Here's my WE7 guide, Zygalski has edited for PES3 though
How to transfer players from club to club
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1. Go to the 3rd option [3. Free Transfers] down in transfer mode
2. Select the team the player you want is in
3. Swap him with a player further down the squad list (below 16 places i think)
4. Select the player again
5. Select the team you want to transfer him to
6. Select a blank space in the team and then he'll be transferred
How to transfer a player from Country to Club
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1. Go to the 2nd option [2. Club Team Selection] in the transfer menu
2. Select a blank slot in the team your transferring TO
3. Go to the country the player plays for.
4. If he isn't at a club in the game already, he'll be selectable. Just select him
To remove a player from a team and make him a "free agent"
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1. Go to the 3rd option [3. Free Transfers] in the transfer menu
2. Select the player and replace him with someone further down your squad list.
3. Go to the 2nd option [2. Club Team Selection] in transfer mode.
4. Select the player and swap him with a blank space in your team, he'll then be removed from your squad
NOTE: To get the player back, do the opposite:
1. Select the 2nd [2. Club Team Selection] option in the transfer menu
2. Select a blank space in your team
3. Select your team again and all the "free" players will be highlighted, select the one you want
To put a player into a national squad from a club
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1. Select the 1st option [1. National Team selection] in the transfer menu
2. Select the country you want.
3. Select a player that you want replaced (eg Jeffers)
4. Select the club where the player you want is
5. The available players will be highlighted, select him (eg Shearer)