The Rule 5 Draft is held on the final day of the Winter Meetings. Teams can pick eligible minor leaguers left off other clubs' 40-man rosters for $100,000 per selection.
Conditions are strict: the picking team must keep the player on the active 26-man roster all of the next season. To send him down, they must offer him back to the original club for $50,000.
That's why only ready-for-the-majors talent gets picked — it's a place to surface developed players buried in someone else's system. Strong scouting departments win here.
Notable success stories: Johan Santana (1999, two Cy Youngs) and George Bell. Japanese players have rarely been involved, but Japanese minor leaguers chasing MLB callups could become Rule 5 candidates.
→ Related: 40-man roster / Minor-league contracts / MLB draft