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

Caster Semenya at the SFT – in 10 points - By Jack Anderson

Editor's note: Jack Anderson is Professor and Director of Sports Law Studies at the University of Melbourne

 

1.     Caster Semenya appealed to the Swiss Federal Court (SFT) arguing that World Athletics’ regulations violated human rights principles relating to gender discrimination and human dignity. The Swiss Federal Tribunal (as at CAS) held that World Athletics’ regulations may prima facie breach such human rights principles but were “necessary, reasonable and proportionate” to maintain fairness in women's athletics;


2.     Although in part addressed at the SFT, expect further legal argument on this in the domestic courts of South Africa or at the ECtHR, and in the following ways:

  • Necessity - is the athletic advantage that Caster Semenya has of such a scientifically-measurable extent that it is necessary for World Athletics to intervene in such an invasive manner? In a broader ethical sense, is the incidence of what the World Athletics’ regulations call “difference of sex development” of such prevalence in the general population, and specifically in middle-distance athletics, that, by way of the principle of “sporting beneficence”, intervention is justified. Or, in contrast, is the incidence of DSD not at a level which justifies a departure from the ethical principle of primum non nocere – first, do no harm?
  • Reasonableness - if World Athletics’ regulations are necessary, is the manner of implementation reasonable and in line with the principle of human and bodily integrity? In answering such a question, the focus must be on the fact that in order to continue to compete in her favourite events (such as the 800 metres) Caster Semenya will have to lower her testosterone level through medication;
  • Proportionate - if World Athletics’ regulations are necessary and reasonable is the manner of implementation proportionate? In answering such a question, the focus must be on whether the regulations disproportionately discriminate against a certain, limited group of athletes in a certain, limited number of events and in a certain, limited manner.More...


Chronicle of a Defeat Foretold: Dissecting the Swiss Federal Tribunal’s Semenya Decision - By Marjolaine Viret

Editor's note: Marjolaine is a researcher and attorney admitted to the Geneva bar (Switzerland) who specialises in sports and life sciences.

 

On 25 August 2020, the Swiss Supreme Court (Swiss Federal Tribunal, SFT) rendered one of its most eagerly awaited decisions of 2020, in the matter of Caster Semenya versus World Athletics (formerly and as referenced in the decision: IAAF) following an award of the Court of Arbitration for Sport (CAS). In short, the issue at stake before the CAS was the validity of the World Athletics eligibility rules for Athletes with Differences of Sex Development (DSD Regulation). After the CAS upheld their validity in an award of 30 April 2019, Caster Semenya and the South African Athletics Federation (jointly: the appellants) filed an application to set aside the award before the Swiss Supreme Court.[1] The SFT decision, which rejects the application, was made public along with a press release on 8 September 2020.

There is no doubt that we can expect contrasted reactions to the decision. Whatever one’s opinion, however, the official press release in English does not do justice to the 28-page long decision in French and the judges’ reasoning. The goal of this short article is therefore primarily to highlight some key extracts of the SFT decision and some features of the case that will be relevant in its further assessment by scholars and the media.[2]

It is apparent from the decision that the SFT was very aware that its decision was going to be scrutinised by an international audience, part of whom may not be familiar with the mechanics of the legal regime applicable to setting aside an international arbitration award in Switzerland.

Thus, the decision includes long introductory statements regarding the status of the Court of Arbitration for Sport, and the role of the Swiss Federal Tribunal in reviewing award issued by panels in international arbitration proceedings. The SFT also referred extensively throughout its decision to jurisprudence of the European Court of Human Rights (ECtHR), rendered in cases related to international sport and the CAS. More...

New Transnational Sports Law Articles Released on SSRN - Antoine Duval

I have just released on SSRN four of my most recent articles on Lex Sportiva/Transnational Sports Law. The articles are available open access in their final draft forms, the final published version might differ slightly depending on the feedback of the editors. If you wish to cite those articles I (obviously) recommend using the published version.

I hope they will trigger your attention and I look forward to any feedback you may have!

Antoine


Abstract: This chapter focuses on the emergence of a transnational sports law, also known as lex sportiva, ruling international sports. In the transnational law literature, the lex sportiva is often referred to as a key example or case study, but rarely studied in practice. Yet, it constitutes an important playground for transnational legal research and practice, and this chapter aims to show why. The focus of the chapter will first be on the rules of the lex sportiva. Law, even in its transnational form, is still very much connected to written rules against which a specific behaviour or action is measured as legal or illegal. As will be shown, this is also true of the lex sportiva, which is structured around an ensemble of rules produced through a variety of law-making procedures located within different institutions. The second section of this chapter will aim to look beyond the lex sportiva in books to narrate the lex sportiva in action. It asks, what are the institutional mechanisms used to concretize the lex sportiva in a particular context? The aim will be to go beyond the rules in order to identify the processes and institutions making the lex sportiva in its daily practice. Finally, the enmeshment of the lex sportiva with state-based laws and institutions is highlighted. While the lex sportiva is often presented as an autonomous transnational legal construct detached from territorialized legal and political contexts, it is shown that in practice it operates in intimate connection with them. Hence, its transnational operation is much less characterized by full autonomy than assemblage.


