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

The Reform of FIFA: Plus ça change, moins ça change?

Since yesterday FIFA is back in turmoil (see here and here) after the FIFA Council decided to dismiss the heads of the investigatory (Cornel Borbély) and adjudicatory (Hans-Joachim Eckert) chambers of the Independent Ethics Committee, as well as the Head (Miguel Maduro) of the Governance and Review Committee. It is a disturbing twist to a long reform process (on the early years see our blogs here and here) that was only starting to produce some tangible results.

This journey to a new FIFA started in 2015 after the events that eventually pushed Sepp Blatter and Michel Platini out, and Gianni Infantino in. As noted by the FIFA Reform Committee in its final report, it became clear FIFA needed to undertake “significant modification to its institutional structure and operational processes […] to prevent corruption, fraud, self-dealing and to make the organisation more transparent and accountable”.[1] The Reform Committee put forward a series of recommendations, which later culminated in a set of reforms approved during the Extraordinary FIFA Congress held in Zurich the 26 February 2016. Greater transparency and accountability were the leading mantras of the reform, which – broadly speaking – hinged on (i) generating a cultural change at FIFA, (ii) fostering greater participation of member associations and stakeholders in FIFA and, most importantly, (iii) reforming the principles of governance at FIFA. The essence of the reform process was about changing the governance structures and ethos at FIFA. This was to be done mainly by:

  • Separating the political and management functions
  • Financial Transparency and Transparency of Compensation
  • Term Limits and Eligibility Checks
  • Promotion of the role of women in football

And, to be fair to FIFA, on paper at least, things changed quite dramatically over last year, here is how.


1.     The new FIFA Council                                                                          

First, the reform changed the political and administrative structure of FIFA. The Executive Committee being replaced by the Council, a new body with a different composition and set of competences. The Council’s larger size is aimed at ensuring broader participation and representativeness. While the Executive Committee comprised 24 members plus the FIFA President, the Council is composed of 36 members plus the FIFA President. The Congress elects the President, whereas the other members of the Council represent the confederations. Each Confederation president is ex officio a vice-president of the Council. UEFA has three vice-presidents at the Council and the other Confederations one each, for a total of eight vice-presidents. The rest of the members are divided as follows: four from CONMEBOL and CONCACAF, six from AFC, UEFA and CAF, and two from OFC. 

One of the main objectives of the governance reform was to reduce the possibility of conflicts of interests. To this end, a firm separation between political decision-making and management was considered crucial. Even though the Council’s role is supposed to be confined within the boundaries of supervising FIFA’s administration and defining strategic directions, it retains strong steering powers through its competence, enshrined in Article 34 FIFA Statutes, to nominate and dismiss the members of FIFA’s Committees as well as FIFA’s Secretary General. Nevertheless, the executive functions are delegated to the Secretary General, who has the duty to carry out the day-to-day business and implement the strategies outlined by the Council. While, the Chief Compliance Officer, oversees this activity and reports to the independent Audit and Compliance Committee.

 

2.     The introduction of eligibility checks

The FIFA reform committee recognized that a trustworthy governance of FIFA requires that the executives be, as much as possible, free of conflicts of interest. Hence, all the members of the Council are now subject to eligibility checks carried out by the Review Committee, a special commission within the newly created Governance Committee, formed by its chairperson, its deputy chairperson and one independent member. The members of the Governance Committee are in turn subject to eligibility checks carried out by the investigative chamber of the Ethics Committee. According to Art. 27(8) FIFA Statutes: “candidates for the positions of chairperson, deputy chairperson and members of each of the Audit and Compliance Committee and the judicial bodies must pass an eligibility check carried out by the Review Committee”.[2] The Secretary General is required to fulfil an eligibility check as well[3] and so do the candidates for standing committees.[4] This new check is the cornerstone of FIFA’s governance reform. In the absence of truly open and fair democratic elections to determine who exercises power inside FIFA, the eligibility checks are a fundamental brake to control the pool of potential executives and ensure a modicum of ethical virtue amongst them.


3.     The strive for financial transparency

The FIFA Reform Committee Report proposed to make public the compensation packages of FIFA’s executives. Thus, the new Art. 51(10) FIFA Statues imposes a duty to disclose the individual compensation of the FIFA President, the members of the Council and the Secretary General. The compensation of the said members and the Compensation Rules are determined by the Compensation Sub-Committee within the Audit and Compliance Committee.[5] Indeed, in its 2016 Governance Report, published in April 2017, FIFA disclosed the compensation packages of its executives. This was a much-needed development in light of the way Blatter, Platini and co were playing with FIFA’s finances, sometimes/often to their own benefits.

