Evgeny Belashchenko
Special to McKeen's Hockey Prospects

The Russian Super League has enjoyed considerable growth over the last few years due to the countries booming economy and new rules that have been put in place for league stability. Player movement with their top stars continues to be a hot topic of debate. McKeen's correspondent Evgeny Belashchenko, examines the status and provides details of Russia's current involvement with the NHL/IIHF transfer agreement. 

After more than 3 years without a transfer agreement, news started to surface that Russia was ready to come into the fold with the NHL and sign a new IIHF transfer agreement. The news has largely painted the issue as Russia's attempt to extort additional funds out of the NHL for talented up-and-coming super stars such as Alexander Ovechkin and Evgeni Malkin. Although this holds some truth, one must also examine Russia's point of view, as well as other factors that have contributed to the conflict. In this article, we will examine the Russian point of view, what led to the rift, and why the country is on the verge of coming back into the fold. 

Russia's Economy Booming

How much do you think an average player gets paid in the Russian Super League? $100,000 US? $200,000 US? Well, some would be interested to find out that an average veteran Russian player is earning upwards of $300,000 - $400,000 per year! These average contributors skate on the latter lines and are part of the supporting cast. NHL-caliber talents such as Alexei Morozov, Maxim Sushinsky, or Artem Chubarov, earn $1,000,000 - $3,000,000 per year. Furthermore, these players pay very little, if any taxes, keeping most of their salary in addition to a number of other rewards and benefits. 

What caused this seemingly unbelievable boom and almost NHL-caliber salary levels? The main reason is the ever-rising prices for oil and natural gas, so interestingly, US actions abroad are indirectly boosting Russian hockey! A huge part of Russia's current economy is based on natural resources and most of the hockey clubs have historically been located in industrial towns strewn across Russia, with the proprietors of these clubs owning the local factories, refineries or smelting plants. These clubs have seen their budgets rapidly climb in recent years to seemingly exorbitant levels. 

So, with clubs now enjoying player-salary budgets of more than $10,000,000, what does a $150,000 transfer fee really do to compensate for losing a top-line player? This is the question that Russia wrestled with for the past several years and a big reason why the league refused to sign the transfer agreement. The benefit from the NHL contributions is negligible, and would have a very little effect on team welfare. It is extremely important for observers to understand this key fact. 

Super League Stability

Stability was a factor three years ago. Budgets could inexplicably be cut over night and certain players would find out that they no longer have a job. This happened to HC Lada two years ago, as well as other clubs on a smaller scale. A testament to this instability was the mass exodus of NHL-caliber players going back to North America after the end of the lockout, despite some players getting very lucrative offers to stay. During the past three years however, the league has continually strived to stabilize and ensure long-term success. Consequently, salaries have mostly leveled-off. Even more important than salaries, league management, now under former goaltending legend Vladislav Tretiak, also took important steps to stabilize the league for the long term. This included a new capacity requirement on stadiums as part of an effort to modernize the league and force club owners not only to pay large sums for players, but also investing in the infrastructure. Furthermore, the league has made efforts to improve the refereeing through collaboration agreements with IIHF that saw foreign referees in Russia. 

Uncontrollable Player Movement Out of Russia

So, as the league continued to solidify as the second-best league in the world, the issue of team ability plays a very important role. The Russian Super League preseason starts in late June, much earlier than the NHL preseason. The previous deadline for signing players out of Europe without incurring any financial penalties was mid-July. Thus, considering that many players signed by NHL clubs usually hold impact roles in the Super League, these clubs are put in a position of having to look for new stars to replace the lost talent. This is often an impossible task, since most of the rosters are already set, the only alternative for Russian clubs is to pillage other European leagues or look to North America's AHL. 

While the NHL is clearly the superior league talent and funding wise, one must appreciate the unique situation placed on Super League clubs that are forced to deal with a loss of key players with just two months before the start of the season. Imagine if this happened in the NHL where a player like Jaromir Jagr would be convinced to sign in Russia while still having an active NHL contract. There would be uproar like no other and the league would heavily punish the player and likely pursue legal action against him for damages. Russian clubs have proven powerless to do the same in the cases of Malkin and Ovechkin, but their inability to deliver does not make their argument any less compelling! 

The Reverse is also True

While Russian teams suffer more when their top players are signed away, NHL clubs also suffer when young players full of potential refuse to continue their development in the AHL and bolt back to Russia without any significant penalty. This happened four times during the 2006-07 season, when Alexei Kaigorodov, Enver Lisin, Vadim Khomitski and Alexei Mikhnov all chose to return to Russia. One could certainly understand their reasoning, since they stood to make more than half-a-million dollars in Russia, compared to just $40,000 - $60,000 in the AHL. However, these players signed contracts in the NHL and thus should be obligated to hold up their end of the bargain. These moves may potentially detract from the players' development, since they are distracted by this "loophole" and may not apply themselves to make the NHL as hard as they would have, if the alternative were skating in the AHL for the rest of the season. 

Parting Thoughts 

So now that we are hopefully on the cusp of Russia returning to the fold and signing the IIHF agreement, I only ask that we do not judge Russia's attempt to level the playing field with the NHL as misguided and unfounded. Russia has valid concerns. Additionally, Russia's holdout may have had a positive impact on the relationship between the IIHF and the NHL, as the NHL did boost its financial commitment to the IIHF, proving that there is room for flexibility.