The 40 recommendations of the Olympic Agenda 2020 are out! First thought: one should not underplay the 40 recommendations, they constitute (on paper at least) a potential leap forward for the IOC. The media will focus on the hot stuff: the Olympic channel, the pluri-localisation of the Games, or their dynamic format. More importantly, and to some extent surprisingly to us, however, the IOC has also fully embraced sustainability and good governance. Nonetheless, the long-term legacy of the Olympic Agenda 2020 will hinge on the IOC’s determination to be true to these fundamental commitments. Indeed, the devil is always in the implementation, and the laudable intents of some recommendations will depend on future political choices by Olympic bureaucrats. 

For those interested in human rights and democracy at (and around) the Olympics, two aspects are crucial: the IOC’s confession that the autonomy of sport is intimately linked to the quality of its governance standards and the central role the concept of sustainability is to play in the bidding process and the host city contract.  

Good Governance = Autonomy

“Good governance and autonomy are strongly linked; they are two sides of the same coin”

This statement is to be found in the only document that really matters to understand the depth of the reforms envisaged: The context and background report. It is a confession; there is no autonomy of sport, unless this autonomy is in the hands of irreproachable institutions. The IOC is prone to consider itself as abiding to such standard, but it is not for itself to judge. The global public will be the sole arbiter of this pledge to good governance, as the IOC recognises: “Autonomy has to be earned”. 

In this regard, the IOC’s Agenda 2020 proposes a certain number of institutional and “good governance” reforms:

Recommendation 27 Comply with basic principles of good governance

The Agenda 2020 foresees that “all organisations belonging to the Olympic Movement [are] to accept and comply with the Basic universal Principles of Good Governance of the Olympic and Sports movements”. To this end, the organisations will be monitored and mentored and self-evaluation tests (probably similar to WADA’s compliance test) will be introduced. Furthermore, the IOC will update the principles of good governance with the help of a working group composed of “experts”. Obviously, the impact of this recommendation depends very much on the stringency of the monitoring and of the nature of the good governance requirements imposed. 

Recommendation 29: Increase Transparency

The IOC vows to publish financial statements according to the International Financial Reporting Standards and to produce an annual activity and financial report, including the allowance policy for IOC members. This is an important step, since it enables external observers to better scrutinise the financial flows in the Olympic movement and to have a full picture of the allowances received by each individual member of the IOC. It will be easier to follow where the IOC’s money is going and it will make money laundering harder. However, external revenues received by IOC members will stay undeclared, leaving the door open for suspicions.  

Recommendation 30: Strengthen the IOC Ethics Commission independence

This recommendation aims at securing the IOC’s ethics commission independence by proposing to elect its chair and its members via a secret ballot of the Session (the IOC’s parliament, assembling all IOC members). This seems quite an obvious thing in a democratic society, but for an institution versed in nepotism, it is a big step. Once implemented, the nomination process of the members of the Commission will be more difficult to control, and, thus, reinforce the independence of the sole potential counter-power (to the executive board) inside the IOC’s institutional structure. Again, this is no cure-all, and the Ethics Commission has yet to prove itself as an effective control mechanism, but it is a first step towards a more balanced institutional game.

 
Recommendation 32: Strengthen ethics

Here it is suggested to revise the Code of ethics, so that it “be fully aligned with the Olympic Agenda 2020’s drive for more transparency, good governance and accountability”. This is a vague, but potentially important, commitment to rethink the IOC’s Code of Ethics. Only time will tell if this revision will lead to better and accountable governance. In any event, only heightened public scrutiny can force the IOC to adopt governance standard ensuring full transparency and accountability. 

Recommendation 37: Address IOC membership age limit

The IOC is recommending a complex system to allow members over 70 to go beyond the official age limit entrenched in Article 16 of the Olympic Charter. In practice, the Session will be able to vote on allowing each member the right to stay on for maximum four years more than the age limit. This is a (minimal) concession to the IOC members strongly opposed to the age limit.  

Recommendation 38: Implement a targeted recruitment process

Recommendation 38 concerns the selection process of new IOC members. The IOC is no democratic institution. The “citizens” of the Olympic family do not elect their representatives. In fact, the IOC members are not necessarily part of the “Olympic family”. Historically, its selection process has been marred by nepotism (e.g. the Samaranch dynasty) as it is based on co-optation. The Agenda 2020 does not do away with this fundamentally oligarchic procedure, but it is slightly correcting it by empowering (and constraining) the nominations Commission, which is in charge of proposing candidates. The choice of the Commission is to be constrained by specific selection criteria, the most prominent being: gender balance; geographical balance; and the existence of an athletes’ commission within the organisation for representatives of Ifs/NOCs. As from now on, the press and the public will be able to blame the IOC if it does not follow its self-imposed requirements (gender balance being the one to watch closely) in the future. 

