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 – July and August 2017. By Tomáš Grell

 Editor's note: This report compiles all relevant news, events and materials on International and European Sports Law based on the daily coverage provided on our twitter feed @Sportslaw_asser.

 

The Headlines

ISLJ Annual Conference on International Sports Law 

On 26 and 27 October 2017, the T.M.C. Asser Institute in The Hague will host the first ever ISLJ Annual International Sports Law Conference. This year's edition will feature panels on the Court of Arbitration for Sport, the world anti-doping system, the FIFA transfer regulations, human rights and sports, the labour rights of athletes, and EU law and sport. We will also welcome the following distinguished keynote speakers:

  • Miguel Maduro, former Advocate General at the European Court of Justice and former head of the FIFA's Governance Committee;
  • Michael Beloff QC, English barrister known as one of the 'Godfathers' of sports law;
  • Stephen Weatherill, Professor at Oxford University and a scholarly authority on EU law and sport;
  • Richard McLaren, CAS Arbitrator, sports law scholar and former head of the World Anti-Doping Agency's investigation into the Russian doping scandal.

You will find all the necessary information related to the conference here. Do not forget to register as soon as possible if you want to secure a place on the international sports law pitch! [Please note that we have a limited amount of seats available, which will be attributed on a 'first come, first served' basis.] More...

FIFA's Human Rights Agenda: Is the Game Beautiful Again? – By Tomáš Grell

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

 

Concerns about adverse human rights impacts related to FIFA's activities have intensified ever since its late 2010 decision to award the 2018 and 2022 World Cup to Russia and Qatar respectively. However, until recently, the world's governing body of football had done little to eliminate these concerns, thereby encouraging human rights advocates to exercise their critical eye on FIFA. 

In response to growing criticism, the Extraordinary FIFA Congress, held in February 2016, decided to include an explicit human rights commitment in the revised FIFA Statutes which came into force in April 2016. This commitment is encapsulated in Article 3 which reads as follows: ''FIFA is committed to respecting all internationally recognized human rights and shall strive to promote the protection of these rights''. At around the same time, Professor John Ruggie, the author of the United Nations Guiding Principles on Business and Human Rights ('UN Guiding Principles') presented in his report 25 specific recommendations for FIFA on how to further embed respect for human rights across its global operations. While praising the decision to make a human rights commitment part of the organization's constituent document, Ruggie concluded that ''FIFA does not have yet adequate systems in place enabling it to know and show that it respects human rights in practice''.[1]

With the 2018 World Cup in Russia less than a year away, the time is ripe to look at whether Ruggie's statement about FIFA's inability to respect human rights still holds true today. This blog outlines the most salient human rights risks related to FIFA's activities and offers a general overview of what the world's governing body of football did over the past twelve months to mitigate these risks. Information about FIFA's human rights activities is collected primarily from its Activity Update on Human Rights published alongside FIFA's Human Rights Policy in June 2017. More...

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

 Editor's note: This report compiles all relevant news, events and materials on International and European Sports Law based on the daily coverage provided on our twitter feed @Sportslaw_asser. You are invited to complete this survey via the comments section below, feel free to add links to important cases, documents and articles we might have overlooked.

 

The Headlines

 
ISLJ Annual Conference on International Sports Law

On 26 and 27 October, the T.M.C. Asser Institute in The Hague will host the first ever ISLJ Annual International Sports Law Conference. This year’s edition will feature panels on the Court of Arbitration for Sport, the world anti-doping system, the FIFA transfer regulations, human rights and sports, the labour rights of athletes, and EU law and sport. More...



Mitigating Circumstances and Strict Liability of Clubs in Match-fixing: Are We Going in the Wrong Direction? An Analysis of the Novara and Pro Patria Cases - By Mario Vigna


Editor’s note: Mario Vigna is a Senior Associate at Coccia De Angelis Vecchio & Associati in Rome, Italy. His main practice areas are sports law, commercial law, and IP law. He also has extensive experience in the Anti-doping field, serving as Deputy-Chief Prosecutor of the Italian NADO and as counsel in domestic and international sports proceedings. He is a frequent speaker at various conferences and workshops. He was not involved in either of the cases discussed below.


