“Discovery rights? They didn’t ‘discover’ them.”
“The player has been around longer than that club. Discovery? Doesn’t even make sense!”
“Gotta get rid of this silly Discovery rights thing.”
Sound familiar? Well, ever since the Vancouver Whitecaps made their intentions known about signing Bayern Munich and Germany legend Thomas Müller, the question of MLS Discovery Rights has led to every ‘Caps fan Googling exactly what it is.
This is not the first time Discovery Rights has come under the microscope. However, even the most ardent fans have difficulty trying to explain exactly what they are.
So, let’s dive into the rabbit hole on the poorly named MLS Discovery Rights. We’ll look at its history within the league, what the intention behind it is and whether it has served its purpose.
What the hell are MLS Discovery Rights?
MLS Discovery rights have existed since the inception of the league in 1996. Essentially, each club can name up to five players who are not currently in MLS and who are not a part of any other MLS assignment mechanism, such as the SuperDraft.
Note: San Diego FC is allowed seven on their Discovery list for the 2025 Roster Compliance Date. This will drop to five at this date’s completion.
Players can be added or removed from a club’s list at any time, and there is no requirement to sign a player from the list.
There are other reasons as to why a player may not be eligible for MLS Discovery Rights, but for the sake of our collective sanity, we will leave those to rest.
To simplify it, a club can have a list of up to five players. A player can appear on multiple clubs’ lists, but whoever listed the player at the earliest date will hold the Discovery right. If clubs added the player on the same day, the club that has a lower points-per-game will hold the right.
Why would any club want this?
Yesterday, Jimmy Brennan, former Toronto FC and Canadian international and current TV analyst, said the concept behind Discovery Rights was to help create parity within the league.
“It kind of gives a little bit of parity as well throughout the league simply because, if you didn’t have that, the majority of players, where would they want to go? They either want to go to L.A. or they want to go to New York.”
He recalled his playing days in England over a decade, between 1996 and 2006, where everyone coming to MLS wanted to play for the LA Galaxy.
“You would never think of going to Salt Lake or Kansas City or Columbus,” he said on the Footy Prime podcast.
And that is it. Discovery Rights are meant to give clubs in MLS that would not likely have an opportunity of signing a marquee player from outside the league at least a chance to sit down with that player or his agent.
It also creates an added financial instrument: Discovery Rights are tradeable within MLS.
If club A is unable to sign player B, for whom they hold a Discovery Right, they can trade that asset to a club for General Allocation Money (GAM) that also wants to sign that player. It is then up to that new club to see if they can get a deal done.
The club holding the initial Discovery Rights may not get the player, but they get a financial benefit in a different form.
The minimum the club can trade for a Discovery Right is $50,000 in GAM. However, Discovery Rights trade on average for around $100,000 to $150,000 GAM.
For example, on March 25, the Vancouver Whitecaps received $150,000 in GAM from Inter Miami for the Discovery Rights to Allen Obando.
Discovery Rights have traded as high as $400,000 GAM (Miguel Almiron’s rights from Charlotte FC to Atlanta United, Marco Reus’s rights from Charlotte FC to LA Galaxy).
Do Discovery Rights work?
So, now that we have a general idea of what they are and how they are used, we have to ask the big ‘elephant in the room’ question: Do Discovery Rights work?
That’s…not an easy answer.
Yes, they do help to create parity within the league. Smaller-market clubs can use Discovery Rights to sign players they may otherwise get priced out of contention. Discovery Rights lower bidding wars on players that want to come to MLS because clubs that do not have a player’s rights have to include the cost of attaining them in any deal.
Smaller clubs can also use Discovery Rights as a financial asset to accumulate GAM. GAM can be very valuable in signing players within the league or to lower transfer and loan fees from outside the league.
Just because a club is unable to sign a player from their Discovery List does not mean they do not benefit.
But they can also be used by an MLS club that would never be likely to sign a particular player to ensure other clubs cannot sign that player unless a suitable offer is made. Essentially, a buying club cannot be held hostage by the rights-holding club, but they can make it difficult.
However, on the player side, Discover Rights can serve to remove player agency.
If a player wants to sign with a club, they and their agent deal with that club. MLS Discovery Rights creates an obstacle by forcing a player to at least listen to offers from the holding club.
It may also dissuade the desired club from making a deal with a player if the Discovery Right is deemed to be too much of a financial burden.
Are they still necessary (or were they ever)?
The argument over whether Discovery Rights are necessary depends on whether you believe they function as intended to create parity or if you believe it’s a convoluted financial instrument in a league with already too many roster rules.
Discovery Rights have started to become (or perhaps they always were) an impediment to smaller market clubs who have been forced into added costs for players.
Let’s use the Vancouver Whitecaps. They are the model of a club that Discovery Rights are meant to benefit. Yet, they are being forced to shell out $400K in GAM for Müller, which has inflated the cost.
But they have their list of five players, don’t they? Not all players become available at the same time, and no club that holds a Discovery Right is available to sign a player at any moment.
Take Inter Miami. Earlier this year, it was revealed that the club had Kevin De Bruyne on their Discovery List. This is a club that already had Lionel Messi, Luis Suarez, Sergio Busquets and Jordi Alba and no available Designated Player slots.
One of the league’s Discovery Rights clauses is that there must exist a reasonable ability to sign a player on any given club’s list. As De Bruyne would likely demand DP-level wages, this should have ruled them out of claiming him.
And yet they did and were allowed to. This means a club like Miami, for which Discovery Rights are meant to hinder in the spirit of parity, was able to claim a financial benefit.
In their current form, they will never be able to sign De Bruyne, but any other club that wants to will face the added hurdle of paying Miami for the right.
Discovery Rights are from a bygone era of MLS, before DPs, before clubs could earn transfer fees from players going overseas and before clubs were able to sign from their academy.
Now, clubs have a multitude of options when it comes to player signings and parity. There are levels of allocation money, DP and U22 Initiative contracts, academy products, transfer fee percentages and more.
But Discovery Rights live on. They are the dinosaurs in the room. Everyone loves to talk about them, but their time is over.
