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 New FIFA Intermediaries Regulations under EU Law Fire in Germany. By Tine Misic

I'm sure that in 1985, plutonium is available in every corner drugstore, but in 1955, it's a little hard to come by.” (Dr. Emmett L. Brown)[1]


Back to the future?

Availing oneself of EU law in the ambit of sports in 1995 must have felt a bit like digging for plutonium, but following the landmark ruling of the European Court of Justice (ECJ) in the Bosman case[2], 20 years later, with all the buzz surrounding several cases where EU law is being used as an efficient ammunition for shelling various sports governing or organising bodies, one may wonder if in 2015 EU law is to be “found in every drug store” and the recent cases (see inter alia Heinz Müller v 1. FSV Mainz 05, Daniel Striani ao v UEFA, Doyen Sports ao v URBSFA, FIFA, UEFA) [3] cannot but invitingly evoke the spirit of 1995.

One of the aforementioned cases that also stands out pertains to the injunction decision[4] issued on 29 April 2015 by the Regional Court (Landesgericht) in Frankfurt am Main (hereinafter: the Court) in the dispute between the intermediary company Firma Rogon Sportmanagement (hereinafter: the claimant) and the German Football Federation (Deutschen Fußball-Bund, DFB), where the claimant challenged the provisions of the newly adopted DFB Regulations on Intermediaries (hereinafter: DFB Regulations)[5] for being incompatible with Articles 101 and 102 TFEU.[6] The Court, by acknowledging the urgency of the matter stemming from the upcoming transfer window and the potential loss of clients, deemed a couple of shells directed at the DFB Regulations to be well-aimed, and granted an injunction due to breach of Article 101 TFEU. More...




Compatibility of fixed-term contracts in football with Directive 1999/70/EC. Part 2: The Heinz Müller case. By Piotr Drabik

Introduction
The first part of the present blog article provided a general introduction to the compatibility of fixed-term contracts in football with Directive 1999/70/EC[1] (Directive). However, as the Member States of the European Union enjoy a considerable discretion in the implementation of a directive, grasping the impact of the Directive on the world of football would not be possible without considering the national context. The recent ruling of the Arbeitsgericht Mainz (the lowest German labour court; hereinafter the Court) in proceedings brought by a German footballer Heinz Müller provides an important example in this regard. This second part of the blog on the legality of fixed-term contract in football is devoted to presenting and assessing the Court’s decision.


I. Facts and Procedure
Heinz Müller, the main protagonist of this case, was a goalkeeper playing for 1.FSV Mainz 05 a club partaking to the German Bundesliga. More...


Compatibility of Fixed-Term Contracts in Football with Directive 1999/70/EC. Part.1: The General Framework. By Piotr Drabik

Introduction
On 25 March 2015, the Labour Court of Mainz issued its decision in proceedings brought by a German footballer, Heinz Müller, against his (now former) club 1. FSV Mainz 05 (Mainz 05). The Court sided with the player and ruled that Müller should have been employed by Mainz 05 for an indefinite period following his 2009 three year contract with the club which was subsequently extended in 2011 to run until mid-2014. The judgment was based on national law implementing Directive 1999/70 on fixed-term work[1] (Directive) with the latter being introduced pursuant to art. 155(2) TFEU (ex art. 139(2) TEC). On the basis of this article, European social partners’ may request a framework agreement which they conclude to be implemented on the European Union (EU, Union) level by a Council decision on a proposal from the Commission. One of the objectives of the framework agreement,[2] and therefore of the Directive, was to establish a system to prevent abuse arising from the use of successive fixed-term employment contracts or relationships[3] which lies at the heart of the discussed problem.[4] More...

UEFA’s FFP out in the open: The Dynamo Moscow Case

Ever since UEFA started imposing disciplinary measures to football clubs for not complying with Financial Fair Play’s break-even requirement in 2014, it remained a mystery how UEFA’s disciplinary bodies were enforcing the Club Licensing and Financial Fair Play (“FFP”) regulations, what measures it was imposing, and what the justifications were for the imposition of these measures. For over a year, the general public could only take note of the 23 settlement agreements between Europe’s footballing body and the clubs. The evidential obstacle for a proper analysis was that the actual settlements remained confidential, as was stressed in several of our previous Blogs.[1] The information provided by the press releases lacked the necessary information to answer the abovementioned questions.

