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 – January 2019 - 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

#Save(d)Hakeem

The plight of Hakeem al-Araibi – the 25-year-old refugee footballer who was arrested last November in Bangkok upon his arrival from Australia on the basis of a red notice issued by Interpol in contravention of its own policies which afford protection to refugees and asylum-seekers – continued throughout the month of January. Bahrain – the country Hakeem al-Araibi fled in 2014 due to a (well-founded) fear of persecution stemming from his previous experience when he was imprisoned and tortured as part of the crackdown on pro-democracy athletes who had protested against the royal family during the Arab spring – maintained a firm stance, demanding that Hakeem be extradited to serve a prison sentence over a conviction for vandalism charges, which was allegedly based on coerced confessions and ignored evidence.

While international sports governing bodies were critised from the very beginning for not using enough leverage with the governments of Bahrain and Thailand to ensure that Hakeem’s human rights are protected, they have gradually added their voice to the intense campaign for Hakeem’s release led by civil society groups. FIFA, for example, has sent a letter directly to the Prime Minister of Thailand, urging the Thai authorities ‘to take the necessary steps to ensure that Mr al-Araibi is allowed to return safely to Australia at the earliest possible moment, in accordance with the relevant international standards’. Yet many activists have found this action insufficient and called for sporting sanctions to be imposed on the national football associations of Bahrain and Thailand.      

When it looked like Hakeem will continue to be detained in Thailand at least until April this year, the news broke that the Thai authorities agreed to release Hakeem due to the fact that for now the Bahraini government had given up on the idea of bringing Hakeem ‘home’ – a moment that was praised as historic for the sport and human rights movement.

Russia avoids further sanctions from WADA despite missing the deadline for handing over doping data from the Moscow laboratory 

WADA has been back in turmoil ever since the new year began as the Russian authorities failed to provide it with access to crucial doping data from the former Moscow laboratory within the required deadline which expired on 31 December 2018, insisting that the equipment WADA intended to use for the data extraction was not certified under Russian law. The Russian Anti-Doping Agency thus failed to meet one of the two conditions under which its three-year suspension was controversially lifted in September 2018. The missed deadline sparked outrage among many athletes and national anti-doping organisations, who blamed WADA for not applying enough muscle against the Russian authorities.

Following the expiry of the respective deadline, it appeared that further sanctions could be imposed on the Russian Anti-Doping Agency, but such an option was on the table only until WADA finally managed to access the Moscow laboratory and retrieve the doping data on 17 January 2019. Shortly thereafter, WADA President Sir Craig Reedie hailed the progress as a major breakthrough for clean sport and members of the WADA Executive Committee agreed that no further sanctions were needed despite the missed deadline. However, doubts remain as to whether the data have not been manipulated. Before WADA delivers on its promise and builds strong cases against the athletes who doped – to be handled by international sports federations – it first needs to do its homework and verify whether the retrieved data are indeed genuine.  

British track cyclist Jessica Varnish not an employee according to UK employment tribunal

On 16 January 2019, an employment tribunal in Manchester rendered a judgment with wider implications for athletes and sports governing bodies in the United Kingdom, ruling that the female track cyclist Jessica Varnish was neither an employee nor a worker of the national governing body British Cycling and the funding agency UK Sport. The 28-year-old multiple medal winner from the world and European championships takes part in professional sport as an independent contractor but sought to establish before the tribunal that she was in fact an employee of the two organisations. This would enable her to sue either organisation for unfair dismissal as she was dropped from the British cycling squad for the 2016 Olympic Games in Rio de Janeiro and her funding agreement was not renewed, allegedly in response to her critical remarks about some of the previous coaching decisions.

The tribunal eventually dismissed her challenge, concluding that ‘she was not personally performing work provided by the respondent – rather she was personally performing a commitment to train in accordance with the individual rider agreement in the hope of achieving success at international competitions’. Despite the outcome of the dispute, Jessica Varnish has insisted that her legal challenge contributed to a positive change in the structure, policies and personnel of British Cycling and UK Sport, while both organisations have communicated they had already taken action to strengthen the duty of care and welfare provided to athletes.  

 

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Upcoming Events

Call for papers - Third Annual International Sports Law Conference of the International Sports Law Journal - 24 and 25 October 2019 - Asser Institute

The Editors of the International Sports Law Journal (ISLJ) invite you to submit abstracts for the third ISLJ Annual Conference on International Sports Law, which will take place on 24 and 25 October 2019 at the Asser Institute in The Hague. The ISLJ, published by Springer and Asser Press, is the leading academic publication in the field of international sports law. The conference is a unique occasion to discuss the main legal issues affecting international sports with renowned academic experts and practitioners.


