By: Nicholas Patricios
The National Football League (NFL) is considering expanding its presence into Europe, specifically in London, as part of its efforts to globalize American Football. Previous attempts with NFL Europa, a European developmental league, were unsuccessful and canceled in 2007. However, NFL Commissioner Roger Goodell has been focused on London since taking office in 2006. Goodell has been advocating for international games, with plans for five games in 2024: three in London, one in Brazil, and one in Germany.
While playing a single game overseas is vastly different from establishing a permanent team in London, logistical challenges like travel time, fan base, suitable venues, and the willingness of American athletes to play abroad can be addressed with sufficient time and money. The biggest hurdles to expansion are the differences in legal systems, especially in tax laws, labor laws, and sporting visas.
Athletes who play for a London team would face higher income taxes because they would fall into the highest tax band in England. Anyone earning over £125,140 pays an income tax rate of 45%. “As per the league’s Collective Bargaining Agreement established in March 2020, NFL players’ minimum salary measured up to $660,000 . . . This year, the minimum salary for an NFL player is $750,000.”
In addition, depending on the legal arrangement, the United Kingdom (UK) government taxes any income earned within its borders. The United States (US) also taxes players’ foreign income, potentially leading to double taxation. To address this, the US Congress established the Foreign Tax Credit (FTC), enabling the income tax for US citizens to be reduced by the amount already paid to a foreign government. However, the issue is that the FTC calculated outside the US cannot exceed the US tax liability for that income. Therefore, since the UK tax rate is higher than the US tax rate, players would not be reimbursed or receive credit for the percentage that is over the US tax rate. This would make it tough to lure players abroad.
The UK’s policy on taxing endorsements may pose challenges for athletes. The UK taxes athletes competing in the country based on their entire global endorsements. This means that high-profile athletes could face higher taxes compared to their less popular teammates if they play in the UK. Although the HMRC (London’s tax and customs authority) has granted some exemptions for Olympic athletes, it has denied these exemptions for tennis players. If the NFL wants to have similar exemptions approved for its athletes, they will need to address this issue with the HMRC in advance.
The potential expansion also faces obstacles related to free movement and competition laws. While US antitrust laws are similar to those in the UK, some adjustments may still be necessary. The NFL draft could potentially conflict with EU legislation as it limits a player’s choice of where to play. However, since the draft is collectively bargained for between the players and owners, it may be permissible. The structure of the London-based team will also be a factor. If a team is based on the East Coast and travels eight times a year, it may be easier to navigate UK labor laws. In the more likely scenario of a London-based team, the NFL would need to address broader issues around players’ mobility. Ensuring the effectiveness of the draft system should be the top priority.
In the UK, there are two tiers of sporting visas. The temporary visa permits athletes to stay for only 26 weeks. Athletes playing for a team in London would need the higher-level Tier 2 visa, but each player’s application must be endorsed by a UK governing body – something the NFL currently lacks. Additionally, European football teams are typically required to demonstrate that a “non-European player brings something special and different to the UK.” To bypass this requirement, the NFL could consider having a minimum number of British players, but this approach would be time-consuming and costly.
NFL players with criminal convictions may be ineligible for the required visa to play in the UK. A player with a “sentence of more than four years could indefinitely be refused a visa, and a player who received a sentence between one year and four years of imprisonment would be denied a visa to the U.K. until ten years after finishing his sentence.” Even players with sentences of under 12 months must wait a mandatory 5-year period from the end of their sentence to obtain a visa. In the past year, 27 NFL players have either been “arrested, charged, or given a citation for a criminal offense,” presenting another significant obstacle for the NFL’s expansion abroad.
Some argued that “when you control a $10 billion empire that wants to become a $25 billion empire by 2027, as Goodell does, major barriers like international laws become minor hurdles.” However, I suspect this will not be the feel-good story we all saw on Ted Lasso. Even if the legal hurdles are overcome, the lack of NFL talent in Europe could cause Goodell’s dream to stall. Additionally, gaining popularity abroad and convincing American athletes to relocate to Europe with their families will be challenging. While the NFL’s expansion into Europe holds significant promise, it is fraught with complex legal challenges—including tax laws, labor laws, sporting visas, and cultural differences—that require careful navigation. This move would require extensive support from the UK Parliament, but the backing of London’s mayor, who wants to bring a Super Bowl to the city, could be a valuable asset.