On 24 April 2015, the UEFA Club Financial Control Body lifted part of the veil by referring FC Dynamo Moscow to the Adjudicatory Body. Finally, the Adjudicatory Body had the opportunity to decide on a “FFP case. The anxiously-awaited Decision was reached by the Adjudicatory Chamber on 19 June and published not long after. Now that the Decision has been made public, a new stage of the debate regarding UEFA’s FFP policy can start.More...

Policing the (in)dependence of National Federations through the prism of the FIFA Statutes. By Tine Misic

…and everything under the sun is in tune,

but the sun is eclipsed by the moon…[1] 


The issue

Ruffling a few feathers, on 30 May 2015 the FIFA Executive Committee rather unsurprisingly, considering the previous warnings,[2] adopted a decision to suspend with immediate effect the Indonesian Football Federation (PSSI) until such time as PSSI is able to comply with its obligations under Articles 13 and 17 of the FIFA Statutes.[3] Stripping PSSI of its membership rights, the decision results in a prohibition of all Indonesian teams (national or club) from having any international sporting contact. In other words, the decision precludes all Indonesian teams from participating in any competition organised by either FIFA or the Asian Football Confederation (AFC). In addition, the suspension of rights also precludes all PSSI members and officials from benefits of any FIFA or AFC development programme, course or training during the term of suspension. This decision coincides with a very recent award by the Court of Arbitration for Sport (CAS) in this ambit, which shall be discussed further below.[4]More...


The Brussels Court judgment on Financial Fair Play: a futile attempt to pull off a Bosman. By Ben Van Rompuy

On 29 May 2015, the Brussels Court of First Instance delivered its highly anticipated judgment on the challenge brought by football players’ agent Daniel Striani (and others) against UEFA’s Club Licensing and Financial Fair Play Regulations (FFP). In media reports,[1] the judgment was generally portrayed as a significant initial victory for the opponents of FFP. The Brussels Court not only made a reference for a preliminary ruling to the European Court of Justice (CJEU) but also imposed an interim order blocking UEFA from implementing the second phase of the FFP that involves reducing the permitted deficit for clubs.

A careful reading of the judgment, however, challenges the widespread expectation that the CJEU will now pronounce itself on the compatibility of the FFP with EU law. More...

A Bridge Too Far? Bridge Transfers at the Court of Arbitration for Sport. By Antoine Duval and Luis Torres.

FIFA’s freshly adopted TPO ban entered into force on 1 May (see our Blog symposium). Though it is difficult to anticipate to what extent FIFA will be able to enforce the ban, it is likely that many of the third-party investors will try to have recourse to alternative solutions to pursue their commercial involvement in the football transfer market. One potential way to circumvent the FIFA ban is to use the proxy of what has been coined “bridge transfers”. A bridge transfer occurs when a club is used as an intermediary bridge in the transfer of a player from one club to another. The fictitious passage through this club is used to circumscribe, for example, the payment of training compensation or to whitewash a third-party ownership by transforming it into a classical employment relationship. This is a legal construction that has gained currency especially in South American football, but not only. On 5 May 2015, in the Racing Club v. FIFA case, the Court of Arbitration for Sport (CAS) rendered its first award involving directly a bridge transfer. As this practice could become prevalent in the coming years we think that this case deserves a close look. More...

20 Years After Bosman - The New Frontiers of EU Law and Sport - Special Issue of the Maastricht Journal of European and Comparative Law

Editor's note: This is a short introduction written for the special Issue of the Maastricht Journal of European and Comparative Law celebrating the 20 years of the Bosman ruling and dedicated to the new frontiers of EU law and Sport (the articles are available here). For those willing to gain a deeper insight into the content of the Issue we organize (in collaboration with Maastricht University and the Maastricht Journal) a launching event with many of the authors in Brussels tomorrow (More info here).More...

