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).More...

ASSER Exclusive! Interview with Charles “Chuck” Blazer by Piotr Drabik

Editor’s note: Chuck Blazer declined our official interview request but thanks to some trusted sources (the FIFA indictment and Chuck’s testimony) we have reconstructed his likely answers. This is a fictional interview. Any resemblance with real facts is purely coincidental.



Mr Blazer, thank you for agreeing to this interview, especially considering the circumstances. How are you doing?

I am facing ten charges concerning, among others, conspiracy to corrupt and money laundering. But apart from that, I am doing great (laughs)!

 

It is good to know that you have not lost your spirit. And since you’ve been involved in football, or as you call it soccer, for years could you please first tell us what was your career at FIFA and its affiliates like?

Let me see… Starting from the 1990s I was employed by and associated with FIFA and one of its constituent confederations, namely the Confederation of North, Central American and Caribbean Association Football (CONCACAF). At various times, I also served as a member of several FIFA standing committees, including the marketing and television committee. As CONCACAF’s general secretary, a position I proudly held for 21 years, I was responsible, among many other things, for negotiations concerning media and sponsorship rights. From 1997 to 2013 I also served at FIFA’s executive committee where I participated in the selection process of the host countries for the World Cup tournaments. Those years at the helm of world soccer were truly amazing years of travel and hard work mainly for the good of the beautiful game. I might add that I even managed to document some of my voyages on my blog. I initially called it “Travels with Chuck Blazer” but Vladimir (Putin) convinced me to change the name to “Travels with Chuck Blazer and his Friends”. You should check it out.

 More...



Financial Fair Play: Lessons from the 2014 and 2015 settlement practice of UEFA. By Luis Torres

UEFA announced on 8 May that it had entered into Financial Fair Play settlement agreements with 10 European football clubs. Together with the four other agreements made in February 2015, this brings the total to 14 FFP settlements for 2015 and 23 since UEFA adopted modifications in its Procedural rules and allowed settlements agreements to be made between the Clubs and the Chief Investigator of the UEFA Club Financial Control Body (CFCB).[1] 

In the two years during which UEFA’s FFP regulations have been truly up and running we have witnessed the centrality taken by the settlement procedure in their enforcement. It is extremely rare for a club to be referred to the FFP adjudication chamber. In fact, only the case regarding Dynamo Moscow has been referred to the adjudication chamber. Thus, having a close look at the settlement practice of UEFA is crucial to gaining a good understanding of the functioning of FFP. Hence, this blog offers a detailed analysis of this year’s settlement agreements and compares them with last year’s settlements. More...

Book Review: Reforming FIFA, or Not

Editor’s note: This short book review will be published in a different format in the International Sports Law Journal, due to its timeliness we decided to reproduce it here. 

Reforming FIFA, or Not

 Antoine Duval

Book Review: Mark Pieth (ed.), Reforming FIFA, Dike Verlag, St. Gallen, 2014, 28.00 CHF, p.178

 


This book looks back at the work of the Independence Governance Committee (IGC). This Committee, constituted in 2011, had as primary objective to drive a reform process of FIFA initiated by its President Sepp Blatter. After ordering from the Swiss anti-corruption expert Mark Pieth, a report on the state of FIFA’s governance, FIFA decided to mandate him with the leadership of a consulting body composed of a mix of independent experts and football insiders, which would be accompanying and supervising the internal reform process of FIFA. The IGC was officially dissolved at the end of 2013, after completing its mandate. The book is composed of eight chapters, written by former members of the IGC, including former chairman Mark Pieth. In addition to the chapters, it includes the different reports (available here, here and here) submitted by the IGC to FIFA across the years. In the words of Pieth, this account is “fascinating because it gives a hands-on, realistic perspective of the concrete efforts, the achievements and the remaining challenges in the struggle for the reform of this organization [FIFA], avoiding the usual glorification or vilification.”[1] This review will first summarize the core of the account of the FIFA reform process provided by the book, before critically engaging with the outcome of the process and outlining the deficiencies that culminated on 29 May 2015 with the re-election of Sepp Blatter as FIFA president.More...



