Asser International Sports Law Blog

Our International Sports Law Diary
The Asser International Sports Law Centre is part of the T.M.C. Asser Instituut

Seraing vs. FIFA: Why the rumours of CAS’s death have been greatly exaggerated

Rumours are swirling around the decision (available in French here) of the Court of Appeal of Brussels in the case opposing RFC Seraing United to FIFA (as well as UEFA and the Belgian Football Federation, URSBFA) over the latter’s ban on third-party ownership. The headlines in various media are quite dramatic (see here and here), references are made to a new Bosman, or to a shaken sport’s legal system. Yet, after swiftly reading the decision for the first time on 29th August, I did not have, unlike with the Pechstein ruling of the Oberlandesgericht München, the immediate impression that this would be a major game-changer for the Court of Arbitration for Sport (CAS) and the role of arbitration in sports in general. After careful re-reading, I understand how certain parts of the ruling can be misunderstood or over-interpreted. I believe that much of the press coverage failed to accurately reflect the reasoning of the court and to capture the real impact of the decision. In order to explain why, I decided to write a short Q&A (including the (not water-proof) English translations of some of the key paragraphs of the decision).

 More...

RFC Seraing at the Court of Arbitration for Sport: How FIFA’s TPO ban Survived (Again) EU Law Scrutiny

Doyen (aka Doyen Sports Investment Limited) is nothing short of heroic in its fight against FIFA’s TPO ban. It has (sometimes indirectly through RFC Seraing) attacked the ban in front of the French courts, the Belgium courts, the European Commission and the Court of Arbitration for Sport. This costly, and until now fruitless, legal battle has been chronicled in numerous of our blogs (here and here). It is coordinated by Jean-Louis Dupont, a lawyer who is, to say the least, not afraid of fighting the windmills of sport’s private regulators. Yet, this time around he might have hit the limits of his stubbornness and legal ‘maestria’. As illustrated by the most recent decision of the saga, rendered in March by the Court of Arbitration for Sport (CAS) in a case opposing the Belgium club RFC Seraing (or Seraing) to FIFA. The arguments in favour of the ban might override those against it. At least this is the view espoused by the CAS, and until tested in front of another court (preferably the CJEU) it will remain an influential one. The French text of the CAS award has just been published and I will take the opportunity of having for once an award in my native language to offer a first assessment of the CAS’s reasoning in the case, especially with regard to its application of EU law. More...

Doyen vs. Sporting II: The Bitter End of Sporting’s Fight at the Swiss Federal Supreme Court. By Shervine Nafissi

Editor’s Note: Shervine Nafissi (@SNafissi) is a Phd Student in sports law and teaching assistant in corporate law at University of Lausanne (Switzerland), Faculty of Business and Economics (HEC).

 

Introduction

The factual background

The dispute concerns a TPO contract entitled “Economic Rights Participation Agreement” (hereinafter “ERPA”) concluded in 2012 between Sporting Lisbon and the investment fund Doyen Sports. The Argentine player was transferred in 2012 by Spartak Moscow to Sporting Lisbon for a transfer fee of €4 million. Actually, Sporting only paid €1 million of the fee while Doyen Sports financed the remaining €3 million. In return, the investment company became the owner of 75% of the economic rights of the player.[1] Thus, in this specific case, the Portuguese club was interested in recruiting Marcos Rojo but was unable to pay the transfer fee required by Spartak Moscow, so that they required the assistance of Doyen Sports. The latter provided them with the necessary funds to pay part of the transfer fee in exchange of an interest on the economic rights of the player.

Given that the facts and circumstances leading to the dispute, as well as the decision of the CAS, were fully described by Antoine Duval in last week’s blog of Doyen vs. Sporting, this blog will solely focus on the decision of the Swiss Federal Supreme Court (“FSC”) following Sporting’s appeal against the CAS award. As a preliminary point, the role of the FSC in the appeal against CAS awards should be clarified.More...