We are delighted to announce the following confirmed keynote speakers:


  • Beckie Scott (Chair of the World Anti-Doping Agency (WADA) Athlete Committee, Olympic Champion, former member of the WADA Executive Committee and the International Olympic Committee (IOC)),
  • Ulrich Haas (Professor of Law at Univerzität Zürich, CAS arbitrator), and
  • Kimberly Morris (Head of FIFA Transfer Matching System (TMS) Integrity and Compliance).


We welcome abstracts from academics and practitioners on any question related to international sports law. We also welcome panel proposals (including a minimum of three presenters) on a specific issue. For this year’s edition, we specifically invite submissions on the following themes:


  • The role of athletes in the governance of international sports
  • The evolution of sports arbitration, including the Court of Arbitration for Sport
  •  The role and functioning of the FIFA transfer system, including the FIFA TMS
  •  The intersection between criminal law and international sports (in particular issues of corruption, match-fixing, human trafficking, tax evasion)
  • Hooliganism
  • Protection of minor athletes
  • Civil and criminal liability relating to injuries in sports


Please send your abstract of 300 words and CV no later than 30 April 2019 to a.duval@asser.nl. Selected speakers will be informed by 15 May.


The selected participants will be expected to submit a draft paper by 1 September 2019. All papers presented at the conference are eligible (subjected to peer-review) for publication in a special issue of the ISLJ.  To be considered for inclusion in the conference issue of the journal, the final draft must be submitted for review by 15 December 2019.  Submissions after this date will be considered for publication in later editions of the Journal.


The Asser Institute will cover one night accommodation for the speakers and will provide a limited amount of travel grants (max. 250€). If you wish to be considered for a grant please indicate it in your submission. 

A Reflection on the Second Report of FIFA’s Human Rights Advisory Board - By Daniela Heerdt (Tilburg University)

Editor's note: Daniela Heerdt is a PhD candidate at Tilburg Law School in the Netherlands and works as Research Officer for the Centre for Sports and Human Rights. Her PhD research deals with the establishment of responsibility and accountability for adverse human rights impacts of mega-sporting events, with a focus on FIFA World Cups and Olympic Games. She published an article in the International Sports Law Journal that discusses to what extent the revised bidding and hosting regulations by FIFA, the IOC and UEFA strengthen access to remedy for mega-sporting events-related human rights violations.

 

On November 26th, the Human Rights Advisory Board[1] of the Fédération Internationale de Football Association (FIFA) published its second report. This blog provides a summary and brief evaluation of the report, by drawing a comparison to the previous report issued by the Human Rights Advisory Board (hereinafter: the Board) based on the content of the recommendations and FIFA’s efforts to implement the Board’s recommendations. The third part of this blog briefly reflects on the broader implications of some of the new recommendations issued for FIFA’s internal policies. The conclusion provides five more general points of observation on the report. More...

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

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

 

Introduction

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

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

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


Season 2 of football leaks: A review of the first episodes

Season 2 of #FootballLeaks is now underway since more than a week and already a significant number of episodes (all the articles published can be found on the European Investigative Collaborations’ website) covering various aspect of the (lack of) transnational regulation of football have been released (a short German documentary sums up pretty much the state of play). For me, as a legal scholar, this new series of revelations is an exciting opportunity to discuss in much more detail than usual various questions related to the operation of the transnational private regulations of football imposed by FIFA and UEFA (as we already did during the initial football leaks with our series of blogs on TPO in 2015/2016). Much of what has been unveiled was known or suspected by many, but the scope and precision of the documents published makes a difference. At last, the general public, as well as academics, can have certainty about the nature of various shady practices in the world of football. One key characteristic that explains the lack of information usually available is that football, like many international sports, is actually governed by private administrations (formally Swiss associations), which are not subject to the similar obligations in terms of transparency than public ones (e.g. access to document rules, systematic publication of decisions, etc.). In other words, it’s a total black box! The football leaks are offering a rare sneak peak into that box.

Based on what I have read so far (this blog was written on Friday 9 November), there are three main aspects I find worthy of discussion:

  • The (lack of) enforcement of UEFA’s Financial Fair Play (FFP) Regulations
  • The European Super League project and EU competition law
  • The (lack of) separation of powers inside FIFA and UEFA More...

Supporters of the ISLJ Annual International Sports Law Conference 2018: Altius

Editor's note: In the coming days we will introduce the supporters of our upcoming ISLJ Annual International Sports Law Conference 2018 (also known as #ISLJConf18). To do so, we have sent them a tailored questionnaire aimed at reflecting both their activities and their expectations for the conference. It is a good opportunity for us to thank them for their enthusiastic support and commitment to international sports law research. We are very happy to finish this series of interviews with Sven Demeulemeester from Altius, a Belgian law firm based in Brussels with a very fine (and academically-minded!) sports law team. 


