Rien ne va plus at FIFA. The news that FIFA’s Secretary General Jérôme Valcke was put on leave and released from his duties has been quickly overtaken by the opening of a criminal investigation targeting both Blatter and Platini.

With FIFA hopping from one scandal to the next, one tends to disregard the fact that it has been attempting (or rather pretending) to improve the governance of the organisation for some years now. In previous blogs (here and here), we discussed the so-called ‘FIFA Governance Reform Project’, a project carried out by the Independent Governance Committee (IGC) under the leadership of Prof. Dr. Mark Pieth of the Basel Institute on Governance. Their third and final report, published on 22 April 2014, listed a set of achievements made by FIFA in the area of good governance since 2011, such as establishing an Audit and Compliance Committee (A&C). However, the report also indicated the reform proposals that FIFA had not met. These proposals included the introduction of term limits for specific FIFA officials (e.g. the President) as well as introducing an integrity review procedure for all the members of the Executive Committee (ExCo) and the Standing Committees.

“In the interest of, and commitment to, transparency”, FIFA made publicly available on 10 September 2015 an 8-point reform plan issued by the Chairman of the Audit and Compliance Committee, Domenico Scala. The report maps the current governance problems FIFA is facing and outlines a list of reform proposals the A&C wants FIFA to implement. More concretely, the A&C believes that the ExCo is FIFA’s main problem, and urges the ExCo to reform itself.

This blog post aims to analyse the proposals submitted by the A&C. It will do so by firstly explaining what the FIFA Executive Committee is, what its powers are and how its members get elected. This allows us to understand the criticism this institution has received in the past by, e.g. the Independent Governance Committee, and by the A&C today. In continuation, a comparison will be made between this latest report on FIFA governance and the 2014 report issued by the IGC. The comparison will help us answer the question to what extent FIFA is seriously trying to undergo the necessary reforms. Lastly, the blog post will determine whether the proposals made by Scala and the A&C can be realistically implemented by FIFA and, where necessary, its Members and the Confederations. 

The FIFA Executive Committee: How it works and why it is criticised

The ExCo is the executive body of FIFA and consists of 25 members: The FIFA President, eight Vice-Presidents and 16 members, including one female member. The FIFA President and the female Member of the ExCo are elected by the FIFA Congress (the legislative body of FIFA, of which all the National Associations are a Member and have one vote each)[1], whereas the Vice-Presidents and the other members are appointed by the Confederations (i.e. UEFA, CONMEBOL, AFC, CAF, CONCACAF and OFC)[2]. It should be noted that the Confederations themselves are not members of FIFA. All members of the ExCo are elected for four years and may be re-elected indefinitely.[3] The tasks of the ExCo include determining the dates, locations and format of the FIFA tournaments and electing the General Secretary on the proposal of the FIFA President.[4] Moreover, the ExCo designates the members of each standing committee.[5] An example of such a standing committee is the Finance Committee, whose task is to monitor the financial management and advise the ExCo on financial matters and asset management.[6]

In a concept paper from September 2011, the IGC described the ExCo as an “assembly of member delegates” rather than executive body. “The nature of the Executive Committee as an assembly of delegates is further supported by its large size (24 members in 2011) and few meetings (two meetings per year)”.[7]

The often-mentioned governance problem of the ExCo involves the ‘double’ or even ‘triple heads’ of some of its members. For example, the man who is president of the Spanish football association (RFEF) since 1988, Ángel María Villar, is also vice-president of UEFA since 1992 and FIFA Executive Committee member since 1998. Having important functions in three related, though different, organisations could trigger severe independency and conflict of interest issues. Furthermore, as the A&C pointed out in his 8-point reform plan, “the misconduct of some, even if it happens ‘only’ at the Confederation / national association level, has a tremendous impact in FIFA itself”.[8] One only needs to remember the example of former ExCo Members, Jack Warner and Chuck Blazer, who in their other function as president and vice president of the CONCACAF laundered millions of dollars and were charged with corruption.[9]

In its concept paper, the IGC already underlined the lack of independent supervision within the ExCo and suggested introducing a number of independent ExCo Members.[10] Further recommendations were substantiated in the IGC’s final report, which included implementing integrity review procedures for all members of the ExCo and the Standing Committees performed by FIFA centrally, and having the FIFA Congress confirm each ExCo member appointment or re-appointment by the Confederations.[11] Nonetheless, more than four years after the publication of the first IGC report and even after the 2015 FIFA corruption scandal, which led to the arrests of ExCo Members Jeffrey Webb and Eugenio Figueredo, the way ExCo Members get elected has not changed. For example, so far a requirement for integrity checks of new Members has not been introduced. 

Comparing the Final Report by the Independent Governance Committee and the Scala reform plan

The Final Report by the IGC contained a list of achievements including:

• Dividing the Ethics Committee into an investigatory and an adjudicatory chamber;

• Revising the Code of Ethics, through which the rules of conduct and expected behaviour (e.g. new standards regarding conflicts of interest, gifts and other benefits, bribery and corruption) are more clearly described;

• Establishing an Audit & Compliance Committee with the typical supervisory role of an Audit Committee and the additional responsibilities for a Compliance Program as well as for Compensation & Benefits;

• Establishing that the Chairman and Vice-Chairman of the Audit & Compliance Committee are independent and meet the necessary professional requirements.[12]

In addition to the list of achievements, the report listed a set of recommendations that were not implemented. The main recommendations are listed in the table below, together with the list of reform proposals found in the 8-point reform plan. 