                                                      

4.     The limited role of the FIFA President

The reformed Statutes reduced the role and discretionary power of the FIFA President, who is now depositary of a more ambassadorial than executive role. Pursuant to Art. 35 FIFA Statutes, the President has no right to vote at the Congress and has one ordinary vote in the Council. The new provision repealed the possibility for the President to have a casting vote whenever votes are split equally inside the FIFA Council.[6] And yet, due to his capacity to set the agenda of the FIFA Council and to steer the Council’s appraisal of the Secretary General, his influence inside the constitutional structure of FIFA should not be underestimated.

 

5.     The introduction of term limits

The need to answer to transparency and accountability demands also resulted in the provision of term ceilings for the most prominent figures within the Organisation. The President, the members of the Council and the members of the independent committees can serve their office for no more than three terms, whether consecutive or not, of 4 years each.[7]

 

6.     The representation of women

FIFA recognised that “football governance at all levels needs to include more women in order to create a more diverse decision-making environment and culture”.[8] It has aimed to achieve this goal in two ways. First, FIFA adopted gender equality as an explicit statutory objective.[9] Second, and more visibly, each Confederation has to reserve for women at least one seat at the FIFA Council.[10]

 

7.     The reform of the standing committees

In order to improve efficiency the number of standing committees was reduced from 26 to 9. The current standing committees, which “advise and assist the Council in their respective fields of function”[11] are: the Governance Committee, the Finance Committee, the Development Committee, the Organising Committee for FIFA Competitions, the Member Associations Committee, the Player’s Status Committee, the Referees Committee, the Medical Committee and the Football Stakeholder Committee. The latter was freshly created to foster greater engagement with the football stakeholders.

Some specific requirements to be fulfilled by the members of the committees are laid out in Art. 39 FIFA Statutes. Paragraph 3 of that provision states that, while the general rule is that members of the committees can be at the same time members of the Council, the members of the Governance Committee, the independent members of the Finance Committee and the independent members of the Development Committee cannot simultaneously belong to the Council.[12]

Furthermore, at least 50% of the members of the Governance Committee, Development Committee and Finance Committee need to fulfil the independence criteria as defined in the FIFA Regulations.[13] These independence criteria need to be fulfilled also by the chairpersons, deputy chairpersons and members of the FIFA judicial bodies, i.e. the Disciplinary Committee, the Ethics Committee (both its investigatory and the adjudicatory chambers) and the Appeal Committee.[14] Furthermore, the members of the Audit and Compliance Committee must not belong to any other FIFA body.[15] The same applies to all the members of the FIFA judicial bodies.[16]


Conclusion: Plus ça change, moins ça change?

To sum up, on paper FIFA did change. It is undeniably a bit more transparent (but we are still waiting for the publication of the Garcia Report or of the decisions of the Ethics Committee) and its executives are a bit more likely to face independent counter-powers (e.g. Ethics Committee or the Governance Committee). FIFA’s reforms rely on a double strategy:

·       independent ex ante control on who is to exercise power inside the organization and;

·       independent ex post review of how this power is exercised.

And yet, with Blatter becoming a phantom of an almost forgotten past, the urge to reform is quickly receding. In fact, reform at FIFA is a bit like the ebb and flow. Its urgency, rises with the tide of public outrage at corruption scandals, and diminishes with public indifference in the face of a new business as usual.

Yesterday, 9 May 2017, we ebbed anew. It seems that the FIFA Council has decided that the time for reforms has past. New sponsors are lining up for the next world cups, the old guard is gone and the time seems ripe to turn the page. However, the institutional changes introduce over the last year made sense only if they are being monitored by strong independent institutions (the Ethics Committee and the Governance Committee), whose members do not feel that they are at the mercy of the power of the FIFA Council. Their role is to be disagreeable and to act as counter-powers, if they are dismissed at will when they do their job then the whole house of cards of FIFA reforms falls apart and we are back to square one. The dismissal and departure of independent and highly qualified academics like Miguel Maduro (with whom I  had the pleasure to work with at the European University Institute during my PhD) and Joseph Weiler are a sign that the Governance Committee and its capacity to control access to FIFA’s most powerful positions is being curtailed. Maybe it’s due, as some seem to think, to the Committee’s decision to bar access to the FIFA Council to Russia’s infamous former sports minister Mutko. In any event, it’s seems that FIFA’s strong (mostly) men are unimpressed by the benefits of “good governance”.