Doyen vs. Sporting I: Doyen’s Pyrrhic Victory at the CAS

At the end of December 2015, the CAS decided on a very public contractual dispute between Sporting Clube de Portugal Futebol SAD (Sporting) and Doyen Sports Investments Limited (Doyen). The club was claiming that Doyen’s Economic Rights Participation Agreement (ERPA) was invalid and refused to pay Doyen’s due share on the transfer of Marcos Rojo to Manchester United. The dispute made a lot of noise (see the excellent coverage by Tariq Panja from Bloomberg here, here and here) as it was the first TPO case heard by the CAS after FIFA’s ban. Yet, and it has to be clear from the outset, the case does not affect the legality of FIFA’s TPO ban; it concerned only the compatibility of Doyen’s ERPA with Swiss civil law. The hearing took place in June 2015, but the case was put under a new light by the football leaks revelations unveiled at the end of 2015 (see our blog from December 2015). Despite these revelations, the CAS award favoured Doyen, and was luckily for us quickly made available on the old football leaks website. This blog will provide a commentary of the CAS decision. It will be followed in the coming days by a commentary by Shervine Nafissi on the judgment, on appeal, by the Swiss Federal Tribunal. More...

The Rise and Fall of FC Twente

Yesterday, 18 May 2016, the licensing committee of the Dutch football federation (KNVB) announced its decision to sanction FC Twente with relegation to the Netherland’s second (and lowest) professional league. The press release also included a link to a document outlining the reasons underlying the decision. For those following the saga surrounding Dutch football club FC Twente, an unconditional sanction by the licensing committee appeared to be only a matter of time. Yet, it is the sanction itself, as well as its reasoning, that will be the primary focus of this short blog.More...

Unpacking Doyen’s TPO Deals: The Final Whistle

Footballleaks is now operating since nearly half a year and has already provided an incredible wealth of legal documents both on TPO (and in particular Doyen’s contractual arrangements) and on the operation of the transfer system in football (mainly transfer agreements, player contracts and agents contracts). This constant stream of information is extremely valuable for academic research to get a better grip on the functioning of the transfer market. It is also extremely relevant for the shaping of public debates and political decisions on the regulation of this market. As pointed out on the footballleaks website, it has triggered a series of press investigations in major European news outlets.

In this blog, I want to come to a closure on our reporting on Doyen’s TPO deals. In the past months, we have already dealt with the specific cases of FC Twente and Sporting Lisbon, reviewed Doyen’s TPO deals with Spanish clubs, as well as discussed the compatibility of the TPO ban with EU law. In the Sporting Lisbon case, Doyen has since earned an important legal victory in front of the CAS (the ensuing award was just published by Footballleaks). This victory should not be overstated, however, it was not unexpected due to the liberal understanding of the freedom of contract under Swiss law. As such it does not support the necessity of TPO as an investment practice and does not threaten the legality (especially under EU law) of FIFA’s ban.

In our previous blogs on Doyen’s TPO deals we decided to focus only on specific deals, Twente and Sporting Lisbon, or a specific country (Spain). However, nearly six months after the whole footballleaks project started, we can now provide a more comprehensive analysis of the TPO deals signed by Doyen. Though, it is still possible that other, yet unknown, deals would be revealed, I believe that few of Doyen’s TPO agreements are still hidden. Thanks to footballleaks, we now know how Doyen operates, we have a precise idea of its turnover, its return on investments and the pool of clubs with which it signed a TPO agreement. Moreover, we have a good understanding of the contractual structure used by Doyen in those deals. This blog will offer a brief synthesis and analysis of this data.More...





Unpacking Doyen’s TPO Deals: TPO and Spanish football, friends with(out) benefits?

Update: On 14 April footballleaks released a series of documents concerning Sporting de Gijón. Therefore, I have updated this blog on 19 April to take into account the new information provided.  

