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

Blog Symposium: Ensuring proportionate sanctions under the 2015 World Anti-Doping Code. By Mike Morgan

Introduction: The new WADA Code 2015
Day 1: The impact of the revised World Anti-Doping Code on the work of National Anti-Doping Agencies
Day 2: The “Athlete Patient” and the 2015 World Anti-Doping Code: Competing Under Medical Treatment
Day 3: Proof of intent (or lack thereof) under the 2015 World Anti-Doping Code

Editor's note
Mike Morgan is the founding partner of Morgan Sports Law LLP. His practice is focused exclusively on the sports sector. He advises on regulatory and disciplinary issues and has particular experience advising on doping and corruption disputes.

Mike acted on behalf of National Olympic Committees at three of the last four Olympic Games and has represented other sports bodies, clubs and high profile athletes in proceedings before the High Court, the FIFA Dispute Resolution Chamber, the American Arbitration Association and the Court of Arbitration for Sport.

 

I. Introduction

According to the World Anti-Doping Agency (“WADA”), the 2015 World Anti-Doping Agency Code (the 2015 Code), which came into effect on 1 January 2015,  is a “stronger, more robust tool that will protect the rights of the clean athletes[1]. Among the key themes of the revised Code, is the promise of “longer periods of Ineligibility for real cheats, and more flexibility in sanctioning in other specific circumstances[2].

While Article 10 of the 2015 Code unquestionably provides for longer periods of ineligibility, the validity of WADA’s claim that the harsher sanctions will be reserved for “real cheats” depends partly on how one defines the term “real cheat”, and partly on how the 2015 Code’s mechanisms for reducing sanctions are to be interpreted.

This blog reflects on the totality of the context from which the current sanctions regime arose.  That is important because Article 10 will have to be applied in a manner consistent with that context in mind if the 2015 Code is to become the tool promised by WADA and if it is to avoid the scrutiny of the courts.


II. Context

A.   Katrin Krabbe

In the lead up to the adoption of the first version of the WADA Code (the “2003 Code”), there was considerable debate as to what length of sanction could lawfully be imposed on an athlete for a first violation[3].

The decision finally to settle on a two-year ban for first offences was heavily influenced by the findings of the Munich Courts in the case of Katrin Krabbe, that a suspension exceeding two years was disproportionate[4]:

(a)           The Regional Court held that a two-year suspension imposed on an athlete for a first offence “represents the highest threshold admissible under fundamental rights and democratic principles”.[5]

(b)           The High Regional Court held that the three-year ban imposed by the IAAF “was excessive in respect of its objective. Such a rigid disciplinary measure as a sanction for a first sports offence is inappropriate and disproportionate”.[6]

And so it came to pass that a first violation under Article 10.2 of the 2003 Code would be punished with a two-year sanction. Various legal opinions procured by WADA between 2003 and 2008 affirmed the position that a two-year sanction for a first violation (1) was a significant incursion on the rights of the individual affected; and (2) was likely the limit of the severity that could be imposed in the absence of aggravating circumstances[7].


B.   Specified Substances

The 2003 Code proved somewhat inflexible, which resulted in two-year bans for unintentional and minor anti-doping rule violations. One of the starkest examples of that inflexibility arose in CAS OG 04/003 Torri Edwards v IAAF & USATF.

Edwards had consumed glucose powder that, unbeknownst to her, contained the stimulant nikethamide. A two-year ban was imposed on her on the basis that she could not meet the thresholds for “No Fault” and “No Significant Fault” and despite the fact that she had, in the words of the CAS panel, “conducted herself with honesty, integrity and character, and that she has not sought to gain any improper advantage or to ‘cheat’ in any way[8].

Ms Edwards’ case became a cause célèbre, leading the IAAF to lobby WADA to have nikethamide and other similar stimulants reclassified as Specified Substances. The then vice-president of the IAAF, Dr Arne Lungqvist explained as follows:

I asked Torri Edwards whether she would allow me to use her case as an example of the importance of making some sort of differentiation between those weak stimulants that you can get over the counter by accident, carelessness, negligence or whatever.  We are not after those who are negligent.

