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

International and European Sports Law – Monthly Report – December 2017. By Tomáš Grell

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.

 

The Headlines 

The International Skating Union's eligibility rules declared incompatible with EU competition law

On 8 December 2017, the European Commission announced that it had rendered a decision in the case against the International Skating Union (ISU). The Commission upheld the complaint lodged in October 2015 by two Dutch professional speed skaters Mark Tuitert and Niels Kerstholt, represented in this case by Ben Van Rompuy and Antoine Duval (you can read their joint statement here), and ruled that the ISU's eligibility rules preventing athletes from participating in speed skating competitions not approved by the ISU under the threat of severe penalties are in violation of EU competition law. In particular, the Commission held that these rules restrict the commercial freedom of (i) athletes who may be deprived of additional source of income as they are not allowed to participate in speed skating competitions other than those authorised by the ISU; and (ii) independent organisers who are unable to attract top athletes. And while the Commission recognised that sporting rules with restrictive effects might be compatible with EU law if they pursue a legitimate objective such as the protection of athletes' health and safety or the protection of the integrity and proper conduct of sport, it found that the ISU's eligibility rules pursue only its own commercial interests to the detriment of athletes and independent organisers of speed skating competitions. The ISU eventually escaped financial sanctions, but it must modify or abolish its eligibility rules within 90 days; otherwise it would be liable for non-compliance payments of up to 5% of its average daily turnover. For more information on this topic, we invite you to read our recent blog written by Professor Stefano Bastianon.

 

The International Olympic Committee bans Russia from the upcoming Winter Olympic Games

The world has been waiting impatiently for the International Olympic Committee's (IOC) decision on the participation of Russian athletes in the upcoming 2018 Winter Olympic Games in Pyeongchang. This was finally communicated on 5 December 2017. Having deliberated on the findings of the Schmid Commission, the IOC Executive Board decided to suspend the Russian Olympic Committee with immediate effect, meaning that only those Russian athletes who demonstrate that they had not benefited from the state-sponsored doping programme will be able to participate in the Games. Such clean athletes will be allowed to compete under the Olympic Flag, bearing the name 'Olympic Athlete from Russia (OAR)' on their uniforms. Further to this, the IOC Executive Board sanctioned several officials implicated in the manipulation of the anti-doping system in Russia, including Mr Vitaly Mutko, currently the Deputy Prime Minister of Russia and formerly the Minister of Sport. Mounting public pressure subsequently forced Mr Mutko to step down as head of the Local Organising Committee for the 2018 FIFA World Cup.

Meanwhile, 21 individual Russian athletes were sanctioned (see here, here, here, and here) in December (in addition to 22 athletes in November) by the IOC Oswald Commission that is tasked with investigating the alleged doping violations by Russian athletes at the 2014 Winter Olympic Games in Sochi. The Oswald Commission also published two full decisions in the cases against Evgeny Belov and Aleksandr Tretiakov who were both banned from all future editions of the Games. It is now clear that the Court of Arbitration for Sport will have quite some work in the coming weeks as the banned athletes are turning to this Swiss-based arbitral tribunal to have their sanctions reviewed (see here and here).

 

Universal Declaration of Player Rights

14 December 2017 was a great day for athletes all over the globe. On this day, representatives of the world's leading player associations met in Washington D.C. to unveil the Universal Declaration of Player Rights, a landmark document developed under the aegis of the World Players Association that strives to protect athletes from ongoing and systemic human rights violations in global sport. The World Players Association's Executive Director Brendan Schwab emphasised that the current system of sports governance ''lacks legitimacy and fails to protect the very people who sit at the heart of sport'' and stated that ''athlete rights can no longer be ignored''. Among other rights, the Declaration recognises the right of athletes to equality of opportunity, fair and just working conditions, privacy and the protection of personal data, due process, or effective remedy.

 

Chris Froome failed a doping test during the last year's Vuelta a España

The world of cycling suffered yet another blow when it transpired that one of its superstars Chris Froome had failed a doping test during the last year's Vuelta a España, a race he had eventually emerged victorious from for the first time in his career. His urine sample collected on 7 September 2017 contained twice the amount of salbutamol, a medication used to treat asthma, than permissible under the World Anti-Doping Agency's 2017 Prohibited List. Kenyan-born Froome has now hired a team of medical and legal experts to put forward a convincing explanation for the abnormal levels of salbutamol in his urine and thus to avoid sanctions being imposed on him. More...

