanuts from Newcastle, compared to that amount.

One of our readers, Shaun, sent us an informative email this morning, and said the Mallorca club are only entitled to the residual value of the contract.

That was the ruling of the Court of Abritation, and although FIFA didn’t agree with it – that is nevertheless the precedent in cases like this, and of course the cost of buying themselves out is the outstanding wages due to them, in the existing contract.

So if Jonas was on say £15K/week that would be about £780K he would have to pay Mallorca for each year left on his contract. If that’s one year that’s £780K Gutierrez would have to pay Mallorca to leave, and even if it’s 2 years, that’s still only £1.56M.

A lot less than £10M, so it’s not surprising that Mallorca are suing the player,  and trying to get as much additional compensation as they can. But we think Jonas is completely in his rights, from how we understand the law, and would certainly have been given lots of legal help from lawyers assisting Newcastle United.

Newcastle would presumably pay £780K back to player to compensate him, and also some signing on fee presumably, which could be hefty.

And the silly thing here is that the player doesn’t really pay up his contract, but the purchasing club do (Newcastle in this case).

So it looks like Newcastle didn’t pay much at all for the player, and it seems a great deal for Newcastle, but not so good for Mallorca.

Gutierrez will make his Newcastle debut against either PSV Eindhoven or Valencia at St. James’ Park, in the pre-season friendlies on August 6th and 9th respectively.  Hopefully, quite a few other players will also be on show for the first time during those home games.

Jonas will have a long summer rest period following Argentina’s summer World Cup qualifiers, and he will therefore miss the Multi Media Sports Cup tournament at his old club Real Mallorca from August 1st-3rd. Maybe that isn’t bad news to him, after all.

Comments welcome.

71 comments so far

  • iain

    Jul 3, 2008 at 4:12 PM

    Comment #1

    tbh if it was one of our players i would be furious.

    but fifa are such a mess im surprised it doest happen more often

  • brownrob

    Jul 3, 2008 at 4:12 PM

    Comment #2

    Sounds like he may be an early contender for best value deal of the summer

  • Ed Harrison

    Jul 3, 2008 at 4:15 PM

    Comment #3

    This rule doesn’t sound too fair to the selling club. Maybe I shouldn’t even call them the selling club – it’s the player who wants to leave.

  • mikeygd

    Jul 3, 2008 at 4:17 PM

    Comment #4

    i apologise for my comments earlier i was angry at the guy who told ed about the skysports news not him. I thought we had signed another player when ed put it up, i didnt believe the kid when he posted it

  • broon ale

    Jul 3, 2008 at 4:19 PM

    Comment #5

    likewise. my apologies.!

  • Hadrian

    Jul 3, 2008 at 4:20 PM

    Comment #6

    Dont like the way its been done myself .
    yeah its great for us now , cant imagine the mallorca fans are to happy , nor would we be if any of our players ever pulled a stunt like that .
    owen could do it now and we’d have no comeback .

    putting the likes of rio ferdinand on a 5 year deal at his age , just to avoid this situation , cant be healthy for the club .

  • mikeygd

    Jul 3, 2008 at 4:22 PM

    Comment #7

    your forgiven broon lol


    Jul 3, 2008 at 4:22 PM

    Comment #8

    Hope the fans are ok when our away supporters go over????

  • ende

    Jul 3, 2008 at 4:26 PM

    Comment #9

    People vilify Barton for beating up a teammate, but the real criminals on this team are its very own management… cause they just got away with THEFT! 😀

  • HeronMag

    Jul 3, 2008 at 4:28 PM

    Comment #10

    I wonder if Chris Mort’s legal team had been researching contractual law and saw a loophole so we could steal Gutierrez.

    If so it’s bad luck Mallorca 🙂

  • D Garew

    Jul 3, 2008 at 4:28 PM

    Comment #11

    Apparently the cost of buying out the remainder of his contract is in the region of £2m which i am sure will be accounted for in any signing on fee being paid to the player by newcastle. Sounds like a good bit of business even before we know anything about him.