1. Can you explain to our readers the work of Altius in international sports law? 

Across different sports’ sectors, Altius’ sports law practice advises and assists some of the world’s most high-profile sports governing bodies, clubs and athletes, at both the national and the international level. The team has 6 fully-dedicated sports lawyers and adopts a multi-disciplinary approach, which guarantees a broad range of legal expertise for handling specific cases or wider issues related to the sports industry. We are proud to be independent but, in cross-border matters, are able to tap into a worldwide network.

2. How is it to be an international sports lawyer? What are the advantages and challenges of the job? 

Sports law goes beyond one specific field of law. The multiplicity of legal angles keeps the work interesting, even after years of practising, and ensures that a sports lawyer rarely has a dull moment. The main downside is that the sports industry is fairly conservative and sometimes ‘political’. While the law is one thing, what happens in practice is often another. Bringing about change is not always easy. 

3. What are the burning issues in international sports law that you would like to see discussed at the conference? 

 The much-anticipated overhaul of the football transfer system is eagerly anticipated and is worth a thorough debate, also in terms of possible, viable alternatives. The impact of EU law - both internal market rules, competition law and fundamental rights – can hardly be underestimated. Also, dispute resolution mechanisms within the realm of sports - and an accessible, transparent, independent and impartial sports arbitration in particular - will remain a ‘hot’ topic in the sector for years to come. Furthermore, ethics and integrity issues should remain top of the agenda, as is being demonstrated by the current money-laundering and match-fixing allegations in Belgium. Finally, in a sector in which the use of data is rife, the newly-adopted GDPR’s impact remains somewhat ‘under the radar’.

4. Why did you decide to support the ISLJ Annual International Sports Law Conference? 

The ISLJ Annual International Sports Law Conference is refreshing, both in terms of its topics and participants. The academic and content-driven approach is a welcome addition to other sports law conferences in which the networking aspect often predominates.

Supporters of the ISLJ Annual International Sports Law Conference 2018: LawInSport

Editor's note: In the coming days we will introduce the supporters of our upcoming ISLJ Annual International Sports Law Conference 2018 (also known as #ISLJConf18). To do so, we have sent them a tailored questionnaire aimed at reflecting both their activities and their expectations for the conference. It is a good opportunity for us to thank them for their enthusiastic support and commitment to international sports law research. We are very happy to continue this series of interviews with LawInSport, a knowledge hub and educational platform for the community of people working in or with an interest in sport and the law  (many thanks to LawInSport's CEO Sean Cottrell for kindly responding to our questions).


1. Can you explain to our readers what LawInSport is about?

LawInSport is a knowledge hub, educational platform and global community of people working in or with an interest in sport and the law.

Our objective is to help people ‘understand the rules of the game™’. What does this mean? It means people in sport having access to information that enables them to have a better understanding the rules and regulations that govern the relationships, behaviours and processes within sports. This in turn creates a foundation based on the principles of the rule of law, protecting the rights of everyone working and participating in sport.  

2. What are the challenges and perks of being an international sports law 'reporter’ ?

I do not consider myself a reporter, but as the head of an organisation that has a responsibility to provide the highest quality information on legal issues in sport,  focusing on what is important and not just what is popular, whilst trying to stay free from conflicts of interests. These two issues, popularism and conflict of interest, are the two of the biggest challenges.

Popularism and the drive to win attention is, in my opinion, causing a lack of discipline when it comes to factual and legal accuracy in coverage of sports law issues, which on their own may seem harmless, but can cause harm to organisations and individuals (athletes, employees, etc).

Conflict of interest will obviously arise in such a small sector, however, there is not a commonly agreed standard in internationally, let alone in sports law. Therefore, one needs to be diligent when consuming information to understand why someone may or may not hold a point of view, if they have paid to get it published or has someone paid them to write it. For this reason it can be hard to get a full picture of what is happening in the sector.

In terms of perks, I get to do something that is both challenging and rewarding on a daily basis, and as  a business owner I have the additional benefit of work with colleagues I enjoy working with. I have the privilege of meeting world leaders in their respective fields (law, sport, business, science, education, etc) and gain insights from them about their work and life experiences which is incredibly enriching.  Getting access to speak to the people who are on the front line, either athletes, coaches, lawyers, scientists, rather than from a third party is great as it gives you an unfiltered insight into what is going on.

On the other side of things, we get the opportunity to help people through either having a better understand of the legal and regulatory issues in sports or to understand how to progress themselves towards their goals academically and professionally is probably the most rewarding part of my work. 

3. What are the burning issues in international sports law that you would like to see discussed at the conference?

  • The long-term implications of human rights law in sport;
  • The importance of meaningful of stakeholder consultation in the creation and drafting of regulations in sport;
  • Effective international safeguarding in sport.