ASSER Exclusive! Interview with Charles “Chuck” Blazer by Piotr Drabik

Editor’s note: Chuck Blazer declined our official interview request but thanks to some trusted sources (the FIFA indictment and Chuck’s testimony) we have reconstructed his likely answers. This is a fictional interview. Any resemblance with real facts is purely coincidental.



Mr Blazer, thank you for agreeing to this interview, especially considering the circumstances. How are you doing?

I am facing ten charges concerning, among others, conspiracy to corrupt and money laundering. But apart from that, I am doing great (laughs)!

 

It is good to know that you have not lost your spirit. And since you’ve been involved in football, or as you call it soccer, for years could you please first tell us what was your career at FIFA and its affiliates like?

Let me see… Starting from the 1990s I was employed by and associated with FIFA and one of its constituent confederations, namely the Confederation of North, Central American and Caribbean Association Football (CONCACAF). At various times, I also served as a member of several FIFA standing committees, including the marketing and television committee. As CONCACAF’s general secretary, a position I proudly held for 21 years, I was responsible, among many other things, for negotiations concerning media and sponsorship rights. From 1997 to 2013 I also served at FIFA’s executive committee where I participated in the selection process of the host countries for the World Cup tournaments. Those years at the helm of world soccer were truly amazing years of travel and hard work mainly for the good of the beautiful game. I might add that I even managed to document some of my voyages on my blog. I initially called it “Travels with Chuck Blazer” but Vladimir (Putin) convinced me to change the name to “Travels with Chuck Blazer and his Friends”. You should check it out.

 More...



Financial Fair Play: Lessons from the 2014 and 2015 settlement practice of UEFA. By Luis Torres

UEFA announced on 8 May that it had entered into Financial Fair Play settlement agreements with 10 European football clubs. Together with the four other agreements made in February 2015, this brings the total to 14 FFP settlements for 2015 and 23 since UEFA adopted modifications in its Procedural rules and allowed settlements agreements to be made between the Clubs and the Chief Investigator of the UEFA Club Financial Control Body (CFCB).[1] 

In the two years during which UEFA’s FFP regulations have been truly up and running we have witnessed the centrality taken by the settlement procedure in their enforcement. It is extremely rare for a club to be referred to the FFP adjudication chamber. In fact, only the case regarding Dynamo Moscow has been referred to the adjudication chamber. Thus, having a close look at the settlement practice of UEFA is crucial to gaining a good understanding of the functioning of FFP. Hence, this blog offers a detailed analysis of this year’s settlement agreements and compares them with last year’s settlements. More...

Asser International Sports Law Blog | The ISU Commission's Decision and the Slippery Side of Eligibility Rules - By Stefano Bastianon (University of Bergamo)

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 ISU Commission's Decision and the Slippery Side of Eligibility Rules - By Stefano Bastianon (University of Bergamo)

Editor’s note: Stefano Bastianon is Associate Professor in European Law at the University of Bergamo and lawyer admitted to the Busto Arsizio bar. He is also member of the IVth Division of the High Court of Sport Justice (Collegio di Garanzia dello sport) at the National Olympic Committee.

1. From the very beginning, the outcome of the ISU case was highly predictable, at least for those who are familiar with the basics of antitrust law. Nevertheless, more than twenty years after the Bosman judgment, the sports sector has shown the same shortsightedness and inability to see the forest for the trees. Even this attitude was highly predictable, at least for those who know the basics of sports governance. The final result is a clear-cut decision capable of influencing the entire sports movement.

2. On the 8th of December 2017, the European Commission ruled that ISU’s eligibility rules breached EU competition law. In particular, the Commission focused on the ISU’s eligibility rule, according to which speed skaters participating in competitions that were not approved by the ISU face severe penalties up to a lifetime ban from all major international speed skating events. The Commission found that such rules restrict competition and enable the ISU to pursue its own commercial interests to the detriment of athletes and organizers of competing events[1]. In sharp contrast with the Commission’s decision is the ISU’s statement published the same day. Indeed, according to the ISU the Commission’s decision is wrong because it fails to consider the specific nature of sports by putting commercial interests ahead of the principles of integrity, health and safety that protect fair play in sport. For this reason the statement ends with the ISU’s reserve to appeal the decision.

