Behind the frantic dash for French cash

French rugby union clubs don't have salary caps, whereas payment ceilings exist in the two codes of rugby in Australia.

It is therefore in the interests of player managers to woo rugby league and union players away from a country where clubs are limited in the amount they can spend to an El Dorado where billionaire patrons pay what they like and commissions are higher.

Player managers in Australia accuse European agents of pitching to their clients: "Come with me and I'll get you a better deal but on the condition you must leave your current manager."

Sonny Bill Williams, who fled the NRL's Bulldogs to play for the French rugby union club Toulon, switched managers earlier this year, leaving the management team of Gavin and Chris Orr to sign with Khoder Nasser.

Nasser says he no longer represents Williams.

The Orrs, who were set to receive 6 per cent of the net of Williams's $450,000 contract with the Bulldogs for each of the next four years, will receive nothing.

Williams's contract with Toulon has been reported to be $3 million over two years, or $1.5 million a year.

This is a figure reached via liberal tax laws in France and some creative accounting by player managers, such as Greg Keenan, who has set up an office in Toulon. The Sydney agent Greg Willett, who negotiated the deal for the former Penrith star Craig Gower to play with the French rugby club Bayonne, says EUR350,000 ($585,000) a year is payment for a top player in France's top league of 14 clubs.

Willett says about a quarter of the contract can be legally paid in image rights, meaning the use of the player's image on television and in publications where the club and the code receive a benefit.

Under French taxation law, the first EUR38,000 paid in image rights is tax free and the remainder can be legitimately taxed at 20 per cent. "Say EUR80,000 of the EUR350,000 goes to image rights," says Willett. "At the current exchange rate and tax, that can turn into $112,000, while the remaining EUR270,000 is taxed at 30 per cent, leaving him with around EUR190,000, which equals $306,000."

Add the $112,000 from image rights to the $306,000 and you have $418,000 which, with free rent and a car, reaches $750,000, according to some player managers - or $1.5 million in Australia, given the gross income necessary to generate it.

So EUR350,000 a year, the top money in France, factors out to $1.5 million in Australia, ignoring the EUR35,000 that must be paid in commission. Most footballers in Australia also invest houses and units, meaning some income is negatively geared, and they have other allowable deductions.

The National Rugby League has a "hard" salary cap compared with the Australian Rugby Union, which makes concessions to allow clubs to keep their star players.

Neither code allows clubs to guarantee separate arrangements with sponsors, lest it be a covert way of avoiding the salary cap. But when the fuel technology company Firepower collapsed, the ARU allowed the Super 14 club Western Force to seek replacement third-party deals for its disgruntled players, while the St George Illawarra star Mark Gasnier is heading for a French rugby union club because his third-party deal with Channel Nine collapsed.

Should the $300,000 owed Gasnier have been paid by the Dragons, the club would have exceeded the salary cap by this amount and been fined $300,000, meaning an outlay of $600,000, or well over a $1 million in revenue, given the savage state government tax on poker machines.

Similarly, the ARU regards the image rights rulings by the Australian Taxation Office on its stars to be salary cap-exempt, while the NRL has petitioned the Tax Office to make an across-the-board ruling which applies to all its 400 players equally.

When it comes to star players, the ARU thinks capitalist and the NRL votes socialist.