Did You Know Your Amateur Club/ Academy is Entitled to Training Compensation When....

Nath Boys, an Amateur club in Lagos Nigeria got a training compensation of £1.7million, equivalent to  N790m (Seven Hundred and Ninty Million Naira) when their former player Wilfred Ndidi signed for Liecester city last season? But you may say Ndidi's first professional contract was with Genk in Belgium, why did Nath boys get compensated again?

Yes, I know it doesn't work that way in the Nigerian football system, so many amateur clubs, especially the unregistered ones, popularly called "boys club" in Nigeria, do not know they could be entitled to a Training Compensation any time their player sign a contract with a professional club abroad. Most of these Boys Clubs are the ones truly responsible for training and building up some of the big stars we have today, with their various structured or unstructured model of operation. These amateur clubs are just content and even boastful that one of their players has signed abroad, but get nothing in return.

What is Training Compensation?
Training compensation is a fee which must be paid to a player’s training club when they sign his first professional contract with another club and on each further transfer until the end of the football season of his 23rd birthday.

Training compensation is due when a player is registered for the first time as a professional or when they transfer between clubs of two different associations (whether during or at the end of his contract) before the end of the season of his 23rd birthday. This means that clubs that sign a player who’s under 23 years old on a Bosman (when their contract runs out), they still have to pay a fee. I guess this answers the question why Nath Boys got another Training Compensation on Ndidi.

However, only registered Amateur clubs and Academies are entitled to Training Compensation. That is one major reason that should drive you to register your club/Academy with the football association (FA), so your club/Academy doesn't  loose out when any of your player signs a professional contract abroad.

Training compensations can only be disbursed after several factors have been put into consideration. For instance, an academy where a player paid for his training and welfare may receive compensation different from an Amateur club that trained a player free or even provided other amentities such as accommodation, salaries or allowances...

What an Academy/ Amateur club provided (Cost of Training) for a player determine the compensation. See list:
Training Costs should cover:
Salaries and/or allowances and/or benefits paid to players (such as pensions and health insurance);
Any social charges and/or taxes paid on salaries;
Accommodation expenses;
Tuition fees and costs incurred in providing internal or external academic education programmes;
Travel costs incurred in connection with the players’ education Training camps;
Travel costs for training, matches, competitions and tournaments;
Expenses incurred for use of facilities for training including playing fields, gymnasiums, changing rooms etc. (including depreciation costs);
Costs of providing a football kit and equipment (e.g. balls, shirts, goals etc.);
Expenses incurred in playing competitive matches including referees expenses, and competition registration fees;
Salaries of coaches, medical staff, nutritionists and other professionals;
Medical equipment and supplies;
Expenses incurred by volunteers;
Other miscellaneous administrative costs (a percentage % of central overheads to cover administration cost accounting, secretarial services etc.).

In calculating training compensation, FA provides categorization of these amateur clubs and academies after inspection of facilities and standard model of operation. See categorization:

All clubs are divided per category:
Category 1 (top level, e.g. club possesses high quality training centre):
all first-division clubs of national associations investing on average a similar amount in training players.
Category 2 (still professional, but at a lower level):
all second-division clubs of national associations with clubs in category 1
all first-division clubs in all other countries with professional football.
Category 3:
all third-division clubs of national associations with clubs in category 1
all second-division clubs in all other countries with professional football .
Category 4:
all fourth- and lower division clubs of the national associations with clubs in category 1
all third and lower division clubs in all other countries with professional football
all clubs in countries with only amateur football .

Find the categorisation of clubs 2013 by FIFA here.

 Another very important consideration in calculating Training Compensation is called THE PLAYER FACTOR. 
 To work out the training compensation amount for each category, the figure obtained below should be multiplied by what is referred to in the Application Regulations as an average “player factor”.

 The “player factor” is a ratio that takes into account the number of players who need to be trained on average by a club in a given category in order to `produce’ one professional player.

The player factor for each given category is obtained by dividing the total number of players being effectively trained, on average, by a club in that category (as defined above), by the average number of those players being offered a full professional contract each year..

Then, how many years did the player spend while being trained in the Amateur club or Academy.

In conclusion, I advice amateur clubs in Nigeria (Boy Clubs) and academies to properly register with the Corporate Affair Commission (CAC)...and most importantly register with the FA. Secondly, they should continuously work to improve their facilities and welfare package to their players. These will insure they get paid a reasonable amount Training Compensation when any of their players eventually sign a professional contract with clubs abroad.