WADA acceded to the IAAF’s lobbying and downgraded nikethamide to the Specified Substance list in September 2005. The IAAF Council shortly thereafter reinstated Edwards to competition further to the doctrine of lex mitior. Following Edwards’ reinstatement, Dr Lungqvist explained as follows:

The IAAF wishes to see strong penalties for real cheats. This was a different case, […]  I did not feel comfortable when I had to defend the then-existing rules against her at the CAS hearing in Athens.

I judge that Torri has paid a high price for having inadvertently taken a particular substance at the 'wrong' time, shortly before [the reclassification] and from now on such an intake would result in a warning only. (Emphasis added)

Four years later, WADA went one step further and, with the introduction of the 2009 version of the WADA Code (the “2009 Code”), broadened the list of substances that would be categorised as Specified Substances, promisinglessened sanctions….where the athlete can establish that the substance involved was not intended to enhance performance” under Article 10.4[10].  

The aim was to avoid the likes of the Edwards case. Indeed, a number of cases determined under the 2009 Code which involved the same glucose brand that had landed Edwards with a two-year ban in 2004, resulted in periods of ineligibility ranging between 0 – 6 months[11].


C.   The rise and fall of “aggravating circumstances”

The primary themes of the 2009 Code were, according to WADA, “firmness and fairness”. “Fairness” was to be reflected by the broadening of the Specified Substance list, while “firmness” was intended to manifest itself through the concept of “aggravating circumstances[12].  

The presence of “aggravated circumstances” permitted Anti-Doping Organizations (“ADOs”) to increase periods of ineligibility beyond the standard two-year ban up to a maximum of four years[13].

A legal opinion commissioned by WADA in relation to the “aggravated circumstances” provisions (the “Third WADA Legal Opinion”) noted as follows[14]:

91. […] it is clear that the intention to enhance performance is not in and-of-itself an aggravating circumstance.

92. […] This provision makes it clear that cheating is an important element of the notion of aggravating circumstances. However, the mere fact of cheating alone is not sufficient. Additional elements are required.

93. The essence of the concept of aggravating circumstances is thus a qualified kind of cheating, which involves an additional element. (Emphasis added)

Not only, therefore, was actual cheating required to invoke the provision but there needed to be something more than the mere fact of cheating. Examples provided by the 2009 Code included being part of a doping scheme or using multiple prohibited substances[15]

The “aggravated circumstances” provision was rarely invoked and, when it was, it rarely resulted in the maximum increase[16]. That ultimately led to the removal of the “aggravated circumstances” provision from the 2015 Code and the introduction of standard four-year sanctions, explained as follows by WADA[17]:

There was a strong consensus among stakeholders, and in particular, Athletes, that intentional cheaters should be Ineligible for a period of four years.  Under the current Code, there is the opportunity for a four-year period of Ineligibility for an Adverse Analytical Finding if the Anti-Doping Organization can show “Aggravating Circumstances.” However, in the more than four years since that provision has been part of the Code, it has been rarely used. (Emphasis added)

The decision to double the standard two-year sanctions to four years may have surprised anyone who had ever read the Third WADA Legal Opinion, since that opinion had expressly cautioned as follows:

138. […] one should bear in mind that a four-year ban would most often put an end to an athlete’s (high level) career and thus be tantamount to a life ban. Therefore, an aggravated first offence could de facto be punished as harshly as numerous second offences (Article 10.7.1) and almost all third offences (Article 10.7.3).

139. This could raise problems if the ineligibility period were automatically of four years in the presence of aggravating circumstances. In reality, Art. 10.6 provides for an increased suspension of up to four years, which means that the adjudicating body is afforded sufficient flexibility to take into account all the circumstances to ensure that aggravating circumstances do not systematically result in a four-year period of ineligibility. (Emphasis added)


D.   Proportionality

The principle of proportionality plays an important role in the determination of sanctions applicable in doping matters. The principle pervades Swiss law[18], EU law[19] and general principles of (sports) law[20].  

The CAS itself has consistently measured sanctions imposed on athletes against the principle of proportionality both before the inception of the WADA Code and since.