Doyen Sports’ TPO (or TPI) model has been touted as a “viable alternative source of finance much needed by the large majority of football clubs in Europe". These are the words of Doyen’s CEO, Nélio Lucas, during a debate on (the prohibition of) TPO held at the European Parliament in Brussels last January. During that same debate, La Liga’s president, Javier Tebas, contended that professional football clubs, as private undertakings, should have the right to obtain funding by private investors to, among other reasons, “pay off the club’s debts or to compete better”. Indeed, defendants of the TPO model continuously argue that third party investors, such as Doyen, only have the clubs’ best interests in mind, being the only ones capable and willing to prevent professional football clubs from going bankrupt. This claim constitutes an important argument for the defendants of the TPO model, such as La Liga and La Liga Portuguesa, who have jointly submitted a complaint in front of the European Commission against FIFA’s ban of the practice.[1]

The eruption of footballleaks provided the essential material necessary to test this claim. It allows us to better analyse and understand the functioning of third party investment and the consequences for clubs who use these services. The leaked contracts between Doyen and, for example, FC Twente, showed that the club’s short term financial boost came at the expense of its long-term financial stability. If a club is incapable of transferring players for at least the minimum price set in Doyen’s contracts, it will find itself in a financially more precarious situation than before signing the Economic Rights Participation Agreement (ERPA). TPO might have made FC Twente more competitive in the short run, in the long run it pushed the club (very) close to bankruptcy.

More than four months after its launch, footballleaks continues to publish documents from the football world, most notably Doyen’s ERPAs involving Spanish clubs.More...

International and European Sports Law – Monthly Report – March 2016. By Marine Montejo

Editor’s note: This report compiles all relevant news, events and materials on International and European Sports Law based on the daily coverage provided on our twitter feed @Sportslaw_asser. You are invited to complete this survey via the comments section below, feel free to add links to important cases, documents and articles we might have overlooked. 

Marine Montejo is a graduate from the College of Europe in Bruges and is currently an Intern at the ASSER International Sports Law Centre.


The Headlines

The Belgian Court of Appeal released its judgment this month regarding Doyen’s legal battle against the FIFA TPO ban. The Appeal Court confirmed the first instance decision and ruled out any provisional measures to block the ban’s implementation (for an in depth review, see our blog post). More importantly, the Court reaffirmed that Swiss based sport federations are liable in front of EU Members’ States courts when EU competition law is involved. That means the next important step for this legal battle is whether or not the European Commission is going to open a formal proceeding (Doyen already lodged a complaint) to assess the compatibility, and more importantly, the proportionality of the TPO ban with EU law. Only a preliminary ruling by the CJEU could hasten the decision if one of the European national courts, hearing a case brought by Doyen (France or Belgium), decided to refer a preliminary question.More...


Doyen’s Crusade Against FIFA’s TPO Ban: The Ruling of the Appeal Court of Brussels

Since last year, Doyen Sports, represented by Jean-Louis Dupont, embarked on a legal crusade against FIFA’s TPO ban. It has lodged a competition law complaint with the EU Commission and started court proceedings in France and Belgium. In a first decision on Doyen’s request for provisory measures, the Brussels Court of First Instance rejected the demands raised by Doyen and already refused to send a preliminary reference to the CJEU. Doyen, supported by the Belgium club Seraing, decided to appeal this decision to the Brussels Appeal Court, which rendered its final ruling on the question on 10 March 2016.[1] The decision (on file with us) is rather unspectacular and in line with the first instance judgment. This blog post will rehash the three interesting aspects of the case.

·      The jurisdiction of the Belgian courts

·      The admissibility of Doyen’s action

·      The conditions for awarding provisory measures More...

Unpacking Doyen’s TPO Deals – Sporting Lisbon’s rebellion in the Rojo case. By Antoine Duval and Oskar van Maren

In this blog we continue unpacking Doyen’s TPO deals based on the documents obtained via footballleaks. This time we focus on the battle between Doyen and Sporting over the Rojo case, which raises different legal issues as the FC Twente deals dealt with in our first blog.

 

I.              The context: The free-fall of Sporting

Sporting Lisbon, or Sporting Club de Portugal as the club is officially known, is a Portuguese club active in 44 different sports. Although the club has the legal status of Sociedade Anónima Desportiva, a specific form of public limited company, it also has over 130.000 club members, making it one of the biggest sports clubs in the world.

The professional football branch of Sporting is by far the most important and famous part of the club, and with its 19 league titles in total, it is a proud member of the big three cartel, with FC Porto and Benfica, dominating Portuguese football. Yet, it has not won a league title since 2002. More...