3. As it often occurs, small cases (that is cases involving almost unknown athletes or less popular sports and for this reason often underestimated) are able to generate consequences of great importance, presenting many aspects of interest to scholars of EU sports law: this is the case of the ISU affair.

4. First of all, it is a matter of common knowledge that the Commission tends not to intervene in cases dealing with regulatory and organizational aspects of sport. To this regard, it is sufficient to consider that in the 1999 Mouscron case the Commission took the view that the UEFA Cup rule requiring that each club must play its home match at its own ground ("at home and away from home" rule) was a sports rule that did not fall within the scope of the Treaty's competition rules and therefore rejected the complaint. In the 2001 FIA case the Commission closed various anti-trust investigations into certain regulations and commercial arrangements involving Formula One after the parties agreed to make changes which limited the FIA to a regulatory role, so as to prevent any conflict of interests and remove certain commercial restrictions imposed on circuit owners and TV broadcasters. Similarly, in the 2002 FIFA case, the Commission closed its investigation into the rules governing international transfers of football players, in which it formally rejected the complaints related to FIFA in the light of the adoption of new rules capable of balancing a player’s fundamental right to free movement and stability of contracts together with the legitimate objective of integrity of the sport and the stability of championships. Lastly, in the 2002 UEFA multi-ownership rule case the Commission established that the purpose of the rule was not to distort competition, but to guarantee the integrity of the competitions it organizes and rejected the complaint. More recently, in the 2011 Formula One Engine Manufacturers case and the 2014 Financial Fair-Play case the Commission rejected the complaints because of a lack of community interest. In this context, even from a purely statistical point of view, the ISU decision cannot be underestimated.

5. Secondly, one aspect of the importance of the ISU decision lies in the specific matter dealt with. Indeed, eligibility rules (although sometimes differently named) are a common element of many sports. For example the FINA General Rule 4, under the heading “Unauthorised relations”, states that

«no affiliated Member shall have any kind of relationship with a non-affiliated or suspended body (…). Any individual or group violating this Rule shall be suspended by the affiliated Member for a minimum period of one year, up to a maximum period of two years. (…). Each Member that conducts a competition shall strictly enforce the FINA Rules governing eligibility».

The FIG Technical Regulations, Appendix B (Rules of Eligibility for the International Gymnastic Federation) state that

«an eligible gymnast is any gymnast who abides by the eligibility rules of the FIG and the gymnast's National Federation. In any competition sanctioned or conducted by the FIG, each National Federation is responsible for certifying the eligibility of gymnasts from its country. Only gymnasts meeting the requirements of Regulation I are authorised to participate in official competitions and particularly those competitions which qualify gymnasts for Olympic Games and Youth Olympic Games (…). A gymnast may not: (…); b) take part in any gymnastic competition or exhibition which is not sanctioned by the FIG or his/her National Federation (…). Any gymnast infringing these rules, after their enforcement, may not claim to be eligible to participate in the Olympic Games and Youth Olympic Games or qualifying tournaments for the Games».

The FIH Regulations on Sanctioned and Unsanctioned Events state that

«it is prohibited for any National Association, and for any organisation or individual (including Athletes, technical officials, umpires, coaching or management staff) under the jurisdiction of a National Association, to participate in any manner in an Unsanctioned Event. Any Athlete or other individual who participates in any capacity in an Unsanctioned Event is automatically ineligible for twelve months thereafter to participate in any capacity in any International Event».

The UCI Cycling Regulations, under the heading «Forbidden Races», state that

«no licence holder may participate in an event that has not been included on a national, continental or world calendar or that has not been recognised by a national federation, a continental confederation or the UCI».

As a consequence, the ISU decision goes far beyond the specific sport considered (speed skating) and represents a clear message sent by the Commission to the entire sports world.