4. Why did you decide to support the ISLJ Annual International Sports Law Conference?

We support ISLJ Annual International Sports Law Conference as it is a non-profit conference that’s purpose is to create a space to explore a wide range of legal issues in sport. The conference is an academic conference that does a great job in bringing a diverse range of speakers and delegates. The discussions and debates that take place will benefit the wider sports law community.  Therefore, as LawInSport’s objective is focused on education it was a straight forward decision to support the conferences as it is aligned with our objectives. 

Supporters of the ISLJ Annual International Sports Law Conference 2018: Women in Sports Law

Editor's note: In the coming days we will introduce the supporters of our upcoming ISLJ Annual International Sports Law Conference 2018 (also known as #ISLJConf18). To do so, we have sent them a tailored questionnaire aimed at reflecting both their activities and their expectations for the conference. It is a good opportunity for us to thank them for their enthusiastic support and commitment to international sports law research. We are very proud to start this series of interviews with Women in Sports Law, an association launched in 2016 and which has already done so much to promote and advance the role of women in international sports law (many thanks to Despina Mavromati for kindly responding to our questions on behalf of WISLaw).


1. Can you explain to our readers what WISLaw is about?

Women In Sports Law (WISLaw, www.wislaw.co) is an international association based in Lausanne that unites more than 300 women from 50 countries specializing in sports law. It is a professional network that aims at increasing the visibility of women working in the sector, through a detailed members’ directory and various small-scale talks and events held in different countries around the world. These small-scale events give the opportunity to include everyone in the discussion and enhance the members’ network. Men from the sector and numerous arbitral institutions, conference organizers and universities have come to actively support our initiative.


2. What are the challenges and opportunities for women getting involved in international sports law?

Women used to be invisible in this sector. All-male panels were typical at conferences and nobody seemed to notice this flagrant lack of diversity. WISLaw created this much-needed platform to increase visibility through the members’ directory and through a series of small-scale events where all members, independent of their status or seniority, can attend and be speakers.

Another difficulty is that European football (soccer) is traditionally considered to be a “male-dominated” sport, despite the fact that there are so many great female football teams around the world. The same misperception applies to sports lawyers!

Last, there is a huge number of women lawyers working as in-house counsel and as sports administrators. There is a glass ceiling for many of those women, and the WISLaw annual evaluation of the participation of women in those positions attempts to target their issues and shed more light into this specific problem.


3. What are the burning issues in international sports law that you would like to see discussed at the conference?

The ISLJ Annual Conference has already set up a great lineup of topics combining academic and more practical discussions in the most recent issues in international sports law. 


4. Why did you decide to support the ISLJ Annual International Sports Law Conference?

The Asser International Sports Law Centre has promoted and supported WISLaw since the very beginning. The ISLJ Annual International Sports Law Conference was the first big conference to officially include a WISLaw lunch talk in its program, allowing thus the conference attendees to be part of a wider informal discussion on a specific topical issue and raise their questions with respect to WISLaw. Another important reason why WISLaw supports this conference is because the conference organizers are making sincere efforts to have increased diversity in the panels : this year’s ISLJ Annual International Sports Law Conference is probably the first sports law conference to come close to a full gender balance in its panels, with 40% of the speakers being women !

The proportionality test under Art. 101 (1) TFEU and the legitimacy of UEFA Financial fair-play regulations: From the Meca Medina and Majcen ruling of the European Court of Justice to the Galatasaray and AC Milan awards of the Court of Arbitration for Sport – By Stefano Bastianon

Editor’s note: Stefano Bastianon is Associate Professor in EU Law and EU sports law at the University of Bergamo and lawyer admitted to the Busto Arsizio bar. He is also member of the IVth Division of the High Court of Sport Justice (Collegio di Garanzia dello sport) at the National Olympic Committee.

 

1. On the 20th July 2018, the Court of Arbitration for Sport (hereinafter referred to as “CAS”) issued its decision in the arbitration procedure between AC Milan and UEFA. The subject matter of this arbitration procedure was the appeal filed by AC Milan against the decision of the Adjudicatory Chamber of the UEFA Financial Control Body dated 19th June 2018 (hereinafter referred to as “the contested decision”). As many likely know, the CAS has acknowledged that, although AC Milan was in breach of the break-even requirement, the related exclusion of the club from the UEFA Europe League was not proportionate. To date, it is the first time the CAS clearly ruled that the sanction of exclusion from UEFA club competitions for a breach of the break-even requirement was not proportionate. For this reason the CAS award represents a good opportunity to reflect on the proportionality test under Art. 101 TFEU and the relationship between the landmark ruling of the European Court of Justice (hereinafter referred to as “ECJ”) in the Meca Medina and Majcen affair and the very recent case-law of the CAS. More...

Asser International Sports Law Blog | RFC Seraing at the Court of Arbitration for Sport: How FIFA’s TPO ban Survived (Again) EU Law Scrutiny

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

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.