Report from the first ISLJ Annual International Sports Law Conference - 26-27 October at the T.M.C. Asser Instituut

Close to 100 participants from 37 different countries attended the first ISLJ Annual International Sports Law Conference that took place on 26-27 October 2017 in The Hague. The two-day programme featured panels on the FIFA transfer system, the labour rights and relations in sport, the protection of human rights in sport, EU law and sport, the Court of Arbitration for Sport, and the world anti-doping system. On top of that, a number of keynote speakers presented their views on contemporary topics and challenges in international sports law. This report provides a brief summary of the conference for both those who could not come and those who participated and would like to relive their time spent at the T.M.C. Asser Institute.More...

Multi-Club Ownership in European Football – Part I: General Introduction and the ENIC Saga – By Tomáš Grell

Editor’s note: Tomáš Grell holds an LL.M. in Public International Law from Leiden University. He contributes to the work of the ASSER International Sports Law Centre as a research intern.

 

Introduction

On 13 September 2017, more than 40,000 people witnessed the successful debut of the football club RasenBallsport Leipzig (RB Leipzig) in the UEFA Champions League (UCL) against AS Monaco. In the eyes of many supporters of the German club, the mere fact of being able to participate in the UEFA's flagship club competition was probably more important than the result of the game itself. This is because, on the pitch, RB Leipzig secured their place in the 2017/18 UCL group stage already on 6 May 2017 after an away win against Hertha Berlin. However, it was not until 16 June 2017 that the UEFA Club Financial Control Body (CFCB) officially allowed RB Leipzig to participate in the 2017/18 UCL alongside its sister club, Austrian giants FC Red Bull Salzburg (RB Salzburg).[1] As is well known, both clubs have (had) ownership links to the beverage company Red Bull GmbH (Red Bull), and therefore it came as no surprise that the idea of two commonly owned clubs participating in the same UCL season raised concerns with respect to the competition's integrity. More...


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

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...


Nudging, not crushing, private orders - Private Ordering in Sports and the Role of States - By Branislav Hock

Editor's note: Branislav Hock (@bran_hock)  is PhD Researcher at the Tilburg Law and Economics Center at Tilburg University. His areas of interests are transnational regulation of corruption, public procurement, extraterritoriality, compliance, law and economics, and private ordering. Author can be contacted via email: b.hock@uvt.nl.


This blog post is based on a paper co-authored with Suren Gomtsian, Annemarie Balvert, and Oguz Kirman.


Game-changers that lead to financial success, political revolutions, or innovation, do not come “out of the blue”; they come from a logical sequence of events supported by well-functioning institutions. Many of these game changers originate from transnational private actors—such as business and sport associations—that produce positive spillover effects on the economy. In a recent paper forthcoming in the Yale Journal of International Law, using the example of FIFA, football’s world-governing body, with co-authors Suren Gomtsian, Annemarie Balvert, and Oguz Kirman, we show that the success of private associations in creating and maintaining private legal order depends on the ability to offer better institutions than their public alternatives do. While financial scandals and other global problems that relate to the functioning of these private member associations may call for public interventions, such interventions, in most cases, should aim to improve private orders rather than replace them. 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...

The legality of surety undertakings in relation to minor football players: the Lokilo case. By Adriaan Wijckmans

Editor's note: Adriaan Wijckmans is an associate specialized in sports law at the Belgium law firm Altius.

In a recent judgment, the Brussels Court of First Instance confirmed the legality of a so-called surety undertaking, i.e. an agreement in which the parents of a minor playing football guarantee that their child will sign a professional contract with a football club as soon as the child reaches the legal age of majority.

This long-awaited ruling was hailed, on the one hand, by clubs as a much needed and eagerly anticipated confirmation of a long-standing practice in Belgian football[1] and, on the other hand, criticised by FIFPro, the international player’s trade union, in a scathing press release. More...



International and European Sports Law – Monthly Report – February 2017. By Tomáš Grell

 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. 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...

Asser International Sports Law Blog | De- or Re-regulating the middlemen? The DFB’s regulation of intermediaries under EU law scrutiny at the OLG Frankfurt. By Antoine Duval and Kester Mekenkamp.

