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

The UCI Report: The new dawn of professional cycling?

The world of professional cycling and doping have been closely intertwined for many years. Cycling’s International governing Body, Union Cycliste Internationale (UCI), is currently trying to clean up the image of the sport and strengthen its credibility. In order to achieve this goal, in January 2014 the UCI established the Cycling Independent Reform Commission (CIRC) “to conduct a wide ranging independent investigation into the causes of the pattern of doping that developed within cycling and allegations which implicate the UCI and other governing bodies and officials over ineffective investigation of such doping practices.”[1] The final report was submitted to the UCI President on 26 February 2015 and published on the UCI website on 9 March 2015. The report outlines the history of the relationship between cycling and doping throughout the years. Furthermore, it scrutinizes the role of the UCI during the years in which doping usage was at its maximum and addresses the allegations made against the UCI, including allegations of corruption, bad governance, as well as failure to apply or enforce its own anti-doping rules. Finally, the report turns to the state of doping in cycling today, before listing some of the key practical recommendations.[2]

Since the day of publication, articles and commentaries (here and here) on the report have been burgeoning and many of the stakeholders have expressed their views (here and here). However, given the fact that the report is over 200 pages long, commentators could only focus on a limited number of aspects of the report, or only take into account the position of a few stakeholders. In the following two blogs we will try to give a comprehensive overview of the report in a synthetic fashion.

This first blogpost will focus on the relevant findings and recommendations of the report. In continuation, a second blogpost will address the reforms engaged by the UCI and other long and short term consequences the report could have on professional cycling. Will the recommendations lead to a different governing structure within the UCI, or will the report fundamentally change the way the UCI and other sport governing bodies deal with the doping problem? More...

Book Review - Camille Boillat & Raffaele Poli: Governance models across football associations and leagues (2014)

Camille Boillat & Raffaele Poli: Governance models across football associations and leagues (2014)

Vol. 4, Centre International d'Etude du Sport, Neuchâtel, Switzerland, softback, 114 pages, ISBN 2-940241-24-4, Price: €24




Source: http://www.cies.ch/en/cies/news/news/article/new-publication-in-the-collection-editions-cies-governance-models-across-football-associations-an/

More...




The aftermath of the Pechstein ruling: Can the Swiss Federal Tribunal save CAS arbitration? By Thalia Diathesopoulou

It took only days for the de facto immunity of the Court of Arbitration for Sport (CAS) awards from State court interference to collapse like a house of cards on the grounds of the public policy exception mandated under Article V(2)(b) of the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards . On 15 January 2015, the Munich Court of Appeals signalled an unprecedented turn in the longstanding legal dispute between the German speed skater, Claudia Pechstein, and the International Skating Union (ISU). It refused to recognise a CAS arbitral award, confirming the validity of a doping ban, on the grounds that it violated a core principle of German cartel law which forms part of the German public policy. A few weeks before, namely on 30 December 2014, the Court of Appeal of Bremen held a CAS award, which ordered the German Club, SV Wilhelmshaven, to pay ‘training compensation’, unenforceable for non-compliance with mandatory European Union law and, thereby, for violation of German ordre public. More...

‘The reform of football': Yes, but how? By Marco van der Harst

'Can't fight corruption with con tricks
They use the law to commit crime
And I dread, dread to think what the future will bring
When we're living in gangster time'
The Specials - Gangsters


The pressing need for change 

The Parliamentary Assembly (PACE) of the Council of Europe (CoE), which is composed of 318 MPs chosen from the national parliaments of the 47 CoE member states, unanimously adopted a report entitled ‘the reform of football’ on January 27, 2015. A draft resolution on the report will be debated during the PACE April 2015 session and, interestingly, (only?) FIFA’s president Sepp Blatter has been sent an invitation

The PACE report highlights the pressing need of reforming the governance of football by FIFA and UEFA respectively. Accordingly, the report contains some interesting recommendations to improve FIFA’s (e.g., Qatargate[1]) and UEFA’s governance (e.g., gender representation). Unfortunately, it remains unclear how the report’s recommendations will actually be implemented and enforced. 

The report is a welcomed secondary effect of the recent Qatargate directly involving former FIFA officials such as Jack Warner, Chuck Blazer, and Mohamed Bin Hammam[2] and highlighting the dramatic failures of FIFA’s governance in putting its house in order. Thus, it is undeniably time to correct the governance of football by FIFA and its confederate member UEFA – nolens volens. The real question is how to do it.