Analysing the two governance reports

As a preliminary note, it is worth mentioning that the establishment of the FIFA Audit and Compliance Committee came about after the IGC suggested doing so in their report, published on 20 March 2012.[13]

A quick look at the above table shows that the recommendations by the IGC and those listed in the 8-point reform plan are very similar. First of all, the introduction of term limits for the FIFA President and ExCo Members is encouraged in both reports, whereas introducing age limits is discouraged. Secondly, both reports agree that there should be an integrity check for at least the President and the ExCo Members performed by FIFA itself. What these integrity checks would entail still needs to be clarified. Thirdly, it is clear that individual compensations of the President and the ExCo Members need to be disclosed to the public. Both reports contend this is essential to improve the governance and transparency of FIFA. Lastly and, in our opinion, most importantly, both reports agree that the Confederations and Member Associations play a most essential role when attempting to effectively improve the governance of FIFA. Where the two reports slightly differentiate from one another is on what the exact position of the Confederations and Member Associations should be, how they are involved in the electoral process of the FIFA President and ExCo members, and how they should be reformed themselves.

In its report, the IGC highlights the importance of the Confederations and national associations, but it does not suggest any substantial reform in this regard. In fact, the second recommendation of the report stipulates that “the members of the Executive Committee should each be individually confirmed by Congress decision upon their appointment or re-appointment by the Confederations”.[14] The IGC’s suggestion of a limitation of the Confederation’s role in the election process of the ExCo members was heavily criticised by, most notably, UEFA. All the UEFA members voted unanimously against the introduction of term limits for ExCo members during the FIFA Congress of January 2013. UEFA also held the view that the Congress should not have the right to confirm Confederation candidates delegated to the ExCo and that integrity checks on candidates should not be performed by FIFA but by the Confederations.[15]

The Scala proposal has a slightly different take on the role of the Member Associations and the Confederations, especially with regard to the election to the ExCo: “all members of the FIFA Executive Committee (are) to be directly elected by the FIFA Congress. The Confederations will retain a right to propose candidates.”[16] Furthermore, “Confederations and FIFA Member Associations have to issue adequate ethics and disciplinary regulations and set up the bodies required to implement them. All persons assigned to FIFA bodies have to pass strict integrity checks in their respective Confederations and national associations.”[17] Lastly, there has to be an obligation for Confederations and Member Associations “to establish integrity checks with regard to positions in their top governing bodies as a precondition for eligibility”.[18]

A conclusion that can be drawn from the Scala reform plan is that it assumes the same governance problems highlighted in the IGC reports, especially as regards the ExCo, but suggest more far-reaching proposals. Improving the governance of the ExCo cannot simply be achieved by introducing term limits and integrity checks at FIFA level, rather similar reforms must be introduced in the Confederations and in the National Associations. This would require that the Confederations and National Associations put in place credible integrity self-checks. Yet, it is clear from the recent past that the Confederations are not willing to implement this type of accountability mechanisms, nor are they really committed to giving them the necessary teeth. 

Conclusion: Can the Scala reform plan be implemented?

The Scala report offers a newish take on old recipes to solve FIFA’s bad governance syndrome. Nearly all of the reforms proposed require amending the FIFA Statutes. For example, “the passing of the integrity check and the introduction of equivalent integrity checks by Confederations and Member Associations to qualify for elections to FIFA governing bodies need to be included in the FIFA Statutes and therefore need to be adopted by the Congress”.[19] Similarly, “direct elections of members of the FIFA Executive Committee mandatorily needs to be provided for in the FIFA Statutes; corresponding revisions would therefore have to be approved by the FIFA Congress”.[20] In accordance with Article 26(6) of the FIFA Statutes, for a proposal to adopt or amend the Statutes, a simple majority (more than 50%) of the valid votes cast is required. Procedurally, implementing the reforms proposed by Scala is straightforward: a simple majority of the votes at a FIFA Congress (the next one being on 26 February 2016) is needed.

However, achieving a simple majority might not be as simple as that. Introducing term limits, for example, would mean that many of the Members voting for this measure would create an “expiration date” for a job they have held for years (decades even in many cases) and do not want to lose. One only needs to remember the fact that during the FIFA Congress of January 2013, the Members of UEFA voted unanimously against the introduction of term limits for ExCo members.

Introducing integrity checks at FIFA level is one thing, but having similar checks at the Confederation and/or National level would imply that the people voting at the FIFA Congress would introduce integrity checks against themselves. In any normal global organisation this should not be a problem. However, as regards the governance of football, in light of the never-ending list of scandals, one can easily understand why many members would prefer not to see such integrity checks taking place in their backyard.

Scala attacks the ‘old boys’ networks’ within the ExCo, the Confederations and the Member Associations.[21] Similarly, the IGC held that “the ultimate success of the reform depends on a change in culture on all levels of the organization, especially with the key opinion leaders who need to lead by example and act in the interest of FIFA and football overall”.[22] Changing FIFA is not only about pushing a reform measure through the FIFA Congress, already an extremely difficult endeavour, it is also about changing a culture of omerta and corruption that has been around since the organisation’s earliest days, and to which the key players want to cling on as long as possible. Whether this can be done from inside the organization is doubtful. Instead, only the pressure of the public and the external legal control exercised by national (and European) authorities will force the great leaders of the beautiful game to bend and finally put in place mechanisms securing their accountability.

[1] Article 25(2)q) of the FIFA Statutes (2015 Edition) – available at http://resources.fifa.com/mm/document/affederation/generic/02/58/14/48/2015fifastatutesen_neutral.pdf.

[2] Article 20(3)g) of the FIFA Statutes.

[3] Article 30 of the FIFA Statutes

[4] Articles 30 and 31 of the FIFA Statutes

[5] Article 34(3) of the FIFA Statutes. This provision also stipulates that the members of the Audit and Compliance Committee are elected by the FIFA Congress.

[6] Article 35 of the FIFA Statutes.

[7] Governing FIFA – Concept Paper and Report, 19 September 2011, page 13.