6. From this point of view, it is important not to forget that before the Commission there are still pending two complaints lodged respectively by the Euroleague Basketball and by FIBA. The dispute between FIBA and Euroleague Basketball goes back to the end of 2015 when FIBA announced the creation of a basketball Champions League in direct competition with the two European professional clubs’ competitions organized by the ECA. In order to force professional clubs to participate in the new Basketball Champions League, FIBA did not hesitate to put pressure on national federations threatening the possibility of excluding their national teams from participation in main competitions such as EuroBasket and the Olympic Games. According to the Euroleague Basketball the complaint «targets the unacceptable and illegal threats and pressures that FIBA and its member federations are making against clubs, players and referees to force them to abandon the Euroleague and the EuroCup and only participate in FIBA competitions. The complaint's objective is to guarantee that clubs, players and referees can freely make the choice to participate in the competitions that they consider appropriate without being subject to threats or pressures. FIBA is violating European Union law because, in a blatant conflict of interest, FIBA has rules on its books that provide for sanctions against those who are involved in competitions not approved by FIBA». In a completely specular way, FIBA has lodged a complaint against the Euroleague Basketball alleging an abusive tying by imposing undue pressure on leagues and clubs, as well as threatening exclusion from the Euroleague unless they commit to the EuroCup (…); a “syndication agreement” circulated among the 11 A license clubs who hold the majority of votes in ECA, meaning that six clubs control ECA, including all Euroleague and EuroCup decisions in sporting and commercial matters; arbitrarily cherry-picking clubs for Euroleague and EuroCup, which means destroying any commercial and sporting value of domestic leagues and undermining the competitive balance in European basketball; abusively discriminating against financially weaker clubs, thereby placing them at a further competitive disadvantage». However, the FIBA/Euroleague dispute involves another fundamental aspect related to the scheduling of competitions. According to FIBA, the new Euroleague calendar does not include windows of time for national team competitions in February or November, and for this reason, the Euroleague is preventing the release of players to national team competitions. On the contrary, according to the Euroleague, FIBA’s new windows in February and November represent a change from the past where international competitions, including the World Cup qualifiers, were held in the summer, during the offseason for most leagues.[2]

Although different in many respects compared to the ISU case, the FIBA/Euroleague affair raises again the problem of conflict of interest when sports federations pretend to exercise autonomously their regulatory power for the sake of the organization of sport and to simultaneously carry out an economic activity related to the organization of sporting events. In consideration of the dual nature of sports federations, the basic problem to be solved is to clarify if and to what extent the conduct of a sports federation is legitimate when it uses its regulatory power to exclude or marginalize third parties from the market of the organization of sporting events. 

