Promotion and Relegation: Why Most of the World Has It and North America Does Not

The question the two systems answer differently

Strip away the culture-war framing and one question separates them:

UEFA applied the same idea to a knockout competition — see the Champions League Swiss model.

Can a club own its place in the league?

In an open system, it cannot. Membership is earned each season and lost by finishing bottom. No club holds a permanent right to be in the competition, and none can sell one, because none has one.

In a closed system, it can. Membership is a property right — bought, held, and sold with the franchise.

Everything else follows from that. The debate is usually conducted as though it were about tradition, jeopardy or spectacle. It is really about what was purchased.

What membership costs when it is for sale

The clearest evidence is the price.

The only route into MLS is an expansion fee, and recent fees run into the hundreds of millions of dollars. San Diego FC’s entry for the 2025 season was reported at $500 million.

Ask what that money bought. Not players, not a stadium, not a trophy. It bought the right to be in the league — a right that only has that value because it cannot be lost on the pitch.

Introduce relegation and you have not added jeopardy to a competition. You have written down an asset that owners paid for, and changed the terms after the purchase.

That is why the answer from inside a closed league is so consistent. It is not a failure of ambition. It is the owners protecting the specific thing they bought.

The historical argument

MLS’s closed structure was a deliberate response to a failure.

The earlier North American Soccer League ran from 1968 to 1984 and collapsed financially. When MLS was built, guaranteed membership was part of the pitch to investors: a place that could not be lost made the club a safer thing to buy and to build a stadium for.

Whether or not one finds that persuasive, it is a real argument from a real precedent — the league it replaced did not survive.

The NFL, NBA and MLB are structured the same way, so MLS was not inventing an approach so much as adopting the local one.

It has been tested legally, and it lost

That body decides most of international sport’s disputes, and travels to the Olympics to do it in a day — see the Court of Arbitration for Sport.

This is the part that moves the discussion from opinion to record.

A case was brought seeking to compel US Soccer to adopt promotion and relegation. In 2020 the Court of Arbitration for Sport ruled against it.

So the question is not merely unresolved or unpopular with owners. It has been put to sport’s highest arbitral body and answered — a national federation was not obliged to restructure its league pyramid.

What open leagues give up in return

Open systems also redistribute deliberately: FIFA diverts 5% of most transfer fees down the pyramid to the clubs that trained the player — see football transfer rules.

It is worth being even-handed, because open systems pay for their jeopardy.

A club facing relegation has every incentive to spend beyond its means to avoid it, and the financial distress that follows relegation is a recurring feature of European football. Revenue collapses on a schedule the club cannot control.

Closed leagues buy stability at the cost of consequence. Open leagues buy consequence at the cost of stability. Neither is free, and each system’s characteristic problem is the direct product of its central choice.

The same question, elsewhere in sport

This is not only a football argument. It is the same structural question that decides how a sport gets onto the Olympic programme — where inclusion is granted for a single Games rather than owned, so no federation holds a permanent place either.

And it is why qualifying for a World Cup looks so different from qualifying for a domestic play-off: international football is an open system almost everywhere, and nobody has bought a right to be at the tournament.

Where places can be owned, they are defended. Where they cannot, they are contested. More on the bodies that make these choices is in how sport is run.