Abstract: This chapter aims to show that the work of the Court of Arbitration for Sport (‘CAS’), which is often identified as the institutional centre of the lex sportiva, can be understood as that of a seamstress weaving a plurality of legal inputs into authoritative awards. In other words, the CAS panels are assembling legal material to produce (almost) final decisions that, alongside the administrative practices of sports governing bodies (‘SGBs’), govern international sports. It is argued that, instead of purity and autonomy, the CAS’ judicial practice is best characterised by assemblage and hybridity. This argument will be supported by an empirical study of the use of different legal materials, in particular pertaining to Swiss law, EU law and the European Convention on Human Rights (‘ECHR’), within the case law of the CAS. The chapter is a first attempt at looking at the hermeneutic practice of the CAS from the perspective of a transnational legal pluralism that goes beyond the identification of a plurality of autonomous orders to turn its sights towards the enmeshment and entanglement characterising contemporary legal practice.


Abstract: Has the time come for the Court of Arbitration for Sport to go public? This article argues that after the Pechstein decision of the European Court of Human Rights, CAS appeal arbitration must be understood as forced arbitration and therefore must fully comply with the due process guarantees enshrined in Article 6(1) ECHR. In particular, this entails a strong duty of transparency with regard to the hearings at the CAS and the publication of its awards. This duty is of particular importance since the rationale for supporting the validity of CAS arbitration, if not grounded in the consent of the parties, must be traced back to the public interest in providing for the equality before the (sports) law of international athletes. Thus, the legitimacy and existence of the CAS is linked to its public function, which ought to be matched with the procedural strings usually attached to judicial institutions. In short, if it is to avoid lengthy and costly challenges to its awards, going public is an urgent necessity for the CAS.


Abstract: In 1998 the FIFA welcomed the Palestinian Football Association as part of its members - allegedly, as an attempt by then FIFA President, the Brazilian João Havelange, to showcase football as an instrument of peace between Israeli and Palestinians. Ironically, almost 20 years after Palestine’s anointment into the FIFA family, instead of peace it is the conflict between Israeli and Palestinians that moved to FIFA. In recent years the Palestinian Football Association (PFA) and the Israeli Football Association (IFA) have been at loggerheads inside FIFA over the fate - I will refer to it as the transnational legality – of five (and then six) football clubs affiliated to the IFA which are physically located in the Israeli settlements in the Occupied Palestinian Territories (OPT). This chapter chronicles the legal intricacies of this conflict, which will serve as a backdrop to discuss arguments raised regarding the legality of business activities of corporations connected to the Israeli settlements. Indeed, as will be shown in the first part of this chapter, the discussion on the legality of economic activities in the OPT has recently taken a business and human rights turn involving systematic targeting of corporations by activists. Interestingly, we will see that this business and human rights turn also played a role in the conflict between the IFA and the PFA. This case study is therefore an opportunity to examine how the strategy of naming and shaming private corporations, and in our case not-for-profit associations, for their direct or indirect business involvement in the settlements has fared. It is also an occasion to critically assess the strength of the human rights ‘punch’ added to the lex sportiva, by the UNGPs.

International and European Sports Law – Monthly Report – June - August 2020 by Thomas Terraz

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

 

 

The Headlines

CAS Decision on Manchester City FC Case

After the UEFA’s Adjudicatory Chamber of the Club Financial Control’s (CFCB) decision earlier this year to ban Manchester City FC for two seasons, observers waited impatiently to see the outcome of this high profile dispute. The CFCB’s decision had found that Manchester City FC overstated sponsorship revenues and in its break-even information given to UEFA. While some feared this showdown could lead to the demise of UEFA’s Financial Fair Play (FFP) regulations, the now publicized CAS panel’s decision is more nuanced. The panel’s decision turned on (see analysis here and here) (a) whether the ‘Leaked Emails’ were authentic and could be admissible evidence, (b) whether the ‘CFCB breached its obligations of due process’, (c) whether the conclusions of the 2014 Settlement Agreement prevents the CFCB from charging Manchester City FC, (d) whether the charges are time-barred, (e) the applicable standard of proof, (f) whether Manchester City FC masked equity funding as sponsorship contributions, and (g) whether Manchester City FC failed to cooperate with CFCB. In the end, among other findings, the Panel held that some of the alleged breaches were time-barred but maintained that Manchester City FC had failed to cooperate with CFCB’s investigation. In light of this, the Panel significantly reduced the sanction placed on Manchester City FC by removing the two-season suspension and reducing the sanction from 30 million euros to 10 million euros.