(a)           Pre-WADA Code: the anti-doping rules of many sports prior to the creation of the WADA Code mandated fixed sanctions without the possibility of reductions. The CAS nevertheless sometimes reduced these sanctions on the basis they were not proportionate.[21]

(b)           Post-WADA Code: The WADA Code introduced mechanisms by which sanctions could be reduced or eliminated.  However, the CAS has made clear that the introduction of these mechanisms does not remove the obligation of disciplinary panels to measure the sanctions applied in any particular case against the principle of proportionality. In CAS 2005/A/830 Squizzato v. FINA, the CAS held that:

10.24 […] the Panel holds that the mere adoption of the WADA Code […] by a respective Federation does not force the conclusion that there is no other possibility for greater or less reduction a sanction than allowed by DC 10.5. The mere fact that regulations of a sport federation derive from the World Anti-Doping Code does not change the nature of these rules. They are still – like before – regulations of an association which cannot (directly or indirectly) replace fundamental and general legal principles like the doctrine of proportionality a priori for every thinkable case.

Though the 2015 Code asserts that it “has been drafted giving consideration to the principles of proportionality and human rights[22], that obviously does not mean that proportionality no longer plays a part in the assessment of sanctions for the same reasons propounded by the CAS in Squizzato. Indeed, the 2015 Code itself recognises that it “is intended to be applied in a manner which respects the principles of proportionality and human rights[23]. Moreover, the most recent CAS decisions in which the principle of proportionality was applied concerned the sanctioning regimes of the 2003 and 2009 Code, both of which mandated default sanctions of two years, not four years[24].  The principle of proportionality is, therefore, arguably even more relevant now than it previously was.


III. Comment

While the 2015 Code does have more mechanisms by which to modify the default sanctions than in previous versions of the WADA Code, that is partly because the default sanctions with regards to most of the violations have doubled[25]:


Violation

Default sanction under the 2015 Code for a first offence

Default sanction under the 2009 Code for a first offence

Presence of a Specified Substance (Art. 2.1)

Two years (Art. 10.2.2)

 

Two years (Art. 10.2.1)

Presence of a non-Specified Substance (Art. 2.1)

Four years (Art. 10.2.1)

Two years (Art. 10.2.1)

Use or Attempted Use of a Specified Substance (Art. 2.2)

Two years (Art. 10.2.2)

Two years (Art. 10.2.1)

Use or Attempted Use of a non-Specified Substance (Art. 2.2)

Four years (Art. 10.2.1)

Two years (Art. 10.2.1)

Evading, Refusing or Failing to Submit to Sample Collection (Art. 2.3)

Four years (Art. 10.3.1)

Two years (Art. 10.3.1)

Whereabouts Failures (Art. 2.4)

Two years (Art. 10.3.2)

One to two years (Art. 10.3.3)

Tampering or Attempted Tampering (Art. 2.5)

Four years (Art. 10.3.1)

Two years (Art. 10.3.1)

Possession of a Specified Substance (Art. 2.6)

Two years (Art. 10.2.2)

Two years (Art. 10.2.1)

Possession of a non-Specified Substance (Art. 2.6)

Four years (Art. 10.2.1)

Two years (Art. 10.2.1)

Trafficking or Attempted Trafficking (Art. 2.7)

Four years to life (Art. 10.3.3)

Four years to life (Art. 10.3.2)

Administration  or  Attempted  Administration (Art. 2.8)

Four years to life (Art. 10.3.3)

Four years to life (Art. 10.3.2)

Complicity (Art. 2.9)

Two to four years (Art. 10.3.4)

Elements of this violation previously formed part of the “Administration or Attempted Administration” violation.

Prohibited Association (Art. 2.10)

Two years (Art. 10.3.5)

This violation did not exist under the 2009 Code.

 

Athletes accused of committing a violation under Articles 2.1, 2.2, 2.3 or 2.6 are now in a position in which they are required to meet the Article 10.2 thresholds regarding “intent” simply to get them back to the two-year default sanctions that would have applied under previous versions of the Code[26].

If the 2015 Code is to become the tool promised by WADA and if it is to avoid or survive legal challenges, tribunals will need to ensure that their interpretations of the reduction mechanisms, such as those contained at Article 10.2, do not result in disproportionate sanctions.