The tide will certainly turn again. Scandals will arise and force through new changes. Nonetheless, one is left to wonder whether the Swiss State and/or the European Union should not forcefully intervene to impose once and for all certain basic “constitutional” requirements  (e.g. independence, transparency, separation of powers) to a global body that exercises a strange form of public-private authority.


[1] 2016 FIFA Reform Committee Report, 2 December 2015, p. 1.

[2] Art. 27(8) FIFA Statutes.

[3] Art. 37 (3) FIFA Statutes.

[4] Art. 39(5) FIFA Statutes.

[5] Art. 51 FIFA Statutes.

[6] Art. 35 FIFA Statutes.

[7] Art. 33 FIFA Statutes.

[8] 2016 FIFA Reform Committee Report, 2 December 2015, p. 9.

[9] Art. 2 f) FIFA Statutes includes “the full participation of women at all levels of football governance” among the objectives of FIFA. The heading of Art. 4 FIFA Statues was amended to explicitly include ‘gender equality’.

[10] Art. 33(5) FIFA Statutes.

[11] Art. 39(2) FIFA Statutes.

[12] Art. 39(3) FIFA Statutes.

[13] Art. 40(1), Art. 41(2) and Art. 42 (1) FIFA Statutes.

[14] Art. 52(4) FIFA Statutes.

[15] Art. 51(1) FIFA Statutes.

[16] Art. 52(5) FIFA Statutes.

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Asser International Sports Law Blog | The EU State aid and Sport Saga: Hungary’s tax benefit scheme revisited? (Part 1)

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

The EU State aid and Sport Saga: Hungary’s tax benefit scheme revisited? (Part 1)

The tax benefit scheme in the Hungarian sport sector decision of 9 November 2011 marked a turning point as regards the Commission’s decisional practice in the field of State aid and sport. Between this date and early 2014, the Commission reached a total of ten decisions on State aid to sport infrastructure and opened four formal investigations into alleged State aid to professional football clubs like Real Madrid and Valencia CF.[1] As a result of the experience gained from the decision making, it was decided to include a Section on State aid to sport infrastructure in the 2014 General Block Exemption Regulation. Moreover, many people, including myself, held that Commission scrutiny in this sector would serve to achieve better accountability and transparency in sport governance.[2]

Yet, a recent report by Transparency International (TI), published in October 2015, raises questions about the efficiency of State aid enforcement in the sport sector. The report analyzes the results and effects of the Hungarian tax benefit scheme and concludes that:

“(T)he sports financing system suffers from transparency issues and corruption risks. (…) The lack of transparency poses a serious risk of collusion between politics and business which leads to opaque lobbying. This might be a reason for the disproportionateness found in the distribution of the subsidies, which is most apparent in the case of (football) and (the football club) Felcsút.”[3]

In other words, according to TI, selective economic advantages from public resources are being granted to professional football clubs, irrespective of the tax benefit scheme greenlighted by the Commission or, in fact, because of the tax benefit scheme.

One would expect TI’s report to be a wake-up call for the Commission, triggering it, as “Guardian of the Treaties”, to re-investigate Hungary’s tax benefit scheme without delay. Further incentives to scrutinize the matter is provided by the Hungarian MEP Péter Niedermüller, who in November 2015 officially asked the Commission whether it intended to review its earlier decision to authorize the tax benefit scheme. The Commission’s answer, seen here below, indicates that immediate action is not to be expected.


Not satisfied with this answer, Niedermüller replied that even though the Commission had authorized the tax scheme in 2011, it does not absolve it “from the obligation to proceed with the appropriate care thereafter and to monitor whether the system is operating in accordance with the objectives originally set”.

The overall aim of this two-part blog is to analyze the rules and procedures surrounding the monitoring of previously authorized aid schemes in the sports sector by the Commission. It will use the tax benefit scheme in the Hungarian sport sector decision as a starting point, describing the objective and the functioning of the aid scheme, as well as the conditions and obligations for Hungary and the Commission attached to it. In continuation, basing myself on the findings and conclusions drawn in the report, I will try to determine whether the current practice in Hungary deviates from the original objectives and conditions of the aid scheme, and what the consequences of such a deviation could be. Do the State aid rules impose an obligation upon the Commission to act and, if so, in what way? Furthermore, could the Hungarian case make one reconsider the usefulness of State aid rules to achieve better accountability and transparency in sport in general? 