            Photograph: Fabrice Coffrini/AFP/Getty Images                   Photograph: Octav Ganea/AP

More...








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

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

In Egypt, Broadcasting Football is a Question of Sovereignty … for Now! By Tarek Badawy, Inji Fathalla, and Nadim Magdy

On 15 April 2014, the Cairo Economic Court (the “Court") issued a seminal judgment declaring the broadcasting of a football match a sovereign act of State.[1]


Background

In Al-Jazeera v. the Minister of Culture, Minister of Information, and the Chairman of the Board of Directors of the Radio and Television Union, a case registered under 819/5JY, the Al-Jazeera TV Network (the “Plaintiff” or “Al-Jazeera”) sued the Egyptian Radio and Television Union (“ERTU” or the “Union”) et al. (collectively, the “Respondents”) seeking compensation for material and moral damages amounting to three (3) million USD, in addition to interest, for their alleged breach of the Plaintiff’s exclusive right to broadcast a World Cup-qualification match in Egypt.  Al-Jazeera obtained such exclusive right through an agreement it signed with Sportfive, a sports marketing company that had acquired the right to broadcast Confederation of African Football (“CAF”) World Cup-qualification matches.

ERTU reportedly broadcasted the much-anticipated match between Egypt and Ghana live on 15 October 2013 without obtaining Al-Jazeera’s written approval, in violation of the Plaintiff’s intellectual property rights.

More...


Why the European Commission will not star in the Spanish TV rights Telenovela. By Ben Van Rompuy and Oskar van Maren

The selling of media rights is currently a hot topic in European football. Last week, the English Premier League cashed in around 7 billion Euros for the sale of its live domestic media rights (2016 to 2019) – once again a 70 percent increase in comparison to the previous tender. This means that even the bottom club in the Premier League will receive approximately €130 million while the champions can expect well over €200 million per season.

The Premier League’s new deal has already led the President of the Spanish National Professional Football League (LNFP), Javier Tebas, to express his concerns that this could see La Liga lose its position as one of Europe’s leading leagues. He reiterated that establishing a centralised sales model in Spain is of utmost importance, if not long overdue.

Concrete plans to reintroduce a system of joint selling for the media rights of the Primera División, Segunda División A, and la Copa del Rey by means of a Royal Decree were already announced two years ago. The road has surely been long and bumpy. The draft Decree is finally on the table, but now it misses political approval. All the parties involved are blaming each other for the current failure: the LNFP blames the Sport Governmental Council for Sport (CSD) for not taking the lead; the Spanish Football Federation (RFEF) is arguing that the Federation and non-professional football entities should receive more money and that it should have a stronger say in the matter in accordance with the FIFA Statutes;  and there are widespread rumours that the two big earners, Real Madrid and FC Barcelona, are actively lobbying to prevent the Royal Decree of actually being adopted.

To keep the soap opera drama flowing,  on 30 December 2014, FASFE (an organisation consisting of groups of fans, club members, and minority shareholders of several Spanish professional football clubs) and the International Soccer Centre (a movement that aims to obtain more balanced and transparent football and basketball competitions in Spain) filed an antitrust complaint with the European Commission against the LNFP. They argue that the current system of individual selling of LNFP media rights, with unequal shares of revenue widening the gap between clubs, violates EU competition law.


Source:http://www.gopixpic.com/600/buscar%C3%A1n-el-amor-verdadero-nueva-novela-de-televisa/http:%7C%7Cassets*zocalo*com*mx%7Cuploads%7Carticles%7C5%7C134666912427*jpg/

More...



The 2014 Dortmund judgment: what potential for a follow-on class action? By Zygimantas Juska

Class actions are among the most powerful legal tools available in the US to enforce competition rules. With more than 75 years of experience, the American system offers valuable lessons about the benefits and drawbacks of class actions for private enforcement in competition law. Once believed of as only a US phenomenon, class actions are slowly becoming reality in the EU. After the adoption of the Directive on damages actions in November 2014, the legislative initiative in collective redress (which could prescribe a form of class actions) is expected in 2017.[1] Some pro-active Member States have already taken steps to introduce class actions in some fashion, like, for example, Germany.

What is a class action? It is a lawsuit that allows many similar legal claims with a common interest to be bundled into a single court action. Class actions facilitate access to justice for potential claimants, strengthen the negotiating power and contribute to the efficient administration of justice. This legal mechanism ensures a possibility to claim cessation of illegal behavior (injunctive relief) or to claim compensation for damage suffered (compensatory relief).  More...