The parameters within which the proportionality of a sanction falls to be measured were described as follows by the panel in CAS 2005/C/976 & 986 FIFA & WADA:

139. A long series of CAS decisions have developed the principle of proportionality in sport cases. This principle provides that the severity of a sanction must be proportionate to the offense committed. To be proportionate, the sanction must not exceed that which is reasonably required in the search of the justifiable aim. (Emphasis added)

The evaluation of whether a sanction is proportionate therefore begins with the identification of the “justifiable aim”. According to WADA, the increased sanctions were intended to target “intentional cheats”. That is echoed by the wording of Article 10.2.3 of the 2015 Code, which provides as follows:  

As used in Articles 10.2 and 10.3, the term “intentional” is meant to identify those Athletes who cheat. The term, therefore, requires that the athlete or other Person engaged in conduct which he or she knew constituted an anti-doping rule violation or knew that there was a significant risk that the conduct might constitute or result in an anti-doping rule violation and manifestly disregarded that risk [….] (Emphasis added)

The final sentence emphasised above is, arguably, open to interpretation.  However, the first line identifies the overarching aim of the provision – i.e. “the term ‘intentional’ is meant to identify those athletes who cheat”.

According to the Oxford Dictionary, a “cheat” is a “person who behaves dishonestly in order to gain an advantage” and the act of “cheating” amounts to “a fraud or deception”.  A reasonable inference, therefore, is that athletes who “cheat” are athletes who have acted knowingly and dishonestly to gain an unfair advantage.

Article 10.2 cannot, therefore, be intended to punish careless athletes.  Bearing in mind the limits pronounced by the courts in Krabbe and bearing in mind the “justifiable aim”, any interpretation of the provision that would result in a four-year ban for nothing more than careless – or even reckless, but otherwise honest - conduct would risk inviting the sort of scrutiny exercised by the German courts in the Pechstein[27] and Krabbe cases.

Likewise, the interpretation of the other reduction mechanisms, such as Article 10.5 (“No Significant Fault or Negligence”), will require the same degree of pragmatism.  If the parameters for “No Significant Fault” were to be applied as strictly today as they were in the Edwards case, anti-doping would end up right back to where it was in 2004, when the Code’s sanctioning regime was perceived to be so inflexible that it had to be overhauled in 2009. Assuming that the aim of the 2015 Code is not to take 11 years’ worth of backward steps, tribunals will have to ensure that “No Significant Fault” is interpreted in a manner that fulfils WADA’s promise of “greater flexibility”, particularly in cases involving Specified Substances and Contaminated Products[28].


IV. Concluding Remark

The 2015 Code has the potential to become the fairest WADA Code to date. However, it also has the potential to be the cruelest. Interpreting it in a manner consistent with the totality of the context from which it was conceived is the surest way to ensure that the right version prevails.



[1] https://www.wada-ama.org/en/what-we-do/the-code

[2] https://wada-main-prod.s3.amazonaws.com/wadc-2015-draft-version-4.0-significant-changes-to-2009-en.pdf

[3] See (1) http://library.la84.org/OlympicInformationCenter/OlympicReview/1999/OREXXVI26/OREXXVI26s.pdf; and (2) http://library.la84.org/OlympicInformationCenter/OlympicReview/1999/OREXXVI26/OREXXVI26t.pdf

[4] See Kaufmann-Kohler, G., Rigozzi, A., and Malinverni, G., “Doping and fundamental rights of athletes: comments in the wake of the adoption of the World Anti-Doping Code”, I.S.L.R. 2003, 3(Aug), 39–67 *61

[5] Krabbe v. IAAF et. al., Decision of the LG Munich of 17 May 1995, SpuRt 1995 p. 161, p. 167

[6] Krabbe v. IAAF et. al., Decision of the OLG Munich of 28 March 1996, SpuRt 1996 p. 133, 138

[7] See (1) Legal Opinion on the Conformity of Certain Provisions of the Draft World Anti-Doping Code with Commonly Accepted Principles of International Law, dated 23 February 2003, paragraphs 142 and 143; (2) Legal Opinion on whether Article 10.2 of the World Anti-Doping Code is compatible with the Fundamental Principles of Swiss Domestic Law, dated 25 October 2005, paragraph 3 (b) (aa) at page 26 and paragraph 3. (f) (aa) at page 32; and (3) Legal Opinion on the Conformity of Article 10.6 of the 2007 Draft World Anti-Doping Code with the Fundamental Rights of Athletes, dated 13 November 2007, at paragraphs 33, 114, 138 and 139

[8] See paragraph 5.8 of CAS OG 04/003 Torri Edwards v IAAF & USATF

[9] See IAAF press release dated 22 November 2005

[10] 2009 Code, Article 10.4 (“Elimination or Reduction of the Period of Ineligibility for Specified Substances under Specific Circumstances”)