[8] “Substantiation of the Reform Proposals Presented at the FIFA Executive Committee Meeting of 20 July 2015”, Reports submitted to the FIFA Executive Committee by the independent Chairman of the FIFA Audit and Compliance Committee, page 4.

[9] For more information on the Chuck Blazer case, read our previous Blog post.

[10] “Governing FIFA”, Concept Paper and Report, 19 September 2011, pages 23-25.

[11] “FIFA Governance Reform Project”, Final Report by the Independent Governance Committee to the Executive Committee of FIFA, page 12.

[12] Ibid, pages 11-12.

[13] “FIFA Governance Reform Project”, First Report by the Independent Governance Committee to the Executive Committee of FIFA, page 9.

[14] Supra 11, page 12.

[15] Ibid, page 10

[16] Supra 8, page 26.

[17] Ibid.

[18] Ibid, page 25.

[19] Ibid, page 8.

[20] Ibid, page 11.

[21] Ibid, page 4.

[22] Supra 11, page 11

Forget the European Championship currently held in France or the upcoming Olympic Games in Rio. Doping scandals are making the headlines more than ever in 2016. From tennis star Sharapova receiving a two-year ban for her use of the controversial ‘meldonium’, to the seemingly never-ending doping scandals in athletics. As if this was not enough, a new chapter was added on 14 June to one of the most infamous and obscure doping sagas in history: the Operación Puerto.

The special criminal appeal chamber,  the Audiencia Provincial, has held that the more than 200 blood bags of professional athletes that have been at the center of the investigations since 2006 can be delivered to the relevant sporting authorities, such as the Spanish Anti-Doping Agency (AEPSAD), WADA, the UCI and the Italian Olympic Committee (CONI). In other words, there is now a good chance that the identities of the involved athletes might eventually be revealed.

Source: http://www.telegraph.co.uk/sport/othersports/cycling/9834122/Operation-Puerto-doctor-Eufemiano-Fuentes-treated-tennis-players-athletes-footballers-and-a-boxer.html

This case note will analyze the court’s ruling and summarize its most important findings. Given the amount of time passed since the scandal first came to light (2004), the blog will commence with a short background summary of the relevant facts. 

Background

The saga can be traced back to the interview by the Spanish sports newspaper AS with the cyclist Jesus Manzano in 2004. During the interview, Manzano admitted that he, as well as other members of his team (Kelme), were involved in blood doping practices, and denounced his team doctor Eufemiano Fuentes as the mastermind behind the operations.[1] As a result of his declarations, Manzano became the victim of regular abuse by the “professional cycling world” and even received death threats. Manzano reported the death threats to the Guardia Civil (a Spanish law enforcement agency), who saw itself obliged to investigate the matter. The results of the Guardia Civil’s investigation proved that the information provided by Manzano regarding names, locations and practices were correct. However, the scope of the Guardia Civil’s investigations was limited due to the fact that, according to Spanish law in force at the time, doping was not considered a criminal offence.

On 23 May 2006, several people were arrested, including doctor Fuentes, who was accused of committing a “crime against public health” enshrined in Article 361 of the Spanish Criminal Code.[2] After his arrest, the Guardia Civil conducted domiciliary visits in the various domiciles owned by Fuentes, in which it found over 200 blood and plasma samples. The blood and plasma bags were labelled with coded names, in order not to reveal the true identity of Fuentes’ clients. Nonetheless, it was clear that Fuentes’ network was much more extensive than previously anticipated and that he had hundreds of clients, from a variety of sports and nationalities.

The relevant SGBs, such as WADA, petitioned for the blood samples to be analysed and all the identities revealed, with the aim of sanctioning the athletes involved. The Spanish public authorities, however, denied the SGBs requests[3], claiming that handing over the blood samples would breach the athletes’ right to privacy and reiterating that athletes involved in doping practices were not (at the time) committing any criminal offence according to Spanish law.

A long-awaited judgment was finally delivered[4] by the Madrid criminal court on 29 April 2013, a judgment which raised many eyebrows worldwide (see for example this critical analysis by the French newspaper Le Monde). Fuentes received a one-year prison sentence for committing a crime against public health and was suspended for four years from practicing sport medicine. More importantly, the court ordered the destruction of the blood samples, as well as other pieces of evidence, such as documents and recorded telephone conversations once the decision becomes final.[5] Given that the case was not about a doping offense but about a crime against public health, the court argued, the investigation of the blood samples would be in breach of the privacy rights of the athletes.

The judgment was appealed by several parties, including Fuentes and the SGBs (AEPSAD, WADA, UCI and CONI). Fuentes demanded to be acquitted, whereas the SGBs appealed the order to have the blood samples destroyed.  

Sentencia Nº 302/2016 of 14 June 2016

The Audiencia Provincial made its judgment public on 14 June 2016. The judgment consists of 23 different appeals by different parties. This case note, however, will only analyze section 18 (on the question whether blood is considered a medicine) and section 21 (regarding the blood and plasma samples). 

Section 18 – Is blood a medicine?

The answer to this question was highly relevant for Fuentes’ appeal against the prison sentence. Article 361 of the Spanish Criminal Code provides inter alia that a person who offers medicine in unauthorized locations[6] or does not fulfill the relevant hygiene criteria, shall be punished with an imprisonment from six months to three years.[7] Fuentes argued that blood extracted from an athlete, which is later injected back into the athlete, was legally not considered a medicine in 2006.