 

I.               The facts and procedure of the case

To cut a relatively long story short, RFC Seraing [the variation of the name of the club remains a disturbing mystery in the various proceedings in Belgium and at FIFA] entered a TPO agreement with Doyen on 30 January 2015, stipulating that the club transfers the economic rights of three players to Doyen against a sum of €300.000. At that time the transitory phase of FIFA’s TPO ban enshrined in art. 18ter RSTP was already in force and the FIFA TMS, tasked with monitoring the enforcement of the RSTP, quickly jumped on the matter. The issue was referred to FIFA’s Disciplinary Committee, which opened on 2 July 2015 proceedings against RFC Seraing for breaching arts. 18bis and 18ter RSTP. Additionally, on 7 July 2015, Seraing introduced in the TMS a request to recruit a Portuguese player, to which it attached an ERPA (on Doyen’s ERPAs see our blog here) attributing 25% of the economic rights attached to the player to Doyen against a payment of €50 000. A few days after, the FIFA TMS started another investigation into the transfer and on 21 July 2015 the FIFA Disciplinary Committee extended the existing proceedings to also cover this matter.

On 4 September 2015, the Disciplinary Committee rendered its (unpublished) decision finding that ‘FC Seraing’ breached arts. 18bis and 18ter RSTP. Consequently, it banned the club from recruiting players (at national and international level) for the next four transfer windows and handed out a fine of CHF 150.000. Seraing challenged the decision with FIFA’s Appeal Committee, which decided on 7 January 2016 to reject the appeal and confirmed the original decision. Eventually, Seraing appealed this decision to the CAS, leading to the latest award. As a side note, it feels like the disputes involving RFC Seraing (or FC Seraing or Seraing United) are a set-up prompted by Doyen to be able to challenge the validity of art. 18ter RSTP in various jurisdictions. If it were true it should not affect the question of the legality of the ban, but it is probably not of great support to the credibility of some arguments raised by Doyen, or its alter ego Seraing, in these proceedings.


II.             The CAS’ assessment of the compatibility of FIFA’s TPO ban under EU law

As the competence of CAS in this matter was not contested, the key question was against which law(s) should the compatibility of FIFA’s TPO ban be assessed. Due to the history of RFC Seraing’s key lawyer, it is no surprise that much of the award is spent assessing the EU law compatibility of the ban. In the past, as I have argued elsewhere (my CAS and EU law article is accessible for free here, download it now!), the CAS has been rather reluctant to apply EU law rigorously. This case is therefore a great opportunity to assess whether it has raised its standards in this regard.

a.    The applicability of EU law

First, is EU law applicable to the case? The CAS has rarely applied EU law (the exception confirming the rule being the rather old CAS 98/200 case, which was later challenged in front of the EU Commission leading to the ENIC decision), an absurdity in light of the Bosman (and prior Walrave) case law of the CJEU, which made clear that EU law is applicable to the regulations of Sports Governing Bodies (SGBs), even when seated outside of the EU. Additionally, in light of the centrality of the free movement rights in EU integration, it is to be expected that like the EU competition rules they be considered part and parcel of a European public policy with which arbitral awards must comply to be recognized and enforced by national courts in the EU.

Thus, the less spectacular, but probably more important, aspect of the award is the clear affirmation that EU law is applicable because it constitutes a “mandatory provision of foreign law” in the sense of art. 19 of the Swiss Federal Act on Private International Law (PILA).[1] Mandatory provisions of foreign law must be taken into account when three cumulative conditions prevail:

  1. Such rules belong to a special category of norms which need to be applied irrspective of the law applicable to the merits of the case;
  2. there is a close connection between the subject matter of the dispute and teh territory where the mandatory rules are in force;
  3. in view of Swiss legal theory and practice, the mandatory rules must aim to protect legitimate interest and crucial values and their application must lead to a decision which is appropriate.[2]

In this case, the Panel considers that the three cumulative conditions are fulfilled because:

  1. EU competition law and EU provisions on fundamental freedoms are largely regarded as pertaining to the category of mandatory rules by courts and scholars within the EU;
  2. the close connections between (a) the territory on which EU competition law  and EU provisions on fundamental freedoms are in force and (b) the subject matter of the dispute results from the fact that the challenge against the legality of the RSTP has an obvious impact on the EU territory. Indeed, the RSTP aims to regulate the activity of football clubs, many of which are European. Furthermore, the particular decision affects the participation of RFC Seraing to competitions taking place on the European soil.
  3. Finally, the Swiss legal system shares the interests and values protected by EU law, specifically by the EU competition rules and EU fundamental freedoms.[3]