[11] See (1) CAS 2011/A/2493 Antidoping Switzerland v/ X; (2) CAS 2013/A/3327 Marin Cilic v. International Tennis Federation & CAS 2013/A/3335 International Tennis Federation v. Marin Cilic; (3) AFLD Decision No. 2011-71 dated 7 July 2011; (4) AFLD Decision No. 2009-50 dated 10 December 2009

[12] Article 10.6 of the 2009 WADA Code (Aggravating Circumstances Which May Increase the Period of Ineligibility)

[13] Note that Violations under Articles 2.7 (Trafficking) and 2.8 (Administration) were not subject to the application of Article 10.6 since the sanctions for those violations (four years to life) already allowed discretion for aggravating circumstances

[14] Legal Opinion on the Conformity of Article 10.6 of the 2007 Draft World Anti-Doping Code with the Fundamental Rights of Athletes, dated 13 November 2007

[15] See commentary to Article 10.6 of the 2009 Code

[16] See CAS 2013/A/3080 Alemitu Bekele Degfa v. TAF and lAAF for a detailed assessment by the CAS of the “aggravated circumstances” provision

[17] WADA, Significant Changes between the 2009 Code and the 2015 Code, Version 4.0, 1 September 2013

[18] See paragraph 124 of CAS 2005/C/976 & 986 FIFA & WADA

[19] See paragraphs 47 and 48 of Case C-519/04 P Meca-Medina & Majcen v Commission [2006] ECR I-6991

[20] See paragraph 83 of the First WADA Legal Opinion

[21] See (1) CAS 1996/56 Foschi v. FINA; (2) CAS 2002/A/396 Baxter v. FIS; (3) CAS 2001/A/337 B. / FINA

[22] See page 11 of the 2015 Code - “Purpose, Scope and Organization of the World Anti-Doping Program and the Code

[23] See the Introduction at page 17 of the 2015 Code

[24] See, for instance (1) CAS 2010/A/2268 I. v. FIA; and (2) TAS 2007/A/1252 FINA c. O. Mellouli & FTN

[25] Note that the table only reflects the default sanctions applicable before consideration of any of the mechanisms intended to increase or decrease those sanctions

[26] Note that article 10.2 only applies to those violations. For a detailed assessment of Article 10.2, see Rigozzi, Antonio and Haas, Ulrich and Wisnosky, Emily and Viret, Marjolaine, Breaking Down the Process for Determining a Basic Sanction Under the 2015 World Anti-Doping Code (June 10, 2015). ISLJ, (2015) 15:3-48

[27] See (1) Landesgericht (LG) München, 26. February 2014, 37 O 28331/12; and (2) Oberlandesgericht (OLG) München, 15 January 2015, Az. U 1110/14 Kart

[28] Notably, the concept of “No Significant Fault or Negligence” in previous versions of the Code was limited to ‘‘exceptional circumstances’’. That limitation has been removed in the context of Specified Substances and Contaminated Products under Article 10.5.1 of the 2015 Code. Thus, it should now be easier for athletes to trigger the application of “No Significant Fault” in those types of cases than it previously was. See Section 6.2 of Rigozzi et al for a detailed discussion of the point


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Asser International Sports Law Blog | The legality of surety undertakings in relation to minor football players: the Lokilo case. By Adriaan Wijckmans

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

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

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

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

Background

Jason Eyenga-Lokilo (“Jason Lokilo”), born on 17 September 1998, joined the youth academy at Belgian top club, RSC Anderlecht (“Anderlecht”), in the spring of 2007. Anderlecht had set up a specific youth academy a couple of months earlier, which combined school education and football training for young football players.

As Jason Lokilo was one of the youth academy’s more promising prospects, Anderlecht and Lokilo’s parents entered into an agreement in which the parents, in exchange for a payment of 75,000 EUR (paid in instalments), guaranteed Anderlecht that their son was going to sign his first professional contract with the club upon turning 16, i.e. the minimum age in Belgium for signing a player contract. This same agreement stipulated that the parents were liable to pay Anderlecht a lump sum of 450,000 EUR in damages, if their son did not sign such a player contract.