The Pechstein ruling of the OLG München - A Rough Translation

The Pechstein decision of the Oberlandesgericht of Munich is “ground-breaking”, “earth-shaking”, “revolutionary”, name it. It was the outmost duty of a “German-reading” sports lawyer to translate it as fast as possible in order to make it available for the sports law community at large (Disclaimer: This is not an official translation and I am no certified legal translator). Below you will find the rough translation of the ruling (the full German text is available here), it is omitting solely the parts, which are of no direct interest to international sports law.

The future of CAS is in the balance and this ruling should trigger some serious rethinking of the institutional set-up that underpins it. As you will see, the ruling is not destructive, the Court is rather favourable to the function of CAS in the sporting context, but it requires a fundamental institutional reshuffling. It also offers a fruitful legal strategy to challenge CAS awards that could be used in front of any national court of the EU as it is based on reasoning analogically applicable to article 102 TFEU (on abuse of a dominant position), which is valid across the EU’s territory.

Enjoy the read! 

Antoine

PS: The translation can also be downloaded at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2561297

 More...




From Veerpalu to Lalluka: ‘one step forward, two steps back’ for CAS in dealing with Human Growth Hormone tests (by Thalia Diathesopoulou)

In autumn 2011, the Finnish cross-country skier Juha Lalluka, known as a “lone-wolf” because of his training habit, showed an adverse analytical finding with regard to human growth hormone (hGH). The timing was ideal. As the FINADA Supervisory Body in view of the A and B positive samples initiated disciplinary proceedings against Lalluka for violation of anti-doping rules, the Veerpalu case was pending before the CAS. At the athlete’s request, the Supervisory Board postponed the proceedings until the CAS rendered the award in the Veerpalu case. Indeed, on 25 March 2013, the CAS shook the anti-doping order: it cleared Andrus Veerpalu of an anti-doping rule violation for recombinant hGH (rhGH) on the grounds that the decision limits set by WADA to define the ratio beyond which the laboratories should report the presence of rhGH had not proven scientifically reliable.

The Veerpalu precedent has become a rallying flag for athletes suspected of use of hGH and confirmed some concerns raised about the application of the hGH test. Not surprisingly, Sinkewitz and Lallukka followed the road that Veerpalu paved and sought to overturn their doping ban by alleging the scientific unreliability of the hGH decisions limits. Without success, however. With the full text of the CAS award on the Lallukka case released a few weeks ago[1] and the new rules of the 2015 WADA Code coming into force, we grasp the opportunity to outline the ambiguous approach of CAS on the validity of the hGH test. In short: Should the Veerpalu case and its claim that doping sanctions should rely on scientifically well founded assessments be considered as a fundamental precedent or as a mere exception? More...

Asser International Sports Law Blog | The Evolution of UEFA’s Financial Fair Play Rules – Part 2: The Legal Challenges. By Christopher Flanagan

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

The Evolution of UEFA’s Financial Fair Play Rules – Part 2: The Legal Challenges. By Christopher Flanagan

The first part of this series looked at the legal framework in which FFP sits, concluding that FFP occupied a ‘marginal’ legal position – perhaps legal, perhaps not. Given the significant financial interests in European football – UEFA’s figures suggest aggregate revenue of nearly €17 billion as at clubs’ 2015 accounts – and the close correlation between clubs’ spending on wages and their success on the field,[1] a legal challenge to the legality of FFP’s ‘break even’ requirement (the Break Even Requirement), which restricts a particular means of spending, was perhaps inevitable.

And so it followed.

Challenges to the legality of the Break Even Requirement have been brought by football agent Daniel Striani, through various organs of justice of the European Union and through the Belgian courts; and by Galatasaray in the Court of Arbitration for Sport. As an interesting footnote, both Striani and Galatasaray were advised by “avocat superstar” Jean-Louis Dupont, the lawyer who acted in several of sports law’s most famous cases, including the seminal Bosman case. Dupont has been a vocal critic of FFP’s legality since its inception.


Mr Striani’s Complaints

Initially, Mr Striani made a complaint to the European Commission to the effect that the Break Even Requirement breached European competition law, and that it restricts several fundamental freedoms of the European Union guaranteed by the Treaty of the Functioning of the European Union (TFEU); namely, the right to free movement of people (Article 45 TFEU), the right to free movement of capital (Article 56 TFEU), and the right to free movement of services (Article 63 TFEU).