Asser International Sports Law Blog | Mega-sporting events and human rights: What role can EU sports diplomacy play? - Conference Report – By Thomas Terraz

Asser International Sports Law Blog

Our International Sports Law Diary
The Asser International Sports Law Centre is part of the T.M.C. Asser Instituut

Mega-sporting events and human rights: What role can EU sports diplomacy play? - Conference Report – By Thomas Terraz

Editor’s note: Thomas Terraz is a fourth year LL.B. candidate at the International and European Law programme at The Hague University of Applied Sciences with a specialisation in European Law. Currently he is pursuing an internship at the T.M.C. Asser Institute with a focus on International and European Sports Law.

 

1.     Introduction

 On March 05, the T.M.C. Asser Institute hosted ‘Mega-sporting events and human rights: What role can EU sports diplomacy play?’ a Multiplier Sporting Event organized in the framework of a European research project on ‘Promoting a Strategic Approach to EU Sports Diplomacy’. This project funded by the European Commission through its Erasmus+ program aims to help the EU adopt a strategic approach to sports diplomacy and to provide evidence of instances where sport can help amplify EU diplomatic messages and forge better relations with third countries. In particular, Antoine Duval from the Asser Institute is focusing on the role of EU sports diplomacy to strengthen human rights in the context of mega sporting events (MSE) both in Europe and abroad. To this end, he organized the two panels of the day focusing, on the one hand, on the ability of sport governing bodies (SGB) to leverage their diplomatic power to promote human rights, particularly in the context of MSEs and, on the other, on the EU’s role and capacity to strengthened human rights around MSEs. The following report summarizes the main points raised during the discussions.

 

2.     Context to the Event

Before diving into the panels, the scene was set by a few speakers who described the background and some of the main issues encircling the event. First, Antoine Duval (Asser Institute) kicked the day off by describing the general goal of the project and his role within it. Specifically, Duval strives to explore key questions such as: to what extent are SGB’s diplomatic actors and do they have human rights responsibilities? Also, what is the role of the EU’s sports diplomacy with regard to human rights at MSEs? Can it and should it get involved and if so, what could it do to be most effective?

Having laid the foundation of the event, Richard Parrish (Edge Hill University) described the background to the project ‘Promoting a Strategic Approach to EU Sports Diplomacy’. Parrish explained that while many countries have a clear sports diplomacy strategy, the EU has been rather ‘late’ to the party. He explained that there may be room for a soft power approach to EU sports diplomacy. The project aims to continue the political momentum gained from a 2016 report on EU sports diplomacy and has now held several events across Europe that analyze this subject from different lenses. Parrish concluded by explaining that the EU has started to be more conscious of this issue and has, for example, now included sport in its dialogue with China for the first time.

Simon Rofe (SOAS) then brought some introductory remarks to help frame the discussions that would follow. Rofe started by pointing out how human rights and diplomacy have not exactly gone hand in hand and that many diplomatic instruments are rather silent on human rights, which often has been intentional. Furthermore, there are also issues when trying to identify which and what form of human rights should be promoted, although the UN has played a leading role in this regard. There are also questions regarding what capacity for change there is within SGBs. Rofe also gave the example of how human rights have already been disseminated through sport, such as during apartheid in South Africa. Nevertheless, as SGBs gain greater roles in non-sport matters, their responsibility to respect and further human rights is significantly increased.

3.     The Panels

a.     Panel 1: Leveraging the Diplomatic Power of the Sports Governing Bodies for Human Rights

Now that the stage was set, the first panel took the floor with Antoine Duval acting as chair. Claire Jenkin (University of Hertfordshire) was the first to speak and examined the concept of legacies, especially in terms of children and young people. In other words, how can SGBs help leave positive human rights legacies in the MSEs host nations? Jenkin took the example of the International Inspiration Programme from the London 2012 Olympics, which was the first ever international legacy initiative linked to the Olympics and ran from 2007-2014. Its goal was to reach out to young people and bring sport to the youth beyond the context of the Games. In the end, it helped influence 55 national policies, strategies and legislative amendments. Jenkin highlighted, once more, how defining which human rights values to promote can be challenging. There are also many in a position that can promote human rights through sport but are simply not aware of their position as a ‘sport diplomat’. Hence, creating awareness, defining the appropriate human rights perspective and ensuring that young voices are heard in this process are essential to developing the SGBs’ human rights diplomacies.

