Evgeni Malkin is at the centre of an international transfer agreement dispute. (Source: Getty Images)

In both scenarios one side feels screwed whether it’s the customer feeling horrible about paying insane gas prices or the European hockey federations getting little in return for the pilfering of their stars. Essentially the European hockey nations who have already accepted the transfer agreement and are losing their players to the NHL are trying to get something extra to make the best out of an already bad scenario – the $200,000 transfer fee is the equivalent of the $0.04 overdraft. The Russian hockey federation views the scenario differently and hence the reason they are the lone holdout from the NHL-IIHF deal. With Evgeni Malkin in place the Russians have their penny dish and thus they feel like they have the leverage to squeeze more out of the NHL. You know what? I can’t blame them.

The common perception is that the Russian Hockey Federation is being greedy by refusing to sign an agreement that the rest of the IIHF hockey bodies have already agreed to. I personally side with the Russians on their refusal to sign the agreement. I can’t understand how anyone could believe that a $200,000 fee is fair compensation to a team like Magnitogorsk who is forced to lose a player of Malkin’s ilk. For that matter I don’t understand why the Swedish, Finnish, Czech Republic and Slovakian federation agreed to such a lopsided agreement. The NHL gets to pilfer your country’s top hockey players for a paltry sum that doesn’t even equate to half of the NHL’s minimum player salary. How is that fair? Unlike the Canadian and American players that are being drafted into the NHL straight from amateur leagues (college and junior) the vast majority of European players are being drafted into the NHL straight from pro teams in their native countries.

There’s a big difference between an amateur team losing their player to another league and a professional club losing their star attraction to another pro league club. The whole philosophy behind amateur hockey is to develop players both on and off the ice so they become ready for the next step. Ideally and perhaps naively amateur sports should be largely devoid of much financial talk. Professional hockey on the other hand is a business that is driven by the bottom line. When a pro team loses their best player the financial outcomes can be immense – reduced ticket revenue, loss of sponsorship, decrease in merchandise sales, poorer TV contract, etc.; $200,000 can’t come close to repairing the financial destruction that the departure of a major draw can cause.

Ideally hockey should follow soccer’s model and introduce a transfer agreement marketplace that would allow Malkin’s Russian club to receive their rightful compensation for losing the country’s top player. For those unfamiliar with the soccer transfer model it works fairly simply. Each year there are two month-long transfer windows (July and December) where players can transfer amongst clubs. A transfer can either be initiated by a player’s transfer request or the club’s decision to place the player on their transfer list. From here the players are treated like they’re a commodity at an auction, the highest bidder wins the services of the player with the transfer fees going directly back to the selling club. Sometimes the size of the transfer fee is based on some stipulations such as the individual success the transferring player has or the level of success he brings to the team.

Malkin’s GM at Magnitogorsk has openly embraced the comparisons to soccer’s lucrative transfer market. He was quoted in the Russian Sports_Express newspaper asking, “How can Dynamo Kiev receive $18 million from Milan for Andrei Shevchenko and we cannot?" Interestingly enough the star Ukranian striker is on the move again and this time he has made history.  Earlier this summer Shevchenko’s move from AC Milan to Chelsea set the all-time largest transfer fee record at $56 million USD. How can you even compare the NHL’s $200K stipend to that? It’s like trying to compare the number of David Ortiz’s clutch hits against Alex Rodriguez’s.

In soccer the transfer fees are actually the biggest expense when it comes to individual player costs. Shevchenko for instance will earn about $11 million per season, which compared to the outrageous transfer fee, seems like a bargain. English defender Rio Ferdinand was passed through the transfer market twice in a year and a half span between November 2000 and July 2002, first from West Ham United to Leeds United and then from Leeds United to Manchester United; all told the transfer fees totaled up to be around $69M USD.

I don’t think that it makes much sense for hockey to follow soccer’s transfer market structure to the same extent where only the biggest soccer clubs can afford to pay exorbitant amounts to purchase and hoard the best players. Many teams like Chelsea will buy players (e.g. Shawn Wright-Phillips) with very little intention of giving them playing time, simply as a means of blocking a fellow rival club from acquiring the player. It’s similar to how banks will continue to lease an unoccupied and moved branch building simply as a way to deter a rival bank from taking over the location and luring the other bank’s old neighbourhood clientele.