 

Qatar Labour Law Reforms Effectively Abolishes the Kafala System

Just a few days after Human Rights Watch released a lengthy report on abusive practices suffered by migrant workers in Qatar, Qatar adopted a series of laws that effectively gets rid of the Kafala system by no longer requiring migrant workers to obtain a ‘No Objection Certificate’ from their employer in order to start another job. The International Labour Organization declared that this development along with the elimination of the ‘exit permit requirements’ from earlier this year means that the kafala system has been effectively abolished. In addition to these changes, Qatar has also adopted a minimum wage that covers all workers and requires that employers who do not provide food or housing at least give a minimum allowance for both of these living costs. Lastly, the new laws better define the procedure for the termination of employment contracts.

In reaction to these changes, Amnesty International welcomed the reforms and called for them to be ‘swiftly and properly implemented’. Indeed, while these amendments to Qatar’s labour laws are a step in the right direction, Amnesty International also cautions that the minimum wage may still be too low, and in order to be effective, these new laws will have to be followed with ‘strong inspection and complaint mechanisms’.

 

CAS Decision Concerning Keramuddin Karim Abuse Case

In June of last year, Keramuddin Karim, former president of Afghanistan’s soccer federation, was banned by FIFA for life (see the decision of the adjudicatory Chamber of the FIFA Ethics Committee) after reports of sexual and physical abuse that emerged in late 2018. Following a lengthy and tumultuous investigation in Afghanistan, Afghan officials came forward with an arrest warrant for Mr. Karim. Nevertheless, despite attempts to apprehend Mr. Karim, Mr. Karim has still avoided arrest over a year later. Most recently in August, Afghan Special Operation officers attempted to apprehend him but he was not at the residence when they arrived.

Meanwhile, Mr. Karim had appealed FIFA’s lifetime ban to the CAS and the CAS Panel’s decision has recently been released. In its decision, the Panel upheld both the lifetime ban and the 1,000,000 CHF fine, finding that due to the particular egregious nature of Karim’s acts, ‘they warrant the most severe sanction possible available under the FCE’. Since both Karim and his witnesses were unable to be heard, the case raises questions connected to the respect of fundamental procedural rights at the CAS.  More...

International and European Sports Law – Monthly Report – March-May 2020 by Thomas Terraz

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

 

The Headlines

Coronavirus Pandemic Takes Over Sports

Since the last monthly report, the coronavirus pandemic has completely taken over the headlines and has had enormous impacts on the sports field. The most significant of these impacts so far was the rather slow (see here and here) decision by the IOC to move the Tokyo 2020 Olympic Games to 2021 after a widespread push among athlete stakeholders to do so. Concerns were raised that besides the wellbeing of the participants, athletes under lockdowns would not have the access to the training facilities, meaning preparations for the Games would suffer. The IOC has already started its new planning for Tokyo 2021 and sees this new opportunity to be ‘an Olympic flame’ at the end of a ‘dark tunnel’ for the entire world.

Besides the Olympics, football has also experienced colossal effects as this crisis landed right as leagues were approaching the end of their season. In this context, FIFA has released specific guidelines on player contracts and transfer windows, which has included extending player contracts to the new postponed end of season dates. It has also organized a working group on COVID-19, which has already made recommendations to postpone all men and women’s international matches that were to be played during the June 2020 window. Earlier in March, UEFA had already announced that the EURO 2020 was also postponed by 12 months and has also recently approved guidelines on domestic competitions. These guidelines place emphasis on ‘sporting merit’ and urge ‘National Associations and Leagues to explore all possible options to play all top domestic competitions giving access to UEFA club competitions to their natural conclusion’. Nevertheless, UEFA also emphasizes that the health of all stakeholders must remain the top priority.

In the end, numerous sport federations have also had to amend their calendars due to the pandemic (see UCI and FIBA) and a variety of sport stakeholders have been confronted with immense financial strain (e.g. football, tennis and cycling). For example, UEFA has acted preemptively in releasing club benefit payments to try to alleviate the economic pressure faced by clubs. There have also been efforts to support athletes directly (e.g. FIG and ITF). All in all, the social and economic impacts of the coronavirus pandemic on sport have been unprecedented and will require creative solutions while continuing to place public health as the top priority.

Platini’s ECtHR Appeal Falls Flat

There have also been a few other stories that have (understandably) been overshadowed by the pandemic. One of these include Michel Platini’s unsuccessful appeal to the ECtHR challenging his 2015 football ban. The ECtHR’s decision concerned the admissibility of his appeal and in the end found it to be ‘manifestly ill-founded’. This is because he failed to raise his procedural rights concerns under Article 6 (1) ECHR in his proceedings at the Swiss Federal Tribunal. Besides rejecting his other claims based on Article 7 and 8 ECHR, the ECtHR decision also touched upon the issue of CAS’ procedural and institutional independence. In doing so, it referred to its Pechstein decision and once more affirmed that the CAS is sufficiently independent and impartial (see para 65), further giving credence to this notion from its case law. However, there are still concerns on this matter as was highlighted in the Pechstein dissent. Overall, the decision indicates that the ECtHR is willing to give the CAS the benefit of the doubt so long as it sufficiently takes into account the ECHR in its awards.