This is a strong confirmation that EU law (mainly EU free movement rights and EU competition law), which applies almost naturally to decisions and regulations of the SGBs[4], will always be deemed applicable if invoked in front of the CAS to challenge their legality. This, as Seraing has learned in the present instance, does not mean that the SGBs rules will be automatically found incompatible with EU law. Instead, it merely subjects them to a duty of justification and proportionality, which will be assessed on a case-by-case basis.[5] The message for sports lawyers appearing in front of the CAS is then: Work hard on your EU law! But don’t get your hopes up too high… 

b.    The compatibility of FIFA’s TPO ban with EU law

The rest of the CAS award is mainly dedicated to assessing the compatibility of the TPO ban with EU law.[6] In doing so, the CAS, rightly in my view, considered that the conditions regarding the compatibility, or not, of a private regulation of an SGB with the EU free movement rights and competition rules overlap with regard to the key question: the proportionality of the rule.

The legitimacy of the objectives of the TPO ban

The Panel’s assessment focuses firstly, and therefore mainly, on a possible disproportionate restriction of the free movement of capital guaranteed under art. 63 TFEU. The Panel decides to assume, without addressing it, that article 63 applies horizontally. This is still a widely uncharted territory and the CJEU has yet to take a clear stand on it. However, the CAS decided to be better safe than sorry and, thus, followed a maximalist interpretation of the scope of application of the article by applying it horizontally to the rules of FIFA. From the outset, it is uncontested that articles 18bis and 18ter RSTP constitute a restriction to the free movement of capital in the EU.[7] Yet, as emphasized by the Panel, a restriction does not entail an automatic incompatibility with EU law. Instead, the restrictive effect might be justified by a legitimate objective and compatible with EU law if the rule or measure is a proportionate mean to attain that objective. In the present case, FIFA invoked a number of potential legitimate objectives underlying the TPO ban:

  • The preservation of the contractual stability;
  • The preservation of the independence and autonomy of clubs in the management of their recruitment policy;
  • The securing of the integrity of football and preservation of the loyalty and equity of competitions;
  • The prevention of conflicts of interests and the securing of transparency in the transfer market.[8]

Those objectives remained uncontested by Seraing and the Panel concluded that they could be deemed legitimate in the sense of the CJEU’s jurisprudence.[9] Instead, Seraing tried to argue that the ‘real’ objective of FIFA in adopting the TPO ban was to ensure that the clubs monopolize the financial streams generated by the transfers of players.[10] Yet, it failed to provide the necessary evidence to convince the Panel, which insisted that “TPO has triggered amongst many commentators and inside the various instances and organisations of football intense worries to which the objectives invoked by FIFA are a response”[11]. Additionally, the Panel considers “that this practice gives way to numerous risks, in particular: risks linked to the opacity of investors escaping the control of football organizations and who are able to freely sell-on their investment; risks of a restriction of the economic freedom and rights of players, through the influencing with a speculative interest of their transfer; risks of conflicts of interests, or even of rigging or manipulation of games, contrary to the integrity of competitions, as the same investor can have TPO deals and multiples clubs involved in the same competition; risks linked to the ethics of sport because the objective pursued by investors is purely a financial and speculative one, to the detriment of sportive and moral considerations”.[12] Hence, the arbitrators buoyed the legitimacy of FIFA’s objectives in adopting the TPO ban.

The proportionality of the ban

The key question is then whether the FIFA ban can be deemed a proportionate means to attain its legitimate objectives. It is at this most crucial stage of the evaluation of the compatibility with EU law that a number of academic commentators have denied the ban’s proportionality.[13] It is the most important part of the award, which will be most likely scrutinized and attacked in follow-up cases in front of national or European courts. It is important to note that SGB regulations have never failed in front of the CJEU because they were lacking a legitimate objective, but rather because they were not considered adequate or necessary to attain their objectives. This stage of the analysis entails political considerations and a comparative analysis of the policy alternatives (and their feasibility) available to tackle a specific problem. In other words, it is not sufficient to claim that you can think in the abstract of a less restrictive alternative, you need to factually demonstrate that this less restrictive alternative is a credible candidate to attain the objective. This is obviously a difficult task for a lawyer. Furthermore, procedural considerations connected to the rulemaking process will come into play. If a sporting rule has been devised via an inclusive legislative procedure and finds broad support amongst the affected actors, then it will in turn be more likely to be deemed proportionate. Instead, if a rule is the result of a secretive, exclusive and authoritarian procedure, then it will be easier to challenge its proportionality. Thus, both substantial (effects-based) and procedural (legitimacy-based) considerations are key to evaluate the proportionality of the TPO ban.

