Asser International Sports Law Blog

Editor’s note: Thomas Terraz is a third 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

Christmas has come very early this year for the EU sports law world in the form of the Court of Justice of the European Union’s (CJEU) judgment in TopFit eV, Daniele Biffi v Deutscher Leichtathletikverband eV by exclusively analyzing the case on the basis of European citizenship rights and its application to rules of sports governing bodies that limit their exercise. The case concerned an Italian national, Daniele Biffi, who has been residing in Germany for over 15 years and participates in athletic competitions in the senior category, including the German national championships. In 2016, the Deutscher Leichtathletikverband (DLV), the German Athletics Federation, decided to omit a paragraph in its rules that allowed the participation of EU nationals in national championships on the same footing as German citizens. As a result, participation in the national championship was subject to prior authorization of the organizers of the event, and even if participation was granted, the athlete may only compete outside of classification and may not participate in the final heat of the competition. After having been required to compete out of classification for one national championship and even dismissed from participating in another, Mr. Biffi and TopFit, his athletics club based in Berlin, brought proceedings to a German national court. The national court submitted a request for a preliminary ruling to the CJEU in which it asked essentially whether the rules of the DLV, which may preclude or at least require a non-national to compete outside classification and the final heat, are contrary to Articles 18, 21 and 165 TFEU. Articles 18 and 21 TFEU, read together, preclude discrimination on the basis of nationality against European citizens exercising their free movement. The underlying (massive) question here is whether these provisions can be relied on by an amateur athlete against a private body, the DLV.

Covered in a previous blog, the Advocate General’s (AG) opinion addressed the case from an entirely different angle. Instead of tackling the potentially sensitive questions attached with interpreting the scope of European citizenship rights, the opinion focused on the application of the freedom of establishment because the AG found that participation in the national championships was sufficiently connected to the fact Mr. Biffi was a professional trainer who advertised his achievements in those competitions on his website. Thus, according to the AG, there was a sufficient economic factor to review the case under a market freedom. The CJEU, in its decision, sidelined this approach and took the application of European citizenship rights head on.

The following will dissect the Court’s decision by examining the three central legal moves of the ruling: the general applicability of EU law to amateur sport, the horizontal applicability of European citizenship rights, and justifications and proportionality requirements of access restrictions to national competitions. More...

1. Introduction

To many it may seem obvious that athletes in a national championship should only be able to participate if they have the nationality of the relevant state. The Dutch Road Cycling National Championships should have Dutch cyclists, and the German Athletics Championships should have German athletes and so forth. However, in reality, foreign competitors are allowed to participate in many national championships in the EU, and there is a wide discrepancy between the rules of national sport governing bodies on this issue. There is no unified practice when investigating this point by country or by sport, and rules on participation range from a complete ban on foreign competitors to absolutely no mention of foreign athletes.[1] Thus, the question arises: should foreign athletes be able to participate in national sport championships?

The Court of Justice of the European Union (CJEU) will soon be required to provide an, at least partial, answer to this dilemma as a result of an application for a preliminary ruling. A German Court has referred three questions to the CJEU on the case TopFit e.V. Daniele Biffi v Deutscher Leichtathletikverband e.V. (DLV) which in essence ask whether EU citizenship rights and in particular, the requirement of non-discrimination on the basis of nationality, should be applied to non-nationals wishing to participate in an athletics national championship in Germany. In the meantime, the Advocate General (AG), who provides a non-binding opinion to the Court before a decision is delivered, Evgeni Tanchev has delivered an interesting opinion on the case. It addresses the claims from the applicants based on EU citizenship rights and urges the CJEU to instead review the case on the basis of the freedom of establishment.

This blog will dissect the AG’s opinion to assess the main arguments put forward in relation to freedom of establishment and EU citizenship. Furthermore, it will weigh the ramifications this case may have on the boundaries of EU law in relation to sport. To fully appreciate the AG’s opinion, it is necessary to first discuss the intriguing factual and legal background colouring this case. After all, this will not be the first time the CJEU faces thorny issues concerning discrimination on the basis of nationality and sport. More...

