How the FIFA Training Compensation System Works: Indemnity and Solidarity Mechanism
By Futbol CV | Series: Training Compensation Rights in Football
This article is part of our Global Guide to Training Compensation Rights in Football. Here we explain FIFA's foundational system governing international transfers.
Before discussing national systems in each country, it is essential to understand the base framework: the one established by FIFA through the Regulations on the Status and Transfer of Players (RSTP). This system exclusively governs international transfers — domestic transfers are managed by each national federation.
FIFA provides two distinct and complementary mechanisms: training compensation (Annex 4) and the solidarity mechanism (Annex 5). Although often confused, they operate very differently.
Training Compensation
When is it triggered?
Training compensation is payable in two situations:
- When a player signs his first professional contract with a club of a different association than the training club.
- On every international transfer of a professional player occurring before the end of the calendar year of his 23rd birthday (i.e., before December 31 of the year he turns 23).
A key point: compensation applies even if the player is out of contract (free agent). It is an obligation of the new club towards the training clubs.
How is it calculated?
The calculation follows this formula:
Training cost per year × Number of training years = Total compensation
The "training cost per year" depends on the category of the new club (the acquiring club), not the training club. FIFA classifies clubs into four categories:
| Category | UEFA | CONMEBOL | CAF/AFC/OFC/CONCACAF |
|---|---|---|---|
| I | €90,000 | USD 50,000 | Varies |
| II | €60,000 | USD 30,000 | Varies |
| III | €30,000 | USD 10,000 | Varies |
| IV | €10,000 | USD 2,000 | Varies |
The computable training period ranges from ages 12 to 21. For ages 12-15, Category IV (the lowest) always applies regardless of the club's actual category. This limits amounts for early training.
Key concept: the "calendar year"
FIFA uses the concept of a "calendar year" (January 1 to December 31) as the unit of calculation, not "season." This has an important practical consequence: if a player turns 12 on June 6, the "calendar year of the 12th birthday" is the entire calendar year (January 1 to December 31). The club where the player was registered during that calendar year is credited with the full year, not just the months after the birthday. Training is measured in full calendar years, not fractions.
The same applies at the upper limit: the obligation to pay compensation exists until the end of the calendar year in which the player turns 23 — that is, until December 31 of that year, regardless of the exact birthday.
Practical example
An Argentine player trained at Boca Juniors (Category I CONMEBOL) from age 12 signs his first professional contract with a Bundesliga club (Category I UEFA) at age 18.
- Ages 12-15 (4 years): Category IV UEFA = €10,000 × 4 = €40,000
- Ages 16-18 (2 years): Category I UEFA = €90,000 × 2 = €180,000
- Total: €220,000
Note that the category of the acquiring club (the German club), not the training club (Boca), is used.
Who pays and who receives?
The new club pays. The amount is distributed among all clubs where the player was registered between ages 12 and 21, proportionally to the years registered at each.
When is it NOT payable?
- If the player was trained at a club in the same country as the new club (domestic regulations apply, not FIFA).
- If the previous contract was terminated without just cause by the player (other sanctions may apply).
- If the player is transferred to a Category IV club and the resulting amount would be disproportionate relative to the club's income.
Solidarity Mechanism
When is it triggered?
The solidarity mechanism activates on every international transfer of a professional player under contract. Unlike training compensation, there is no age limit — it applies throughout the player's career.
However, an important condition: it only applies when there is a transfer involving a fee (with a price). If the player moves on a free transfer, no solidarity payment is due.
How is it calculated?
5% of the total transfer fee (including any conditional compensation) is deducted and distributed among the training clubs according to these percentages:
| Player's age during training | Percentage per year |
|---|---|
| 12 years | 0.25% |
| 13 years | 0.25% |
| 14 years | 0.25% |
| 15 years | 0.25% |
| 16 years | 0.50% |
| 17 years | 0.50% |
| 18 years | 0.50% |
| 19 years | 0.50% |
| 20 years | 0.50% |
| 21 years | 0.50% |
| 22 years | 0.50% |
| 23 years | 0.50% |
Total: 1% (ages 12-15) + 4% (ages 16-23) = 5%
Practical example
A player trained entirely at Club Atlético Lanús (ages 12-21) is transferred at age 27 for €10,000,000.
- 5% of €10,000,000 = €500,000
- Ages 12-15 (4 × 0.25%): €100,000
- Ages 16-21 (6 × 0.50%): €300,000
- Total for Lanús: €400,000 (the remaining 4% of the 5% is unallocated because the player had no other training clubs between ages 22-23)
Who pays?
The selling club — the 5% is deducted from the amount it receives. The buying club pays the full price and is responsible for ensuring distribution (now via the FIFA Clearing House).
Key differences between the two mechanisms
| Aspect | Training Compensation | Solidarity Mechanism |
|---|---|---|
| Age limit | Until the end of the calendar year of the 23rd birthday | No age limit |
| Condition | Applies even without an active contract (free agent) | Only applies with a transfer involving a fee |
| Calculation basis | Training cost × years | 5% of the transfer fee |
| Who pays | The new club | Deducted from the selling club |
| Scope | Only international transfers | Only international transfers |
FIFA Categories: Why They Matter and Why They Are Controversial
Only nine associations have clubs in Category I: Argentina, Brazil, Germany, Belgium, Spain, France, England, Italy, and the Netherlands. This creates structural inequality: an African Category IV club receives up to 9 times less compensation than a European Category I club for the same training work.
The Football Foundation Africa has identified this disparity as a primary cause of academy closures on the continent.
The FIFA Clearing House
Fully operational since 2025, the FIFA Clearing House automates the calculation and distribution of solidarity and training compensation payments through the Electronic Player Passport (EPP). This significantly reduces non-compliance: previously, training clubs had to claim individually, often unsuccessfully.
What about domestic transfers?
FIFA expressly delegates regulation of domestic transfers to each national association. Some — like Argentina, Brazil, or France — have robust systems. Others — like Uruguay — have no regulation. This is why knowing each country's system is essential.
→ Return to the Global Guide to Training Compensation Rights
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