The court firstly established that the Criminal Code does not legally define “medicine”, meaning that the definition needed to be found in administrative laws,[8] such as the Medicine Law[9]. This law stipulates that blood derivatives could be considered medicine, but blood as a whole cannot.[10] The court also looked for a definition in EU law, more specifically EU Council Directive 98/381/CEE laying down special provisions for medicinal products derived from human blood or human plasma. Article 1, point 2, holds that whole blood, plasma or blood cells of human origin are outside the scope of the Directive. Having established that the blood and plasma samples found in Fuentes’ domiciles cannot be considered medicine, the court concluded that the doctor could subsequently not be punished for committing a crime against public health as stipulated in Article 361 of the Criminal Code. A punishment of any kind would be contrary to the “principle of legality”.[11] 

Section 21 – blood and plasma samples

The RFEC, WADA, UCI and CONI wanted to see the destruction order of the blood and plasma samples overturned and, instead, the samples delivered to them.[12]  Importantly, both the criminal court in first instance and the Audiencia Provincial recognized that a possible doping investigation by the SGBs after a handover of the blood samples would be an administrative procedure, rather than a criminal procedure such as in the case at hand.[13]

However, the first instance court had also indicated that the SGBs could not use the blood samples, because administrative sanctioning procedures do not allow this type of evidence to be used. To reach this conclusion, the court in first instance referred to an administrative law case involving disciplinary proceedings against a magistrate. In that case, recorded phone conversations were not deemed receivable evidence because of a breach of privacy, which would infringe Article 8 of the ECHR. The court transposed this reasoning to Operación Puerto and held that using the blood samples for an administrative proceeding was inadmissible.

The Audiencia Provincial did not follow this reasoning. Instead it referred to criminal case law, which established a difference between the recording of phone conversations on the one hand and domiciliary visits on the other. So-called “casual findings” during domiciliary visits of evidence for crimes that were not the ones the visits were authorized for, can still be used as evidence. In fact, the blood and plasma bags cannot be considered “casual findings”, since the public authorities were authorized to undertake the domiciliary visits to find evidence for an alleged crime against public health. Moreover, contrary to the recording of phone conversations which is only authorized in case of a penal procedure, domiciliary visits are measures that could also be authorized in administrative procedures.[14]  In other words, this type of evidence obtained in the framework of a criminal procedure can also be used in an administrative disciplinary procedure, such as doping cases.

As regards the transfer of the blood and plasma samples to an SGB, the court stated the following: In accordance with the provisions of the 2013 anti-doping laws, the samples can be handed over to the Spanish Anti-Doping Agency. The Agency would need to submit a formal request to a court, and the court would consider the request taking into account the principle of proportionality.[15]  The Audiencia Provincial considers that a transfer of the blood samples could be proportionate since it pursues the objective of fighting against doping. This is so because: doping use is contrary to the ethical values of sport, which are fair play and competition. Not allowing the transfer of the blood and plasma samples would give the impression that doping is not really a problem and might indicate that in sports the end justify the means.[16]  

Conclusion

On the day the judgment was released, AEPSAD expressed its satisfaction with the Audiencia Provincial’s decision and stated that it is studying the possible measures it can now take, either by itself or together with the other SGBs referred to in the judgment. WADA too acknowledged the court “for having reached the decision to provide anti-doping authorities with this crucial evidence”, but also stated that it is “dismayed that it took so long to receive the decision”. Finally, UCI regrets it had to wait this long for the decision, but will now partner with WADA, the RFEC, AEPSAD and CONI, to determine the legal options available with regards to analyzing the blood and plasma bags; and, where applicable, pursuing anti-doping rule violations.

In its press release, UCI points to the crucial question that will need an (un)satisfying answer: Can the SGBs still pursue anti-doping violations, or is too late? Article 17 of the 2015 WADA Code enshrines that the statute of limitations is 10 years. Coincidentally, it has been 10 years and two months since the arrests of Fuentes was made and Operación Puerto started taking shape. It is therefore unlikely that doping sanctions will be handed out on the basis of blood samples collected during the period 2002-2006. But simply discovering the identity of the doped athletes could have far-reaching consequences on its own. For example, when Bjarne Riis admitted in 2007 that he used EPO during his victorious 1996 Tour de France, the UCI was not able to sanction him anymore. However, the Tour de France organizing organization (ASO) has removed him as a past winner. Similar consequences are thinkable with the discoveries of the identities in the Operación Puerto case. Furthermore, Operación Puerto, widely recognized as the darkest chapter in the history of Spanish professional sport, can only truly be closed when the identities of the athletes are revealed. Publicly naming and shaming the athletes is an important mean to create a fairer competition and to prevent other athletes from doping themselves.  

[1] The actual interview with AS is not available anymore. A summary of the interview can be read at http://velonews.competitor.com/2004/03/news/more-from-manzano-its-like-an-open-bar_5763.

[2] Sentencia de la Audiencia Provincial de Madrid Nº 302/2016 de 10 de junio 2016, page 7. A few months later, in 2006, Article 361bis was added to the Spanish Penal Code, a provision that made doping a criminal offense.

[3] Cyclists, such as Jan Ullrich, Ivan Basso, Michele Scarponi and Óscar Sevilla were known to be among Fuentes’ clients, for the most part thanks to journalist investigations. The German cyclist Jörg Jaksche admitted voluntarily, and Spanish cyclist Alejandro Valverde received a suspension by the Italian Olympic Committee CONI in 2010.

[4] As can be seen from the 176-page judgment, the names of the suspects have been changed. For example, primary suspect Eufemanio Fuentes is called “Juan Máximo”.

[5] Sentencia del Juzgado Penal de Madrid Nº 144/203 de 29 de abril 2013, pages 175-176.

[6] A hospital, for example, would be considered an authorized location. A cycling team bus, or a hotel room, could be considered unauthorized locations for the offering of certain types of medicine.

[7] Artículo 361 Código Penal: “El que fabrique, importe, exporte, suministre, intermedie, comercialice, ofrezca o ponga en el mercado, o almacene con estas finalidades, medicamentos, incluidos los de uso humano y veterinario, así como los medicamentos en investigación, que carezcan de la necesaria autorización exigida por la ley, o productos sanitarios que no dispongan de los documentos de conformidad exigidos por las disposiciones de carácter general, o que estuvieran deteriorados, caducados o incumplieran las exigencias técnicas relativas a su composición, estabilidad y eficacia, y con ello se genere un riesgo para la vida o la salud de las personas, será castigado con una pena de prisión de seis meses a tres años, multa de seis a doce meses e inhabilitación especial para profesión u oficio de seis meses a tres años”.