Mark Dry – UKAD Dispute

In February, Mark Dry was suspended by UKAD after a decision of the National Anti-Doping Panel (NADP) Appeal Tribunal  for four years after having given a ‘false account’ in order to ‘subvert the Doping Control process’. Specifically, Dry had told anti-doping authorities that he had been out fishing after he had missed a test at his residence. After further investigation, Dry admitted that he had forgotten to update his whereabouts while he was actually visiting his parents in Scotland and in panic, had told anti-doping authorities that he had been out fishing. Following the decision of the NADP Appeal Tribunal, athlete stakeholders have argued the four-year ban was disproportionate in this case. In particular, Global Athlete contended that Whereabouts Anti-Doping Rule Violations only occur in cases where an athlete misses three tests or filing failures within a year. Furthermore, even if Dry had ‘tampered or attempted to tamper’, a four-year sanction is too harsh. Subsequently, UKAD responded with a statement, arguing that ‘deliberately providing false information’ is ‘a serious breach of the rules’ and that the UKAD NADP Appeal Tribunal ‘operates independently’. In light of the mounting pressure, Witold Bańka, WADA President, also responded on Twitter that he is ‘committed to ensuring that athletes’ rights are upheld under the World Anti-Doping Code’. More...

Anti-Doping in Times of COVID-19: A Difficult Balancing Exercise for WADA - By Marjolaine Viret

Editor's note: Marjolaine is a researcher and attorney admitted to the Geneva bar (Switzerland) who specialises in sports and life sciences.


I.               Introduction

The COVID-19 pandemic has shaken the manner in which we approach human interactions that suppose close and prolonged physical contact. Across the world, authorities are having to design ways to resume essential activities without jeopardising participants’ health, all the while guaranteeing that other fundamental rights are paid due respect. The fight against doping is no exception. Anti-doping organizations – whether public or private – have to be held to the same standards, including respect for physical integrity and privacy, and considerate application of the cornerstone principle of proportionality.

Throughout this global crisis, the World Anti-Doping Agency (‘WADA’) has carefully monitored the situation, providing anti-doping organizations and athletes with updates and advice. On 6 May 2020, WADA issued the document called ‘ADO Guidance for Resuming Testing’ (‘COVID Guidance’). A COVID-19 ‘Q&A’ for athletes (‘Athlete Q&A’) is also available on WADA’s website, and has been last updated on 25 May 2020. This article focuses on these two latest documents, and analyses the solutions proposed therein, and their impact on athletes.

Like many public or private recommendations issued for other societal activities, the WADA COVID Guidance is primarily aimed at conducting doping control while limiting the risk of transmission of the virus and ensuing harm to individuals. More specifically, one can identify two situations of interest for athletes that are notified for testing:

  1. The athlete has or suspects that they may have been infected with COVID-19, or has come in close contact with someone having COVID-19;
  2. The athlete fears to be in touch with doping control personnel that may be infected with COVID-19.

Quite obviously, either situation has the potential to create significant challenges when it comes to balancing the interests of anti-doping, with individual rights and data protection concerns. This article summarises how the latest WADA COVID Guidance and Athlete Q&A address both situations. It explores how the solutions suggested fit in with the WADA regulatory framework and how these might be assessed from a legal perspective.

The focus will be on the hypothesis in which international sports federations – i.e. private entities usually organised as associations or similar structures – are asked to implement the COVID Guidance within their sport. National anti-doping organizations are strongly embedded in their national legal system and their status and obligations as public or semi-public organisations are likely to be much more dependent on the legislative landscape put in place to deal with the COVID-19 pandemic in each country. Nevertheless, the general principles described in this article would apply to all anti-doping organizations alike, whether at international or national level. More...



(A)Political Games: A Critical History of Rule 50 of the Olympic Charter - By Thomas Terraz

Editor’s note: Thomas Terraz is a fourth year LL.B. candidate at the International and European Law programme at The Hague University of Applied Sciences with a specialisation in European Law. Currently he is pursuing an internship at the T.M.C. Asser Institute with a focus on International and European Sports Law.

 

Since its inception, the Olympic Movement, and in particular the IOC, has tirelessly endeavored to create a clean bubble around sport events, protecting its hallowed grounds from any perceived impurities. Some of these perceived ‘contaminants’ have eventually been accepted as a necessary part of sport over time (e.g. professionalism in sport),[1] while others are still strictly shunned (e.g. political protest and manifestations) and new ones have gained importance over the years (e.g. protection of intellectual property rights). The IOC has adopted a variety of legal mechanisms and measures to defend this sanitized space.  For instance, the IOC has led massive efforts to protect its and its partners’ intellectual property rights through campaigns against ambush marketing (e.g. ‘clean venues’ and minimizing the athletes’ ability to represent their personal sponsors[2]). Nowadays, the idea of the clean bubble is further reinforced through the colossal security operations created to protect the Olympic sites.