    Jul 3, 2008 at 4:31 PM

    Comment #12

    Heron Mag – I was about to suggest the same thing(post10). Maybe we can expect a few more deals like this. Of our recently reported targets – does anyone know others who fit the age and contract criteria? -Arda? Arshavin? Inler? Aimar? Derdiyok certainly too young

  • DohDohDoh

    Jul 3, 2008 at 4:33 PM

    Comment #13

    People may not like it but this is the future world of football contracts. Wenger spoke at the weekend about the end of clubs getting transfer fees. FIFA’s Article 17 & Bosman look set to help make this a reality. There has been a lot of rumours about Lampard doing the same thing to Chelsea.

    Hadrian – you are completely right, it could and undoubedtly will happen to us at some point.

    The club have done nothing wrong in this, all above board etc. They are playing the rules. The real trick is going to be to persuade players and agents to sign in the future. More money will fall out of the game, and it will be the lower league clubs who will probably suffer.

    Football finance and contracts are in a mess.

  • Marc Hottiger

    Jul 3, 2008 at 4:34 PM

    Comment #14

    I am looking forward to seeing him play for us. Kevin Keegan has a good eye for exciting players and provided that we allow him the time to settle, I’m hoping he can be a big hit here.

  • Jim

    Jul 3, 2008 at 4:41 PM

    Comment #15

    It’s good to know that NUFC are well aware of this rule considering our own ‘buy them young’ policy.

    Do you think KK had much input in this signing because I think he just OK’d the suggestion.

  • Kash2

    Jul 3, 2008 at 4:42 PM

    Comment #16

    @Marc Hottiger; Marc are you the guy who played for us back in the 90’s?

    I’ve got a feeling that Newcastle are targeting a few players who are able to buy out there contracts. Good strategy if it works!

  • RuLezzz

    Jul 3, 2008 at 4:45 PM

    Comment #17

    we should try and sign Geovanni from ManC, they are releasing him…

  • SwedeEric

    Jul 3, 2008 at 4:45 PM

    Comment #18

    The sad thing is that Martins could do this after this season if he want´s… Say Arsenal wants him but Ashley and keegan says no, then he just buys his contract out and Arsenal compensate him for that… Say he is on 60k per week today, he signed a 5 year contract… meens he have 2 years left, pay around 6M punds to Newcastle and he then can go were ever he wants, any club will be happy to give him that money back, and can then give him a huge sign on bonus, both parties are happy, but the whole Toon stands furius!

    They realy need to change this rule asap!

  • scottish mag

    Jul 3, 2008 at 4:46 PM

    Comment #19

    marc hottiger are u the marc hottiger that played for nufc 94/95 season or are u just using his name

  • Hadrian

    Jul 3, 2008 at 4:47 PM

    Comment #20


    with 2 years on your contract you can only buy it out to move abroad .

  • scottish mag

    Jul 3, 2008 at 4:47 PM

    Comment #21

    kash2 thats freaky i was typing went to get a biscuit then pressed submit and we had asked the same question lol

  • Kash2

    Jul 3, 2008 at 4:49 PM

    Comment #22

    I know, i’ve been asking that question for ages. Neither Marc or Ed answer the question!

  • Faustino

    Jul 3, 2008 at 4:53 PM

    Comment #23

    Does that mean If I added a second name to my user people would think I’m Tino?

  • broon ale

    Jul 3, 2008 at 4:53 PM

    Comment #24

    marc hottiger lives next door to ed in north carolina. Hottiger looks after some sort of youth academy school.

    it could actually be him as it wouldnt be a surprise if ed mentioned to him that he runs a newcastle website.

    i doubt it is him though! far to busy

  • Kash2

    Jul 3, 2008 at 4:54 PM

    Comment #25

    Do you have a sub-machine gun?


    Jul 3, 2008 at 5:03 PM

    Comment #26

    Kash2 I think the fans will need one when they go over to Mallorca!!

  • Luke

    Jul 3, 2008 at 5:05 PM

    Comment #27

    I can’t imagine Majorca are very happy. As far as I understood this ruling, European clubs have a ‘gentleman’s agreement’ between them that they would not endorse buying a player out of his contract. Can of worms. Opened. It’s all very well laughing our heads off at such a steal but we may soon very well be on the receiving end.

  • Faustino

    Jul 3, 2008 at 5:08 PM

    Comment #28

    Kash 2 – ho ho ho now I have a machine gun!

    I like the fact we’ve pre-screwed Fat Fred. If he completes a purchase this transfer will be thrice as sweet!