[8] Sentencia de la Audiencia Provincial de Madrid Nº 302/2016 de 10 de junio 2016, page 61.

[9] Ley 25/1990, de 20 de diciembre, del Medicamento.

[10] Sentencia de la Audiencia Provincial de Madrid Nº 302/2016 de 10 de junio 2016, pages 59-61.

[11] Ibid., pages 69-73.

[12] Ibid., pages 76-77.

[13] Ibid., pages 78-79.

[14] Ibid., pages 80-81.

[15] Artículo 33(5) de la Ley Orgánica 3/2013, de 20 de junio, de protección de la salud del deportista y lucha contra el dopaje en la actividad deportiva: “La Agencia Española de Protección de la Salud en el Deporte podrá solicitar que le sean remitidas aquellas diligencias de instrucción practicadas que sean necesarias para la continuación de los procedimientos sancionadores. Dicha petición será resuelta por el Juez de instrucción, previa audiencia de los interesados, en el plazo de 20 días. En dicha audiencia los interesados podrán solicitar que sean también remitidos los documentos que les puedan beneficiar. La resolución del Juez será plenamente respetuosa con el principio de proporcionalidad, entregando a la Administración, mediante resolución motivada, únicamente las diligencias que la aplicación de tal principio autorice”.

[16] Sentencia de la Audiencia Provincial de Madrid Nº 302/2016 de 10 de junio 2016, page 83.

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.

On 17 February 2016, the Landesarbeitsgericht Rheinland-Pfalz delivered its highly anticipated decision in the appeal proceedings between German goalkeeper Heinz Müller and his former employer, German Bundesliga club Mainz 05.[1] The main legal debate revolved around the question (in general terms) whether the use of a fixed term contract in professional football is compatible with German and EU law. 

In first instance (see our earlier blog posts, here and here), the Arbeitsgericht Mainz had ruled that the ‘objective reasons’ provided in Section 14 (1) of the German Part-time and Fixed-term Employment Act (Gesetz über Teilzeitarbeit und befristete Arbeitsverträge, “TzBfG”), the national law implementing EU Directive 1999/70/EC on fixed-term work, were not applicable to the contract between Müller and Mainz 05 and therefore could not justify the definite nature of that contract.[2] In its assessment the court devoted special attention to the objective reason relating to the nature of the work, declining justifications based thereupon.[3] Tension rose and the verdict was soon labelled to be able to have Bosman-like implications, if held up by higher courts.[4]

The Landesarbeitsgericht Rheinland-Pfalz has however taken a different road, one going in the (radically) opposite direction, by deciding that the contested fixed term contract period between a Bundesliga football club and a professional player can in fact be justified based on the objective reason of the nature of the work.[5] This case is an example of how the successful reliance on EU law ultimately depends on the interpretation of a national implementing measure by the competent national courts.[6]

This blog post will try to provide an insight in the court’s reasoning, addressing the four main arguments raised in the judgment. Followed by some point of criticism, making comparisons with the ruling in first instance, as well as the Dahmane v KRC Genk case.[7]  

The reasoning of the court

The Landesarbeitsgericht turns to the concept of the specificity of the work (“Eigenart der Arbeitsleistung”) in the second part of its decision.[8] It thereby immediately stresses that every ‘employment relationship’ has its particularities, which thus prohibits a broad interpretation of the nature of the work. It elucidates:

It therefore must be a specificity, the nature of which transcends in an exceptional way the particularities inherent to every (normal) employment relationship, wherein also industry specific features have to be considered.[9]

Thus, for the justification of Section 14 (1) (4) TzBfG to apply, it has to be a special ‘employment relationship’, which in an extraordinary way transcends the particularities inherent to any normal form of employment. The court follows by stating that the employment relationship between a Bundesliga club and a professional football player is characterized by specific features rendering it such special status.[10] The following arguments are substantiating this claim: 

1. Extraordinary high degree of uncertainty 

At the time of concluding the contract, there is an extraordinary high degree of uncertainty regarding the timespan the player can be employed successfully in the pursuit of the club’s sporting and thereto related economical goals.[11]

In the field of professional football, however, there are special features which lead to a degree of uncertainty significantly exceeding the one present at the conclusion of other employment contracts.[12]

The court substantiates this by referring to the possibility of injuries, leading to potential constraints on the player’s future performance. The latter is in any case dependent on many factors and thus only partially predictable. Other unforeseeable circumstances are put forward by the court that may affect the player’s use and performance in a team. It depends in particular on the manager’s tactical approach, the changes therein and the player’s adaptability to those changes. Group dynamics can negatively influence the individual performance. Moreover, in their constant strive for improvement, clubs take on new players, which may cause a previously valuable player to be no longer suited to the raised performance level of the team and the associated increased sporting objective of the club. This leads the court to believe that there is a legitimate interest for the club to use fixed term contracts.[13]

2. The particular need for a balanced age structure of the professional squad

A legitimate interest, to limit the contracts of professional players, derives from professional football’s immanent nature of the particular need, guided by the sporting goal, for a balanced age structure of the squad.[14]

From this a legitimate interest to use fixed term contracts can be derived. For reasons of competitiveness, clubs are constantly striving to “refresh” their squad. They achieve this by signing young players, introducing skilled players from their own youth department in the first team and possibly endow them with a professional contract. The court states that if professional players would have indefinite contracts, this would inevitably lead (in a certain time) to an immense inflation and total oversizing of the squad, which for most teams then would no longer be financeable.[15]