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

De- or Re-regulating the middlemen? The DFB’s regulation of intermediaries under EU law scrutiny at the OLG Frankfurt. By Antoine Duval and Kester Mekenkamp.

Football intermediaries, or agents, are again under attack in the news. For some, corrupt behaviour has become endemic in football’s culture. It is always dangerous to scapegoat a whole profession or a group of people. Many intermediaries are trying their best to lawfully defend the interests of their clients, but some are not. The key focus should be on providing an adequate legal and administrative framework to limit the opportunities for corrupt behaviour in the profession. This is easier said than done, however. We are dealing with an intrinsically transnationalized business, often conducted by intermediaries who are not subjected to the disciplinary power of federations. Sports governing bodies are lacking the police power and human resources necessary to force the intermediaries to abide by their private standards. In this context, this blog aims to review a recent case in front of the regional court of Frankfurt in Germany, which highlights the legal challenges facing (and leeway available to) national federations when regulating the profession.

Since April 2015, the FIFA Regulations on Working with Intermediaries (“Intermediaries Regulations”) entered into force. They replaced the 2008 FIFA Players’ Agents Regulation and introduced dramatic changes to the regulation of players’ agents (for a quick introduction read our short guide here). Although seeing its first light on April Fools’ Day, the Intermediaries Regulations are not to be taken lightly. On the contrary, the new rules constitute a major turning point in the governance of player and club representation. Furthermore, the question of the compatibility of the Intermediaries Regulations with EU competition law promptly arose when the Landgericht Frankfurt am Main (LG) had to rule on a challenge to the Reglement für Spielervermittlung (DFB-regulations), the national measure implementing the FIFA Regulations issued by the German Football Federation (DFB, Deutschen Fußball Bund). In its injunction of 29 April 2015 the LG found some provisions of the DFB-regulations to be contrary to Article 101 TFEU (see our earlier blog). This decision was appealed by both parties to the Oberlandesgericht Frankfurt am Main (OLG), which rendered its ruling on 2 February 2016. This blog aims to analyse the decision of the OLG, while also putting it into its wider legal and social context.

I.              Back to the future: The Piau case revived

It is not the first time that the regulation of football agents/intermediaries by football federations and EU law are colliding. The previous Piau saga that started on 23 March 1998 with a complaint to the European Commission by a French agent, Laurent Piau, ended only very recently in front of the French Courts with a painful defeat for Mr. Piau. In the framework of that case, the then Court of First Instance of the EC (CFI) issued a ruling on the compatibility of the FIFA Agents Regulations with EU competition law, on appeal against the Commission’s decision to reject the complaint by Laurent Piau. In that decision, the CFI famously showed its surprise to see a private association engaging in regulatory activity without an express delegation of public power. In the words of the Tribunal, “the rule-making power claimed by a private organisation like FIFA, whose main statutory purpose is to promote football, is indeed open to question”.[1] Indeed, “[i]n principle, such regulation, which constitutes policing of an economic activity and touches on fundamental freedoms, falls within the competence of the public authorities”.[2] Yet, as many know, the world of football is special and in practice national states have very much relinquish regulatory control over it.

The CFI was pragmatic enough to recognize this unusual state of affairs. In fact, this peculiarity also enabled it to consider that the FIFA regulations, issued by a private organization, could not escape the scope of EU competition law.[3] Yet, in fine, the CFI endorsed the compatibility of the FIFA regulations with EU Competition law. It considered first that the European Commission (EC) was right in holding that it obtained the repeal of the most restrictive provisions contained in the original FIFA regulations.[4] Furthermore, the CFI supported the EC’s view that the compulsory nature of the FIFA licensing mechanism could be justified under the framework of then Article 81(3) EC [now 101(3)TFEU]. It stated that the “Commission did not commit a manifest error of assessment by considering that the restrictions stemming from the compulsory nature of the licence might benefit from an exemption on the basis of Article 81(3) EC”.[5] Finally, the CFI affirmed the applicability of Article 82 EC [now 102 TFEU] to the FIFA regulations, but concluded that “it follows from the above considerations regarding the amended regulations and the possible exemption under Article 81(3) EC that such an abuse [of a dominant position] has not been established”.[6]

Thus, based on the framework of analysis used in Piau, there is absolutely no doubt that EU competition law is applicable to the DFB-regulations (and analogically to all the other national regulations implementing the new FIFA Intermediaries Regulations).[7] The key question, however, is whether the restrictive effect on competition of those new rules can be justified. Such a justificatory framework of analysis is also broadly in line with the CJEU’s case law on competition law and sport, and in particular its Meca-Medina ruling.[8] The question of the legitimate objectives and proportionality of the new rules was rightly identified by the LG and OLG as the defining one to assess rule-by-rule the legality of the DFB’s regulations.