The Spanish TV Rights Distribution System after the Royal Decree: An Introduction. By Luis Torres

On the first of May 2015, the Spanish Government finally signed the Royal Decree allowing the joint selling of the media rights of the Spanish top two football leagues. The Minister for Sport stated that the Decree will allow clubs to “pay their debts with the social security and the tax authorities and will enable the Spanish teams to compete with the biggest European Leagues in terms of revenues from the sale of media rights”.[1]Although the signing of the Royal Decree was supposed to close a very long debate and discussion between the relevant stakeholders, its aftermath shows that the Telenovela is not entirely over. 

This blog post will first provide the background story to the selling of media rights in Spain. It will, thereafter, analyse the main points of the Royal Decree and outline how the system will work in practice. Finally, the blog will shortly address the current frictions between the Spanish League (LFP) and the Spanish football federation (RFEF).More...

Sport and EU Competition Law: New developments and unfinished business. By Ben Van Rompuy

Editor's note: Ben Van Rompuy, Head of the ASSER International Sports Law Centre, was recently interviewed by LexisNexis UK for their in-house adviser service. With kind permission from LexisNexis we reproduce the interview on our blog in its entirety. 

How does competition law affect the sports sector?  

The application of EU competition law to the sports sector is a fairly recent and still unfolding development. It was only in the mid-1990s, due to the growing commercialization of professional sport, that there emerged a need to address competition issues in relation to, for instance, ticketing arrangements or the sale of media rights.  More...



Is FIFA fixing the prices of intermediaries? An EU competition law analysis - By Georgi Antonov (ASSER Institute)

Introduction

On 1 April 2015, the new FIFA Regulations on Working with Intermediaries (hereinafter referred as the Regulations) came into force. These Regulations introduced a number of changes as regards the division of competences between FIFA and its members, the national associations. A particularly interesting issue from an EU competition law perspective is the amended Article 7 of the Regulations. Under paragraph 3, which regulates the rules on payments to intermediaries (also previously referred to as ‘agents’), it is recommended that the total amount of remuneration per transaction due to intermediaries either being engaged to act on a player’s or club’s behalf should not exceed 3% of the player’s basic gross income for the entire duration of the relevant employment contract. In the case of transactions due to intermediaries who have been engaged to act on a club’s behalf in order to conclude a transfer agreement, the total amount of remuneration is recommended to not exceed 3% of the eventual transfer fee paid in relation to the relevant transfer of the player.More...

The Impact of the new FIFA Regulations for Intermediaries: A comparative analysis of Brazil, Spain and England. By Luis Torres

INTRODUCTION

Almost a year after their announcement, the new FIFA Regulations on working with Intermediaries (“FIFA Regulations”) came into force on 1 April 2015. Their purpose is to create a more simple and transparent system of regulation of football agents. It should be noted, however, that the new FIFA rules enable every national football association to regulate their own system on players’ intermediaries, provided they respect the compulsory minimum requirements adopted. In an industry that is already cutthroat, it thus remains to be seen whether FIFA’s “deregulation” indeed creates transparency, or whether it is a Pandora’s Box to future regulatory confusion.

This blog post will provide an overview of the new FIFA Regulations on working with intermediaries and especially its minimum requirements. Provided that national associations are encouraged to “draw up regulations that shall incorporate the principles established in these provisions”[1], three different national regulations have been taken as case-studies: the English FA Regulations, the Spanish RFEF Regulations and the Brazilian CBF Regulations. After mapping their main points of convergence and principal differences, the issues that could arise from these regulatory differences shall be analyzed.  More...

Blog Symposium: Why FIFA's TPO ban is justified. By Prof. Dr. Christian Duve

Introduction: FIFA’s TPO ban and its compatibility with EU competition law.
Day 1: FIFA must regulate TPO, not ban it.
Day 2: Third-party entitlement to shares of transfer fees: problems and solutions
Day 3: The Impact of the TPO Ban on South American Football.
Day 4: Third Party Investment from a UK Perspective. 