The tax benefit scheme in the Hungarian sport sector decision

A description of the scheme

In April 2011, the Hungarian authorities notified the Commission of their plans to introduce a tax benefit scheme with the aim of developing the country’s sport sector.[4] More specifically, via the scheme, they hoped to “increase the participation of the general public in sport activities, by inter alia, promoting mass sport events, training of the young generations as well ensuring adequate sport infrastructure and equipment for the general public”. Due to the existence of a market failure (i.e. a situation where individual market investors do not invest even though this would be efficient from a wider economic perspective), Hungary saw itself obligated to provide public money to the sport sector in order to achieve the aforementioned objectives.[5]

Under the scheme, which will run until 30 June 2017, corporations (operating in any sector that is subject to corporate tax) can choose to donate money to sport organizations, both amateur and professional. Sport organizations may use these resources to train the young generation, cover personnel expenses and to construct/renovate sport infrastructure. The donations would be deducted from the corporation’s taxable income and from their tax liability.[6] Hungary decided to focus the aid scheme on the five most popular team sports in the country, i.e. football, basketball, ice hockey, water polo and handball. The reasoning behind this choice is that the scheme would not only benefit the sport organizations themselves, but also the sportsmen and sportswomen using the facilities, as well as the general public interested in attending the sporting events.[7] Sport organizations wishing to receive donations have to elaborate a development programme (DP), in which they outline the planned use of the donations. The DPs are evaluated by the respective national sport governing bodies (SGBs), who decide whether the sport organization is eligible for the donations. Once the SGBs approve a DP, the sport organizations may approach corporations willing to donate money to them.[8]

In the specific case of donations used for the construction, renovation or maintenance of sport infrastructures, Hungary notified the Commission that it had introduced a monitoring system that serves to avoid any misuse of the donations or cross-subsidizations of other activities of sport organizations. The so-called Controlling Authority (a public entity falling directly under the Ministry of National Resources) monitors compliance of donators and beneficiaries with the central price benchmarking mechanism regarding rental and operation fees of the infrastructure, introduced to limit the distortion of competition arising from the tax benefit scheme.[9]  


The Commission’s decision

As stated above, the donations should be used to fund the development of sport infrastructure, train the youth teams and cover personnel expenses. The Commission agreed with Hungary that the training of youth teams falls outside the scope of EU State aid rules, in line with the 2001 Commission Decision Subventions publiques aux clubs sportifs professionels. Donations used to cover personnel costs could be falling under the General Block Exemption Regulation[10] or the de minimis aid Regulation.[11] Compliance with the two Regulations is a task for the Hungarian authorities.[12] Consequently, and taking into account that amateur sport clubs are generally not considered to be undertakings within the meaning of Article 107(1) TFEU, the tax benefit scheme in the Hungarian sport sector decision only covers aid for the infrastructures used by the professional sport organizations.

Although the tax benefit scheme fulfilled the criteria of Article 107(1), and thus constituted State aid, the Commission declared the scheme compatible with EU law under Article 107(3)c) TFEU. Importantly, the Commission held that the scheme was introduced in a sufficiently transparent and proportionate manner, i.e. that the measure was well-designed to fulfil the objective of developing the country’s sport sector.[13] Moreover, the Commission acknowledged the special characteristics of sport and held that the objective of the scheme is in line with the overall objectives of sport as stipulated in Article 165 TFEU, namely that the EU “shall contribute to the promotion of European sporting issues”, because the sport sector “has enormous potential for bringing the citizens of Europe together, reaching out to all, regardless of age or social origin”.[14]

It is worth mentioning that the Commission took a very similar approach in its decisions on the other State aid measures granted for sport infrastructure. It considers a sport infrastructure as embodying a typical State responsibility for which the granting of State aid is a well-defined objective of common interest.[15]

Finally, to ensure that the monitoring and transparency obligations are carried out properly, the Commission requires Hungary to submit an annual report to the Commission, containing inter alia, information on the total aid amount allocated on the basis of this scheme, the sport infrastructure projects funded, their aid intensities, their beneficiaries, the parameters applied for benchmarking prices, the rents effectively paid by the professional sport organizations, as well as a description on the benefits provided to the general public and on the multifunctional usage of the infrastructures.[16] There is no requirement to publish this annual report. Therefore, assessing whether the information provided by Hungary to the Commission is in line with the actual practice in the country is currently extremely difficult. 