II.            The OLG Frankfurt and the Compatibility of the DFB regulations with EU Competition Law

The OLG’s ruling bears no clear winner or loser, as both parties can claim to have prevailed on parts of their claims. In its decision the Court clearly outlined a set of provisions that it deemed compatible with EU law, and another contrary to it. In any event, this case is again a good reminder that EU law is no golden bullet against the regulations of the Sports Governing Bodies (SGBs). Instead, their compatibility with EU law must be assessed on a case-by-case basis, bearing in mind their contexts and objectives. Nevertheless, EU law can be invoked to challenge the rationality of the SGBs’ regulations and to check any disproportionate encroachment on the economic freedom of the affected actors.

A.    The DFB rules incompatible with EU Law

In the present case, the DFB’s regulations for intermediaries faced a relatively detailed quasi-constitutional control by the OLG. The German court found that parts of the regulatory options adopted by the German federation are disproportionate to attain their objectives and therefore contrary to Article 101 TFEU. This is especially true of the rule forcing intermediaries to abide by the rules and jurisdictions of the DFB, UEFA and FIFA, and of the rule imposing a duty to provide an extended certificate of good conduct usually reserved for professions involving a risk to the integrity of minors.

In line with the decision in first instance, the OLG ruled against the provision requiring intermediaries to submit to the jurisdictions of FIFA, UEFA, DFB and its members in connection with all violations of their regulations and statutes (see point 1 of DFB Vermittlererklärung für natürliche Personen – Anhang 1, and a related notice later issued by the DFB).[9] In the OLG’s view, it would result in an impossible situation for intermediaries, as they would be required to have a ‘reasonable’ knowledge of, at least, 35 different association statutes and face being subjected to 30 different jurisdictions.[10] The court puts forward that it is necessary, as a prerequisite for the submission of non-members to the rules of an association and its jurisdiction, to be able, at any time to take knowledge, in a reasonable manner, of the content of the regulations, compliance mechanisms and sanctions. This possibility was not warranted in the present case. In other words, if the DFB wishes to subject intermediaries to its jurisdiction it is possible, but it would need to clearly define what such a submission would entail in terms both of the rules and procedures that would be applicable. In fact, as recognized by the European Parliament,[11] some type of disciplinary control by the national federations over the intermediaries is necessary to give some teeth to their regulations.

Furthermore, the OLG also rules that agents cannot be forced to submit an extended certificate of good conduct (erweiterten Führungszeugnisses).[12] The OLG agrees with the appellant that this duty is impossible to fulfil as under German criminal law, such certificate can be issued only for occupations suitable to establish/result in contacts with children and young people. Yet, such a contact with minors is not at the heart of an intermediary’s profession, especially that, as we will see below, intermediaries cannot derive any financial compensation for a transfer or employment contract involving a minor, it seems thus impossible for he or she to obtain the requisite certificate.[13]

The OLG has clearly drawn a line in the sand. There is a limit to the obligations the DFB can impose, they must be rationally possible to fulfil and connected to the objectives pursued and must not be unreasonably burdensome for the intermediaries.

B.    The DFB rules compatible with EU Law

The judgment is rather remarkable for what it considers proportionate regulation by the DFB.