  • Davies

    Jul 3, 2008 at 5:11 PM

    Comment #29

    Christ I hope not. Sorry, did I say Christ, I meant Luke. Sorry again.

  • hanzowen

    Jul 3, 2008 at 5:13 PM

    Comment #30

    as many fans/Geordies have expected KK still has got something to settle his unfinished business this time around & likely to surprise us for this summer signings like Jonas case.
    Hopefully more of the same please mr. King Kev & co. as we know soon we can get the results to please all of us (yeah surely this’d eventually lead us winning a trophy or 2).

  • steve

    Jul 3, 2008 at 5:16 PM

    Comment #31

    Wenger was going on about this on Monday in the Times, basically he was saying that he thought that there would be no transfer fees in the near future due to ability of players to just buy themselves out of contract and that getting a player to sign a 3 year contract effectively meant you could only hold him to it in the first year. I’ll try and dig link out
    Players can effectively just buy themselves out and there’s nothing the club can do

  • Kluivert

    Jul 3, 2008 at 5:20 PM

    Comment #32

    Of course it’s Hottiger and I’m Patrick kluivert, and that other guy is really Tino… we all come on here to chew the fat on Toon news…

    Aye I had a good time up in Newcastle when I was there… good looking ‘bords’ as you geordies say!

    Shame about Holland eh… they should have let me play on a while for them!

  • 51times

    Jul 3, 2008 at 5:23 PM

    Comment #33

    As happy as I am about this signing and the way it was done, I have to say that article 17 can’t last, it just isn’t fair on the clubs.

  • steve

    Jul 3, 2008 at 5:27 PM

    Comment #34

    Actually it was the observer

    “Critically, the Fifa regulations allowed a player who agreed his contract when under the age of 28 to terminate it after three seasons ‘without just cause’ as long as he informs his club of his intention to do so and pays appropriate compensation. Though the level of such damages went unspecified, the test case that followed Andy Webster’s decision to use the rule to leave Hearts for Wigan in 2006 determined that sum as the outstanding value of a player’s contract (in the Scotland defender’s case, £150,000).

    The result, according to Wenger, is that a modern footballer’s contract effectively secures a player’s services for just two seasons, regardless of the length formally agreed in the paperwork. ‘After two years you have to renegotiate your contract because after three years the player can move out,’ Wenger says. ‘You give longer contracts because it offers a little bit of protection for the player to have to pay compensation if he moves after three years – if you give a player a five-year contract and he moves after three, he has to pay two years’ [wages].

    ‘But, after two years, you have to re-negotiate with the player because he can move the next season; you have no choice. For me, this measure is inflationary. Why? Because after two years you have to sit down with the player, whether he has played well or not, or you will lose him. You can never get him to sign an extension to his contract for less – that means you will always have to increase his salary. ”

    Full article here http://www.guardian.co.uk/football/2008/jun/29/arsenal?gusrc=rss&feed=football

  • catawbamag

    Jul 3, 2008 at 5:32 PM

    Comment #35

    Mallorca blew it. They created bad blood between the player and themselves.

    They refused to renegotiate his contract last year, leaving themselves open to this. He was only asking for a 4k per week raise. Also they failed to notify him of transfer bids that were made for him in the winter window.

    They set themselves up for this. I dont feel sorry for them at all.

  • steve

    Jul 3, 2008 at 5:35 PM

    Comment #36

    @catawbamag – so you’ll be happy for Owen / Martins to pay up thier contracts next year then and just walk away from the toon without us getting a penny!

  • spen27

    Jul 3, 2008 at 5:46 PM

    Comment #37

    players who are not happy are not welcome at this club i’d rather be a mid table at best club with players who respect the club/fans then a top 4 team with money grabbers who’l leave as soon as a so called better offer comes along.

  • spen27

    Jul 3, 2008 at 5:48 PM

    Comment #38

    i.e ronaldo

  • daiv

    Jul 3, 2008 at 5:58 PM

    Comment #39

    Cheap and good. Hope it does not happen to us but what goes round comes around. Remember Owen or Oba in the future.
    When is Ashley going to dig deep? He cannot hope to get everybody on the cheap. man City and Spurs are trying to challenge the top 4. Where is our ambition?

  • Luke

    Jul 3, 2008 at 6:07 PM

    Comment #40

    Christ? Close, but not quite.


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