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The European Commission have agreed to reverse the Bosman Ruling for all players up to the age of 23 as part of a series of wide-ranging proposals.
According to the Sunday Business newspaper, the EC and Fifa have reached agreement over three significant issues; an alteration of the Bosman Ruling, a percentage of transfer fees to be passed on to clubs who develop players up to that age and the introduction of a strict transfer window.
The alteration of the Bosman Ruling is the biggest move by the EC. The case in 1994 revolutionised football, with players being able to move clubs for free once their contracts had expired.
However from next season, it will no longer apply to any player up to the age of 23, with clubs being able to demand compensation for the cost of the players' training.
The EC Commissioner for Competition, Mario Monti, agreed the deal with representatives from Fifa, Uefa and the international professional footballers' association, FIFPro, last Wednesday.
It is a major turnaround for the EC authorities who have argued for the past six years that the free movement of labour within Europe is the very basis of the European Union itself.
But it is understood the declaration by 15 heads of government in the aftermath of the Nice summit led to the EC immediately agreeing to two of the Fifa proposals.
The declaration stated that sport - and particularly football - had special social implications and that any decision on its future had to take this into account.
"We have compromised with Fifa on their proposal for players up to the age of 23," said competition commission spokesman Amelia Torres.
"We agree that clubs should have some kind of compensation for their efforts in training the players at an initial stage.
"It protects clubs who have a tradition of training players. They are the future of the game, so we want to protect that."
The two other agreements are equally significant. From next season international transfers will be limited to two-month period from the end of May to the beginning of August.
The move is aimed at preventing big clubs from buying in star players from around the world during a campaign.
The other area of general agreement was to ensure that clubs, who both discovered and trained players up to the age of 23, should benefit from moves throughout the player's career.
The clubs a player has played at before that age would divide 5% of transfer fees after the age of 23 in an effort to ensure that they can benefit from all the work done in the initial years.
When a player is into the last 6 months of his contract he can sign a contract with any club in the world and sign for them when his contract expires. If a players contract has run out, he can leave whenever he wishes.