First, it endorses, contrary to the LG, the proportionality of the ban on intermediary fees for transfers or contracts involving minors.[14] This ban was a very controversial part of the new FIFA regulations, as it was deemed extremely restrictive of the economic freedom of intermediaries and potentially counter-productive. [15] However, in the view of the OLG, article 7.7 of the DFB-regulations pursues a legitimate objective: the protection of minors (der Minderjährigenschutz).[16] It aims, more specifically, to prevent the transfer of underage players based solely on the economic interests of the intermediary and/or that underage players are taken to Germany without a stable employment perspective.[17] Moreover, the OLG deems this prohibition to be necessary as the other legal protections for minors provided by the German civil code are often inapplicable.[18] Finally, the court considers this prohibition to be proportionate. First, because intermediaries are not barred from being remunerated for advising minors when this advice is not requested in the framework of the conclusion of an employment contract or a transfer. Furthermore, the OLG notes that similar measures have been adopted in all other European countries and is supportive of a uniform approach to the regulation of the role of intermediaries in transfers of minors.[19] Overall, this is not a surprising assessment. The need to combat human trafficking and to fight abuses linked to transfers of minors have been repeatedly emphasised by the European institutions in their soft law.[20] Recently, the European Parliament underlined ‘the specific vulnerability of young players and the risk of them becoming victims of human trafficking’[21]. Only time will tell whether this type of draconian measure will rein such abuses. In any event, if reducing the economic incentives of intermediaries linked to transfers of minors will most probably restrict their economic opportunities, it is also likely to diminish the connected incentives for human trafficking in football.[22]

Furthermore, the OLG’s judgment also endorses the transparency requirements imposed by the DFB. More precisely, it deemed the obligation for clubs and players to disclose the contract details covering remuneration and payments to intermediaries’ enshrined in article 6.1 DFB-regulations compatible with EU competition law.[23] The legitimate aim pursued is the transparency and traceability of the market for intermediaries. Behind this objective, lies the idea that player transfers should be primarily based on sporting, rather than financial reasons. Consequently, it deems that an obligation to disclose payments connected to intermediation is necessarily linked to the attainment of this goal. This duty to disclose is also considered proportionate. For the OLG, it does not run counter the German data protection rules, nor does it constitute a disproportionate infringement in the commercial operations of an intermediary. When balancing the interest of the intermediary to keep the financial flows secret and the interest of the DFB in unveiling these flows, the OLG finds that transparency aimed at limiting the external influence of intermediaries on transfers should prevail.[24] In the eyes of the court, the DFB has concretely demonstrated that the negotiation of transfers is linked with important fees (erheblichen Zahlungen), which are liable to trigger a transfer of a player for economic reasons, rather than sporting ones. This, the OLG argues, runs counter to the ideal of fair sporting competitions. [25] In general, striving for greater transparency/publicity in the intermediary market is at the heart of the regulatory shift intended by the new FIFA regulations.[26] In fact, a recent report by two Harvard based scholars argues that the lack of transparency in the transfer market is one of the main causes for money laundering and corruption in football.[27] This is reinforced by the concentration of the market for intermediaries, with a group of happy few constituting an oligopoly.[28] Besides, due to the inherently transnational operation of the market, it is extremely difficult to monitor for national authorities. Intermediaries rely on complex contractual structures (many of them have been recently exposed on the footballleaks website), juggling with national laws and arbitration clauses to reduce both their taxes and regulatory oversight. Though the transparency requirements imposed by the DFB are extremely limited (a first rough synthesis for 2015 is available here) and way bolder proposals must be put on the table,[29] this is an important step in the right direction. This quest for transparency and openness around the financial flows involving intermediaries is very much “applauded” by the European parliament.[30] In fact, if supporters and citizens, who are often in fine called to financial rescue when an overspending club is ailing, are expected to exercise a public check over the over-optimistic (and sometimes corrupt) management of clubs and the correlated extravagant fees paid to intermediaries, they must be able to rely on trustful data to conduct such a critical assessment.

Finally, and this is most interesting in light of the on-going legal battle over FIFA’s third-party ownership ban, the OLG, confirming the LG’s assessment, also recognized the legitimacy of the DFB’s ban on an intermediary having an interest in future transfer compensations.[31] Its legitimate purpose is to rein the disproportionate influence, based on personal financial incentives, of intermediaries on a player’s transfers.[32] The OLG seems to follow the LG’s view that the potentiality of obtaining a share of future transfer fees constitutes a major incentive for intermediaries to actively encourage an early termination of a player’s contract.[33] In short, the German court endorses the need to limit incentives for intermediaries to trigger contractual ruptures over their personal financial interest in a future transfer of a player. A similar logic could be applied to the proportionality assessment of the TPO ban. Indeed, this ban is also aimed at avoiding that transfers be triggered for purely financial reasons. The idea being that a club should not be in a position of dependence vis-à-vis a third-party (in practice often an intermediary) that would force it to transfer a player to satisfy its own purely economic rationale. In this regard, the OLG’s judgment is very encouraging for FIFA as it supports a logic of ‘de-financiarization’ of football. The court is very much recognizing that economic incentives should not be front-and-centre in contemporary football and that the fact that there is a clear economic dimension to sport (triggering for example the application of EU law and/or labour law) should not overshadow its other dimensions (cultural, social, ethical, educational). Conciliation is necessary, players are not amateurs anymore, transfers are possible, TV rights money can trickle down, but the rampant financiarization (and collateralization) of labour contracts seems both dangerous in terms of the economic instability it might trigger (think FC Twente) and of the unethical abuses it might incite and conceal.