In his complaint to the Commission, Mr Striani identified five anti-competitive effects of the Break Even Requirement:

  1. It restricts external investment into football;
  2. It will have the effect of calcifying the hierarchy of the game, preventing ‘small’ clubs from competing at higher levels;
  3.  It will depress the transfer market;
  4.  It will depress players’ wages; and
  5. It will therefore adversely affect players’ agents’ revenue.

Superficially at least, each point above has merit and internal logic. Equally, there are coherent rebuttals. For balance, some (of the various) potential counter arguments are listed below:

  1. From the outset, FFP has not altogether restricted exogenous investment into football and loss making (regardless of quantum) has been permissible for certain expenditure. Rather than restricting investment, FFP funnels loss-making investment in certain directions such as stadium and infrastructure spending.
  2. There is little movement in football’s sporting hierarchy under any model. The evidence suggests that those clubs who spend the most on wages tend to experience the most success on the pitch;[2] however, it is questionable whether there is inherent merit in supplanting the clubs that are best able to maximise revenue generation with those that have the owners most willing to fund losses. Under either model, those with the most money to expend on players’ wages will usually win.[3]
  3. It is reductive to equate a healthy, functioning transfer market with clubs’ rights to make losses; nor is it of intrinsic value to the sport for transfers to be significant in magnitude, whether in cost or volume.
  4. Owners’ equity inputs are far from the only source of salary growth. In any event, further consideration should be given as to whether, if a deflationary effect can be established, this is a function of the top end of the salary scale being depressed reducing mean salary, or whether the impact is felt by in modal or median salary. Ultimately, FFP could depress wages on an aggregate basis but still benefit most players should median or modal wages improve in a more financially stable environment.
  5. Players’ intermediaries may not have a sufficiently proximate interest in the financial regulatory aspects of clubs’ spending. UEFA’s rule-making power is given effect and legitimacy by way of complex contractual relationship between players, clubs and the sport’s governing bodies and intermediaries do not have privity of contract with UEFA insofar as FFP is concerned.

Mr Striani also brought a claim, on similar legal basis, in the Belgian national courts (Mr Striani being based in Belgium). In part because of these collateral proceedings, the Commission rejected Mr Striani’s complaint. In a press release, Mr Dupont confirmed that the Commission had given its view to the effect that Mr Striani, being an agent and therefore not directly subject to FFP, lacked a legitimate interest in the rules, and that the Belgian national courts, already having been seized of the case, were a suitable forum for a hearing of the merits.

Mr Striani was joined by various other parties in his claim in the Belgian courts. However, Mr Striani (along with his co-complainants) was again frustrated on technical grounds outwith the substantive issues of his dispute.  The Belgian court found that it did not have jurisdiction to hear the dispute, because, to put it simply, under the relevant jurisdictional rules (the Lugano Convention), UEFA was entitled to be sued in the courts of its place of domicile, i.e Switzerland. Ben van Rompuy goes into more detail on the jurisdictional nuances here.

Somewhat oddly, given its self-proclaimed jurisdictional incompetence, the Belgian Courts did make an order referring the case to the Court of Justice of the European Union (CJEU).

Perhaps unsurprisingly, the CJEU rejected the referral on the basis that it was “manifestly inadmissible,” and also “observing that the national court had failed to provide any of the necessary information to enable the European Court to address European competition law issues.”[4]

This puts Mr Striani’s complaint into no man’s land. Rejected by the Commission; rejected by the Belgian national courts; and rejected by the CJEU; all without any substantive adjudicative decision as to the legality of the Break Even Requirement. Irrespective of one’s views on FFP, it is a source of frustration that five years on from FFP’s introduction, its legality remains an unresolved question despite vigorous and not frivolous challenge. Mr Striani’s challenges have, to date, proven impotent in settling the (increasingly academic) debate.

Evidently frustrated at the Commission’s refusal to formally review the legality of FFP, Mr Striani went on to make a complaint to the EU Ombudsman alleging maladministration by Vice President of the Commission at the material time, Joaquín Almunia. The complaint centred on Mr Almunia’s association with Athletic Bilbao and his prior statements perceived as endorsing FFP. However, the Ombudsman found no maladministration to have occurred. 


Galatasaray’s CAS Appeal

There is, however, a forum in which a decision has been made as to the legality of the Break Even Requirement; namely the Court of Arbitration for Sport (CAS) in Galatasary v UEFA (CAS 2016/A/4492). Galatasaray, like Mr Striani, were represented by Mr Dupont; and, like Mr Striani, the basis of Galatasaray’s case was that the Break Even Requirement breached EU competition law and illegally trammelled EU fundamental freedoms as to workers, services and capital.