When, in 2013, Aston Villa made a request to Anderlecht to give Jason Lokilo a trial when he was 15 years of age, Anderlecht refused, citing the player’s training obligations and the existing surety undertaking. Jason Lokilo’s father, a football agent, then told Anderlecht that he wanted to revise the terms of the surety undertaking, given the fact that a number of European football ‘powerhouses’ wanted to sign his son. Anderlecht refused his demand.

In June 2014, Jason Lokilo and his parents sent a letter to Anderlecht arguing that the surety undertaking was unlawful and hence null and void. Jason Lokilo alleged that unacceptable coercion had been put on him to sign his first contract with Anderlecht, which the player and his advisers considered was contrary to public policy. Anderlecht replied that it considered the surety undertaking to be perfectly valid since the surety did not prevent the player from signing his first professional contract with another club.

By the end of July of 2014, the gridlock between both parties ended with Jason Lokilo leaving Anderlecht and the latter club starting court proceedings against Jason Lokilo’s parents for a damages claim of 450,000 EUR.

Jason Lokilo eventually signed a contract with Crystal Palace in the summer of 2015.[2]

The Brussels Court of First Instance ruling

In its 22 November 2016 judgment, the Brussels Court of First Instance (“CFI”) confirmed the principle of this surety undertaking in the context of professional football.

The CFI referred to Article 1120 of the Belgian Civil Code that expressly allows the principle of a surety undertaking. A surety undertaking under Belgian civil law can be defined as an agreement in which one party promises another party regarding what a third party (who is either absent or legally not competent) will do, give or refrain from doing. The third party retains the freedom not to commit himself, since he, as a third party, is not bound by the agreement. However, the contracting party that made the promise will in that case be liable to pay the contractually foreseen damages if this third party eventually does not commit himself.

The main question the court had to decide was to determine whether the surety undertaking had a valid object and cause.

Jason Lokilo’s parents first argued that the contract was contrary to public policy legislation, considering the contract violated the freedom of association principle enshrined in the Convention on the Rights of the Child (“UNCRC”), the European Convention on Human Rights (“ECHR”) and the European Social Charter (“ESC”). The CFI did not follow this reasoning, simply stating that the surety undertaking did not bind Jason Lokilo and did not prevent him from signing a contract with another club.[3]

Lokilo’s parents also invoked an alleged violation of Belgian federal legislation, which prohibits player contracts below the minimum age requirement. This argument was cast aside by the court since at no point in time was a player contract signed below the legal minimum age of 16.

Furthermore, Lokilo’s parents argued that the contract breached a (regional) decree guaranteeing an amateur sportsperson the right to leave their club free-of-charge at the end of each sporting season. The CFI repeated that Lokilo was not bound by the surety undertaking and could still freely leave Anderlecht, stating that this outcome was, moreover, exactly what Lokilo did in 2014. An aggravating circumstance for the CFI was the fact that Lokilo’s father had indicated to Anderlecht that Aston Villa in 2013 was willing to cover the 450,000 EUR in damages, as a result of which the CFI considered these damages were ‘clearly not an obstacle for Jason Lokilo to leave Anderlecht’.

The argument invoked by Lokilo’s parents under EU law (free movement) was also dismissed by the CFI ‘for lack of a cross-border EU element[4].

In the end, the CFI granted damages to Anderlecht but limited the amount payable by the parents, on the one hand, based on the grounds that Jason Lokilo’s mother was not an agent (and hence not professionally active in football) and, on the other hand, because 450,000 clearly exceeded the actual damages suffered by Anderlecht. The CFI set the damages ex aequo et bono at 140,000 EUR instead.

Some considerations

The Lokilo case echoes the Spanish Baena case,[5] although the latter concerned a slightly different situation and had a clearly different outcome.

Where the Spanish Supreme Court in its 5 February 2013 ruling considered a pre-contractual agreement concluded on behalf of a minor football player at odds with the minor’s best interests and therefore contrary to public policy, the CFI adopted a rather strict ‘pacta sunt servanda’ approach.

