If a footballer in England chooses to leave a club on a free transfer or a pre-contract agreement before the age of 24, his former team is entitled to compensation from their new club.
This system, run by the Professional Football Compensation Committee (PFCC), protects young players’ freedom to move while ensuring clubs are compensated for training them.
If the two sides cannot decide on a suitable payment agreement, the case is then referred to a transfer tribunal.
When assessing a case, the PFCC typically considers:
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The player’s age
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How long they were at their old club
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The training and development they received
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Contract offers made by each club
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The player’s potential
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The status of both clubs
The tribunal then decides how much money the club is entitled to.
In 2016, Liverpool were ordered to pay £6.5m, plus £1.5m in add-ons, to sign Burnley striker Danny Ings from Burnley at a tribunal.
Liverpool also had to pay up to £4.3m to sign then 16-year-old forward Harvey Elliott from Fulham in 2021 after the clubs failed to agree a compensation package.
Thanks to Dave in Bristol and Martin in Newcastle for the questions.
This article is the latest from BBC Sport’s Ask Me Anything team.