3. The public’s need for variety

Taking into account the public’s variety-need in assessing the legality of a fixed-contract is justified in light of the increasing commercialization of professional football and it having many similarities with the entertainment industry.[16]

Referring to case law in the area of theatre and stage arts, the court considers sports fans’ need for variety to be a specific feature of professional football. This aspect, in view of the increasing commercialization of professional football, further justifies the use of definite contracts. Fans of course want excellent performing players and crowd favourites (“Publikumsliebling”) to stay with the club on a long-term basis, yet this cannot be foreseen at the time of the conclusion of the contract. The court is however adamant that fans strive for variety with regard to the composition of the team as such.[17]

The public expects the club’s management to, from time to time, if not in every transfer window, improve and thus change the team by attracting new players.[18]

Thus, according to the court, the public expects the club’s management to attract new players and thus periodically change the composition of the team. Likewise it notes that, when concluding a contract, clubs and players need to start from the assumption that fans want change and, hence, want to see different players over time.[19] 

4. The player’s interests

Even from the player’s perspective, according to the court, the use of fixed term contracts is beneficial.

From the player’s side it is to be considered, that by the orderly conclusion of fixed-term contracts that cannot be terminated, the player’s risk of losing his job is, at least temporarily, lifted.[20]

Again referring to the imminent threat of possible injury, the court puts forward that a fixed term contract protects players particularly against early termination of the employment contract by personal compulsory redundancy. Furthermore, it is the court’s view that the ending of fixed term contracts creates room for possible subsequent transfers, deemed in the football player’s interests.[21]

Next, the court shortly addresses the typically extraordinary amount of remuneration paid in professional football (in the Bundesliga annually amounting to an average of 1.5 million euros). It takes note of the aim of EU Directive 1999/70/EC, being the improvement of the situation of weak and thus socially vulnerable workers and to prevent the emergence of a ‘precariat’ of always only temporary salaried workers. It subsequently notes that, in balancing the interests, the exceptionally high remuneration completely changes the scale in application of Section 14 TzBfG, however unfortunately without giving any further guidance.[22]

In an overall consideration of all these circumstances the court finds that the fixed term contract signed between Müller and Mainz 05, and thus the use of fixed term contracts in professional football in general, corresponds to the view of a sensible and reasonable contractual partner.[23] 

Und Jetzt? Some points of criticism

The Landesarbeitsgericht seems to have felt the need to soothe the debate that has arisen after the ruling in first instance. In direct opposition to the Arbeitsgericht Mainz, it has concluded that the contested fixed term contract period between a Bundesliga football club and a professional player can in fact be justified based on the objective reason of the nature of the work.[24] The protective stance in favour of the player provided by the Arbeitsgericht, together with the bulk of that court’s argumentation, has now been abandoned. Although the rationale given by the Landesarbeitsgericht for its ruling, especially the first and second argument (being for large parts in consensus with a commentator of the first instance ruling),[25] seems convincing to this author. Altogether, it still leaves room for further debate. 

On the one hand, with regard to the extraordinary high degree of uncertainty, the Landesarbeitsgericht even could have gone further by developing an argument based, not on the uncertainty of successful performance, but on the inevitability of a decline in physical performance.[26]

On the other hand, the court’s claim that the use of definite contracts is in the player’s own best interest seems rather circular, when it states that the ending of definite contracts at clubs makes room for subsequent transfers.[27] It moreover does not explain the precise influence of the high remuneration received in professional football in the balancing of interests under Section 14 TzBfG.[28] This author would have also liked some further elaboration on the courts assumption of the fans’ variety-need.[29]

Perhaps most importantly, by separating these ‘special employment relationships’ in professional football from normal employment, the Landesarbeitsgericht seems to have taken away the protective shield of labour law from the hands of the players/workers (supported in the ruling in first instance) and placed it right back at the feet of the clubs. It may be that the system of fixed term contracts is the most suitable in addressing the particularities of professional football,[30] and yes, the court has provided some valuable arguments for granting a justification based on the nature of the work. Still, the court must tread warily not to give clubs a carte blanche established on this special status of sport. Because, what would be the limits of this autonomy and how would these limits be policed?

In a previous Belgium case, the Dahmane v KRC Genk case (see our earlier blog post), the outcome was somewhat different. There, the Belgian court had to rule on a player’s unilateral termination of his labour contract with his club. In relation to this matter, the court decided, first, against a differentiation between football players and other professional athletes, and second, against a differentiation between professional athletes and normal workers. According to the Belgian court sport does exhibit certain particularities, however a perceived ‘specific nature of sport’ was not a decisive factor leading it to deviate from other labour relationships.

This reasoning is more in line with the Arbeitsgericht’s view in first instance regarding the question of the nature of the work. Be that as it may, the Landesarbeitsgericht does not concur, leaving us with yet another twist in this ongoing debate since the Bosman ruling. Can we speak of this perceived separate creature, being football or sport, and should this have a special status? And, if so, what should be the implications of this special status in relation to (EU) (labour) laws? These questions are far from settled.

[1] Landesarbeitsgericht Rheinland-Pfalz: Urteil vom 17.02.2016 – 4 Sa 202/15 (Appeal decision Heinz Müller case)

[2] FIFPro Press Release,Müller case is a wake-up call for football, 8 April 2015

[3] P. Drabik, Compatibility of fixed-term contracts in football with Directive 1999/70/EC on fixed-term work: the general framework and the Heinz Müller case, Int Sports Law J (2016).

[4] “Successful lawsuit threatens time-limited contracts in football” http://www.dw.com/en/successful-lawsuit-threatens-time-limited-contracts-in-football/a-18341045.

