Ahead of Major League Soccer’s transfer window opening on January 31, the league announced significant rule changes that could impact how teams spend money on players who leave clubs of the league. As part of the change, a club can use unlimited funds to trade players already in the league. This previously required the use of general allocation money, actors, or a combination of other limited mechanisms.
While there is a limit of only two players a team can acquire and trade via this mechanic over the course of a season, this allows for blockbuster moves that do not prevent a team from doing more with their effective. One such example could end up involving Atlanta United. Their search for a designated player at forward could lead to a record purchase as the Five Stripes reportedly already did. made an offer to sign Emmanuel Latte Lath from Middlesbrough, but that wouldn’t stop them from pairing him with someone like Evander from the Portland Timbers in an inter-league swap.
Previously, it was difficult to move a designated player via trade, as there were not enough resources available through league mechanisms to compensate for the team’s loss of a player, but as an owner can go straight into his pockets to acquire someone, this increases the levels of inter-league deals that can be made significantly. For the team selling a player, the revenue from these deals can be converted into GAM, allowing them to immediately use these deals to strengthen their roster.
It seems like it’s only a matter of time before this mechanic is used to acquire a player, but let’s take a quick look at some of the other rule changes.
MLS Expense Changes
Aside from the GAM received through the U22 initiative, it no longer has an expiration date allowing teams to stack it to use as they wish. Previously, the GAM only lasted three transfer windows and adds to the flexibility that will be given to teams. There is also now a second contract buyout for clubs, whereas previously there was only one. If a designated player is loaned to an international club, this will now also open up this place. Teams can also now switch between players if they wish to use the two or three designated player model during the season instead of having deadlines during which these changes must be made.
The key word here is flexibility. Even though teams are still limited to having their salaries below the spending cap, changes like this will make the league more globally competitive, at least when it comes to teams whose owners are not afraid to open their wallets to finance staff building. . Parity may have its downsides, but if MLS wants to compete in events like the Club World Cup, the top teams need to focus on how they can compete with other teams around the world. Indeed, it is an open and limited transfer market which can help keep stars in MLS.
The decline of parity
For teams that have managed to get by thanks to the strength of their academies by increasing elements from abroad like the Philadelphia Union and FC Dallas, this is a decision that could make more difficult for them to compete without investing. Since this is a completely new mechanism, there is no guarantee that judicious ownership will continue to have a similar effect on domestic actors, but if changes cause concern, it is one of between them.
Without the threat of relegation, there is nothing to lose for teams who don’t spend but it is also a risk the league must take. More ways to acquire talent is a good thing for the league and this could be the first step toward lifting some of the league’s roster restrictions. MLS lags behind Liga MX in spending and last season, players like Cade Cowell and Brandon Vazquez began to be poached by Mexico.
While Vazquez is back, mechanisms like this give national teams the same chance to get these players back. If this ultimately also aligns with MLS transfer windows happening at the same time as Europe, then it would be an entirely new market. That’s a lot of projections, but it’s also the direction the league is heading.
As 2026 approaches, MLS is in a unique position to capitalize on soccer interest domestically as the World Cup approaches. Being able to ensure as much talent is in the league before then is vital and will help achieve that. How teams use it is something to watch, but while there’s still a lot to do to really move MLS forward, the ability to spend more is only a good thing.