Nevertheless, politics, and in particular political protest, has long been regarded as one of the greatest threats to this sanitized space. More recently, politics has resurfaced in the context of the IOC Athletes’ Commission Rule 50 Guidelines. Although Rule 50 is nothing new, the Guidelines stirred considerable criticism, to which Richard Pound personally responded, arguing that Rule 50 is a rule encouraging ‘mutual respect’ through ‘restraint’ with the aim of using sport ‘to bring people together’.[3] In this regard, the Olympic Charter aims to avoid ‘vengeance, especially misguided vengeance’. These statements seem to endorse a view that one’s expression of their political beliefs at the Games is something that will inherently divide people and damage ‘mutual respect’. Thus, the question naturally arises: can the world only get along if ‘politics, religion, race and sexual orientation are set aside’?[4] Should one’s politics, personal belief and identity be considered so unholy that they must be left at the doorstep of the Games in the name of depoliticization and of the protection of the Games’ sanitized bubble? Moreover, is it even possible to separate politics and sport?  

Even Richard Pound would likely agree that politics and sport are at least to a certain degree bound to be intermingled.[5] However, numerous commentators have gone further and expressed their skepticism to the view that athletes should be limited in their freedom of expression during the Games (see here, here and here). Overall, the arguments made by these commentators have pointed out the hypocrisy that while the Games are bathed in politics, athletes – though without their labor there would be no Games – are severely restrained in expressing their own political beliefs. Additionally, they often bring attention to how some of the most iconic moments in the Games history are those where athletes took a stand on a political issue, often stirring significant controversy at the time. Nevertheless, what has not been fully explored is the relationship between the Olympic Games and politics in terms of the divide between the ideals of international unity enshrined in the Olympic Charter and on the other hand the de facto embrace of country versus country competition in the Olympic Games. While the Olympic Charter frames the Games as ‘competitions between athletes in individual or team events and not between countries’, the reality is far from this ideal.[6] Sport nationalism in this context can be considered as a form of politics because a country’s opportunity to host and perform well at the Games is frequently used to validate its global prowess and stature.

To explore this issue, this first blog will first take a historical approach by investigating the origins of political neutrality in sport followed by an examination of the clash between the ideal of political neutrality and the reality that politics permeate many facets of the Olympic Games. It will be argued that overall there has been a failure to separate politics and the Games but that this failure was inevitable and should not be automatically viewed negatively. The second blog will then dive into the Olympic Charter’s legal mechanisms that attempt to enforce political neutrality and minimize sport nationalism, which also is a form of politics. It will attempt to compare and contrast the IOC’s approach to political expression when exercised by the athletes with its treatment of widespread sport nationalism.More...

International and European Sports Law – Monthly Report – February 2020 - By Thomas Terraz

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

 

The Headlines

Manchester City sanctioned by UEFA’s Financial Fair Play

Manchester City has been sanctioned under UEFA’s Financial Fair Play (FFP) regulations for two seasons for ‘overstating its sponsorship revenue in its accounts and in the break-even information’ it had provided UEFA. The February 14 decision of the Adjudicatory Chamber of the Club Financial Control Body (CFCB) likely heralds the start of a long and bitter legal war between Manchester City and UEFA, which may end up settling many of the questions surrounding the legality of FFP rules. Since its introduction in 2010, the compatibility of FFP with EU law, especially in terms of free movement and competition law, has been a continued point of contention amongst the parties concerned and commentators (see discussion here, here and here). It was only a matter of time that a case would arise to test this issue and the present circumstances seem to indicate that this may go all the way.                                 

Regardless, the ban will not be enforced this season and in light of the appeal process, it is hard to predict when the CFCB’s decision will have any effect. Indeed, Manchester City has shown an incredible willingness to fighting this out in the courts and shows no signs of backing down. The next stop will be the CAS and perhaps followed by the Swiss Federal Tribunal. It should also be recalled that the CAS has already examined FFP in its Galatasaray award, where it found FFP compatible with EU law (see commentary here). There is even a decent chance that this emerging saga may end up in front of the European Commission and eventually the Court of Justice of the European Union.

Sun Yang CAS award published

After a much-anticipated public hearing, the Panel’s award in the Sun Yang case has finally been published, sanctioning Sun Yang with an eight-year period of ineligibility (see here for a detailed commentary). The decision does not reveal anything groundbreaking in terms of its legal reasoning and in many ways the case will most likely be remembered for its historical significance: the case that jumpstarted a new era of increased public hearings at the CAS.