Transparency International report, “Corruption Risks in Hungarian Sports Financing”

The tax benefit scheme in the Hungarian sport sector decision looked like a blue print for the way in which public authorities could grant State aid to the sport sector: It was aimed at a wide scope of recipients and the general public would benefit as well, transparency was guaranteed, monitoring and compliance mechanisms were introduced and, last but not least, it was notified in advance to the European Commission. 


Lack of transparency

However, TI’s report shows that, four years after the scheme was launched, little remains of all those good intentions. To start with, TI claims that Hungary’s objective was not to increase the participation of the general public in sport activities, but simply to make Hungarian football clubs “excel at the European and international levels”.[17] TI’s primary finding is that there is a flagrant lack of transparency on every level regarding the scheme. Most of the data collected in the report was obtained by TI through freedom of information requests.[18]

The first flaw in the scheme is that under Hungarian national laws and regulations, there is no obligation to disclose the identity of the donating corporations. Consequently, even though the SGBs keep count of which clubs are entitled to receive donations and how much they actually received, many questions remain on how the money is distributed in practice.

TI also questions the integrity of the clubs’ eligibility process. The Hungarian SGBs, who are in charge of selecting the clubs worthy of receiving donations, are to a large extent run by people with close ties to the Hungarian Government.[19] Moreover, for the selection process, the SBGs do not need to provide a reasoning behind the decision to choose or not to choose a club worthy of donations. As TI states, the tax benefit scheme poses a serious threat to transparency and accountability, and can lead to illicit lobbying and backroom deals between politicians, businessmen and clubs. 


Disproportionate distribution of beneficiaries

The advantage of using a general tax scheme as a State aid measure is that it leads to many different beneficiaries and is therefore considered as one of the least distortive type of state intervention.[20] However, the functioning of this particular tax benefit scheme creates the exact opposite result a few clubs are clearly favored. According to the report, the subsidies from the tax scheme totaled €649 million in four years. An amount of €240 million was specifically designated for football clubs, 37% of the total amount. Of all the money donated to football, 28% (or €68 million) went specifically to 13 football clubs, who, perhaps unsurprisingly, all play in Hungary’s highest football league.[21] Of these 13 football clubs, Puskás Akadémia FC received by far the highest amount, no less than €30 million. Puskás Akadémia FC plays in Hungary’s top division, but also functions as the youth team of Videoton FC, one of Hungary’s biggest and most successful clubs. Interestingly enough, Puskás Akadémia FC was founded in 2007 by the current Hungarian Prime Minister Viktor Orban. 


Unnecessary construction of new sport infrastructure?

The Hungarian authorities expressed the need in 2011 for adequate sport infrastructure facilities. Due to a market failure, it was necessary for the State to step in and provide the necessary funds, albeit by means of a tax benefit scheme. The Commission agreed with Hungary that there is a lack of investments in sport infrastructure and that using public money to do so is an objective of common interest.[22] The TI report indicates that especially the Hungarian football stadiums have undergone significant upgrades since 2011, but at the same time questions the necessity to use public funds for these upgrades. Hungarian professional football has not been attracting more people to stadiums since 2011. The country’s highest division averaged only 4,897 spectators per game for the 2014/15 season, 624 less than in the previous year.[23] An example of potential unnecessary construction of sport infrastructure is the “Nagyerdei” stadium, opened in 2014,  in the city of Debrecen. The stadium, that can hold over 20,000 spectators, cost €40 million to construct. However, with a match average of 3,400,[24] one wonders whether the construction of this stadium was an objective of common interest, or whether there was another, hidden, agenda. Referring to the well-reported, including by the European Commission, close relationships between Hungary’s businesses and its political elite, TI points to the realistic possibility that the construction and renovation of (football) stadiums through public procurement procedures, was simply a way to for contractors to “finance the economic orbit of influential politicians in return for all manners of political and financial favours”.[25]  


Interim conclusion

TI’s report clearly shows that there is a huge discrepancy between Hungary’s intention to devise a tax benefit scheme benefitting to the entire sport sector, as notified to the Commission in 2011, and the actual operation of the scheme. The necessity for new and renovated football infrastructure appears superfluous and the tax benefit scheme itself proved to be more beneficial for some clubs, particularly Puskás Akadémia FC. Furthermore, the Commission decision declaring the tax benefit scheme compatible with EU law highlighted the transparency of the scheme and acclaimed its monitoring mechanisms. More than four years on, it can be concluded that the scheme is far from transparent and questions can be raised on the independence and functioning of the monitoring mechanisms. Assuming that the Commission receives annual reports by the Hungarian authorities on the tax benefit scheme, why has it not undertaken any action? Is it simply a matter of unwillingness or could the answer be found in EU State aid law and its procedural rules itself? The next part of this blog will analyze the rules and procedures surrounding the monitoring of previously authorized aid schemes by the Commission, and determine whether Commission action can be expected.