Editor’s note: Sven Demeulemeester and Niels Verborgh are sports lawyers at the Belgium law firm, Altius.

Introduction

In its 16 November 2018 judgment, the Court of Justice of the European Free Trade Association States (the EFTA Court) delivered its eagerly awaited ruling in the case involving Henrik Kristoffersen and the Norwegian Ski Federation (NSF).

On 17 October 2016, Kristoffersen had taken the NSF to the Oslo District Court over the latter’s refusal to let the renowned alpine skier enter into a sponsorship with Red Bull. At stake were the commercial markings on his helmet and headgear in races organised under the NSF’s umbrella. The NSF refused this sponsorship because it had already granted the advertising on helmet and headgear to its own main sponsor, Telenor. Kristoffersen claimed before the Oslo District Court, that the NSF should be ordered to permit him to enter into an individual marketing contract with Red Bull. In the alternative, Kristoffersen claimed damages up to a maximum of NOK 15 million. By a letter of 25 September 2017, the Oslo District Court referred several legal questions to the EFTA Court in view of shedding light on the compatibility of the rules that the NSF had invoked with EEA law.

If rules do not relate to the conduct of the sport itself, but concern sponsorship rights and hence an economic activity, these rules are subject to EEA law. The EFTA Court ruling is important in that it sets out the framework for dealing with - ever more frequent - cases in which an individual athlete’s endorsement deals conflict with the interest of the national or international sports governing bodies (SGBs) that he or she represents in international competitions.More...

Editor's Note: Christopher is an editor of the Asser International Sports Law Blog. His research interests cover a spectrum of sports law topics, with a focus on financial regulatory disputes, particularly in professional football, a topic on which he has regularly lectured at the University of the West of England.

It is five years since the Union of European Football Associations (UEFA) formally introduced ‘Financial Fair Play’ (FFP) into European football through its Club Licensing and Financial Fair Play Regulations, Edition 2012. With FFP having now been in place for a number of years, we are in a position to analyse its effect, its legality, and how the rules have altered over the last half decade in response to legal challenges and changing policy priorities. This article is split into three parts: The first will look at the background, context and law applicable to FFP; Part Two will look at the legal challenges FFP has faced; and Part Three will look at how FFP has iteratively changed, considering its normative impact, and the future of the rules. More...

Editor’s note: Kester Mekenkamp is an LL.M. student in European Law at Leiden University and an intern at the ASSER International Sports Law Centre. This blog is, to a great extent, an excerpt of his forthcoming thesis, which he shall submit in order to complete his master’s degree.

This final blog aims to provide some broader perspective, by sketching first the grander scheme in which Article 19 RSTP – FIFA's provision on the protection of minors – operates. Thereafter, the focus will shift towards testing Article 19 RSTP, thereby keeping in mind the previous blogs (Part 1: The Early Years and Part 2: The 2009 reform and its aftermath), against EU free movement law.

Putting Article 19 RSTP into perspective: The bigger picture

After having investigated the nuts and bolts of FIFA’s provision on the protection of minors in the first two parts of this blog, it might be useful to address its bigger picture.

Article 19 RSTP and its accompanying provisions regulate only a small share of the targeted activity. There is, unfortunately, also an illegal world. Circumvention of the prohibition is allegedly commonplace.[1] Visas and passports can be falsified.[2] Work permits can be obtained on the basis of jobs arranged by clubs.[3] More...

This is the second part of a three-piece blog on FIFA’s provision on the protection of minors, Article 19 of the Regulations on the Status and Transfer of Players. The contribution in its entirety aims to provide an encompassing overview of the rule’s lifespan since its inception in 2001. The previous (first) part has shed light on the “birth” and “first years” of the provision, and as such illustrated the relevant developments from 2001 till 2009. This second part covers the rule’s “adolescent years”, which span from 2009 to the present. The major changes put forward in the 2009, 2015 and 2016 versions of the RSTP will be addressed. Thereafter the important CAS decisions concerning Article 19, Muhic, Vada I and II, FC Barcelona, RFEF, and the FIFA decisions relating to Real Madrid and Atlético Madrid, will be scrutinized. The third, and final, part will constitute a substantive assessment of the provision under EU Internal Market law.