Editor’s note: Finally, the last blog of our TPO ban Symposium has arrived! Due to unforeseen circumstances, FIFA had to reconsider presenting its own views on the matter. However, FIFA advised us to contact Prof. Dr. Christian Duve to author the eagerly awaited blog on their behalf. Prof. Dr. Christian Duve is a lawyer and partner with Freshfields Bruckhaus Deringer LLP and an honorary professor at the University of Heidelberg. He has been a CAS arbitrator until 2014. Thus, as planned, we will conclude this symposium with a post defending the compatibility of the TPO ban with EU law. Many thanks to Prof. Dr. Duve for having accepted this last-minute challenge! More...






Blog Symposium: Third Party Investment from a UK Perspective. By Daniel Geey

Introduction: FIFA’s TPO ban and its compatibility with EU competition law.
Day 1: FIFA must regulate TPO, not ban it.
Day 2: Third-party entitlement to shares of transfer fees: problems and solutions
Day 3: The Impact of the TPO Ban on South American Football.
Day 5: Why FIFA's TPO ban is justified.

Editor's note: In this fourth part of our blog symposium on FIFA's TPO ban Daniel Geey shares his 'UK perspective' on the ban. The English Premier League being one of the first leagues to have outlawed TPO in 2010, Daniel will outline the regulatory steps taken to do so and critically assess them. Daniel is an associate in Field Fisher Waterhouse LLP's Competition and EU Regulatory Law Group. As well as being a famous 'football law' twitterer, he has also published numerous articles and blogs on the subject.

 

What is Third Party Investment?
In brief Third Party Investment (TPI) in the football industry, is where a football club does not own, or is not entitled to, 100% of the future transfer value of a player that is registered to play for that team. There are numerous models for third party player agreements but the basic premise is that companies, businesses and/or individuals provide football clubs or players with money in return for owning a percentage of a player’s future transfer value. This transfer value is also commonly referred to as a player’s economic rights. There are instances where entities will act as speculators by purchasing a percentage share in a player directly from a club in return for a lump sum that the club can then use as it wishes. More...





Asser International Sports Law Blog | Dahmane v KRC Genk: A Rough Translation

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

Dahmane v KRC Genk: A Rough Translation

Dahmane v KRC GENK

Court of Labour of Antwerp (Hasselt district) 6 May 2014

Chamber 2

Algemeen rolnummer 2009/AH/199

 

The Facts 

  • Dahmane signed with KRC GENK on 1 July 2007 for four years (till 30 June 2011). Dahmane unilaterally terminated the contract January 2008. 
  • KRC GENK demanded from Dahmane compensation of EUR 878.888,88 (36 months wages) at the labour court of Tongeren. The demand was based on Article 5 § 2 of the Law for Professional Sportsmen (24 February 1978) and the Royal Decree of 13 July 2004 that Determines the Amount of the Compensation based on the Law for Professional Sportsmen. According to the Royal Decree (of 2004) the compensation had to be equal to 36 months of salary in the case of Dahmane. 
  • Dahmane demanded EUR 250.000,00 from KRC GENK compensation calculated in accordance with the Labour Agreements Law (03 July 1978). D. argued that according to article 40 § 1 of this law, the severance pay can only amount to 12 months of salary.  

  • 25 May 2009 - The Labour Court agreed with the demands of KRC GENK, whereas it disagreed with Dahmane’s. Dahmane placed an appeal. 

  • 22 June 2010 – Court of Labour decided that Dahmane had unlawfully unilaterally terminated the labour contract between him and KRC GENK. Dahmane had to reimburse KRC GENK with a compensation equal to 36 months of salary, because Dahmane fell under the Law regarding Labour Agreements of Professional Sportsmen of 24 February 1978. The Court rejected Dahmane’s request for damages.   

  • The Court of Labour turned to the Belgian Constitutional Court with the preliminary question whether the Law for Professional Sportsmen of 24 February 1978 breaches the Articles 10 and 11 of the Belgian Constitution on Equal Treatment, as there was an inconsistency with the Labour Agreements Law of 03 July 1978 under which the severance pay can only amount to 12 months of salary. Secondly, it was questioned whether the rule in question infringed the freedom of employment.  