Some changes are also on the books concerning the Scope and Composition of IOC Commissions (Recommendation 40). Unfortunately, they are of unclear nature and magnitude.

These institutional innovations, if implemented, are positive steps forward to constrain power inside the IOC and to open it to outside scrutiny. The most remarkable outcome of the Olympic Agenda 2020 remains the crystal clear acknowledgment by IOC that the autonomy of sport is necessarily tied to the quality of the governing processes in place. This essentially means that the Agenda 2020 can only be the beginning of a dynamic institutional reform process that must lead the IOC to be more inclusive of the many constituencies of the sporting world. This is not enough, however; the IOC must also be receptive to the needs of society as a whole.  

Sustainability and Human rights in the bidding process

The bidding process should be at the centre of all critical attention. It is clear that it is the bidding process that entrusts the IOC with real political leverage. At this point, it takes fundamental decisions that will impact the life of millions (if not billions) of citizens Therefore, the brunt of the substantial (in contrast with the institutional measures discussed above) reforms was expected to impact on the bidding procedure (see the joint paper by the Swiss, German, Austrian and Swedish NOCs). It is also on the bidding process that the IOC received the most contributions in the framework of the Agenda 2020 (more than 90). In this regard, Sochi was a wake-up call, due to the abuses recorded on the human rights and anti-discrimination front, and the environmental sustainability side. The IOC Agenda 2020 is not shy of tackling these issues and, with caveats discussed below, should be praised for doing so. First, and this is a fundamental point, the Host City Contract will from now on be made publicly available (for now we only have leaked draft documents as for the 2022 contract). This is a necessary move for an institution claiming to follow good governance principles. Indeed, it will ease the work of critics and commentators scrutinising the contract and the public as a whole will have access to the official document itself.  

Recommendation 1: Shape the bidding process as an invitation

This first recommendation contains a variety of proposals. The spirit of which is “to invite potential candidate cities to present an Olympic project that best matches their sports, economic, social and environmental long-term planning needs”. Thus, for “reasons of sustainability”, the IOC will tolerate that events do not take place in the Host-city but in another nearby city or country (modification of article 34 of the Olympic Charter). The Host City Contract will include a provision banning discriminations, as was previously announced and celebrated by Human Rights Watch. In addition to this, article 21 of the 2022 Host City Contract will impose sustainability requirements on the Host city. Yet, the transformative quality of these provisions is still to be demonstrated. The main point remains that new regulations for the bidding procedure will be drafted. These will be key to set in stone the sustainability and Human rights turn of the Olympic family and will be the place to look at in order to assess whether the IOC is really serious about the changes put forward in the Olympic Agenda 2020.

Recommendation 2: Evaluate bid cities by assessing key opportunities and risks

The evaluation of the bids is key to the IOC’s impact on sustainability or human rights aspects (and not only to ensure that its commercial interests are safeguarded). Hence, it is good news that the IOC is to consider as positive aspects of a bid: “the maximum use of existing facilities and the use of temporary and demountable venues where no long-term venue legacy need exists or can be justified”. Furthermore, the Evaluation Commission is “to benefit from third-party, independent advice in such areas as social, economic and political conditions, with a special focus on sustainability and legacy”. In fact, the final reports by the Evaluation Commission are to include “an assessment of the opportunities and risks of each candidature, as well as of sustainability and legacy” (modification of bye-law to rule 33) and third-party independent risk-assessments are to be conducted. This will be a powerful tool in the hands of NGOs to decisively influence the selection process by providing in depth (and public) assessments of the sustainability of the different bids. It will also, and perhaps mainly, offer critical ammunitions in case the IOC is inclined to disregard the sustainability assessment provided by the Evaluation Commission. There is no rock solid guarantee that the IOC will in the end take into account the sustainability of a bid to allocate the Games. Yet, a full-blown neglect of this assessment would give way to damaging public criticism.  