The Panel insists first that the TPO ban has limited effects on the freedom to invest in football. Indeed, it finds that investors are not barred from investing in clubs or to finance specific operations (such as transfers), the ban is devised only to exclude certain types or modalities of investing.[14] On the procedural/legislative side, the Panel notes that the ban has been introduced after a broad consultation and on the basis of numerous, though unpublished, expert reports.[15] This positive assessment of the adoption process could be contested, especially because FIFA did not release the expert reports to the public, which were therefore not subjected to the critical scrutiny of their peers.  Moreover, the Panel takes due note of the relatively long experimentation of a lighter measure (article 18bis RSTP), which has proven inefficient to control the widespread recourse to TPO.[16] The question was then whether Seraing would be able to come up with a credible less restrictive alternative to rein the anarchic use of TPO in football. The Belgian club claimed that FIFA’s legitimate objectives could have been attained through regulation and measures improving transparency (very similar to La Liga’s argument here).[17] Nonetheless, the arbitrators noted that Seraing failed to specify the alternative measures it envisaged.[18] Instead, the Panel sided with FIFA in finding that it lacks the capacity and legal competence to properly police investors which are not subjected contractually to its disciplinary power.[19] In such a context, the Panel finds that the risks of conflicts of interests stemming from TPO contracts cannot be properly controlled by FIFA and the national federations, and the alternative measures proposed by Seraing are bound to fail.[20] Finally, the Panel also referred to the previously existing bans in France, England and Poland, insisting that FIFA was also aiming at harmonizing the rules applicable to the transfer market in Europe to alleviate any potential discrimination.[21] Hence, the arbitrators conclude that the ban is a proportionate restriction to art. 63 TFEU and compatible with EU law. While the Panel doubts that the TPO ban has substantial restrictive effects on the free movement of players and on the freedom to provide services of agents,[22] in any case it refers to its findings under art. 63 TFEU to conclude that it must be held proportionate.[23]

Regarding the compatibility of the ban with EU competition law, Seraing argued that it constitutes an unlawful restriction to free competition under article 101 TFEU and an abuse of a dominant position under article 102 TFEU. The CAS deemed (uncontroversially) FIFA an association of undertaking for the purpose of article 101 TFEU and recognized that the TPO ban affects trade between the Member States.[24] However, the arbitrators emphasized that Seraing bears the burden of proving that the ban constitutes a restriction by object or effect of free competition in the internal market.[25] In that regard, the CAS referred to the CJEU’s analytical framework developed in its Wouters case.[26] It concluded, referring to its previous holdings, that the ban had legitimate objectives and was necessary to attain them, and therefore did not constitute a restriction in the sense of article 101 (1) TFEU. As far as the abuse of a dominant position is concerned, after criticizing the lack of serious economic analysis by the appellant,[27] the Panel simply reiterated its previous findings regarding the legitimate objectives and proportionality of the ban.[28] 

The CAS swiftly rejected all the other arguments raised by Seraing on the basis of the EU’s Fundamental Rights Charter,[29] the European Convention of Human Rights,[30] and Swiss law.[31] Nonetheless, it did held that the sanction imposed on Seraing by the FIFA Disciplinary Committee was too stringent in light of the proportionality principle and reduced Seraing’s transfer ban to three windows and a fine of CHF 150.000.[32]

 

III.           Conclusion

Doyen lost a new battle and, while the war is still raging on, the controversial company is slowly starting to run out of legal ammunitions to challenge FIFA’s TPO ban. I have explained elsewhere why I believe the ban to be compatible with EU law and many of the arguments of the CAS in this award resonate with my own views.  Yet, though I think banning TPO is a step in the right direction to a healthier transfer market, I also believe that FIFA is artificially sustaining a transfer market that leads to the shadowy financiarization of football brutally exposed in the recent football leaks. In other words, the fact that a challenge against articles 18bis or 18ter fails does not mean that the whole RSTP is compatible with EU law, and for various reasons I believe that the current article 17RSTP is likely to fall foul of the EU internal market rules.[33]

The broader lesson of this TPO saga is that EU law is (at last) becoming a potent tool to challenge SGBs and their rules at the CAS. However, EU law is not blind to the necessary regulatory function they exercised vis-à-vis transnational sporting activities. What EU law targets is the SGBs’ illegitimate, disproportionate, and abusive regulatory behaviour to the detriment of the affected actors. When invoking EU law, sports lawyers must be aware of the need to show concretely the disproportionate nature of the rule or decision challenged. This is a heavy evidentiary burden. In other words, one cannot be satisfied with simply pointing out a restrictive effect, instead an interdisciplinary engagement with the economic and social effects of a regulation as well as with its legislative process is in order.

On a final note, I am truly pleased to see that the CAS is finally taking EU law a bit more seriously. This is a giant step forward, which will protect its awards from challenges in front of national courts, foster its reputation in Europe’s legal communities, and empower it as a counter-power inside the system of the lex sportiva. I urge the CAS to fully embrace this change and to continue to thoroughly assess the EU law compatibility of the sporting rules challenged in front of it. In this regard, it should keep in mind that the more these rules are the result of a deliberative and inclusive (in a way democratic) transnational legislative process, the more they can be deemed legitimate in the eyes of EU law…and vice versa.