Given that the version adopted in 2008 left Article 19 untouched, the 2009 RSTP represented the next significant step in the regulation of the protection of minors. It had become clear that the system as used up to that point was inadequate to achieve its goal,[1] most notably because several national associations still neglected to strictly apply the rules.[2] More...

On 24 November 2016, a claim was lodged before a Zurich commercial court against FIFA’s transfer regulations by a 17-year-old African football player.[1] The culprit, according to the allegation: The provision on the protection of minors, Article 19 of the Regulations for the Status and Transfer of Players.[2] The claimant and his parents dispute the validity of this measure, based on the view that it discriminates between football players from the European Union and those from third countries. Besides to Swiss cartel law, the claim is substantiated on EU citizenship rights, free movement and competition law. Evidently, it is difficult to assess the claim’s chance of success based on the sparse information provided in the press.[3] Be that as it may, it does provide for an ideal (and unexpected) opportunity to delve into the fascinating subject of my master thesis on FIFA’s regulatory system aimed at enhancing the protection of young football players and its compatibility with EU law. This three-part blog shall therefore try to provide an encompassing overview of the rule’s lifespan since its inception in 2001. More...

Editor's note: 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 result of the Brexit referendum on 23 June 2016 took the European Union (almost) by surprise. A lot has been said and written about the impact of the United Kingdom leaving the EU. As in all other areas, the British sport sector will also face the effects of the modification of the relationship between the EU and its (probable) former Member State, the UK. It is nearly impossible to foresee all consequences as the UK has not even triggered article 50 TFEU yet to officially start the exit negotiations. However, as the UK position toward the EU will change in any case, this two-part blog aims to examine the main practical implications of such an exit for the UK, but also for the EU, in relation to the actual application of EU law in sport and the EU sport policy.

Unless stated otherwise, the use of the terms Brexit in this blog should be understood as a complete exit of the UK from the European Union. This blog focus in particular on this worst case scenario and its consequences for UK sport. However, it is highly improbable that the future Brexit negotiations with the EU will end up without some kind of special agreement between the two parties the first of which being an EEA type of agreement with full access to the internal market and applicability of EU law.

The first part of this blog will examined the consequences for UK sport in terms of access to the EU internal market and the applicability of free movement principles. The second part is focused on specific impacts with regard of others domain of EU law for professional and grassroots UK sport. More...

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).More...

Due to the legitimate excitement over the recent Pechstein ruling, many have overlooked a previous German decision rendered in the Wilhelmshaven SV case (the German press did report on the decision here and here). The few academic commentaries (see here and here) focused on the fact that the German Court had not recognized the res judicata effect of a CAS award. Thus, it placed Germany at the spearhead of a mounting rebellion against the legitimacy of the CAS and the validity of its awards. None of the commentators weighed in on the substance of the decision, however. Contrary to the Court in Pechstein, the judges decided to evaluate the compatibility of the FIFA rules on training compensations with the EU free movement rights. To properly report on the decision and assess the threat it may constitute for the FIFA training compensation system, we will first summarize the facts of the case (I), briefly explicate the mode of functioning of the FIFA training compensation system (II), and finally reconstruct the reasoning of the Court on the compatibility of the FIFA rules with EU law (III).More...

Editor's Note: Ryan Gauthier is Assistant Professor at Thompson Rivers University in Canada. Ryan’s research addresses the governance of sports organisations, with a particular focus on international sports organisations. His PhD research examined the accountability of the International Olympic Committee for human rights violations caused by the organisation of the Olympic Games.

Publicly Financing a Stadium – Back in the Saddle(dome)

Calgary, Canada, held their municipal elections on October 16, 2017, re-electing Naheed Nenshi for a third term as mayor. What makes this local election an interesting issue for sports, and sports law, is the domination of the early days of the campaign by one issue – public funding for a new arena for the Calgary Flames. The Flames are Calgary’s National Hockey League (NHL) team, and they play in the Scotiabank Saddledome.