Perhaps of some interest is the extent to which the panel took into account Sun Yang’s behavior during the proceedings in order to support its assessment of the case. For example, the panel describes how Sun Yang had ignored the procedural rules of the hearing by inviting ‘an unknown and unannounced person from the public gallery to join him at his table and act as an impromptu interpreter’. The Panel interpreted this as Sun Yang attempting ‘to take matters into his own hands’ which it found resembled the athlete’s behavior in the case (see para 358). The Panel also found it ‘striking’ that Sun Yang did not express any remorse concerning his actions during the proceedings. Since the proceedings were held publicly and have been recorded, it is possible to verify the Panel’s assessment in this regard.

In the end, it is possible that Sun Yang may seek to reduce the period of ineligibility once the 2021 WADA Code comes into force (see para 368). For now, Sung Yang may also try to appeal the award to the Swiss Federal Tribunal on procedural grounds, and has already indicated his wish to do so. More...

Mega-sporting events and human rights: What role can EU sports diplomacy play? - Conference Report – By Thomas Terraz

Editor’s note: Thomas Terraz is a fourth year LL.B. candidate at the International and European Law programme at The Hague University of Applied Sciences with a specialisation in European Law. Currently he is pursuing an internship at the T.M.C. Asser Institute with a focus on International and European Sports Law.

 

1.     Introduction

 On March 05, the T.M.C. Asser Institute hosted ‘Mega-sporting events and human rights: What role can EU sports diplomacy play?’ a Multiplier Sporting Event organized in the framework of a European research project on ‘Promoting a Strategic Approach to EU Sports Diplomacy’. This project funded by the European Commission through its Erasmus+ program aims to help the EU adopt a strategic approach to sports diplomacy and to provide evidence of instances where sport can help amplify EU diplomatic messages and forge better relations with third countries. In particular, Antoine Duval from the Asser Institute is focusing on the role of EU sports diplomacy to strengthen human rights in the context of mega sporting events (MSE) both in Europe and abroad. To this end, he organized the two panels of the day focusing, on the one hand, on the ability of sport governing bodies (SGB) to leverage their diplomatic power to promote human rights, particularly in the context of MSEs and, on the other, on the EU’s role and capacity to strengthened human rights around MSEs. The following report summarizes the main points raised during the discussions. More...

Special Issue Call for Papers: Legal Aspects of Fantasy Sports - International Sports Law Journal

The International Sports Law Journal (ISLJ) invites submissions to a special issue focusing on legal aspects of fantasy sports. For some time, fantasy sports has been a major phenomena in North America and this has been reflected in the sports law literature. Fantasy sports have more recently grown in popularity in the rest of world, raising a number of novel legal questions. The ISLJ wants to support fruitful global discussions about these questions through a special issue. We welcome contributions from different jurisdictions analyzing fantasy sports from the perspective of various areas of law including, but not limited to, intellectual property law, gambling law, and competition law.

Please submit proposed papers through the ISLJ submission system (http://islj.edmgr.com/) no later than November 15, 2020. Submissions should have a reccomended length of 8,000–12,000 words and be prepared in accordance with the ISLJ's house style guidelines (https://www.springer.com/journal/40318/submission-guidelines). All submissions will be subject to double-blind peer review.

Question about the special issue can be directed to the Editor–in-Chief, Johan Lindholm (johan.lindholm@umu.se).

Asser International Sports Law Blog | The EU State aid and Sport Saga – A blockade to Florentino Perez’ latest “galactic” ambitions (part 1)

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 EU State aid and Sport Saga – A blockade to Florentino Perez’ latest “galactic” ambitions (part 1)

This is the first part of a blog series involving the Real Madrid State aid case.

Apart from being favoured by many of Spain’s most important politicians, there have always been suspicions surrounding the world’s richest football club regarding possible financial aid by the Madrid City Council. Indeed, in the late 90’s a terrain qualification change by the Madrid City Council proved to be tremendously favourable to the king’s club. The change allowed Real Madrid to sell its old training grounds for a huge sum. Though the exact price for the grounds remains unknown, Real Madrid was suddenly capable of buying players like Figo and Zidane for record fees. However, the European Commission, even though agreeing that an advantage was conferred to the club, simply stated that the new qualification of the terrain in question does not appear to involve any transfer of resources by the State and could therefore not be regarded as State aid within the meaning of article 107 TFEU.

