Obtaining Letter of Clearance

If a Player last played for a FIBA Team, then the Player must request a Letter of Clearance from the FIBA Team before executing an NBA Contract (unless the NBA permits the execution of the Contract beforehand).

While it is the Player’s responsibility to obtain the Letter of Clearance, it is the NBA Team’s responsibility to make inquiries whether the Player last played for a FIBA Team.

The FIBA Team then has 7 days to confirm if the Player is under Contract with the FIBA Team and therefore prohibited to sign with the NBA Team.

Should the Player sign the NBA Contract before the Letter of Clearance is executed (usually as part of a condition prior to paying a fee to the FIBA Team for the letter of clearance), then he is not permitted to participate with the Team until the Letter of Clearance is executed.

Negotiations Permitted

An NBA Team or FIBA Team are permitted to negotiate with a Player under Contract with the other League and even execute a contract that begins after the expiration of the existing Contract.

International Buyout

If the Player remains under a binding FIBA Contract, there can be an agreement on a buyout of the Contract to release the Player from the Contract and allow him to sign the NBA Contract.

The amount of the buyout can be agreed upon between the FIBA Team and the Player (and of course the NBA Team).

A Player cannot be signed to a Two-Way or Exhibit 10 Contract for 1 year after the Team entered an agreement to make an IPPA on the Player’s behalf.

An NBA Team is permitted to pay any amount up to the Excluded International Player Payment Amount (EIPPA) without consequences toward Team Salary.

If the buyout amount exceeds the applicable EIPPA, then the excess amount comes out of the Player’s paycheck, and is considered a Signing Bonus for purposes of his Salary. Visit the Salary pages for details.