Sao Paulo: Third-party ownership of footballers will become illegal in Brazil from May 1, the country`s domestic governing body CBF said in new transfer regulations published on Tuesday.
The move aims to bring Brazil into line with a FIFA ban on the practice that comes into effect on the same day.
Third-party ownership occurs when the transfer rights of players are wholly or partially owned by the player or a company, instead of only the player`s club.
The practice is already illegal in some European leagues but common in Portugal, Brazil and other South American countries, where investors buy up players in the hope of making a profit when they are sold to big name clubs.
Brazilian football is bankrupt with the top 20 teams owing more than five billion reals ($1.89 billion) and clubs and investors say the practice keeps clubs alive by injecting cash into the game.
Some fund managers have said they will seek a way around the ban, perhaps by buying small clubs who loan their best players out to give them a shop window.
Existing contracts will be recognised but any deals signed between now and May 1 involving a third party will only be valid for one year, the Brazilian Football Confederation said.