The Court of Arbitration for Sport
(CAS) registers approximately 300 cases every year. Recently, the Swiss Federal Supreme Court – which is the sole
judicial authority to review arbitral awards rendered in Switzerland – reminded
in the Matuzalém Case (Case 4A_558/2011) that CAS awards may be enforced in other States that are parties to
the New York
Convention on the recognition and enforcement of foreign arbitral awards.
However, in that case, the Federal
Court failed to recognize the main intent of FIFA, which is to avoid foreign
State courts’ interference – even to the detriment of a plaintiff’s right of
having the option to challenge a CAS award in a non-Swiss jurisdiction. Article
67(2-3) FIFA Statutes
requires that provision shall be made to CAS arbitration and prohibits FIFA members
to have recourse to courts of law unless provided for by FIFA regulations. Member
associations must accordingly insert an arbitral agreement in their statutes on
the recognition of CAS to resolve disputes under Article 10(4)(c) FIFA Statutes.
Regarding labour-related disputes, Article 22 FIFA Regulations on the Status and Transfer of Players in conjunction with Article 5 FIFA Statutes 2003 has carved out an exception to the aforesaid FIFA ‘exclusion’ and
‘allows’ FIFA members to seek redress before civil courts. Nonetheless, FIFA could
still use its disciplinary power to enforce decisions (e.g. CAS awards). In
addition, Article 64(1) FIFA Disciplinary
explicitly stipulates that ‘[a]nyone who
fails to pay another person […] or FIFA … money…, even though instructed to do
so by … a subsequent CAS appeal decision
…, or anyone who fails to comply with another [CAS appeal] decision …’,
will be disciplinary sanctioned (e.g., fine, ban on any football-related
activities, expulsion (member association), relegation (club) and transfer ban
(club)). This is a typical case of so-called ‘arbitration with a reduced
consensual character’ (Steingruber 2012), which is contrary to the consensual
spirit that underlies private arbitration.
should also be noted that in the Cañas case (Case 4P.172.2006, par. 22.214.171.124) the Swiss Federal Supreme Court recognized
and tolerated the athlete’s reduced consent to arbitration (under Article 2 of
the Player's Consent and Agreement to ATP Official Rulebook) in order to be
able to practice tennis as a professional. It is moreover ‘based on the
continuing possibility of an appeal acting as a counterbalance to the
“benevolence” with which it is necessary to examine the consensual nature of
recourse to arbitration where sporting matters are concerned’ (Case 4P.172.2006, para.
126.96.36.199). In other words, the application
of ex post reviews of CAS awards by the Federal Court is a sine qua non to its acceptance of an athlete’s reduced consent to
CAS awards could be challenged before
courts, however, if they are incompatible with public policy (of Switzerland or
EU Member States et cetera).
awards – Swiss notion of substantive public policy
As far as arbitration is concerned,
national courts generally adopt a deferent attitude to arbitration, mainly
reviewing the due process components and only entering substantial matters if
they are incompatible with substantive public policy. Accordingly, the parties involved
can only challenge arbitral awards on substantive grounds if they contravene the
national notion of substantive public policy.
The Swiss Federal Supreme Court has
only once annulled an international arbitral award rendered in Switzerland for
being incompatible with substantive public policy. Interestingly, the case concerns
a CAS (appeal) award.
In case an
international arbitral award such as a CAS award is rendered in disregard of
fundamental principles of substantive law, and consequently cannot
be reconciled with the essential and widely recognized system of values that
from a Swiss perspective should be
part of any legal order, it violates the Swiss notion of substantive public
In the Matuzalém case (Case 4A_558/2011) of 2012, the Federal Court annulled a CAS award for being an
excessive restriction of Matuzalém’s economic freedom and therefore contrary
to the Swiss notion of substantive public policy. Moreover, the Federal Court
The ban imposed
for an unlimited period for being unwilling or being unable to pay the large
amount of damages that was awarded in the first CAS award of 2011, is a
self-constituted violation of public policy.
from all football-related activities is inappropriate because it would
deprive him of the possibility to earn his working income as a professional
footballer to fulfill his obligations, namely to pay the aforesaid debts.