Scotiabank Saddledome, credit to Lorraine Hjalte, Calgary Herald

The team began play in 1972 as the Atlanta Flames, moving to Calgary in 1980. The Saddledome was built in 1983 to support both the newly-arrived Flames, and Calgary’s 1988 Winter Olympic Games. Today, the Saddledome is the oldest arena in operation in the NHL. Due to its age, and the damage caused by floods in 2013, the Flames are looking for a new home. As is the norm in North America, the Flames have no intention of going it alone, but are seeking a deal with the City of Calgary where the city would subsidize part of the arena. Negotiations have been ongoing for several years, with a few possible sites discussed.

Shortly into the 2017 municipal election campaign, negotiations between Calgary and the Flames broke down. The City of Calgary publicly released their proposal for a $555 million stadium, where the city would effectively subsidize 33% of the stadium through a mix of funding, land, and demolition of the old Saddledome. The team would pay 33% of the costs, and the fans would kick in the final 33% through a ticket tax. The Flames responded by releasing their proposal for a $500 million stadium, where the city would provide 45% of the funding through a ‘Community Revitalization Levy’ (a loan from the province of Alberta, paid off by property taxes on new developments around the arena), with the team providing 55% of the remainder. The difference in costs may be that the Flames’ proposal does not appear to consider the demolition of the old Saddledome. While the team’s proposal has the team paying more costs up-front, it would also see the Flames pay no property tax or rent during their tenure in the new stadium, while keeping all revenue generated by the arena.

Canadian national media praised Mayor Nenshi for not simply capitulating to the demands of the Flames. Print media exhorted taxpayers to “Just say ‘No’” to subsidizing the Flames, and called Nenshi’s re-election “a win for every city blackmailed by a sports team”. The Calgary Flames, and the NHL were less sanguine, as NHL Commissioner Gary Bettman blamed Nenshi for not getting a new arena for the Flames, and Flames’ management suggesting that the team would have to move. The night of Nenshi’s re-election saw the communications director of the Flames, Sean Kelso, take a more direct stance:

The ongoing dispute in Calgary is emblematic of a larger problem in North America – the public financing of stadiums for professional sports teams.

Public Financing of Stadiums in North America – A General Overview

North American cities have subsidized stadiums for professional sports teams for decades. However, cities rarely simply transfer cash to a team. Instead, more complex mechanisms are used: issuing bonds, tax increases, lotteries, and the use of “eminent domain”.

First, cities may provide money for stadiums through providing bonds to team owners. These bonds are tax-exempt, and are normally used by cities for public improvements. Cities have been able to justify their use for stadiums, and the tax-exempt nature of the bonds lowers the lifetime borrowing costs for a team. Second, cities may simply increase taxes. Cities used to increase property taxes to raise money for stadiums, but local residents began to resent such increases. Today, cities often increase “sin taxes” (e.g., on alcohol, or gambling), or taxes on hotels, in an attempt to move the burden of increased taxation to out-of-town people who won’t be voting in the next municipal election. Third, cities may set up lotteries, in conjunction with the state or province, to raise money for the stadium. Finally, cities may exercise their use of “eminent domain”. This tactic enables cities to condemn the land, with payment of just compensation (which is often not market value) to the original owner, for the furtherance of a “public purpose” (what constitutes a public purpose is broad, following the US Supreme Court decision in Kelo v. City of New London, 545 U.S. 469 (2005)).

After understanding the what, the question remains: why do cities subsidize sports stadiums? Ultimately, there is a limited supply of major-league teams, and cities view being a “major league” city as a benefit. Unlike European professional leagues, where any local team could make it to the top league through promotion, the top leagues in North America are closed leagues, currently limited to 30-32 teams in the “big four” leagues. Cities that want to be home to a professional team must convince a league to expand, placing a new team in their city (as Las Vegas recently did with the NHL), or convince an owner of an already-existing team to relocate (as Las Vegas has done with the National Football League’s Oakland Raiders). One way to encourage expansion or relation is to offer a subsidized stadium. It can be argued that these tactics are no different than a city offering a subsidy to convince a company to establish or relocate an office – like what is happening with Amazon right now – except for the scale of the subsidy.