[5] Landesarbeitsgericht Rheinland-Pfalz: Urteil vom 17.02.2016 – 4 Sa 202/15 (Appeal decision Heinz Müller case), II.1.b

[6] P. Drabik, “Compatibility of fixed-term contracts in football with Directive 1999/70/EC on fixed-term work: the general framework and the Heinz Müller case”, Int Sports Law J (2016), p. 153, 157

[7] A.R. 2009/AH/199 (6 may 2014), Dahmane v KRC Genk

[8] Appeal decision Heinz Müller case, II.1.b

[9] “Es muss sich daher um eine vertragstypische, die jedem Arbeitsverhältnis innewohnende Besonderheit in einem außergewöhnlichen Maß übersteigende Eigenart handeln, wobei jedoch auch branchenspezifische Merkmale bzw. Gesichtspunkte zu berücksichtigen sind“ Ibid, II.1.b

[10] Ibid, II.1.b

[11] Ibid, II.1.b.aa

[12] “Im Bereich des Profifußballs bestehen indes Besonderheiten, die dazu führen, dass das Maß dieser Ungewissheit das insoweit bei Abschluss sonstiger Arbeitsverträge gegebene Unsicherheitsrisiko erheblich übersteigt“, Ibid, II.1.b.aa

[13] Ibid, II.1.b.aa

[14] “Ein berechtigtes Interesse, die Verträge der Lizenzspieler zu befristen, ergibt sich auch aus der dem Profifußball immanenten Eigenart der besonderen Notwendigkeit einer ausgewogenen, der sportlichen Zielsetzung gerecht werdenden Altersstruktur des Spielerkaders“ Ibid, II.1.b.bb

[15] Ibid, II.1.b.bb

[16] “Die Berücksichtigung des Abwechslungsbedürfnisses des Publikums bei der Befristungskontrolle ist im Hinblick auf die zunehmende Kommerzialisierung des Profifußballs, der mittlerweile vielerlei Ähnlichkeiten mit der Unterhaltungsbranche aufweist, gerechtfertigt“ Ibid, II.1.b.cc

[17] Ibid, II.1.b.cc

[18] “Das Publikum erwartet von der sportlichen Leitung des Vereins, dass diese von Zeit zu Zeit, wenn nicht sogar in jeder Transferperiode, die Mannschaft durch Verpflichtung neuer Spieler verbessert und damit zugleich auch verändert“ Ibid, II.1.b.cc

[19] Ibid, II.1.b.cc

[20] “Auf Seiten des Spielers ist zu berücksichtigen, dass diesem durch den Abschluss eines befristeten, ordentlich unkündbaren Arbeitsvertrages zumindest vorübergehend das Risiko des Verlustes seines Arbeitsplatzes genommen wird“ Ibid, II.1.b.dd

[21] Ibid, II.1.b.dd

[22] Ibid, II.1.b.dd

[23] Ibid, II.1.b.ee

[24] Ibid, II.1.b

[25] Piotr Drabik, “Compatibility of fixed-term contracts in football with Directive 1999/70/EC on fixed-term work: the general framework and the Heinz Müller case”, International Sports Law Journal (2016), 15; 3-4, page 156

[26] As advocated in: Ibid, p. 152, 156,

[27] Appeal decision Heinz Müller case, II.1.b.dd

[28] Ibid, II.1.b.dd

[29] Ibid, II.1.b.cc

[30] As advocated in: Piotr Drabik, “Compatibility of fixed-term contracts in football with Directive 1999/70/EC on fixed-term work: the general framework and the Heinz Müller case”, International Sports Law Journal (2016), 15; 3-4, page 153

Yesterday, UEFA published the very much-expected settlements implementing its Financial Fair Play (FFP) regulations. Today, we address tomorrow’s challenges for FFP, we offer five, more or less realistic, scenarios sketching the (legal) future of the FFP regulations.

Scenario 1 : Happily ever after

We enter the brave new world of FFP. The settlements are not contested and Dupont’s EU law crusade sinks into oblivion. Meanwhile, the Qatari owners of PSG come up with a new marketing concept, the club recruits four locally trained players and wins the Champions league fielding the same starting team 14 times.[1] Thanks to FFP, in 2015, nobody is losing money anymore[2], Cristiano Ronaldo’s transfer to PSG for EUR 30 Mio. is by far the most expensive one and Arsenal’s coach Wenger feels rich for the first time in his career. No new FFP violation is registered, except for Shakhtar Donetsk, which messed up its financial accounts due to the move back to the rubble.

Scenario 2: Here we go again

FFP ends here for 2014, but history repeats itself in 2015. Clubs are still losing money and appear to fail to comply with the agreed settlements.[3] However, Manchester City and PSG have recourse to new innovative marketing contracts to turn their losses into profits.[4] To this end, the PSG squad members are named official ambassadors of the State of Qatar and their wages are covered by the Qatari state. The nightmare continues for Platini, who is stuck between a rock and a hard place. On one side he counts on Qatar’s vote and influence to win the FIFA presidency in June 2015, on the other he needs to defend his credibility in the eye of the German austerity hawks. The procedure is delayed until July, at which point the cases are referred to the adjudicatory chamber.[5] Both clubs are found in breach again, the chamber imposes a EUR 100 Mio. fine and Champions League squads are reduced to 18 players.[6]

Scenario 3: Settlements are not enough

Wenger is outraged! Fining PSG and Manchester City is a bit like fining a central bank: they’ll just print more money. 2014 was supposed to be the year his side would eventually get to play the Champions League without having to go through the preliminary rounds. Thus, Arsenal, backed by Everton, decides, on the 25 May 2014, to contest the settlements in front of the Adjudicatory Chamber.[7] Olympique de Marseille, always keen on fighting PSG on any turf, also appeals the settlement. However, in a final decision, the Adjudicatory Chamber dismisses the complaints. Far from abandoning their quest for justice, the clubs decide to refer the decision to CAS[8], where Everton, Arsenal and Marseille obtain a re-devaluation of the controversial sponsoring agreements. CAS hands out a two-year ban on transfers for both clubs, but comes short of kicking them out of the Champions League.[9] As usual, the final appeal to the Swiss Federal Tribunals is a waste of time: Arsenal will have to go through the preliminary round...again.

