Holstein Kiel v Hertha BSC: relegated clubs and second-tier squads

The fixture in brief

Google searches in Germany show interest in the meeting between Holstein Kiel and Hertha BSC, a 2. Bundesliga fixture. This article does not deal with the match itself. It looks at the two clubs as examples of a familiar situation in German football: a former top-flight side trying to put together a squad that can compete in the second tier while spending less than it once did.

Holstein Kiel is based in the port city on the Baltic coast of Schleswig-Holstein. For most of its modern history it played below the top division, until it won promotion to the Bundesliga for the first time. It went back down after one season there. Hertha BSC, from Berlin, is a much bigger club with a long top-flight record and was one of the founding members of the Bundesliga. Its relegation came after years of large spending and changes in ownership.

So the fixture brings together two different routes into the same division. One is a smaller club returning to a level it knows well. The other is a capital-city club with fixed costs built for a higher level. Both have to follow the same registration windows, licensing conditions and contract rules.

Origins of the meeting

Clubs in the Bundesliga and 2. Bundesliga are run by the Deutsche Fußball Liga (DFL), which oversees both professional divisions. Promotion and relegation link the two divisions, so clubs regularly move between them. That movement is why a fixture like this one appears on the schedule. It is not a traditional rivalry. The clubs come from opposite ends of the country and have spent long periods in different divisions.

Their relegations followed different patterns. A newly promoted club usually reaches the Bundesliga with a squad built on second-tier contracts, plus a few signings on top-flight terms. If it goes straight back down, many of those contracts are still running. A club relegated after a long top-flight spell often has older, more expensive contracts, sometimes agreed when it expected to compete in Europe. In both cases the question for the new season is the same: which contracts still stand, at what wage, and which players the club can sell or loan out.

Squad building in the second tier today

German clubs handle relegation mainly through the employment contract. Many contracts include a clause that cuts a player's salary automatically if the club drops a division. Some also include a release clause that applies only after relegation, letting the player leave for a fixed fee. These clauses are negotiated individually and are usually kept private. Whether a given player's contract contains one is therefore usually not public.

Licensing is the second part of the system. Every club in both professional divisions has to obtain a licence from the DFL each season. To do so it must show that it is financially able to keep operating, as well as meeting infrastructure and administrative criteria. A relegated club with high wage costs has to show how it will cover them with lower income. In practice that can force sales, contract terminations by mutual agreement, or loans that take wages off the books.

The third part is media money. The DFL distributes central broadcasting revenue using a formula with several components. Some components reward performance over several seasons, not just the most recent one. A recently relegated club therefore keeps more than a long-standing second-tier club, but it gets no separate, guaranteed payment for that purpose. That cushion shrinks over time, so clubs tend to plan their squads around a limited period.

Registration is controlled by the transfer windows: one in summer and a shorter one in winter. Outside those windows clubs can generally register only players who are not under contract elsewhere, within the limits set by the regulations. The DFL's squad rules also require a minimum number of locally trained players. This makes a club's academy important when money is short.

Ownership affects all of this. The 50+1 rule in Germany limits how far an outside investor can control a club's football operation. Investment can still come in, but the members' association keeps the majority of voting rights. For a relegated club, this affects how much outside money can be used to fill a gap in revenue.

Common misconceptions

One common mistake is to assume that relegation cancels contracts. It does not. A contract stays valid unless it contains a clause that applies on relegation, or both sides agree to end it.

A second mistake is to expect English-style parachute payments. The German system gives relegated clubs some extra support through the media-money formula. There is no separate fixed payment.

A third is to think that a second-tier club can register players whenever it likes. The windows and squad-list rules apply in the same way in both divisions.

A fourth is to treat a single fixture as the moment when the transfer market moves. Sales, loans and contract changes depend on windows, licensing deadlines and individual negotiations, not on any one match. Nor is it known from public sources how either club's wage bill is structured, so any claim about a specific player's terms should be treated with caution.

Where to look next

The DFL publishes its licensing regulations, match operations rules and the principles behind its media-money distribution. These are the main documents for understanding how a relegated club is assessed. The Deutscher Fußball-Bund sets rules that sit above the league's, and FIFA's Regulations on the Status and Transfer of Players set out the international framework for registration and loans. Each club's annual reports and its statements on completed transfers show how the rules have been applied in practice. Each club's statutes and members' assemblies show how the 50+1 rule works within that club.

Frequently asked questions

Do player contracts end when a German club is relegated?

No. A professional contract in Germany stays valid after relegation unless it includes a clause that changes or ends it in that situation. Many contracts include automatic salary reductions for playing in the 2. Bundesliga, and some include a release clause that applies only after relegation. These terms are agreed individually and usually not published, so outsiders generally cannot know what a particular player's contract says.

Are there parachute payments in the 2. Bundesliga?

There is no separate parachute payment of the kind used in England. The DFL shares central media income through a formula that partly rewards performance over several seasons. A club that has recently left the Bundesliga therefore usually receives more than a long-established second-tier club. That advantage shrinks over time, so relegated clubs usually plan their squads and wage bills around a limited period.

What is the DFL licensing procedure?

Every club in the Bundesliga and 2. Bundesliga needs a licence from the Deutsche Fußball Liga each season. The club has to show it is financially able to keep operating and meets sporting, legal, infrastructure and administrative criteria. A relegated club with high costs has to explain how it will pay them with lower income, which often affects its decisions on transfers, loans and contract terminations.

When can 2. Bundesliga clubs register new players?

Clubs register new players in two transfer windows, a longer one in summer and a shorter one in winter. These operate within the framework set by FIFA and the national rules. Outside the windows, registration is generally limited to players without a contract, under the conditions in the regulations. The same principles apply to clubs in both German professional divisions.

How does the 50+1 rule affect relegated clubs?

The 50+1 rule means a club's members' association keeps the majority of voting rights in its professional football company, which limits how much control outside investors can have. Investors can still provide capital and hold minority stakes. For a relegated club, the rule affects how much outside money can be brought in to replace lost revenue, and on what terms.

Sources and further reading

• Deutsche Fußball Liga: licensing regulations, match operations rules and media-money distribution principles
• Deutscher Fußball-Bund: national rules on player status and registration
• FIFA: Regulations on the Status and Transfer of Players, covering windows and loans
• Club annual reports and official statements from Holstein Kiel and Hertha BSC on completed transfers