Next up was Florian Kirschner (World Players Association/UNI Global Union) who looked at how SGBs have exercised their human rights diplomatic role. Kirschner illustrated how sport has a fundamental role in our society and is naturally connected to several human rights. The sports movement also clings to principles such as fairness, solidarity, equality and inclusion. However, Kirschner argued, SGBs have not always upheld these principles and pointed to several examples, such as widespread corruption, the award of MSEs to countries with questionable human rights records, suppression of free speech and violations of worker’s rights. There have also been instances of ‘sportwashing’, where states use sport events to try to give the impression that they are compliant with human rights, while coming short of their obligations in practice. The World Players Association, NGOs and other trade unions have come together to push SGBs, under the UN framework, to take greater account of human rights. Kirschner closed with the case of Hakeem al-Araibi and highlighted how many actors, including FIFA, were able to use their influence to push for his release.

Lucy Amis (Unicef UK/Institute for Human Rights and Business) then explained to the participants the importance of transferring the policies SGBs have adopted in relation to human rights into actual practice. This means developing strategies that enforce the values SGBs claim to uphold. There are numerous cases where sport has not lived up to these values: including cases where migrant workers are exploited to build MSE sport facilities, cases of child labor, and various instances where fans chant homophobic and racist slurs. Amis highlighted that SGBs must be especially diligent in cases affecting children because they face the highest risk of exploitation. On the other hand, sports diplomacy has helped initiate positive changes in some countries. In Rwanda, sport was used to help rebuild its society amidst significant adversities. There have also been encouraging developments in Qatar. Despite many calls to cancel the World Cup, FIFA’s persistence to hold the World Cup there has helped bring an end to the kafala system. All in all, challenges do remain. For instance, many national SGBs are limited to a very small and amateur staff, which creates greater challenges in creating, implementing and enforcing human rights strategies.

Finally, Guido Battaglia (Centre for Sport and Human Rights) closed the panel and began by giving an overview of the Centre for Sport and Human Rights’ goals and work. Battaglia described how the Centre’s main priority is helping those who are most affected by sports - the athletes, workers, and fans, among others - based on international human rights standards. The Centre promotes and fosters human rights in sport by bringing a wide variety of actors together, including SGBs, local organizing committees, governments, sponsors, broadcasters, international organizations, civil society and trade unions. The aim is to help these groups share best practices, increase their capacities and improve accountability on human rights issues. Battaglia then shared examples of how the Centre has been active in the field. One of these cases concerned Semyon Simonov, a human rights activist in Russia, who had been arrested while interviewing workers building World Cup stadiums in Volgograd. During this time, the Centre held a conference during which Human Rights Watch directly requested FIFA to monitor the situation. This eventually prompted FIFA to attend one of Simonov’s court hearings, acting as a sort of diplomatic pressure and signaling the sports world was watching. Battaglia concluded that pushing human rights through sports diplomacy, while still in its infancy, is gaining momentum and that there is enormous potential to help unite society through sport.

 

b.     Panel 2: A Human Rights Dimension for the EU’s Sports Diplomacy?

The second panel, chaired by Carmen Perez (Universidad Carlos III de Madrid), then directly confronted the central question of how the EU could develop a human rights-based sports diplomacy. Arnout Geeraert (Utrecht University) launched the panel with a purposively provocative statement that EU sports diplomacy is ridiculous and that fundamentally there should be a deepening rather than a widening of its action in this matter. Since the EU has limited resources to focus on its sports diplomacy, it should work to strengthen its current efforts. Generally, the EU promotes liberal norms such as liberty, anti-discrimination, democracy, human rights and good governance in its actions. In the sports sector, the EU has had the greatest success in steering SGBs through negative integration and soft power measures, and SGB usually comply because they seek to be on good terms with the EU. In the end, Geeraert contends that the EU’s sport diplomacy should be to place more pressure on SGBs through a variety of existing channels, including coordinating EU member state positions in international organizations like the Council of Europe, and forming alliances with non-member states. The EU could then push human rights through these various relationships, which would indirectly compel SGBs to respect human rights.