Conclusion: The legal consequences of FIFA’s retreat

The new FIFA Regulations for Intermediaries are first and foremost a confession of impotence from the part of FIFA. Fifteen years after introducing a worldwide regulatory mechanism applicable to football agents, FIFA basically acknowledged its incapacity to control the profession and rein its negative externalities. The old licensing system proved unable to provide a qualitative level playing field for agents, nor was FIFA capable (or willing to invest enough resources) to truly enforce its rules. In fact, at the local level, a multitude of informal agents and practices had practically hollowed out the FIFA Regulations.[34] Yet, instead of strengthening its regulatory apparatus and enforcement mechanisms, FIFA decided to retreat and basically handed over the responsibility to regulate intermediaries to the multitude of national federations. One can be excused for doubting at first that such a re-nationalization is well suited to control an inherently transnational market.[35] Yet, there is still some room left for hope.

The re-nationalization of the Regulations will undoubtedly bring about a complex regulatory landscape with different regimes applicable in each national jurisdiction.[36] Moreover, agents/intermediaries might face an enhanced amount of red tape and administrative fees if they aim at entering each and every national market. These negative consequences can be tempered, however, by a number of things. First of all, the market for intermediaries has never been truly transnational. Sociologists have shown that it operates more as a chain of national actors rather than with truly transnational players.[37] Furthermore, the big transfer money (and thus intermediary money) in football is concentrated on a small number of national markets (mainly the European big five[38]). This means that if those markets jointly engage in a strict regulation of intermediaries it will affect disproportionately (probably positively) the profession. Due to massive TV rights revenues these national federations and leagues also dispose of the necessary (financial and administrative) resources to rigorously enforce their rules. For example, if at a European level, national federations were able to coordinate their new intermediaries regulations and provide a level regulatory field for the profession, which would involve both reducing the administrative costs to exercise it and a sharper control of its negative externalities, FIFA’s regulatory retreat would be largely compensated by a potentially more effective regulatory system.

What is the role of EU law in this regard? The Piau case is a good reminder that the CJEU is sympathetic to the need to regulate the market for intermediaries. Since then, the soft law of the European institutions (and especially the European Parliament’s position) has very much comforted this sympathy.[39] However, it would be rather naïve to believe that the EU would be able and willing to take on the task of single-handedly re-regulating such a complex transnational field. It has currently other burning priorities and crucially lacks the resources and expertise to do so. The role of EU law is rather one of a careful catalyst and counter-power, aimed at encouraging private regulations at the national or transnational level and eschewing that they go too far in scapegoating the intermediaries and in restricting their economic freedoms. In this regard, the OLG Frankfurt provided, on the basis of EU law, a rather balanced review of the DFB regulations, striking down some of the more intrusive (or arguably less rational) parts of the regulations, while recognizing the legitimacy and proportionality of others. EU law can be invoked to open up a critical discussion over the regulatory trade-offs of transnational private regulations. Not more but also not less.


[1] Case T-193/02, Laurent Piau v Commission [2005] ECR II-0209, paras. 112-115; Landesgericht Frankfurt am Main: Urteil vom 29. April 2015 · Az. 2-06 O 142/15, para. 77. On the Piau ruling see D. Waelbroeck & P. Ibañez-Colomo, ‘Case C-171/05 P, Laurent Piau, Order of the Court of Justice (Third Chamber) of 23 February 2006, [2006] ECR I-37’, Common Market Law Review 43: 1743–1756, 2006.

[2] Ibid., para. 78.

