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Shocking rule changes see Chinese FA levy 100% tax on foreign player transfers, and increase under-23 player quotas

Chinese football clubs must pay a tax of 100% on transfer fees for foreign players in the next window, according to another sudden rule change revealed by the CFA today.

According to the edict, clubs must match the transfer fee paid for a foreign player with a payment of equal value to the CFA’s development fund which goes towards “The development of youth football, supporting community football and public welfare projects involving football.”

The rule will only apply to clubs who are “loss-making” – but with all CSL clubs nowhere near profitable, the new policy will have a very significant impact on the Chinese transfer market. Club finances in China are traditionally a very murky affair and the new policy did not specify anything about they would be assessed.

Government displeasure over astronomical transfer fees lavished by CSL clubs on top footballing stars has been growing over the past 18 months and at the start of this year, a new policy called for CSL clubs to cease “irrational spending” amid fears that transfer deals were being used as a means to siphon cash out of China. The country has very strict rules on how much money individuals can take out of China.

However, clubs apparently paid little heed to calls for purse strings to be tightened and overall spending in the last transfer window was the highest yet for the CSL. The next transfer window opens on June 19 and closes on July 14, and it would appear that the CSLs spendthrift days are over for the time being.

In another rule change, the CFA have said that as from the start of the 2018 season, clubs must use the same amount of foreign and u-23 players in a match. The announcement gave no other detail about its exact implementation, but it would appear that if a team starts with three foreign players, there must be three u-23 players used in the match at some point – potentially even as late substitutes.

A new rule stipulating each team must start with one u-23 player on the pitch and another on the bench was brought in at the start of this season just weeks before kick-off. But any mention of how long u-23 players must stay on the pitch was lacking, a situation which led to frequent early substitutions of u-23 players, often in the first 15 minutes. There was no mention of whether the new u-23 rule introduced today would replace that which was enacted at the start of this season.

The CFA announcement said the new rule was to “encourage clubs to increase their youth training systems” and added, “The CFA will provide specific details on the implementation of this policy at a later date, we hope that all clubs can start preparing now so the rule can be implemented in an earnest manner when the time comes.”

It remains to be seen exactly how the new rules will affect both transfer policy and team selections, but their impact will be hugely significant.

A leading international commentator on Chinese football frequently quoted by the world's top media. Offers piercing and resolutely honest insights into the bustling crossroads where football, society, economics and politics meet in contemporary China. Based in Shanghai since 2005, observer of the Chinese game since 2000.

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