Agata Dziarnowska (European Commission) took a different view from Geeraert and argued that a widening of the EU’s sport diplomacy should also be a part of the EU’s strategy in this field. Fundamentally, Dziarnowska argued, soft power is the EU’s most effective tool, and when you add the fact that Article 165 TFEU gives the EU the ability to cooperate with third countries on issues related to sport, there is a clear path for the EU to act. When it does so, it should be promoting EU values, including those related to human rights. In this context, the EU has already begun to take action within this strategic framework. For example, promoting the aforementioned values will be part of the new Erasmus programme. Additionally, the Council relatively recently adopted Conclusions related to sports events to ‘enhance integrity, transparency and good governance in major sport events’. These Conclusions specifically addressed business and human rights principles and highlight the importance of the selection process. Dziarnowska closed by underlining that EU action will greatly rely on strong political support, particularly from the Member States.

Alexandre Mestre (Sport and Citizenship) built on Dziarnowska’s contention that there is indeed an avenue for the EU to intervene on human rights. Given the wording of Article 165 TFEU, there are a multitude of areas for EU action. Mestre explained that crucial issues such as fighting against human trafficking, doping, child labor, sexual abuse of athletes, excessive commercial/economic exploitation of athletes are matter that deserve the EU’s attention. Furthermore, recent cases, such as Caster Semenya’s dispute with World Athletics, has shown how the SGBs’ eligibility rules could be another area where the EU could add value, given its previous experience with eligibility. Moreover, the EU has tremendous experience dealing with cases of discrimination and could use this expertise as a basis to promote human rights issues. Like Geeraert, Mestre also sees the EU increasing its cooperation with other entities, such as with the Council of Europe, civil society and third countries hosting MSEs. Mestre, nevertheless, also envisages direct cooperation with SGBs as part of the EU’s sports diplomacy strategy.

Lastly, Christian Salm (European Parliamentary Research Service) gave a historical perspective on the EU’s sports diplomacy, emphasizing the European Parliament’s role. Salm described how the 1970s were truly pivotal in this story, especially since it was the ‘decade of breakthrough’ for human rights. There were two events that placed human rights as a top priority: the World Cup in Argentina in 1978 and the 1980 Moscow Olympics. Concerning the first, the European Parliament’s Political Affairs Committee decided to have a hearing concerning human rights to counter political propaganda from Argentina’s right-wing military regime. While the hearing was blocked by a vote, the socialist group decided to hold its own debate, which created a significant media interest. The hearing generated calls for the release of the opposition leader in Argentina and led to a wider debate concerning sport events, specifically with regards to boycotts. Salm then described how leading up to the 1980 Moscow Olympics the international situation following the Soviet invasion of Afghanistan and the wave of oppression on human rights activists stimulated majority support amongst the European Parliament to boycott the Olympics. While the European Parliament was in many ways limited, it understood its role as a guardian of human rights and was able to generate significant attention to these issues. More recently, in February 2014 the European Parliament also held a public hearing on migrant workers building stadiums. With this perspective, Salm explained, the European Parliament can definitely play a part in developing a human rights dimension to EU sports diplomacy.

 

4.     Conclusion

After each of the panels, participants were able to ask questions which stimulated many fruitful discussions, such as the importance of including human rights considerations in MSE bidding processes and defining an overall EU diplomatic strategy that would effectively use the EU’s leverage on these questions. On the latter issue, to prevent a fragmented diplomatic approach, the second panel concluded that coordination between all EU actors and informal policy making – such as raising awareness through public hearings and conferences – can help create a cohesive and effective EU sports diplomacy scheme. In any event, from all the discussions, it is evident that human rights will need to play a greater role in any EU sports diplomacy strategy given the inherent human rights concerns that MSEs carry.

On behalf of the organizers, we would like to thank all the speakers and participants for ensuring a remarkably productive and rich event in difficult times. We look forward to seeing you at the Institute again soon!


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