I.               Introduction 

Gambling in football is a popular and potentially lucrative activity. It also raises numerous issues. When faced with the issue of gambling, the European Court of Justice (now Court of Justice of the EU) determined that gambling was economic activity per se, notwithstanding gambling’s vulnerability to ethical issues, and thus could not be prohibited outright.[1] With the legality of gambling established, it was left to the proper legislative bodies (national legislatures, national and international federations, etc.) to regulate gambling in order to guard against fraud and corruption. Gambling was not going to disappear; the dangers inherent to gambling would require attention.  More...




Overdue payables in action: Reviewing two years of FIFA jurisprudence on the 12bis procedure – Part 2. By Frans M. de Weger and Frank John Vrolijk.

Editor's Note: Frans M. de Weger is legal counsel for the Federation of Dutch Professional Football Clubs (FBO) and CAS arbitrator. De Weger is author of the book “The Jurisprudence of the FIFA Dispute Resolution Chamber”, 2nd edition, published by T.M.C. Asser Press in 2016. Frank John Vrolijk specialises in Sports, Labour and Company Law and is a former legal trainee of FBO and DRC Database.

This second blog will focus specifically on the sanctions available for FIFA under Article 12bis. It will provide explanatory guidelines covering the sanctions imposed during the period surveyed.


Introduction

The possibility to impose sanctions under article 12bis constitutes one of the pillars of the 12bis procedure. Pursuant to Article 12bis of the RSTP, edition 2016, the DRC and the PSC may impose a sanction on a club if the club is found to have delayed a due payment for more than 30 days without a prima facie contractual basis[1] and the creditor have put the debtor club in default in writing, granting a deadline of at least 10 days.[2] The jurisprudence in relation to Article 12bis also shows that sanctions are imposed ex officio by the DRC or the PSC and not per request of the claimant.More...





Overdue payables in action: Reviewing two years of FIFA jurisprudence on the 12bis procedure – Part 1. By Frans M. de Weger and Frank John Vrolijk.

Editor's Note: Frans M. de Weger is legal counsel for the Federation of Dutch Professional Football Clubs (FBO) and CAS arbitrator. De Weger is author of the book “The Jurisprudence of the FIFA Dispute Resolution Chamber”, 2nd edition, published by T.M.C. Asser Press in 2016. Frank John Vrolijk specialises in Sports, Labour and Company Law and is a former legal trainee of FBO and DRC Database.

In this first blog, we will try to answer some questions raised in relation to the Article 12bis procedure on overdue payables based on the jurisprudence of the DRC and the PSC during the last two years: from 1 April 2015 until 1 April 2017. [1] The awards of the Court of Arbitration for Sport (hereinafter: “the CAS”) in relation to Article 12bis that are published on CAS’s website will also be brought to the reader’s attention. In the second blog, we will focus specifically on the sanctions applied by FIFA under Article 12bis. In addition, explanatory guidelines will be offered covering the sanctions imposed during the period surveyed. A more extensive version of both blogs is pending for publication with the International Sports Law Journal (ISLJ). If necessary, and for a more detailed and extensive analysis at certain points, we will make reference to this more extensive article in the ISLJ. More...

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

Editor's note: This report compiles all relevant news, events and materials on International and European Sports Law based on the daily coverage provided on our twitter feed @Sportslaw_asser. You are invited to complete this survey via the comments section below, feel free to add links to important cases, documents and articles we might have overlooked.

The Headlines

The end of governance reforms at FIFA?

The main sports governance story that surfaced in the press (see here and here) during the last month is related to significant personal changes made by the FIFA Council within the organization’s institutional structure. In particular, the FIFA Council dismissed the heads of the investigatory (Mr Cornel Borbély) and adjudicatory (Mr Hans-Joachim Eckert) chambers of the Independent Ethics Committee, as well as the Head (Mr Miguel Maduro) of the Governance and Review Committee. The decision to remove Mr Maduro was taken arguably in response to his active role in barring Mr Vitaly Mutko, a Deputy Prime Minister of Russia, from sitting on the FIFA Council due to an imminent conflict of interests. These events constitute a major setback to governance reforms initiated by the football’s world governing body in 2015. For a more detailed insight into the governance reforms at FIFA, we invite you to read the recent blog written by our senior researcher Mr Antoine Duval. More...