Boosters of stadium subsidies have argued that cities should be happy to have sports teams, as the teams will generate an economic boost. They claim that the team, and their new stadium, will increase local income, employment rates, property values, and the well-being of citizens. However, economists have generally debunked these claims. While there are examples of successful stadiums, they are generally not as successful as predicted, often not worth the costs, and the few successes are drowned out by every other instance where the economic impact was not realized (sort of like hosting the Olympic Games or FIFA World Cup).

Proposed Legal Solutions to Halt Public Financing of Stadiums

Given the lack of economic benefits generated by stadiums, particularly given the hundreds of millions of dollars of subsidies granted to each stadium, legal scholars have proposed legislative, regulatory, and judicial solutions to halting this gravy train.

In regards to legislative solutions, Canada and the United States could follow the model of the European Union (EU). The EU has restrictions on government assistance to private industries, to prevent the distortion of competition across the EU – these are known as the “State Aid” rules, found in Art. 107 of the Treaty on the Functioning of the European Union. In practice, the EU has an uneven history of applying the State Aid rules to sport. However, it has shown more enthusiasm over the past year to find evidence of state aid that is incompatible with the Treaty, including in a case that involved a questionable deal involving land next to Real Madrid’s Bernabéu Stadium. However, legislative solutions are unlikely to be enacted by either the American Congress or the Canadian Parliament (or local legislative bodies). There appears to be no interest to do so, and why would there be? Politicians can benefit from new stadiums by working with business elites who support the stadiums, and the evidence of repercussions at the ballot box appear to be mixed.

Some legal scholars have suggested regulatory or judicial solutions, such as: halting the tax-free status of municipal bonds, ending the use of eminent domain to obtain land for stadiums, and advocated a stronger role for antitrust oversight over the conduct of teams and leagues in this regard. However, courts have construed these particular laws broadly enough to allow the public financing of stadiums to continue.

A Good Governance Approach to the Public Financing of Stadiums – Atlanta Braves Case Study

When even Calgary’s stance, which had the city subsidizing at least 1/3 of the stadium, is considered brave, it seems reasonable to presume that publicly-subsidized stadiums will continue apace in North America. As such, it may be more helpful to consider what happens after a stadium project is proposed. Applying a good governance approach to stadium financing could be a helpful way forward. If stadiums are going to be built, regardless, then it is best to make those who build stadiums – governments and teams – accountable to the taxpayers and fans.

Good governance principles have been increasingly applied to the organization of sport – particularly the governance of international sporting organisations. While good governance can be defined in a myriad of ways, it is often broken down to particular principles. In examining stadium projects, I suggest that four principles should be considered: transparency, public participation, solidarity, and review. These principles closely track those used by the Sports Governance Observer.

One recent stadium project seems to have studiously avoided all of these principles entirely – in a way that demonstrates the need for these principles to be applied in the first place. This project took place in the Calgary Flames’ old home of Atlanta, USA.

Turner Field, credit to Zpb52

In 2013, the Atlanta Braves announced that they were leaving their current stadium in downtown Atlanta. They weren’t moving to a new city, but were moving 32 kilometres north to the suburb of Cobb County. The reason for the move? A brand new, publicly-financed stadium. The Atlanta Braves had played at Turner Field since 1997. Not even twenty years later, the stadium, originally built as the centrepiece of the 1996 Summer Olympic Games, was deemed to be obsolete by the Braves. Enter Cobb County. To pay for a new stadium for the Braves, Cobb County issued $368 million in municipal bonds (originally estimated at $276 million). The Braves, in chasing public money, bucked the trend of teams moving closer to the city centre, as suburbs are not conducive to stadiums.