7. Going back to the merit of the ISU affair and waiting to read the decision, the Commission’s press release and the statement by Commissioner Vestager are very important in order to better understand the scope and limits of the decision. The decision is not about the pyramid structure of European sports. The principle of a single federation for each sport and the right of the federations to organise competition from local to international levels is a milestone of the European model of sport. In this context the decision does not question the right of sports federations to enact rules necessary to achieve those goals. However, the ISU decision confirms that sport is not just for fun, but it is also a business. Therefore, although the Commission does not intend “to be the referee in every dispute about sport”, in matters dealing with the economic dimension of sport, sports federations must understand that the business of sports has to comply with competition rules. This means that the sole fact that eligibility rules or any other rule enacted by sports federations pursue a legitimate objective (for example, the protection of athletes’ health, the integrity and the proper conduct of sport, the fight against doping) does not represent a valid justification to put those rules outside the scope of EU law. Indeed, according to the Court of Justice’s case law, sporting rules set up by sports federations are compatible with EU law only if they pursue a legitimate objective and the restrictions that they create are inherent and proportionate to reaching this objective. Therefore, in cases relating to the exercise of regulatory power by sports federations the problem does not concern the legitimate nature of the objectives pursued. Generally speaking, in all the cases examined by the Commission and National antitrust authorities, the legitimacy of the objectives pursued by the federations has never been questioned. On the contrary, in those cases the problem was the inherent and proportionate character of the restrictions created by the federations through the exercise of their regulatory power. From this point of view, therefore, it can be said that it must certainly be considered inherent and proportionate to the objective of ensuring the integrity of the sport the rule requiring the athletes who participate in an event not authorized by the respective federation to undergo, at their own expense, an anti-doping tests before being able to attend an event organized by the federation. Quite the reverse, a clause sanctioning the athlete who participates in a competition not authorized by the federation with a lifetime ban from all the events organized by the federation appears totally disproportionate. Similarly, it must certainly be considered inherent and proportionate to the objective of ensuring the integrity of the sport the rule requiring anyone who intends to organize a sporting event outside the federation to ensure compliance with the rules of the game, as elaborated by the federation, and the anti-doping controls. In contrast, the clause that imposes on the organizer of an event the obligation to respect the rules of the federation in regards to the choice of the athletes or teams admitted to participate in such competition must be considered disproportionate. Although it is true that the European model of sport expressly refers to the mechanism of promotion and relegation as a distinguishing feature compared to the US model, it is equally true that the Commission has never qualified the structure of open leagues as a legitimate objective capable of justifying the provision of rules restricting competition or the free movement of persons. Moreover, even considering the model of the open leagues a necessary feature of the European sports model, it must be emphasized that the organization of a sporting event based on a system of special licenses is not in itself in contrast with the founding values ​​of the European sports model. On the one hand, the existence of other events (national and European) characterized by the traditional mechanisms of promotion and relegation represents the best safeguard of the European model of sport. However, it is clear that in order to protect the meritocratic criterion behind the mechanism of promotion and relegation it is sufficient to provide a mixed system where some athletes or teams are admitted on the basis of a licence and other athletes/teams are admitted on the basis of the results achieved on the pitch.

8. We can imagine the ISU’s disappointment regarding the Commission’s decision.  On the contrary, what is really difficult to understand is the ISU’s position shown in the statement published on the same day of the Commission’s decision. The idea that the Commission’s decision fails to consider the specific nature of sport is simply nonsense considering the rather vague nature of the notion of specificity of sports, especially in the post Meca Medina era. Similarly, the idea that the Commission’s decision puts commercial interests ahead of the principles of integrity, health, and safety that protect fair play in sports has no legal basis. In the same way, the idea that the decision is contrary to the Treaty, which recognizes the voluntary, social, and educational functions of sports reveals a serious lack of knowledge of the basics of EU law applied to the sports sector. On the other hand, the ISU correctly affirms that its eligibility rules—similar to the eligibility rules of many other international sports federations—ensure the protection of the health and safety of athletes at all authorized events as well as the integrity of sports events, and that these rules are essential to the role of international federations as the guardians of sports movement. However, it is easy to assert that the Commission’s decision does not question this argument and the fundamental role of international federations to organize the proper and correct conduct of sport.  To this regard, the decision not to impose a fine on the ISU is a clear signal. Another signal is represented by the recognition that there are many disputes which have little or nothing at all to do with competition rules as they raise primarily issues related to the governance of a sport. In other words, sports federations must understand that the sole fact that they are charged to guarantee the integrity and proper conduct of their sport, the protection of athletes’ health, and other fundamental values related to sports does not automatically mean that the rules enacted to pursue these objectives cannot be scrutinized through the lens of EU law. Once and for all, it should be understood that when the exercise of regulatory power by sports federations is able to affect the distinct market of the organization of sports events, in which sports federations compete with other sports events organisers, EU law applies. This new context should have been evident following the Bosman ruling and, above all, after the Meca Medina judgment. Unfortunately, the ISU decision (and the ISU’s reaction) confirms that this is not yet the case.


[1] For more details, see http://leidenlawblog.nl/articles/what-can-eu-competition-law-do-for-speed-skaters 

[2] On this subject it is worthy to note that the statement by Commissioner Vestager on the ISU decision clearly highlights that things like the penalties for doping or match-fixing, or deciding the precise scheduling have little or nothing at all to do with antitrust. For these, sports organisations must live up to their responsibilities and find solutions and mechanisms for solving disputes that deliver the results that the public and the athletes deserve.

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