Scenario 4: My name is Dupont, Jean-Louis Dupont

All the parties agree with the settlements proposed, FFP seems to be heading for a smooth run. All, but one. Belgian lawyer Jean-Louis Dupont, secretly backed by wealthy clubs, challenged FFP in front of the Belgian Courts and the European Commission. He claims, loud and clear, that FFP is a restriction of EU Free Movement and Competition Law. In 2018, after 4 years of protracted litigation, the Court of appeal of Bruxelles finally decides to refer the matter to the Court of Justice of the EU in Luxembourg.[10] Meanwhile, the European Commission has also been enquiring on a putative infringement of EU competition law, but the new Commissioner for Competition Law, former French minister Pierre Moscovici, freezes the final decision after a phone call with Platini. On the 15 December 2020, the Court, in its instantly famous Striani judgement[11], considers FFP a clear restriction on EU free movement and competition law. In spite of the specificity of sport, its proportionality cannot be warranted. However, the judgement has no retroactive effect and both the Court and Advocate General considered that a better system could have been worked out. As soon as the ruling is known, UEFA enters in résistance: Platini calls up Sarkozy (by then old-new President of France), who, in a moment of rage, decides to leave the EU.

Scenario 5: The Reality Check

The FFP settlements will stand as they are; it is rather unlikely, though possible, that any affected party will raise an objection against them. PSG and Manchester City will not recruit any big players unless they sell big, but will most likely focus on getting decent locally-trained players on-board for the Champions League bench. The 2015 FFP edition will probably feature a replay of the current edition. We do not see, at least for PSG, any chance that it could accrue its revenues (except very creatively), in order to meet the target of a maximum EUR 30 Mio deficit. The main conundrum for the 2015 FFP process will be to design credible sanctions for a recidivist. On the EU law front, the process will take a lot of time. Regarding the Belgium Courts, any first instance decision will be appealed all the way to the highest Court and will undoubtedly end up in a very time-consuming procedural ping-pong with the Court of Justice of the EU (earliest final decision not before 2019-2020). The EU competition law complaint launched with the European Commission might be quicker to unfold, but will most likely be a forum for re-negotiating the FFP rules rather than to abolish them altogether (the transfer system overhaul at the turn of the century could serve as a model). On a final note, Wenger is surely disappointed by the apparent leniency of the sanctions, but for once he might be able to throw a bit of his weight around on the transfer market.

[1] The settlement for PSG and Manchester City include specific restrictions of the squads size for the Champions League: “[the club] accepts that for the duration of the settlement it will be subject to a limitation on the number of players that it may include on the “A” list for the purposes of participation in UEFA competitions. Specifically, for season 2014/15 PSG may only register a potential maximum of 21 players on the “A” list, instead of the potential maximum of 25 as foreseen in the relevant competition regulations.” Furthermore, pursuant to Article 18.08 of the Regulations of the UEFA Champions League: “As a minimum, eight places are reserved exclusively for “locally trained players” and no club may have more than four “association-trained players” listed on these eight places on List A.”

[2] The goals of the UEFA Club Licensing and FFP Regulations are stated at article 2.2. They affirm that FFP aims “to introduce more discipline and rationality in club football finances” and “to encourage clubs to operate on the basis of their own revenues”.

[3] The settlements read as follows: “In case [the Club] fails to comply with any of the terms of this Agreement, the  UEFA CFCB Chief Investigator shall refer the case to the Adjudicatory Chamber, as  foreseen in Art. 15 (4) of the Procedural Rules.”

[4] The reason why both clubs failed to adhere to the FFP rules is that their sponsorship contracts with related parties were deemed overvalued and therefore adjusted as required by Article 58.4 of the UEFA FFP Regulations.

[5]Article 15.4 of the Procedural rules governing the UEFA Club Financial Control Body, edition 2014, states that: “If a defendant fails to comply with the terms of a settlement agreement, the CFCB chief investigator shall refer the case to the adjudicatory chamber.”

[6] Article 29 of the Procedural rules governing the UEFA Club Financial Control Body, edition 2014 foresees that:

The following disciplinary measures may be imposed against any defendant other than an individual:

a) warning,

b) reprimand,

c) fine,

d) deduction of points,

e) withholding of revenues from a UEFA competition,

f) prohibition on registering new players in UEFA competitions,

g) restriction on the number of players that a club may register for participation in UEFA competitions, including a financial limit on the overall aggregate cost of the employee benefits expenses of players registered on the A-list for the purposes of UEFA club competitions,

h) disqualification from competitions in progress and/or exclusion from future competitions,

i) withdrawal of a title or award.

[7] Indeed, directly affected party (as Everton, Arsenal and Marseille in those case) can ask the adjudicatory chamber to review the settlements. Article 16.2. of the Procedural rules governing the UEFA Club Financial Control Body, edition 2014 foresees that: “Any decision of the CFCB chief investigator to conclude a settlement agreement or to apply disciplinary measures within the meaning of Article 14(1)(c) may be reviewed by the adjudicatory chamber at the request of a directly affected party within ten days from the date of publication of the decision.”

[8] Article 34 of the Procedural rules governing the UEFA Club Financial Control Body, edition 2014 confers to directly affected party a right to appeal final decisions to CAS.

[9] Supra, No 6

[10] Article 267 of the Treaty on the Functioning of the EU gives to national courts the possibility to refer a question concerning the interpretation of EU law to the Court of Justice of the EU.

[11] Daniel Striani is a player agent on who’s behalf the complaints by Dupont against FFP were launched.