Premier League clubs will be forbidden from making any transfers, domestically or internationally, except within two limited transfer "windows" per year from next season onwards.
The radical shake-up was agreed yesterday by Europe's 11 leading footballing nations – including England, Spain, Italy, France and Germany – and is likely to be rubbed-stamped at the next executive committee meeting of Uefa, European football's governing body, in January.
The Nationwide League is hoping and expecting to gain an exemption from the new rules, thereby allowing its 72 clubs to trade with each other almost year round, as now, when buying and selling is forbidden only between the third Thursday in March and the end of the season.
The League still vehemently opposes the rules that will stop the Premier League clubs trading, however, because they will stop Nationwide clubs raising money throughout the season by selling to élite clubs.
David Burns, the chief executive of the Football League, said last night: "The Football League remains implacably opposed to the introduction of domestic transfer windows. They are something which I believe are wholly restrictive and damaging financially to the League's clubs.
"It is not uncommon for any business to find itself with a short-term cash flow problem and one remedy is to sell an asset. Football is no different, clubs often need to sell a player to meet a cash shortage.
"The imposition of transfer windows would create just two short periods during the year in which clubs could ease their cash flow problems. By limiting clubs' freedom to trade as they see fit, according to their own short-term demands, such a proposal could very possibly wreak havoc on the future of our club system."
The move comes as part of a package of measures that seek to harmonise the international transfer system. The Premier League said last night that more discussions on the issue would take place before the changes are finalised but insiders accept the new system is inevitable despite being unwanted.
The first "window" under the new system will run from the end of the current domestic season until 31 August next year, and the second from 1 January to 31 January 2003. The same windows will operate annually thereafter. For countries with seasons based on the calendar year, such as those in Scandinavia, the periods would be 1 July to 31 August, and 15 December to 31 January.
The knock-on effects are likely to be most extreme in England, which is almost unique in Europe for not already having domestic transfer windows. Under the new system last week's transfer of Robbie Fowler from Liverpool to Leeds would not have taken place. Nor would any other transfer involving a Premiership club since the start of September.
Struggling clubs who want to bring in new faces outside the "windows", such as Southampton or Leicester in recent weeks, for example, will not be able to. Unhappy players or those who suddenly find themselves working under a new manager who does not want them will also be forced to stay put until trading re-opens, even if two clubs agree on a transfer.
Burns' views were echoed by the Leeds United chairman, Peter Ridsdale, who said that he was in favour of harmonising international transfers but was firmly against "tinkering" with the domestic system. "We have been aware of the new proposals as part and parcel of a package of measures surrounding the new transfer system," he said.
"The Premier League chairmen did discuss it and vote on it, in isolation, a year ago and were strongly against. But that was not part of [Europe-wide] discussions. It could be that we have to accept [domestic transfer windows] as a fait accompli. Given a free vote on the issue I would not support it. It's a case of bureaucrats tinkering with something that's not broken.
"The current system is great as it is. It allows speculation to take place, which is part and parcel of the game. Supporters know that and like that. Windows force time pressures and push prices up, which can only be bad."
A Uefa spokesman begged to differ, saying that most countries in Europe already had domestic transfer windows and England would merely be catching up by following suit. "In most countries except England the new windows are already in place, give or take a few weeks on the precise dates," he said.
Pedro Tomas, the chairman of the Uefa Committee which made yesterday's decision, added: "This is an historic agreement, which, for the first time, should give us harmonised transfer periods in European professional football. We believe that this is the right way forward for sporting, legal and financial reasons. It should help to provide some increased stability in the game, and help create a solid framework for the future."Reuse content