The Olympic Games and Human Rights – Part II: Human Rights Obligations Added to the Host City Contract: Turning Point or Empty Promise? – By Tomáš Grell


This is a follow-up contribution to my previous blog on human rights implications of the Olympic Games published last week. Together with highlighting some of the most serious Olympic Games-related human rights abuses, the first part has outlined the key elements of the Host City Contract ('HCC') as one of the main legal instruments regulating the execution of the Olympic Games. It has also indicated that, in February 2017, the International Olympic Committee ('IOC') revised the 2024 HCC to include, inter alia, explicit human rights obligations. Without questioning the potential significance of inserting human rights obligations to the 2024 HCC, this second part will refer to a number of outstanding issues requiring clarification in order to ensure that these newly-added human rights obligations are translated from paper to actual practice. More...


The Olympic Games and Human Rights – Part I: Introduction to the Host City Contract – By Tomáš Grell

Editor’s note: Tomáš Grell is currently an LL.M. student in Public International Law at Leiden University. He contributes to the work of the ASSER International Sports Law Centre as a part-time intern.


In its press release of 28 February 2017, the International Olympic Committee ('IOC') communicated that, as part of the implementation of Olympic Agenda 2020 ('Agenda 2020'), it is making specific changes to the 2024 Host City Contract with regard to human rights, anti-corruption and sustainable development. On this occasion, IOC President Thomas Bach stated that ''this latest step is another reflection of the IOC's commitment to embedding the fundamental values of Olympism in all aspects of the Olympic Games''. Although the Host City of the 2024 Summer Olympic Games is scheduled to be announced only in September this year, it is now clear that, be it either Los Angeles or Paris (as Budapest has recently withdrawn its bid), it will have to abide by an additional set of human rights obligations.

This two-part blog will take a closer look at the execution of the Olympic Games from a human rights perspective. The first part will address the most serious human rights abuses that reportedly took place in connection with some of the previous editions of the Olympic Games. It will also outline the key characteristics of the Host City Contract ('HCC') as one of the main legal instruments relating to the execution of the Olympic Games. The second part will shed light on the human rights provisions that have been recently added to the 2024 HCC and it will seek to examine how, if at all, these newly-added human rights obligations could be reflected in practice. For the sake of clarity, it should be noted that the present blog will not focus on the provisions concerning anti-corruption that have been introduced to the 2024 HCC together with the abovementioned human rights provisions. More...



Asser International Sports Law Blog | The FIFA Business – Part 1 – Where Does The Money Come From? - By Antoine Duval and Giandonato Marino

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 FIFA Business – Part 1 – Where Does The Money Come From? - By Antoine Duval and Giandonato Marino

On next Thursday the 2014 World Cup will kick off in Sao Paulo. But next week will also see the FIFA members meeting on Tuesday and Wednesday at a much awaited FIFA congress. For this special occasion we decided to review FIFA’s financial reports over the last ten years. This post is the first of two, analysing the reports and highlighting the main economic trends at play at FIFA. First, we will study the revenue streams and their evolution along the 2003-2013 time span. In order to ensure an accurate comparison, we have adjusted the revenues to inflation, in order to provide a level playing field easing the comparative analysis over the years and types of revenues. Our first two graphs gather the main revenue streams into two comparative overviews. Graph 1 brings together the different types of revenues in absolute numbers, while Graph 2 lays down the share of each type of revenues for any given year (the others category covers a bundle of minor revenue streams not directly relevant to our analysis).

 

 


Graph 1: FIFA revenues in Millions of Dollars, 2003-2013 (adjusted for inflation).

 


Graph 2: Share of each revenue stream in Total FIFA revenues 2003-2013

 

Since 2003, FIFA’s total revenues have more than doubled, from 685 Million$ to 1406 Million$. Its constant growth over the last decade turned negative only in 2011 and 2012 due to a fallout in broadcasting revenues (see below Graph 4). In terms of economic power this means that FIFA has doubled its financial capacity within ten years.  It has succeeded in developing new income streams, while also consolidating its traditional source of revenue: broadcasting rights.




Graph 3: Total FIFA revenues in Million$ 2003-2013 (adjusted for inflation)

 

Key to FIFA’s continuous enrichment were the broadcasting revenues. From 2006 to 2010 they nearly doubled from 391 Million$ to 779 Million$. A huge 100% jump! Since this peak, revenues have settled for a more modest amount of around 600 Million$, but still much higher than at the turn of the century. In any given year the broadcasting revenues represent 40 to 50% of FIFA’s total revenues. Thus, one can understand the paramount importance of broadcasting rights for the economic stability and health of FIFA. The progressive bite of the revised TV without frontier directive of the EU (revised in 1997), enabling countries to define certain World Cup games as “major events” which therefore must be broadcasted freely, might explain the recent fall in broadcasting revenues. In this context, recent decisions of the EU Courts, in cases T-68/08, C‑205/11 P and  C‑204/11 P reinforce the rights of the Member States to make use of the “major events” listing, this could, on the long run, limit the rise of the broadcasting revenues for FIFA.