The context of the dispute was as follows: Galatasaray was investigated by the UEFA Club Financial Control Body (CFCB), which, as mentioned in Part One, oversees and enforces adherence to FFP, in respect of a potential breach of FFP, and in particular the Break Even Requirement. The procedural rules governing the CFCB allow clubs to enter into a ‘settlement agreement’ at the discretion and direction of the CFCB Chief Investigator.

The CFCB Chief Investigator determined that Galatasaray had breached the Break Even Requirement and a settlement agreement was reached that provided, inter alia, that the Turkish club must “be break even compliant…at the latest in the monitoring period 2015/16,” and that the club must not increase its aggregate wage bill, which stood at €90m.

Galatasaray hopelessly failed to meet either stipulation, increasing their wage bill by €5.5m and exceeding the acceptable deviation figure in Break Even Requirement by €134.2m. These figures were audited and verified by independent consultants.

In view of this egregious breach of the settlement agreement, the Investigatory Chamber referred Galatasaray to the Adjudicatory Chamber, who, on 2 March 2016, issued a decision ordering, inter alia, that Galatasaray reduce their wage bill to a maximum of €65m over the next two FFP reporting periods, and banning the club from any European competitions for which they otherwise qualified on sporting merit for the next two seasons.

Galatasaray appealed this decision to the CAS, arguing that the sanctions levied by UEFA were illegal because the rules on which they were based, i.e. the FFP rules, were illegal.

If the basis of Galatasaray’s appeal (breach of competition law, breach of fundamental freedoms) is familiar to those with a knowledge of the legal issues FFP presents, so too will be UEFA’s defence of the Break Even Requirement. UEFA argued that the Break Even Requirement constitutes rules that “are prudential rules necessary for the proper functioning of football clubs,” and “Any restriction they may cause pursues legitimate governance objectives and is proportionate to their achievement.[5] (Emphasis added.) 

UEFA’s view is clearly intended to align FFP with the legal tests identified in Part One of this series; namely that FFP must be:

  1. Necessary (for the proper conduct of the sport);
  2.  Suitable (as a means to pursue that necessary objective); and
  3. Proportionate (to the aims pursued).

Applicability of EU Law

The non-application of EU law by the CAS has previously been called ‘an absurdity’ by this blogin 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”.

In this case, UEFA postulated that EU law was “irrelevant” to the dispute – the parties both being from Turkey and Switzerland respectively, i.e. nations outside of the EU – but “did not argue” that FFP is “not subject to the invoked provisions of EU law or can be applicable even if contrary to these provisions.”[6] Galatasaray argued that EU law applied as FFP constitutes mandatory rules in EU territory. The parties agreed that Swiss law applied.

The CAS panel of arbitrators (the Panel) found that EU law, being a foreign mandatory rule, applied pursuant to Article 19 of the Swiss Federal Act on Private International Law, under which arbitral tribunals must consider foreign mandatory rules where:

i.       such rules belong to a special category of norms which need to be applied irrespective of the law applicable to the merits of the case;

ii.      there is a close connection between the subject matter of the dispute and the territory where the mandatory rules are in force; and

iii.    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.


The Panel found that this test had been met on the facts in this instance. As an interesting side note, the CAS also followed this line of reasoning in the subsequent Third Party Ownership case discussed by Antoine Duval here.

Article 101 TFEU

The first hurdle for Galatasaray in establishing the illegality of the Break Even Requirement is to show that it fits within the boundaries of the prohibition laid down in Article 101 TFEU, i.e. that it has as its object or effect the prevention, restriction or distortion of competition within the European internal market.

The Panel found that FFP did not have anti-competitive intent as its object. On its face, this seems a reasonable conclusion; after all, FFP is not intended to stymie inter-club competition. However, it should not be treated as axiomatic. As Weatherill has highlighted, “UEFA’s own website (though not the FFP Regulations themselves) identify as one of the principal objectives to decrease pressure on salaries and transfer fees and limit inflationary effect”. Whether such effect was an independent goal of UEFA in instituting FFP rather than mere political bluster is open to question, but the objectives of UEFA should be subject to further interrogation.