The CFI considered that the surety undertaking did not prevent Lokilo from signing a contract with a club other than Anderlecht. This finding may be correct from a strictly legal perspective, but ignores the reality that a child may not want to pursue his or her career at another club if he realises that, by doing so, his or her parents will be liable to pay damages. Moreover, under Belgian law, while a minor is indeed of legal age to sign his or her first professional contract when turning 16, the minor in principle still needs parental authorisation to do so until reaching 18 years of age. Parents might of course not be very inclined to agree to their child signing his or her first professional contract elsewhere, and therefore not provide the necessary parental authorisation, if doing so triggers important financial liabilities for them…

The surety undertaking seems also incompatible with regional decrees guaranteeing amateur sportsmen the right to leave their club free-of-charge at the end of each sporting season. These decrees are considered to have a public policy character by the case law, and disallow any hindrance, financial or otherwise, when moving to another sports club.[6] The fact that the surety undertaking related to a switch from an amateur to a professional contract,[7] did not alter the fact that the player was not free to leave for another amateur club when turning 16 either, since he was forced to sign a professional contract with Anderlecht when turning 16 or see his parents face the prospect of paying hefty compensation.

Arguments regarding the fundamental rights of the minor were either not invoked or not upheld by the CFI. The CFI stated that the matter concerned a contract between the parents and the club and not between the player and the club, as a result of which the minor’s fundamental rights were not jeopardised.

This argument is frankly unconvincing.

It should be noted that the UNCRC[8] recognises the right of a child to freedom of association[9] and the right to participate freely in cultural life.[10] The UNCRC furthermore protects children from economic exploitation.[11] The UNCRC provides also that “in all actions concerning children, whether undertaken by public or private social welfare institutions, courts of law, administrative authorities or legislative bodies, the best interests of the child shall be a primary consideration.”

The UNCRC is often labeled as ‘soft’ law,[12] with Belgian case law even considering most of its provisions lacking a self-sufficient or self-executing character;[13] yet, the UNCRC remains a treaty with clear moral authority. Moreover, a number of its provisions do have direct effect, especially when read in combination with other international legal sources, such as the ECHR and the EU Charter of Fundamental Rights. The obligation to consider the best interests of the child is expressly incorporated in the EU Charter of Fundamental Rights.[14] Even though the obligation to observe the child’s best interests is not expressly laid down under the ECHR, the ECtHR incorporates this obligation also in its case law.[15] One could further argue that the surety undertaking disproportionally affects the career development and perspectives of a player who is a minor, and so violates that player’s proprietary rights[16] and the right to family life that both the player and the player’s family enjoy.[17]

In addition, both the Belgian Constitution[18] and the Belgian Economic Code[19] protect the freedom for each individual to freely choose his or her occupation. This freedom can only be curtailed through or by law.[20] An agreement jeopardising one’s freedom to freely choose one’s occupation, has an unlawful causa and is null and void.[21]

The statement made by the CFI that the EU internal market law does not apply due to a lack of cross-border effect is at odds with the fact that Lokilo clearly intended to join a club outside Belgium, within the EEA (as shown by Aston Villa’s interest and his eventual signing with Crystal Palace), a fact that was not contested by Anderlecht. As Anderlecht is a Belgian football ‘powerhouse’, and clearly one of the top clubs in Belgium (if not the top club), a player aiming higher than Anderlecht would necessarily have to look at opportunities abroad.

If EU law is deemed to apply, then the guiding principles of the Bernard case must be observed. The CJEU, in its Bernard ruling,[22] recalled that an obstacle to the freedom of movement of workers can be accepted only if it pursues a legitimate aim and is justified by overriding reasons in the public interest. The CJEU clearly accepted recruitment and training of players as a legitimate aim. Even where that is so, that measure’s application still must be such as to ensure the objective’s achievement and not go beyond what is necessary for that purpose. In considering whether a system restricts the freedom of movement, the specific characteristics of sport, and of football in particular, their social and educational function, should be taken into account. One may even take into account the costs of training other players that do not succeed at establishing a professional career (the player factor).[23]

This being said, the surety undertaking mechanism in this case seems overly restrictive for the player. Although, again, a surety undertaking binds the parents and not the player, and damages can only be claimed from the parents, the surety undertaking obviously ultimately serves to discourage a player from exercising his or her right of free movement. Moreover, the player already suffers a restriction upon his or her free movement, following the training compensation mechanism in place under FIFA regulations, which is criticisable in its own right.[24] The surety undertaking constitutes an additional burden on the player’s free movement. In Bernard, although the CJEU seemed to accept the principle of training compensation, the CJEU dismissed the French arrangements governing young players (‘joueurs espoirs’) since they did not involve compensation for real training costs incurred, but rather were damages for breach of contractual obligations calculated with reference to the total loss suffered by the club. And taking into account the actual loss suffered by Anderlecht is exactly what the CFI has done. To the extent a surety undertaking goes beyond what is necessary to encourage the recruitment and training of minors (and funds those activities), a violation of the EU internal market law seems given.