Recommendation 4: Include sustainability in all aspects of the Olympic Games

This recommendation is aimed at ensuring that sustainability “is included in all aspects of the planning and staging of the Olympic Games”. Sustainability is to be achieved via “a sustainability strategy to enable potential and actual Olympic Games organisers to integrate and implement sustainability measures”. The IOC wants to assist the Organising Committees “to establish the best possible governance for the integration of sustainability throughout the organisation”. To this end, the “[n]ext Host City Contract [is] to reflect, through a number of additional obligations” these policy goals. Moreover, the IOC considers signing a “MoU with the United Nations Environment Programme (UNEP) for possible independent assessment of OCOG sustainability performances”. Again, depending on the extent to which the Host City Contract will be modified, these changes are substantial. However, the UNEP might need concrete commitments to be convinced to deepen its existing collaboration with the IOC, especially after the disaster of the Sochi Games. The Host City Contract is certainly an important lever to impose obligations on the Host City, but to effectively do so it needs to be accompanied by clear and potent procedures ensuring its enforcement.  

Recommendation 5: Include sustainability within the Olympic Movement’s daily operations

The IOC’s administration in its day-to-day operations is to follow sustainability standards. Most notably, it aims to “introduce sustainable sourcing policies in tendering processes, sponsorship, licensing and supplier agreements for renewals or new contracts”. This is an instance of IOC greening its own administrative operations to improve its image. 

Recommendation 14: Strengthen the 6^th Fundamental Principle of Olympism

In a symbolic gesture, the 6^th fundamental principle of Olympism, which forbids all types of discrimination, is to be re-written into a hybrid text of Article 14 of the European Convention of Human Rights and Article 2 of the UN Universal Declaration of Human Rights.  This is a tricky move and guessing the way the new principle will be interpreted in the future is an impossible deed. On one side, it seems that the principle is now completely in line with anti-discrimination standards widely recognised under international law. On the other, one has the impression that the new wording narrows its scope of application. Indeed, discrimination is not “incompatible with belonging to the Olympic Movement” anymore, it is merely inadmissible when exercising the rights and freedom granted by the Olympic charter. In general, this is a symbolic provision, the wording of the Host City Contract or the bidding requirements have way more practical relevance, but this development is not necessarily a sign of a more stringent action from the part of the IOC against discriminations. 

Conclusion: The Devil is in the implementation/interpretation

This leads us to a final, and crucial, caveat. Law is very much about the interpretation of the meaning of words. In our case, the IOC will be the main responsible to give a practical meaning to the sweet words enshrined in the Agenda 2020’s recommendations. Starting with the IOC Session on the 8 and 9 December in Monaco, which will decide on the modifications to the Olympic Charter or its byelaws. The legal meaning of transnational concepts such as sustainability, good governance and discrimination is more or less shared around the globe. The IOC cannot afford to betray it; there is no space for the use of newspeak, or for any other word games leading to a practical disregard of the essential gist of those concepts. The IOC and its president have raised high expectations with this set of recommendations indicating a willingness to change from the side of the Olympic movement. Such expectations cannot be disappointed over and over again; it would certainly be suicidal for the Olympic movement to betray its grand promises. Now comes the time to deliver!

Editor's note (13 July 2015): We (Ben Van Rompuy and I) have just published on SSRN an article on the Pechstein ruling of the OLG. It is available at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2621983. Feel free to download it and to share any feedback with us!

On 15 January 2015, the earth must have been shaking under the offices of the Court of Arbitration for Sport (CAS) in Lausanne when the Oberlandesgericht München announced its decision in the Pechstein case. If not entirely unpredictable, the decision went very far (further than the first instance) in eroding the legal foundations on which sports arbitration rests. It is improbable (though not impossible) that the highest German civil court, the Bundesgerichtshof (BGH), which will most likely be called to pronounce itself in the matter, will entirely dismiss the reasoning of the Oberlandesgericht. This blogpost is a first examination of the legal arguments used (Disclaimer: it is based only on the official press release, the full text of the ruling will be published in the coming months).

The Pechstein Saga

Few are able to remember the start of Claudia Pechstein’s legal crusade through all available jurisdictions in the northern hemisphere[1]. Thus, a concise summary of the previous episodes is in order. Claudia Pechstein is a German Speed-Skater, multiple Olympic Gold Medallist and World Champion. In 2009, she was one of the first athletes caught for doping on the basis of the blood profiling system introduced by the International Skating Union (ISU)[2]. Henceforth, the ISU banned her from all competitions for two years. This triggered a long and embroiled legal saga. She appealed the ban in front of the Court of Arbitration for Sport (CAS), based on an arbitration agreement included in her license with the national and international federations. The CAS dismissed (CAS 2009/A/1912 & 1913 and CAS OG 10/04) her claims and confirmed the two-year ban. Subsequently, she contested (twice!) the award in front of the Swiss Federal Tribunal (Case 4A_612/2009, 10 February 2010 and Case 4A_144/2010, 28 September 2010), but was both times unsuccessful. Her case is also pending before the European Court of Human Rights. Meanwhile, she started an action for damages (around € 4 Million) in front of the local Court of Munich (Landesgericht München). This Court released its judgment on 26 February 2014, despite recognizing the invalidity of the arbitration clause, it considered that the award’s res judicata effect was to be recognized because Pechstein did not contest the competence of CAS when she appealed the ISU’s decision to it. Pechstein decided to appeal the judgment to the Oberlandesgericht München, which in its decision from 15 January 2015 embraced her claims.