  • 18 May 2011 – the Belgian Constitutional Court declared itself incompetent to answer the preliminary questions because the question whether a professional sportsmen falls under either the Law for Professional Sportsmen or the Labour Agreements Law solely depended on Royal Decree on Determining the Amount of the Compensation based on the Law for Professional Sportsmen (13 July 2004). According to Belgian law, the legality of the Royal Decree has to be decided by the Court of Labour itself. 

  • Therefore, the judgment of 6 May 2014 was the second time the Court of Labour dealt with the case regarding the unilateral termination of the player’s contract between Dahmane and KRC GENK. This time it had to decide whether the Royal Decree breached the Belgian Constitution.

 

The Case 

  • The demands by Dahmane:

    • That the Court of Labour rejects the Royal Decree on Determining the Amount of the Compensation based on the Law for Professional Sportsmen (13 July 2004) because it breaches the Belgian Constitution (part II, §1).

    • That the Court of Labour asks the CJEU the preliminary question whether the Royal Decree of 2004 breaches Article 45 TFEU since the free movement of professional sportsmen is unreasonably restricted by the Royal Decree (part II, §1).

 

  • KRC GENK arguments:

    • Football has specific characteristics that can be summarized in:

      • Atypical employment market

      • Atypical professional career (part III.b. §5).

    • That the difference between labour agreements of professional sportsmen on the one hand “normal” labour agreements is based on the “specific character of labour agreements of professional sportsmen en the specific character of sport in general”.

      The “specificity of sport” forms a special statute for sport, whereby common law cannot be applied unabridged (part III.b. §6).

    • Referring to European Case Law, and the Commission’s White book on sport, KRC GENK highlighted that to achieve the objectives inherent to sport, which include avoiding competition distortions and the preservation of the stability of participating sport clubs, certain specifics measures can be taken aimed at guarantying  legal certainty of labour relationships in the sport sector (part III.b. §6).

 

  • The Court's holdings

    • Agreed that sport exhibits certain characteristics that can deviate from other labour relationships between employer and employee, but held that since the Royal Decree in question did not mention the specificity of sport, this exception is inapplicable (part III.b. §5).

    • KRC GENK did not take the economic aspect of sport (e.g. the pursuit of economic profits) into account in its arguments, and the importance of fair competition in this regard. These economic objectives are not exclusive to the sport sector but underlie the market economy in general. Therefore, the Court sees no valid reason as to why a separate Royal Decree is necessary to achieve the objectives of the sport sector when similar objectives are pursued by other economic sectors. In other words, no separate laws should be applicable to sport when it pursues economic objectives (part III.b. §6).

    • As regards KRC GENK’s arguments that for football in particular certain legislative deviations preventing richer clubs from buying all the good players from smaller clubs, thereby distorting competition, are justifiable, the Court found them to be incorrect. Even though football’s transfer system causes movement of footballers to differ from the “normal” functioning of the labour market, in this case it is important to draw a distinction between the buying and selling of players between clubs on the one hand, and the unilateral termination of a player’s contract by either club or player on the other. Yet again the Court saw no reason why the specificity of football should enable the adoption of Royal Decrees breaching article 10 and 11 of the Belgian Constitution (part III.b. §6).

    • The Court took into account that the average career of a professional sportsman is relatively short (12 years according to RKC GENK and six to eight years according to Dahmane). A compensation amounting to 36 months of salary would for many professional sportsmen be equal to 1/3 of total career revenues and is therefore not justified in the present case (part III.b. §7).

    • The Royal Decree applies to professional sports in general, not only to football, KRC GENK’s can therefore not rely on the specificity of football to justify its legality (part III.b. §6 and §7).

    • Given that the Royal Decree is declared contrary to the Constitution, the Court sees no reason to make a preliminary reference to the ECJ (part III.b. §12).

 

Conclusion: the Court considered that a Royal Decree imposing a compensation of 36 months of salary on a player breaching his contract is disproportionate. Furthermore, the Court found the Royal Decree unjustifiable under the Constitutional principle of equal treatment and non-discrimination (part III.b. §8).

 

 

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