MLB owners approve extension of posting system, Shohei Ohtani posted

This has been anticipated for some time, but Major League Baseball made it official Friday with the extension of their 2013 posting agreement with Nippon Pro Baseball (NPB) for one more year, through November 1, 2018.

As a result of today’s approval, the Hokkaido Nippon-Ham Fighters of NPB will post right-handed pitcher/outfielder Shohei Ohtani Friday, with a release fee of $20 million. The window for Ohtani to negotiate with Major League Clubs will expire at 10:59 p.m. CT on December 22, 2017. In addition, right-handed pitcher Kazuhisa Makita of the Saitama Seibu Lions will be posted on or before December 31. The postings of both Ohtani and Makita will be governed by the terms of the 2013 protocol agreement that was extended through the current off-season.

Dan Halem, Chief Legal Officer of Major League Baseball, said: “Major League Baseball values greatly its longstanding relationship with Nippon Professional Baseball and is pleased that the parties have reached an agreement. I would like to recognize and thank the NPB Clubs, Commissioner Katsuhiko Kumazaki, incoming Commissioner Atsushi Saito and their staff – especially Nobby Ito – for their hard work, courtesy and professionalism throughout this months-long process. We believe that this new agreement will allow baseball to continue to flourish in the United States and Japan.”

The new agreement beginning next November has these provisions. First, the term of the new agreement will be November 1, 2018 through October 31, 2021.

• Effective November 1, 2018, the release fee that Major League Clubs will pay a posted player’s former NPB Club will be as follows:
• For Major League contracts with a total guaranteed value of $25 million or less, the release fee will be 20% of the total guaranteed value of the contract;
• For Major League contracts with a total guaranteed value between $25,000,001 and $50 million, the release fee will be: (i) 20% of the first $25 million of total guaranteed value (i.e., $5 million) plus (ii) 17.5% of the total guaranteed value exceeding $25 million;
• For Major League contracts with a total guaranteed value of $50,000,001 or more, the release fee will be: (i) 20% of the first $25 million of total guaranteed value (i.e., $5 million) plus (ii) 17.5% of the total guaranteed value between $25,000,001 and $50 million (i.e., $4,375,000) plus (iii) 15% of the total guaranteed value exceeding $50 million;
• For Major League contracts that contain bonuses, salary escalators or options (Club, mutual or vesting), the Club may owe a supplemental release fee at a later date equal to 15% of any bonuses or salary escalators actually earned by the player under his contract, and/or 15% of any compensation paid to the player in Club, mutual or vesting option years that were exercised or vested; and
• For Minor League contracts, the release fee will be a flat 25% of the signing bonus. (For Minor League contracts of “Foreign Professionals” that contain Major League terms, a supplemental release fee will be owed if the player is added to the 25-man roster).
• The annual window during which NPB players can be posted will be shortened to November 1st through December 5th.
• All other material terms of the prior protocol agreement, including the 30-day negotiating window once a player has been posted, remain the same.

Remember, all those provisions don’t start until next year (except as noted). For now, the $20 million posting fee for Ohtani will get a team the rights to negotiate with him. The money doesn’t get paid except by the team that actually signs him, so no team loses anything by saying, “Sure, we’d like to talk to him.”

Also remember that Ohtani is subject to the international bonus pool rules, since he’s under 25 years old. In this article I wrote last month I list all the teams and the amount of money they can spend on Ohtani. Of course, since he has to sign a minor-league contract, is subject to MLB’s free-agency rules and will have to play 2018 on a big-league minimum salary, the signing bonus he gets might mean less than the potential of endorsements he can get with the team/city he signs with.

Chicago and the Cubs can certainly provide that. I still think he might wind up with an American League team where he can DH when he’s not pitching, but that’s all up to him and the teams he’s negotiating with.

If you’re wondering about Kazuhisa Makita, he’s a 33-year-old righthander who was a starter until two years ago, when he was converted into fulltime relief. His NPB stats show that, at the very least, he has impeccable command and control with very low walk rates. He’s got a funky submarine motion and might be someone the Cubs could look at for bullpen help. Here’s some video of him pitching against Evan Longoria in the MLB/Japan All-Star series in 2014:

We’ve got a three-week circus coming up. Enjoy!