While the rationale and the dollar figure should raise some eyebrows, the process used to secure funding for the stadium should be deeply disturbing to fans of democratic processes. The deal itself was negotiated in secret between a single Cobb County commissioner, and the Atlanta Braves. The president of the Atlanta Braves, John Schuerholz, stated that if news of the deal “had leaked out, this deal would not have gotten done…If it had gotten out, more people would have started taking the position of, ‘We don’t want that to happen. We want to see how viable this was going to be.’” Eventually, the deal needed to be voted on by Cobb County commissioners. At the public vote held in May 2014, only twelve speaking slots were available to the public. Stadium supporters had lined up by 2pm for the 7pm meeting, and the Commissioners denied any additional speaking slots. The same Commissioners voted 5-0 to fund the stadium. Opponents of the stadium filed a suit in the Georgia courts, alleging that the bonds used to finance the new stadium violated the Georgia state constitution, and various state laws. However, the opponents were defeated in the courthouse, too, as the Georgia Supreme Court upheld the validity of the bonds as they provided at least some plausible public benefit. The stadium opened in 2017 to positive reviews from fans and ballpark enthusiasts.

In examining the Atlanta Braves new ballpark by applying principles of good governance, the results are discouraging. Transparency was almost non-existent throughout most of the process, as the deal was completed in secret, as admitted by the president of the team. Public participation was curtailed throughout the process, and most galling, at the eve of the final vote on the funding. There have been no solidarity benefits that have come to the forefront, although it should be noted that it is possible that money that was raised to pay for public parks was diverted to funding the stadium, which cuts against the idea of solidary benefits. Finally, there will likely be no post facto review of the stadium and any attendant benefits it may claim. While there was review of the deal itself through the courts, the Georgia Supreme Court noted that “we do not discount the concerns Appellants have raised about the wisdom of the stadium project and the commitments Cobb County has made to entice the Braves to move there. But those concerns lie predominantly in the realm of public policy….”.

SunTrust Field, Credit to David Goldman/AP

The Value of Good Governance Principles in the Stadium Debate

The case of Atlanta demonstrates the importance of good governance in the public financing of stadiums. Proponents, critics, and scholars can apply these principles to evaluate and engage in more thoughtful debates over the processes of public financing of stadiums. Since stadiums are likely to receive public funding, regardless of the merits, a better process should improve the benefits to the public, while constraining the costs.

Applying principles, as opposed to enacting legislation, may lead the reader to ask “can these principles be enforced?” In terms of traditional legal enforcement, namely recourse to a regulatory body or a court, a city would probably need to implement these terms into a Memorandum of Understanding with the team. For principles such as solidarity, particulars could be written into the final funding agreement. This has been done, for example, with the Community Benefits Agreement implemented between the City of Edmonton, and the Edmonton Oilers hockey team, for a publicly-subsidized stadium that opened in 2016.

However, even if the city itself refuses to implement these principles, they do provide a framework to hold decision-makers to account. In instances where the government has done wrong by the citizens, but there are no judicial remedies, the remedy is then to vote the government out. In establishing these principles, they then provide standards by which the government can be held to account, if not formally, then at least through the ballot box.

Our International Sports Law Diary
The Asser International Sports Law Centre is part of the

A New Chapter for EU Sports Law and European Citizenship Rights? The TopFit Decision - By Thomas Terraz

Can European Citizens Participate in National Championships? An Analysis of AG Tanchev’s Opinion in TopFit e.V. Daniele Biffi v Deutscher Leichtathletikverband e.V. - By Thomas Terraz

The Kristoffersen ruling: the EFTA Court targets athlete endorsement deals - By Sven Demeulemeester and Niels Verborgh

The Evolution of UEFA’s Financial Fair Play Rules – Part 1: Background and EU Law. By Christopher Flanagan

FIFA’s provision on the protection of minors - Part 3: The compatibility of Article 19 with EU law. By Kester Mekenkamp.

FIFA’s provision on the protection of minors - Part 2: The 2009 reform and its aftermath. By Kester Mekenkamp.

FIFA’s provision on the protection of minors - Part 1: The Early Years. By Kester Mekenkamp.

Brexit and EU law: Beyond the Premier League (Part 1). By Marine Montejo

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

SV Wilhelmshaven: a Rebel with a cause! Challenging the compatibility of FIFA’s training compensation system with EU law

Asser International Sports Law Blog

Our International Sports Law Diary
The Asser International Sports Law Centre is part of the

A Good Governance Approach to Stadium Subsidies in North America - By Ryan Gauthier

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