Conclusion

In conclusion, based on the considerations set out above, it can certainly not be excluded that the ruling will be overturned on appeal. Such an appeal, which would bring the case before the Brussels Court of Appeal, is being considered by the player’s parents, but has not yet been lodged.

Apart from the doubt around their enforceability, it should be noted that payments under surety undertakings may in addition give rise to (social) tax issues, if they are not structured correctly.[25] [26]

The problem with the surety undertaking in the Lokilo case predominantly lies with the surety undertaking’s disproportionate character in the specific case at hand. Less restrictive solutions could, in the author’s view, be envisaged, although exploring such alternatives would exceed the scope of this article.



[1] Surety undertakings, together with money lending contracts (loan to parents pledging that their child will sign first professional contract, non-reimbursable if child effectively signs contract), are common practice with Belgian top level teams.

[2] Jason Lokilo is still a member of the Crystal Palace Academy. Crystal Palace offered Anderlecht compensation for an approximate amount of 45,000 EUR, which Anderlecht refused.

[3](…), la convention de porte-fort litigieuse n’engageait que les parents de Jason vis-à-vis du club et ne créait aucune obligation pour lui

[4]Or, contrairement à l’arrêt Bernard qu’ils invoquent (arrêt du 16 mars 2010 – pièce 3 de leur dossier), M. et Mme Lokilo ne démontrent pas, dans le cas present, l’existence d’un élément d’extranéité.

[5] Sentencia de 5 de febrero de 2013. STS 229/2013. Tribunal Supremo. Sala de lo Civil. http://www.iurismuga.org/es/bases-de-datos/jurisprudencia/144-jurisprudencia-derecho-espanol/8153-sts-n-de-resolucion-26-2013-de-05-02-2013-sentencia-baena. The case was invoked by the parents before the CFI but considered irrelevant because, according to the CFI, the contract between Baena and Barcelona was entered into by (on behalf of) the minor player.

[6] Vred. Ghent 16 September 2013, role n° 130318.

[7] The relevant decrees apply to amateur sports, not professional sports.

[8] http://www.ohchr.org/EN/ProfessionalInterest/Pages/CRC.aspx

[9] Article 15 UNCRC

[10] Article 31 UNCRC

[11] Article 32 and 36 UNCRC. One may argue that, in the end, a child is used to generate money through (later) transfers and sponsorship deals.

[12] H. Stalford, Children and the European Union: Rights, Welfare and Accountability, Hart Publishing, [2012], 34.

[13] Belgian case law has been reluctant to grant direct effect to the UNCRC: cf. Cass. 11 June 2010, obs. S. Van Drooghenbroeck, Le droit international et européen des droits de l’homme devant le juge national, Larcier, [2014], 196 and following.

[14] Article 24 (2) of the EU Charter of Fundamental Rights

[15] Handbook on European law relating to the rights of the child, European Union Agency for Fundamental Rights, 75.

[16] Article 1 of ECHR First Protocol: “Every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided for by law and by the general principles of international law. (…)”.

[17] Article 8 ECHR

[18] Article 23 Constitution

[19] Article II.9 of the Economic Code. This is one of the oldest Belgian public policy principles, previously laid down in the famous Decree D'Allarde of 2 - 17 March 1791

[20] C.E. 12 July 1993, JLMB [1993], 1442, note J.F. NEURAY

[21] Cass. 29 September 2008, C.06.443.F, JTT [2008] 464.

[22] CJEU 16 March 2010, Olympique Lyonnais v Olivier Bernard and Newcastle United.

[23] i.e. the ratio of players who need to be trained to produce one professional player.

[24] S. Weatherill, European Sports Law, T.M.C. Asser Press [2014], 485 and following.

[25] The tax and social security authorities may e.g. argue that these payments relate to the (future) employment contract of the player.

[26] The surety undertaking’s ‘nephew’, the money lending contracts, in addition pose problems under Belgian finance law since clubs as a rule do not possess the necessary licences or authorisations.


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