Agreements between the club and the Council have been a regularity for the last 25 years.  A more recent example concerns an agreement signed on 29 July 2011 (Convenio29-07-2011.pdf (8MB). The agreement regularizes two earlier agreements between the Council and Real Madrid dating from 1991 and 1998 respectively. The commitments deriving from those earlier agreements were not followed by the relevant parties and therefore had to give way to a new agreement. A closer look at the 29 July 2011 Agreement exposes a bizarre chain of events. It turned out that in 1998 Real Madrid transmitted an undivided half of their old training grounds to the municipality. Apart from a large sum of money, the club was to receive a number of terrains spread out over the municipality, including a terrain located in the area called Las Tablas valued at €595.194 in 1998. However, due to its qualification for sporting usage, the Council concluded in 2011 that the parcel could not be transferred to the club due to the fact that Madrid’s urbanity laws only permit a transfer of urban or urbanizable terrains. For that reason, the Council agreed to compensate the football club not for the original value of €595.194 but for a staggering €22.693.054,44! Real Madrid was not compensated in the form of a sum, but rather it was presented with a packet of terrains including four terrains of a total area of 12.435 m/2 in the street Mercedes Arteaga in the Carabanchel district of Madrid.

The year 2011 also saw a second agreement between the Council of Madrid and the football club, this time concerning construction works on the Real Madrid stadium Santiago Bernabéu. This agreement, dating from November 2011, is known as operation Bernabeú-Opañel and includes the following plans. The Council is to transfer to the club a terrain constituting a 12.250 m/2 buildable surface which borders the west-side of the Bernabéu stadium. This acquirement permits Real Madrid to cover the stadium with a roof, to build a shopping centre and a hotel on the façade situated on the Paseo de la Castellana (one of Madrid’s most important streets). In return, the club firstly agreed to transfer to the Council the shopping centre Esquina del Bernabéu, which is situated at the South-East-side of the stadium with a buildable surface of 6.858 m/2. The Council would then demolish the shopping centre and convert it into a public park. Secondly, the club is to transfer back to the Council part of the four terrains located in the street Mercedes Arteaga that it received as part of the 29 July 2011 Agreement.  In addition to the transfers of the old shopping centre and the terrains located in the street Mercedes Arteaga, Real Madrid is also to pay €6.6 million to the Council. The Council, however, encountered an obstacle in its own urban laws. The Plan General de Ordenación Urbana de Madrid de 1997 (PGOU) did not permit private parties, like Real Madrid, to construct on public terrains owned by the Council. Therefore, on 16 November 2012, the Government of the autonomous region of Madrid announced that the PGOU is to be modified ad hoc for the operation Bernabeú-Opañel.

By means of the operation Bernabeú-Opañel, Real Madrid expressed that it hopes to “convert the Club in a sporting institution of reference in the world. The aim is for the stadium to have a maximum level of comfort and services superior to the most modern and advanced sporting stadiums in the world” (PropuestaRealMadrid.pdf (914.2KB)). According to the Council, the operation will not only improve sporting and leisure facilities in the city, it will also create up to 9.546 m/2 of “green zones”. Moreover, the investment for the construction works will be borne only by Real Madrid and it is expected that the construction works will give employment to more than 2 000 people and the exploitation to 600 people.

 

In 2012, the ecological movement Ecologistas en Acción found several legal irregularities with regard to the 29 July Agreement operation Bernabeú-Opañel and (unsurprisingly) concluded that the agreements appeared to be very beneficial for Real Madrid. It therefore started legal proceedings in front of the Spanish administrative Court claiming that the ad hoc modification of the PGOU was illegal. It would later on launch on appeal in front of the Tribunal Superior de Justicia de Madrid, or Madrid High Court (TSJM-Order-31-07-2014.pdf (112.3KB)). Simultaneously, it informed the European Commission of potential unlawful State aid granted by the Council of Madrid to Real Madrid. To Spain’s outrage, on 18 December 2013, the Commission declared that it had enough reasons to believe that the incriminated transactions might involve State aid and launched a formal investigation in accordance with Article 108(2) TFEU. Concretely, the Commission expressed the following concerns:

1) The Commission doubts whether it was impossible for the Council of Madrid to transfer the Las Tablas property to Real Madrid;

2) The Commission doubts that a market value of the Las Tablas plot of land has been sought;

3) The Commission doubts the market conformity of the value of the properties which were transferred to Real Madrid by the 2011 Agreement and at the occasion of the subsequent further exchange of land around the Bernabéu Stadium, and;

4) The Commission doubts that there is an objective of common interest, which could justify selective support to a very strong actor in a highly competitive economic sector. 

The Commission’s doubts seem, in light of the facts at hand, reasonable. To decide whether or not the land transactions qualifies as unlawful State aid, however, the four cumulative criteria of Article 107(1) TFEU need to be fulfilled. (1) The aid must confer an economic advantage on Real Madrid; (2) it must be granted by a Member State or through State resources; (3) the advantage must be selective and distorts or threatens to distort competition; and (4) it must affect trade between Member States.