The Decision of the Oberlandesgericht München

The overall position of the Oberlandesgericht concerning the CAS award is straightforward. The court considers the arbitration clause between the ISU and Claudia Pechstein as contrary to German (and maybe European) antitrust law, which is part of German public policy, and, therefore, refuses on the basis of Article V (2) (b) New York Convention of 1958 to recognize the validity in Germany of the CAS awards rendered in the Pechstein case. But, why is it so?

First of all, the judges point out a typical (but often overlooked) fact about International Sports Governing bodies: they are monopolists. In other words, they control the market(s) for international sports competitions and nowadays (at least in speed-skating) no professional athlete can afford, if he is to live from his sport, to miss those competitions. Yet, German antitrust law bans an undertaking placed in a dominant position from imposing contractual conditions that differ from what they would be in a normal competitive environment. Hence, the Court held that the ISU was unlawfully imposing onto Claudia Pechstein the signing of a CAS arbitration clause. But, is a forced arbitration clause per se constitutive of an antitrust violation? The Court is subtler. In fact, it acknowledges that an arbitration clause imposed by a Sports Governing Body does not constitute per se an antitrust violation. To the contrary, the Court clearly states that there are good reasons (for example the uniform application of anti-doping regulations) to subject the resolution of sporting disputes between athletes and Sports Governing Bodies to a unique world court for sport. What is the problem then?  

In the eyes of the German court, the problem lies with CAS and its institutional set-up. First of all, the Sports Governing Bodies (International federations, NOCs and IOC) have a decisive influence on who is potentially called to be an arbitrator in CAS arbitration. Here, without clearly alluding to it in the press release, the Court has the closed list of CAS arbitrators in mind. In short, only a predefined number of people can act as arbitrators before CAS. Those arbitrators are appointed on the CAS list by ICAS, the CAS code in force at the time of the case foresaw that 3/5 of the arbitrators were appointed upon proposals made by the Sports Governing Bodies[3]. This has changed. As from the 1 January 2014 the ICAS is free to appoint whomever it deems appropriate on the list[4]. Nevertheless, the Court finds that, at least for the time Pechstein was facing the CAS, the Sports Governing Bodies were in a structurally favourable position regarding the composition of the arbitral panel. In practice, athletes were forced to ratify this disequilibrium due to the monopoly of Sports Governing Bodies on the access to international sporting competitions.

Furthermore, the German judges consider that this imbalance plagues also the nomination process of a president of an arbitral panel. Indeed, under article R54 of the CAS Code, the president of the CAS Appeals Arbitration Division is responsible to nominate the presidents of the panels[5]. However, the president of the CAS appeals division is himself nominated by the ICAS[6], which consists mainly of representatives of the Sports governing bodies[7], and is often a personality close to them[8]. Currently, the ICAS has 20 members, of which 14 have (or had) direct ties with Sports Governing bodies and none is connected to the existing athlete’s unions. This institutional bias entrenches the structural imbalance in favour of the Sports Governing Bodies already identified by the Court apropos the closed list of arbitrators. Thus, the independence of the panel cannot be guaranteed and the fairness of the arbitral process safeguarded. Therefore, in light of the monopolistic position of the ISU and the lack of independence of CAS panels, the imposition of an arbitration clause depriving the athlete of her constitutional right to a judge constitutes a breach of German antitrust law.

Consequently, and contrary to the first instance Landesgericht[9], the Oberlandesgericht refuses to recognize, on the basis of Article 5 par. 2  b) of the 1958 New York Convention, the validity of the CAS awards invoked by ISU to oppose the damage claims raised by Pechstein. The Court leaves open the question of the damage claims, the partial ruling on the jurisdiction being susceptible to an appeal to the highest German civil Court, the BGH.

Towards a Gundel 2.0 for CAS: Reform or die!