[1] TAS 2016/A/4490 RFC Seraing c. FIFA, 9 mars 2017, para. 73 : « La Formation arbitrale considère que le droit de l’Union Européenne (« droit de l’UE »), dont notamment les dispositions des traités en matière de liberté de circulation et de droit de la concurrence, doivent être prises en compte par la Formation arbitrale, dans la mesure où elles constituent des dispositions impératives du droit étranger au sens de l’article 19 de la Loi fédérale sur le droit international privé du 18 Décembre 1987 (« LDIP »).

[2] This English translation is taken from CAS 2016/A/4492 Galatasaray v. UEFA, 23 juin 2016, para. 43.

[3] TAS 2016/A/4490 RFC Seraing c. FIFA, para. 76. The French version reads as follows :

i.       Les dispositions de droit européen, concernant notamment le droit de la concurrence et les libertés de circulation, sont communément considérées comme des règles impératives par les juridictions de l’Union et la doctrine ;

ii.     Les relations étroites entre (a) le territoire sur lequel le droit européen est en vigueur et (b) l’objet du litige, tiennent au fait que la mise en cause de la légalité du RSTJ a un impact évident sur le territoire européen. En effet, le RSTJ vise à réguler l’activité des clubs de football, dont de nombreux clubs européens. De plus, la Décision attaquée affecte notamment la participation du RFC Seraing à des compétitions se déroulant sur le sol européen.

iii.    Enfin, l’ordre juridique suisse partage les intérêts et valeurs protégées par le droit européen et notamment les dispositions de droit européen en matière de droit de la concurrence et de libertés de circulation.

[4] See B. van Rompuy, The role of EU Competition Law in Tackling Abuse of Regulatory Power by Sports Associations. In general, see S. Weatherill, European Sports Law, Asser Press, 2014. For my take on the centrality of EU law to exercise a ‘counter-democratic’ check on the lex sportiva, see my PhD thesis (in French) available here.

[5] See crucially CJEU, Meca Medina, 18 July 2006, ECLI:EU:C:2006:492, para.42.

[6] See TAS 2016/A/4490 RFC Seraing c. FIFA, paras 90-144

[7] Ibid., para.97.

[8] Ibid., para 101. En l'espèce la FIFA invoque plusieurs objectifs poursuivis par les mesures en cause, et qu’il convient de reprendre : la préservation de la stabilité des contrats de joueurs , la garantie de l'indépendance et l'autonomie des clubs et des joueurs en matière de recrutement et de transferts, la sauvegarde de l'intégrité dans le football et du caractère loyal et équitable des compétitions, la prévention de conflits d'intérêts et le maintien de la transparence dans les transactions liées aux transferts de joueurs.

[9] Ibid., paras 102-104.

[10] Ibid., paras 105-106.

[11] Ibid. para. 107.

[12] Ibid., para.108.

[13] See J. Lindholm, Can I please have a slice of Ronaldo? The legality of FIFA’s ban on third-party ownership under European union law and S. Egger, Third-party Ownership of Players’ Economic Rights und Kartellrecht, in K. Vieweg, Inspirationen des Sportrechts, Duncker & Humblot, Berlin, 2016, pp.307-331.  

[14] TAS 2016/A/4490 RFC Seraing c. FIFA, paras 109-112

[15] It refers to “une phase significative d’étude, de consultation, de travaux et discussions à laquelle ont participle de nombreux interlocuteurs”, at Ibid., para.113.

[16] Ibid., para.114.

[17] Ibid., para. 116.

[18] Ibid.

[19]“La FIFA ne peut pas contrôler les intérêts de personnes qui ne lui sont pas affiliées, ni les contrats qui sont conclus à l'occasion ou à la suite de transferts par d'autres personnes que les clubs, joueurs et agents et dont la déclaration est obligatoire via le TMS.” Ibid., para.117.

[20] Ibid., para.118.

[21] Ibid., para. 120.

[22] Ibid., paras 125-127.

[23] Ibid., para. 128.

[24] Ibid., para. 135.

[25] Ibid., para. 137.

[26] Ibid., para. 138.

[27] Ibid., para. 142.

[28] Ibid., para. 143.

[29] Ibid., paras 145-148.

[30] Ibid., paras 149-151.

[31] Ibid., paras 152-161.

[32] Ibid., paras 167-179.

[33] On this see R. Parrish, Article 17 of the Fifa Regulations on the Status and Transfer of Players : Compatibility with EU Law and G. Pearson, Sporting Justifications under EU Free Movement and Competition Law: The Case of the Football ‘Transfer System’.

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