The aforesaid ban
on request of Shaktar Donetsk is unnecessary because the first
CAS award may be enforced under the New York convention.
objective of enforcing compliance by Matuzalém was to be regarded as less
important by CAS than his ban from all football-related activities.
It should be noted that the national
notion of public policy may vary per jurisdiction. Accordingly, enforcing
arbitral awards that have been annulled at the seat of arbitration – e.g. the Matuzalém
case – could still be enforced in
e.g. Austria, Croatia, Denmark, France, Ireland,
Luxembourg, The Netherlands, Poland
and Spain. However,
arbitral awards that have been set aside at the seat of arbitration are likely
to be refused enforcement in e.g. Germany, Hungary, Italy and the United
awards – EU notion of substantive public policy
From an EU law perspective, it must be
taken into consideration that enforcing arbitral awards like, e.g., CAS awards by
Member States’ courts may affect the internal market. The Court of Justice
already dealt with this topic and introduced a broad notion of public policy in
the Eco Swiss Case (Case C-126/97)
by ruling that Article 101 TFEU may
be regarded as a public policy matter in the sense of Article V(2)(b) of the New
York convention. In the Manfredi Case (Joined cases C-295/04 to C-298/04), the Court further stated (para. 31): ’Articles …
[101-102 TFEU] are a matter of public
policy which must be automatically
applied by national courts …’. In other words, national courts do have an ex officio duty to exercise control
during inter alia enforcement proceedings
of arbitral awards. In the Nordsee Case (C-102/81),
the Court further stressed the importance of ex post reviews of arbitral awards by national courts.
The latter is especially relevant in reference
to their obligation to ensure the uniform application of EU law.
The Court stated (para 13) that private
arbitral tribunals are not to be
considered as ‘any court or tribunal’ under Article 267 TFEU and therefore are not allowed to directly submit an
application for a preliminary ruling on EU law. However, in case an arbitral tribunal
is, inter alia, established by law,
permanent, independent, has a compulsory jurisdiction, its procedure is inter
partes and it applies rules of law, the Court of Justice recently (Case C‑555/13) characterised
it as ‘any court or tribunal’. Consequently, a mandatory arbitral tribunal established
in a Member State may refer questions to the Court of Justice for a preliminary
As regards to doping-related disputes,
the WADA Code is mandatory in substance and must be followed by signatories
like, e.g., National Anti-Doping Organizations. Moreover, all Member States have designated a National Anti-Doping Organization (Appendix 1 WADA Code)
as the primary authority to adopt and implement inter alia anti-doping measures at the national level. In addition,
Article 23.2.2 in conjunction with Article 13.2.1 WADA Code refers inter alia to the exclusive jurisdiction
of the CAS Appeal Arbitration, which means that CAS has been recognized by all
Member States as a mandatory arbitral tribunal (established in Switzerland) with
regard to doping-related disputes. However, as opposed to the regulations of sports
governing bodies like FIFA, the WADA Code explicitly mentions the application
of ex post reviews of CAS awards by national courts.
According to the Court, reviewing
arbitral awards should be limited in scope and refusing to enforce foreign
arbitral awards (i.e. CAS awards) by national courts should only be possible in
circumstances, both in the interest of efficient arbitral proceedings. As
previously mentioned, national courts are generally deferent towards arbitral
awards. Moreover, they do not review the way the law is applied by the
arbitrators. A national court’s review is confined to the nature and impact of
the decision and its procedural aspects. Accordingly, the Court accepted the national
courts’ limited scope of review in reference to the principle of procedural autonomy to implement and enforce national and
EU law. Moreover, in the interest of good administration,
fundamental principles of procedure recognized by all Member States must
prevail. This procedural autonomy finds its limit in the need to warranty the effet utile of EU competition law as
fully as other public policy matters (i.e. principle of equivalence). Moreover,
according to the Court, EU competition law is a fundamental provision for the
realisation of the internal market and must therefore be regarded as a public
policy matter by national courts when enforcing arbitral awards. Thus, the Court
ruled that a national court’s limited review of arbitral awards must extend to EU
competition law, which should be integrated in the Member State’s national
notion of public policy in order to ensure that EU law actually takes effect (principle of effectiveness).