In this instance, the Panel found that Galatasaray “failed to demonstrate that the object of [FFP] would not be stated in its Article 2 [dealing with FFP objects]”. Having considered the question, the Panel “did not find convincing evidence that the object of [FFP] would be to distort competition, i.e. to favour of disfavour certain clubs rather than to prevent clubs from trading at levels above their resources”.

Thus in order to be caught within the prohibition under Article 101 TFEU, Galatasaray would need to show that FFP had an anti-competitive effect. As FFP did not fall within the examples given in the Commission’s guidance on anti-competitive agreements (horizontal/vertical), the burden of proof fell on Galatasaray to demonstrate FFP’s anti-competitive effects.

They did not do so. However – and frustratingly for those with an interest in the topic – Galatasaray did not actually adduce any detailed empirical analysis as to the effects of FFP on competition (para. 74).

Irrespective of the lack of empirical evidence put forward, the Panel expressed a view that “competition is not distorted by ‘overspending’” (para. 76); nor does FFP ossify the structure of the market as “dominant clubs have always existed and will continue to exist”. The latter point is superficially correct; however, it fails to address the fact that the Break Even Requirement may have prevented clubs from entry to the ‘dominant club’ position of superiority. 

The Panel went on to cite with approval the applicability of the carve-out for regulatory rules developed in Wouters, as discussed in more detail in Part One of this series.

Article 102 TFEU

Galatasaray produced evidence that UEFA was a dominant undertaking (which, given UEFA is a governing body with total authority over the rules of elite European football, is a case easily made), but it did not show how it was abusing its position in the case of FFP. Thus the Panel found that Galatasaray did not demonstrate an abuse of dominance by UEFA.

Fundamental Freedoms

Galatasaray argued that the Break Even Requirement violated fundamental freedoms of the EU as to the free movement of workers, the free movement of capital, and the free movement of services. However, it submitted “very little argumentation” in support of these claims (para. 85).

The Panel highlighted the fact that FFP does not discriminate based on nationality, as the rules apply equally to all clubs participating in UEFA competitions; that the rules apply equally to “domestic operations” (para. 86); and “do not restrict fundamental freedoms: players can be transferred (or offer services cross-border without limitations; capitals can move from a EU country to another without any limit.

Ergo, the Panel found Galatasaray had not shown any breach of a fundamental freedom of the EU.

Swiss Law

Galatasaray did not invoke the relevant provisions of Swiss competition law in detail; however, the Panel noted that the substantive nature of Swiss competition law was analogous to EU competition law, diverging only in respect of reference to the domestic market. Accordingly, the Panel’s reasoning “would be the same” (para. 89). 

The CAS’s Finding

Galatasaray did not establish its case and as such its appeal was not upheld by the CAS and the CFCB’s decision was confirmed. UEFA successfully defended the first hearing on the substantive legal issues of the Break Even Requirement. 


An Illusory Victory for UEFA?

UEFA may have successfully fended off a binding determination of the legal issues at play in challenges brought in domestic and European courts, albeit on procedural grounds; and it may have won the first serious challenge to the substantive legal issues at play in the CAS, albeit aided by a lack of proper particularisation of some of the issues by Galatasaray; but it is debatable whether it was able to altogether insulate FFP from the effect of these challenges. In the years since its inception, the nature and content of the rules has gradually shifted towards a more liberal approach to external investment, and in all probability this was influenced by the vehemence of the legal challenges to the rules.

At the outset of Mr Striani’s challenge to FFP, his lawyer, Mr Dupont, said "What my client hopes is that Uefa will be forced to review this rule and go for more proportionate alternatives”.  He may not have achieved this through a favourable determination of the courts; however, as will be examined in greater detail in Part Three of this series, he may have ultimately been successful in his objectives to some extent.


[1] See, for example, Kuper, S and Szymanski, S 2012 Soccernomics 2nd ed. London: HarperSport at p14

[2] See Kuper, S and Szymanski, S 2012 Soccernomics 2nd ed. London: HarperSport

[3] It should be noted, however, that Mr Dupont has argued that a flat salary cap – in many ways more restrictive than the Break Even Requirement – would be preferable, see Stefano Bastianon, 'The Striani Challenge to UEFA Financial Fair-Play A New Era after Bosman or Just a Washout?' [2015] 11(1) The Competition Law Review 7-39 at p18

[4] Daniel Geey, LawInSport and BASL Sport Law Year Book 2015 - 2016 (Sean Cottrell ed, LawInSport 2016) at p108

[5] Para 50

[6] Para 39

Comments are closed