[3] “On the other hand, since they are binding on national associations that are members of FIFA, which are required to draw up similar rules that are subsequently approved by FIFA, and on clubs, players and players’ agents, those regulations are the reflection of FIFA’s resolve to coordinate the conduct of its members with regard to the activity of players’ agents. They therefore constitute a decision by an association of undertakings within the meaning of Article 81(1) EC (Case 45/85 Verband der Sachversicherer v Commission [1987] ECR 405, paragraphs 29 to 32, and Wouters and Others, paragraph 71), which must comply with the Community rules on competition, where such a decision has effects in the Community.” Ibid., para. 75.

[4] Ibid., paras 83-99.

[5] Ibid., para. 104.

[6] Ibid., para. 117.

[7] This is well recognized and explicated in the OLG’s judgment. See, OLG Frankfurt am Main, Urt. v. 02.02.2016, Az.: 11 U 70/15 (Kart), para. II.1.

[8] Case C-519/04 P David Meca-Medina and Igor Majcen v Commission [2006] ECR I-6991, para. 42 ff. See further S. Weatherill, ‘Anti-doping Revisited: The Demise of the Rule of ‘Purely Sporting Interest’?’ in S. Weatherill, European Sports Law, ASSER Press, Springer, 2014, pp. 379-399 and B. Van Rompuy, The Role of EU Competition Law in Tackling Abuse of Regulatory Power by Sports Associations, available at http://ssrn.com/abstract=2767467.

[9] OLG Frankfurt am Main, Urt. v. 02.02.2016, Az.: 11 U 70/15 (Kart),, II.2.b.

[10] Ibid, II.2.b

[11] The European Parliament “Underscores the finding of the study that the regulations of agents established by sports federations are basically aimed at controlling access to the profession and regulating its exercise, but that these bodies have only limited supervisory and sanctioning powers, since they lack any means of control or direct action vis-à-vis sports agents who are not registered with them; nor are they entitled to impose civil or criminal penalties”. European Parliament, Resolution on players’ agents in sports, 17 June 2010, (2011/C 236 E/14), para.8.

[12] OLG Frankfurt am Main, Urt. v. 02.02.2016, Az.: 11 U 70/15 (Kart), II.3.a

[13] Ibid, II.3.a: Art. 3.2 and 3.3 DFB-regulations

[14] Ibid, II.2.a

[15] For a good critique see N. de Marco, ‘The new FA Football Intermediaries Regulations and the Disputes Likely to arise’, at §23-25.

[16] Art. 7.7 DFB-regulations

[17] OLG Frankfurt am Main, Urt. v. 02.02.2016, Az.: 11 U 70/15 (Kart), II.2.a

[18] “Die Regelung ist auch notwendig; insbesondere bieten entgegen den Darstellungen der Klägerin die Regelungen zur beschränkten Geschäftsfähigkeit Minderjähriger gemäß §§ 104 ff BGB im vorvertraglichen Feld der Anbahnung eines möglichen Vertragsschlusses keinen Schutz. Dies erlangt Bedeutung, sofern - wie vom Beklagten dargestellt - eine Mehrzahl an potentiellen Spielern angeworben, jedoch nur einer tatsächlich vermittelt wird.” Ibid, II.2.a.

[19] “Schließlich erlangt bei der Verhältnismäßigkeitsprüfung auch Bedeutung, dass im europäischen Ausland ausnahmslos Regelungen hinsichtlich des Verbots der kostenpflichtigen Vermittlung minderjähriger Spieler verabschiedet wurden, so dass eine einheitliche Handhabung im Sinne des Minderjährigenschutzes in besonderer Weise geboten erscheint.” Ibid, II.2.a.

[20] See amongst others: European Parliament, Resolution on the future of professional football in Europe, 29 March 2007, (2006/2130(INI)), paras 35-38; European Parliament, Resolution on players’ agents in sports, 17 June 2010, (2011/C 236 E/14), para.6-7;

[21] European Parliament, Resolution on players’ agents in sports, para.6.

[22] This is a truly worrying development. See A. C. Najarian, ‘"The Lost Boys": FIFA's Insufficient Efforts To Stop Trafficking of Youth Footballers’, 22 Sports Law. J. 151 2015. On the ‘muscle drain’ phenomena, see W. Andreff, ‘“Muscle Drain” in Sport and how to regulate it? A plea for a “Coubertobin” tax’ and J. Scherrens, ‘The muscle drain of African Football Players to Europe: Trade or Trafficking?’, Master Thesis 2007.