 

Graph 4: FIFA Broadcasting Revenues 2003-2013 (adjusted to Inflation)

 

The marketing rights (see graph 5) constitute the second leg of FIFA’s financial income stream. They have been constantly growing since 2003. From 168 Million$ in 2003 to 419 Million$ in 2013, reaching quasi 150% growth (at constant prices). In recent years, this has been a more dynamic revenue stream than broadcasting rights, but it has remained less important in absolute terms. It seems that the FIFA Partners Programme launched by FIFA, probably inspired by the TOP Programme created by the IOC, is a tremendous success. Nowadays, marketing rights constitute 30 to 35% of FIFA’s total revenues. Together, broadcasting revenues and marketing rights amount to a staggering 75 to 85% of FIFA’s total revenues. A share which remained more or less stable over the latest years (see Graph2).


Graph 5: FIFA Revenues from Marketing rights 2003-2013

 

The rather minor revenue streams are constituted by the FIFA hospitality rights, licensing and brand licensing revenues. Hospitality rights revenues (Graph 6) are a relic from the past. They derive from the profits made by MATCH Hospitality, the sole company authorised by FIFA to offer and guarantee exclusive hospitality packages for every match of the FIFA World Cup directly or through its appointed sales agents. With the competition of internet-based travel agencies and the evolution of the ticketing system of FIFA under the pressure of the European Commission, the revenues of match hospitality have been dwindling over the last 10 years.




Graph 6: FIFA Hospitality Rights Revenues 2003-2013 (adjusted for inflation)


The FIFA licensing programme (Graph 7) derives its revenues from fixed royalty payments and variable profit shares paid for the use of the FIFA brand. FIFA’s licensing programme covers a broad range of activities, including for example numismatic and philatelic collections and the more classical retail & merchandising. After a peak at the World Cup 2006 in Germany, where FIFA licensing brought in 51 Million$, licensing revenues have remained more or less stable averaging at 10 to 20 Million$ a year.


 

Graph 7: FIFA Licensing Revenues 2003-2013 (adjusted for inflation)

 

Another closely related, but distinct for accountancy purposes, income stream, is the one generated by brand licensing (Graph 8). Five companies dispose of a specific agreement with FIFA: Adidas, Electronic Arts, Hublot, Louis Vuitton and Panini. Each of these companies holds a licence to use the FIFA Brand Marks in the advertising, marketing, promotion and sale of its licensed products or programmes. These long-term licensing agreements bring in more and more money, from 5 Million$ in 2003, to 58 Million$ in 2013. The biggest jump for a category of FIFA revenues.  Its success is exemplified by the world-wide fame of the eponym Electronic Arts video game: FIFA. However, all three revenue streams amount to less than 10% of FIFA’s total revenues in 2013, the lion share is still constituted by the broadcasting rights.



Graph 8: FIFA Brand Licensing Revenues 2003-2013 (adjusted for inflation)

 

Conclusion: Get rich and die getting richer?

Economically the last 10 years have been a phenomenal success for FIFA. Its revenues have grown substantially and it has, to some extent, managed to diversify its revenue streams. Indeed, FIFA is less and less dependent on broadcasting revenues, while relying more and more on marketing and brand licensing income streams. This diversification appears judicious as the broadcasting market seem to be losing steam, especially in light of a public will, at least at the European level, to control and tame the monopoly of FIFA over the broadcasting of the World Cup. Thus, FIFA is in a paradoxical situation. It will enter its congress engulfed in an unending governance crisis, but financially it looks as profitable as ever. In some way the big leap forward of FIFA’s recent, and highly successful, commercialization might cause the existential crisis it is now confronted with. Indeed, all this fresh money influx may have destabilized even more a governance system prone to favour nepotism. Hence, the paradox might be that FIFA got rich and might die (at least as we know it) because of it. This is also connected to the way FIFA distributes the revenues it collects, which will be the focus point of the second part of this blog series.

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