The Court furthermore stated that reviewing
an arbitral award for being incompatible with public policy should only occur under
exceptional circumstances. Only if
the effects of enforcing an arbitral award by a national court contravene the
most fundamental principles of law in the respective jurisdiction, it may be
denied recognition and enforcement for being incompatible with public policy.
In order to qualify as such, a competition law violation must therefore be
regarded as very serious, e.g. a complete disregard of an obvious and serious
violation such as a cartel. In addition, the Court especially referred to the
prohibition laid down in Article 101(1) TFEU, which is primarily a matter of
substance. In reference to the national courts’ limited scope of review, one
can therefore argue that infringements to EU competition law may be regarded as
substantive public policy violations during inter
alia enforcement proceedings of arbitral awards.
Finally, competition law is not the internal
market’s only fundamental provision. It could be extrapolated that the Court relied
on a wide
notion of public policy in Eco Swiss. For instance, the fundamental
provisions of free movement may be applicable in a CAS award’s enforcement
proceedings and could, in principle, qualify as public policy matters in
exceptional circumstances. If, e.g., enforcement proceedings of the Matuzalém
CAS award were sought before Member States’ courts, a violation of the freedom of
workers (he played for Lazio Roma between 2008 and 2013) or service providers (e.g.,
personal sponsorship or endorsement deals) could be invoked to bar the
recognition and enforcement of the award.
CAS awards are potentially fragile at
the enforcement stage as they may contradict national States’ understanding of
the public policy exception. This is even more so if one characterises EU
competition law and EU free movement rights as public policy concerns. However,
in practice the enforcement of CAS awards is very rarely used. Sport
governing bodies can rely on their contractual disciplinary power to ban
athletes from the competition they organize and thus do not rely on national
courts to enforce CAS awards. Nevertheless, banned athletes could initiate
action for damages against sports governing bodies and force them to ask for the
recognition and enforcement of the award in their defence plea. Thus, there is
a very indirect (and protracted) way to challenge CAS award on the basis of EU public
policy, but it is a windy and rocky legal path.
A personal message to Claudia
Pechstein - German Speedskater and
Olympic Champion (five gold, two silver and two bronze): Pursuant to Article
25(6) of the ISU Constitution, the ISU is also complicit
and the respective CAS awards could accordingly be challenged for being
incompatible with substantive public policy if they were to be enforced in a
Member State …
 Notes are mostly ommitted. A comprehensive article will be published in 2014.
 E.g., Cour de cassation,
23 March 1994, Yearbook Commercial Arbitration, Vol XX (1995), p. 663.
 E.g., Amsterdam Court of Appeal, Case No.
200.005.269/01, April 28, 2009; Amsterdam Court of Appeal, Case No.
200.100.508/01, September 18, 2012.
 ICC Guide to national procedures for the recognition
and enforcement of awards under the New York convention, ICC Court of
Arbitration Bulletin (Vol 23, Special Supplement) 2012, p. 20.
 It should be noted that, as far as we know, only one CAS ordinary award has actually been
enforced in a Member State: IMFC Licensing B.V. v. R.C.D. Espanyol de
Superior de Justicia de Catalunya, 30 May 2012 (IMFC Licensing, B.V. v. R.C.D.
Espanyol de Barcelona, S.A.D.) Yearbook XXXVIII (2013) pp. 462-464.