[23] OLG Frankfurt am Main, Urt. v. 02.02.2016, Az.: 11 U 70/15 (Kart), II.3.b; Art. 6.1 DFB-regulations

[24] Ibid, II.3.b

[25] “Dies widerspricht dem Grundsatz eines am fairen Wettbewerb orientierten sportlichen Wettkampfs [...]“. Ibid, II.3.b

[26] In FIFA’s own words: “The new system does not regulate access to the activity but provide a framework for tighter control and supervision of the transactions relating to transfer of football players in order to enhance transparency.” FIFA, Working with intermediaries – reform of FIFA’s players’ agents system, Background information, April 2015, p.2.

[27] M. Andrews and P. Harrington, Off Pitch: Football’s financial integrity weaknesses, and how to strengthen them, CID Working Paper No. 311 January 2016, p.68-103.

[28]“The analysis of shares highlights that the big five league players’ representation market is highly concentrated: half of the footballers are managed by 83 football agents or agencies. Our study reveals the existence of closed relational networks that clearly favors the concentration of players under the control of few agents.”R. Poli, G. Rossi & R. Besson, Football Agents in the biggest five European football markets. An empirical research report, CIES, February 2012, p.2.

[29] Andrew and Harrington suggest for example to create both a “Transfer Clearinghouse to house transfer process information” and a “centralized processes for registering and managing intermediaries”, op.cit. 27, p.96-99.

[30] The EP “[a]pplauds sport governing bodies’ efforts to bring about more transparency and supervision of financial flows.” European Parliament, Resolution on players’ agents in sports, 17 June 2010, (2011/C 236 E/14), para.11. See also European Parliament, Resolution on the European dimension in sport, 2 February 2012 (2011/2087(INI)), paras 76, 78 and 87.

[31] OLG Frankfurt am Main, Urt. v. 02.02.2016, Az.: 11 U 70/15 (Kart),, II.3.c; Art. 7.3 DFB-regulations

[32]“Zweck der Regelung ist es, einer an sachfremden, d.h. nicht sportlichen Interessen ausgerichteten Einflussnahme der Vermittler auf Spielerwechsel, insbesondere im Bereich der vorzeitigen Vertragsbeendigung, entgegenzuwirken. Die Regelung ist geboten, da dieser Zweck durch das Verbot insbesondere der Zahlung von Transferentschädigungen oder Beteiligungen an einem künftigen Transferwert eines Spielers den Anreiz zur sachfremden, finanziell motivierten Einflussnahme mindert.” Ibid, II.3.c.

[33] LG Frankfurt am Main: Urteil vom 29. April 2015 · Az. 2-06 O 142/15, paras. 83-84

[34] A finding shared by the CIES study and the Study on Sports Agents in the European Union commissioned by the EC in 2009.

[35] The European Parliament stated in its 2010 Resolution on Agents that « doing away with the existing FIFA licence system for player’s agents without setting up a robust alternative system would not be the appropriate way to tackle the problems surrounding player’s agents in football”. European Parliament, Resolution on players’ agents in sports, 17 June 2010, (2011/C 236 E/14), para. 10. The same scepticism is displayed by M. Andrews and P. Harrington, Off Pitch: Football’s financial integrity weaknesses, and how to strengthen them, CID Working Paper No. 311 January 2016, at p.98.

[36] For a preliminary rough mapping, see M. Colucci (ed.), The FIFA Regulations on Working with Intermediaries – Implementation at National Level, International Sports Law and Policy Bulletin, Issue 1-2015.

[37] This is highlighted in the CIES study of 2012.

[38] I.e. the English Premier League, the German Bundesliga, the Spanish La Liga, the Italian Serie A and the French Ligue 1.

[39] European Parliament, Resolution on the future of professional football in Europe, 29 March 2007, (2006/2130(INI)), para. 44; European Parliament, Resolution on the White Paper on Sport, 8 May 2008 (2007/2261(INI)), para. 100; European Parliament, Resolution on players’ agents in sports, 17 June 2010, (2011/C 236 E/14); European Parliament, Resolution on the European dimension in sport, 2 February 2012 (2011/2087(INI)), paras 75-78. This need for regulation is also embraced, though more carefully, by the European Commission in its White Paper on Sport, see European Commission, White Paper on Sport, COM(2007) 391, at para. 4.4. See also European Commission, ‘Commission blows the whistle over inflated football transfer fees and lack of level playing field’, 7 February 2013

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