[1] An explanation on why the public financing of sports infrastructure and professional sports clubs only started to attract State aid scrutiny in recent years can be read in: Ben Van Rompuy and Oskar van Maren, “EU Control of State Aid to Professional Sport: Why Now?” Forthcoming in: “The Legacy of Bosman. Revisiting the relationship between EU law and sport”, T.M.C. Asser Press, 2016.

[2] See for example Oskar van Maren, “EU State Aid Law and Professional Football: A threat or a Blessing?”, European State Aid Law Quarterly, Volume 15 1/2016, pages 31-46.

[3] Transparency International, “Corruption Risks in Hungarian Sports Financing”, page 41.

[4] Commission Decision of 9 November 2011, SA.31722 – Hungary - Supporting the Hungarian sport sector via tax benefit scheme, paras 2-3.

[5] Ibid., paras 88-90.

[6] Ibid., paras 15-16.

[7] Ibid., paras 28-34.

[8] Transparency International report of 22 October 2015, “Corruption Risks in Hungarian Sports Financing”, page 31.

[9] Commission Decision SA.31722, paras 37-39.

[10] The GBER applicable at the time the decision was taken was Commission Regulation No800/2008 of 6 August 2008.

[11] Commission Decision SA.31722, para 10.

[12] Ibid., para 64.

[13] Ibid., paras 95-98.

[14] Ibid., paras 86-87.

[15] See for example Commission Decision of 20 March 2013, SA.35135 Multifunktionsarena der Stadt Erfurt, para 14.

[16] Commission Decision SA.31722, para 57.

[17] Transparency International report, page 29.

[18] Ibid., page 31.

[19] Ibid., page 32. TI points out that the chairman of the Hungarian FA is CEO of the country’s biggest commercial bank and close to the Government.

[20] Commission Decision SA.31722, para 20.

[21] The TI report actually mentions the clubs as well as their youth academia. The 13 clubs are: Puskás Akadémia FC (aka Felcsút FC, the youth team of Videoton FC); Ferencváros; Újpest FC; Vasas SC; Szolnoki MÁV FC; Debreceni VSC; Diósgyőri VTK; Zalaegerszegi TE; OVI-FOCI; Illés Sport Alapítvány; Budapest Honvéd FC; Balmazújvárosi FC and; Békéscsaba 1912 Előre.

[22] Commission Decision SA.31722, paras 91-93.

[23] Transparency International report, page 38.

[24] Ibid.

[25] Ibid., page 42.

Comments (1) -

  • Colin MIEGE

    5/18/2016 5:51:33 PM |

    This is a very good and deeply investigating paper.
    Congratulations!

Comments are closed
Asser International Sports Law Blog | 20 Years After Bosman - The New Frontiers of EU Law and Sport - Special Issue of the Maastricht Journal of European and Comparative Law

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

20 Years After Bosman - The New Frontiers of EU Law and Sport - Special Issue of the Maastricht Journal of European and Comparative Law

Editor's note: This is a short introduction written for the special Issue of the Maastricht Journal of European and Comparative Law celebrating the 20 years of the Bosman ruling and dedicated to the new frontiers of EU law and Sport (the articles are available here). For those willing to gain a deeper insight into the content of the Issue we organize (in collaboration with Maastricht University and the Maastricht Journal) a launching event with many of the authors in Brussels tomorrow (More info here).