Advantage to Real Madrid over its competitors

As the Commission pointed out in paragraph 21 of its notice initiating the infringement procedure against Spain, “Real Madrid appears to enjoy an economic advantage from the fact that a plot of land, which at the time of its acquisition was valued at €595,194, appears 13 years later, in an operation to offset mutual debts, with a value of more than €22 million”. Furthermore, there are also doubts regarding the market conformity of the lands transferred in the operation Bernabéu-Opañel. In situations where the public authorities wish to sell public property to private investors, it should make sure that the revenue obtained from the sale is comparable to market level. This criterion is also known as the “market economy vendor principle”. In accordance with the Land sale Communication, should the public authorities wish to avoid any advantage to the recipient over its competitors during a land sale transaction, it should apply one of the two following procedures: (1) an unconditional bidding procedure or (2) a procedure where the land is valued by one or more independent asset valuers prior to the sale negotiations. The Court of Justice has ruled that other methods may also achieve the same result, but in order to comply with EU State aid rules, the national provisions establishing rules for calculating the market value of land must in all cases lead to a price as close as possible to the market value.[2] Special obligations for the buyer, such as urban planning requirements, do play a role when determining whether or not the land was sold at market value. Furthermore, land transfer deals, which often consist of more than just one land transaction, have to be scrutinized in their entirety.[3] Therefore, to determine whether an advantage was conferred to Real Madrid, both agreements between the club and the Council have to be take into account with a special focus on the valuation methods used.

In 1998, the valuation for the terrain in Las Tablas (€595,194) was done by the administration of Madrid, on the basis of legislation which offers a technique to determine the value of urban real property. The calculated value for the same terrain in Las Tablas in 2011 amounted to €22.693.054,44. According to a valuation report released by the Municipal Valuation Department, the value was calculated in accordance the same application rules. Yet it has to be borne in mind that the Municipal Valuation Department forms part of the Área de Gobierno de Urbanismo y Vivienda del Ayuntamiento de Madrid. Not only is the Área de Gobierno de Urbanismo y Vivienda the main public authority regarding urban planning in Madrid, it is together with Real Madrid the main party in the 2011 Agreement itself.

Real Madrid was not compensated in the form of a payment, but rather it was presented with another packet of terrains valued at €19,972,348.96. In the valuation report released by the Municipal Valuation Department, a list is included with average terrain values per district calculated by the independent appraiser Tasamadrid. In continuation, the Municipal Valuation Department applied a formula based on its own legislation to determine the final value of the terrains. This packet of terrains included land in the street Mercedes Arteaga, valued at €4,360,862 which were transferred back to the municipality in the operation Bernabéu-Opañel.

The operation Bernabéu-Opañel also included the club transferring the old shopping centre Esquina del Bernabéu and added a payment of €6,6 million. A second valuation report indicates that the value of the Esquina del Bernabéu is €3,861 per square meters passed on the average values of terrains found in adjacent streets. Furthermore, the Council “requalified” the terrain between the Bernabéu stadium and the street Paseo de la Castellana by ad hoc modifying the local urban laws (PGOU) before transferring it to Real Madrid. The value of this terrain is also calculated in the second report and ads up to €1,208 per square meter. Even though two of the terrains in question can be found in the same area, the value per square meter of the Esquina Bernabéu is much higher (€3,861) as compared to the value of the land between the Bernabéu stadium and the street Paseo de la Castellana (€1,208). True, the terrain with the Esquina del Bernabéu has already been built on, thereby increasing the value, but one should keep in mind that the operation Bernabéu-Opañel consists of demolishing the Esquina del Bernabéu and turning it into a green zone. On the other, the other terrain will be used for the construction of a hotel and a new shopping centre. Secondly, a quick glance at other real estate transfers in the same area of Madrid shows that the value of the terrains is in fact much higher. In 2012, the Picasso tower was purchased by a private firm for €400 million, or €5000 m/2. Today, the building Torre Titania can be bought for €11,000 m/2 and the building Castellana 200 is for sale for €150 million.

With all the above in mind, one could legitimately get the feeling that the actual aim of the Agreement of 29 July 2011 was to pave the way for the operation “Bernabéu-Opañel”, as some media suggested. Unlike in the Konsum Nord case, where the General Court held that the presence of a link between different transactions could mean that the measure in question does not constitute State aid, the link between the agreements in the Real Madrid case only increases suspicions regarding unlawful State aid. Furthermore, the Council of Madrid has also been inconstant regarding its valuation methods. The value of the terrain in Las Tablas was calculated without an independent appraiser and the value of the Esquina del Bernabéu was calculated using the average value of terrains found in adjacent streets. In short, there are good reasons to believe that the transactions were made in order to provide a financial advantage to Real Madrid.

The remaining three criteria of Article 107(1) TFEU and possible justifications will be discussed in an upcoming blog post.



[1] Notes are omitted. A comprehensive article can be accessed at Oskar van Maren, "The Real Madrid case: A State aid case (un)like any other?".

[2] Case C-239/09 Seydaland Vereinigte Agrarbetriebe [2010] ECR I-13083, §33-35

[3] Case T-244/08 Konsum Nord ekonomisk förening v Commission [2011] ECR II-0000, §58

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