 20 Years After Bosman - The New Frontiers of EU Law and Sport

By Antoine Duval

The Bosman ruling is not just another ruling of the Court of Justice of the EU (CJEU), it is by far the most well-known decision of the Court outside of the Euro-bubble.[1] In the UK the phrase ‘a Bosman’ is commonly used to qualify the free move of a football player to a new club at the end of his contract. Beyond its anchoring in the English idiom, Bosman stands out as a shared European reference. However, it is often – misleadingly - credited for all the ills and wrongs of football. In any case, it is part and parcel of the European (even worldwide) public debate on football and its regulation. If a European public sphere is to emerge at some point, the heated public discussion that was triggered in Europe by Bosman is probably an avant-goût of it. Therefore, 20 years after the ruling, the least a European sports lawyer and academic can do, is to acknowledge ones indebtedness and, to some extent, gratitude for this ruling.

One aspect that needs to be emphasized is that Bosman is not an instrument with the paramount objective to deregulate the football market or the world of sport in general. It is not, as many on the side of the Sports Governing Bodies (SGBs), and FIFA and UEFA in particular, have portrayed it, a decision aimed at destroying the transnational legal system (also known as lex sportiva) they had put in place to coordinate the organization and unfolding of transnational sporting competitions. On the contrary, SGBs have the possibility to justify their rules and regulations. As Stephen Weatherill rightly pointed out long ago, the only requirement SGBs have to fulfil to ensure that their regulations comply with EU law is to explain convincingly why they are needed.[2] Thus, a constructive (and positive) perspective on Bosman stresses its constitutional over its deregulatory function. Private regulations adopted by private powers, which are not particularly renowned for the quality of their governance, need to be subject to checks and balances. After Bosman, the EU free movement rights and competition law have impersonated such a check on (or counter-power to) the rules privately adopted and enforced by SGBs. In fact, it is here that the true, long-lasting legacy of Bosman lies.

This issue brings together a mixed line-up of both young and established scholars, sports law experts and EU law specialists, to discuss the legacy of Bosman and the future of the relationship between EU law and sport. Besides the synthetic and comprehensive introductory piece of Stefaan Van Den Bogaert that brings us back to the original crusade of Mr Bosman, all the contributions are geared towards the recent and future legacies of the ruling. A broad range of legal problems raised by the interaction of EU law and sport is touched upon. 

In the first article, Ben Van Rompuy builds on Advocate General Lenz’s conclusions in Bosman, the following practice adopted by the EU Commission as well as on the case law of the CJEU on competition law and sport to argue that competition law can be a powerful tool to impose a legal check on the regulatory practices of SGBs.

In the second piece, Phedon Nicolaides analyses a relatively new front line between EU law and sport: state aid. Although not directly connected to Bosman, state aid cases are taking a prominent place in the practice of the EU Commission in the field of sport. In fact, state aid law has become a useful legal proxy to control the way public authorities decide to support economically sporting organizations and their events.

The third piece by the editor of this issue is dedicated to the interaction between the Court of Arbitration for Sport (CAS) and EU law. Indeed, the emergence of the CAS is probably the most important institutional legacy of Bosman, and EU law now has a role to play in exercising a form of ‘Solange’ control over CAS’s judicial activity.

In the fourth article, which follows most clearly into the footpath of Bosman, Richard Parrish discusses the compatibility of the FIFA Regulations on the Status and Transfers of Players (RSTP) with EU law. He suggests that the RSTP as it stands can be deemed contrary to EU law.

The fifth article of the issue by Jacob Kornbeck, a former member of the sports unit of the European Commission, analyses the role of the Commission in the drafting process of the new World Anti-Doping Code recently adopted by the World Anti-Doping Agency. He highlights that the ethos of Bosman spread to other spheres of action of the EU in sport and shows concretely in what way it influenced the position of the EU in the negotiations over the new Code that entered into force in January 2015. Finally, Anna Sabrina Wollmann, Olivier Vonk and Gerard-René de Groot look at the growing problem of nationality requirements in sports. If Bosman stands more particularly for an Europeanization of football, globalization and the ease of cross-border movement for professional sportspeople have heightened the question of the sporting nationality of athletes worldwide. This contribution critically analyses the many calls for a separate sporting nationality and proposes an alternative path.


[1] Case C-415/93 Union royale belge des sociétés de football association ASBL v. Jean-Marc Bosman, Royal club liégeois SA v. Jean-Marc Bosman and others and Union des associations européennes de football (UEFA) v. Jean-Marc Bosman, EU:C:1995:463.

[2] ‘The ECJ has collapsed the idea that there are purely sporting practices unaffected by EC law despite their economic effect, but it has not refused to accept that sport is special. Its message to governing bodies – explain how!’, S. Weatherill, European Sports Law (T.M.C. Asser Press, 2007), p. 353.


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