The Pechstein Saga is not finished yet; an appeal to the BGH by ISU is to be expected. However, one should not underestimate the symbolic value of the Oberlandesgericht’s ruling and the threat it constitutes to the work of CAS. Indeed, if the ruling were to be confirmed by the BGH it would basically imply that CAS awards are unenforceable in German courts and that athletes may therefore (successfully or not) claim damages against the Sports Governing Bodies imposing sanctions on the basis of these awards. From the press release it remains unclear whether the decision is based solely on German antitrust law or also on EU antitrust law. Nonetheless, this decision might also be constructed as an abuse of a dominant position in the sense of article 102 TFEU and could gain validity in the EU as a whole. This would be a dramatic setback for sports arbitration, nothing short than the death of CAS.

But, it need not come to such extremity. As recognized by the Oberlandesgericht, the CAS fulfils an important function in the sporting world. It is a necessary institution to provide a level legal playing field when issues of doping or transfers are leading to acrimonious transnational disputes. Additionally, it also has advantages for the athletes, as it is usually perceived as cheaper and faster than state justice[10]. All of this is duly acknowledged in the decision. In short, what the German Court is asking for is an institutional reform of CAS. This restructuring would entail a fundamental reshuffling of the internal functioning of the CAS. Indeed, the German judges have identified the two main weak points of CAS, the forced arbitration coupled with its lack of independence[11]. The forced arbitration can be accepted if, and only if, the structural independence of CAS from the Sports Governing Bodies is warranted[12]. The challenge to CAS can be formulated as follows: cut the ties that bind you to the Sports Governing Bodies or we will not accept the validity of the arbitration clause underpinning your competence.

In fact, the CAS was at a fairly similar (less dramatic) crossroad after the Gundel case of the Swiss Federal Tribunal in 1993[13]. In the Gundel case, the SFT recognized the independence of CAS but also clearly indicated that it would not do so if the IOC were a party to a dispute in front of CAS. This led to what is known as the Paris agreement, an in depth structural reform of CAS[14]. Mainly, the ICAS was created to separate the management of CAS from the IOC. The SFT expressed its satisfaction with the reforms in its famous Lazutina case and blessed the CAS with the full recognition of its independence[15]. This, however, did not mean that the recognition of the independence of CAS was legally a given beyond Switzerland. To the contrary, it was (and is) still hotly debated in the literature[16]. Now, the German court basically says the Paris agreement is not enough, we need a new one, ensuring that athletes (and other stakeholders like clubs or supporters) get a true say in the ICAS. It is time for the CAS’s institutional structure to better reflect the diversity of actors affected by its decisions. If not, CAS awards will not be recognized in Germany and, by extension, the entire territory of the EU, thus leading the sports justice into a profound crisis.

[1] All the relevant legal documents are available on her website at http://www.claudia-pechstein.de/gerichtsunterlagen.php

[2] On the dispute see D. McArdle, ‘Longitudinal Profiling, Sports Arbitration and The Woman Who Had Nothing to Lose. Some Thoughts on Pechstein v International Skating Union”, available at https://dspace.stir.ac.uk/bitstream/1893/3356/1/Pechstein%20final.pdf

[3] Article S14 CAS Code, edition 2004

[4] The new article S14 CAS Code reads as follows:

« In establishing the list of CAS arbitrators, ICAS shall call upon personalities with appropriate legal training, recognized competence with regard to sports law and/or international arbitration, a good knowledge of sport in general and a good command of at least one CAS working language, whose names and qualifications are brought to the attention of ICAS, including by the IOC, the IFs and the NOCs. ICAS may identify the arbitrators with a specific expertise to deal with certain types of disputes. »

[5] Article R54 CAS Code 2004 (and 2014) reads as follows: “If three arbitrators are to be appointed, the President of the Division shall appoint the President of the Panel upon appointment of the arbitrator by the Respondent and after having consulted the arbitrators.”

[6] Article S6 par.2 CAS Code 2004 (and 2014)

[7] Article S4 CAS Code 2014 foresees that:
« ICAS is composed of twenty members, experienced jurists appointed in the following manner :

1.     four members are appointed by the International Federations (IFs), viz. three by the Association of Summer Olympic IFs (ASOIF) and one by the Association of the Winter Olympic IFs (AIOWF), chosen from within or outside their membership;

2.     four members are appointed by the Association of the National Olympic Committees (ANOC), chosen from within or outside its membership;

3.     four members are appointed by the International Olympic Committee (IOC), chosen from within or outside its membership;

4.     four members are appointed by the twelve members of ICAS listed above, after appropriate consultation with a view to safeguarding the interests of the athletes;

5.     four members are appointed by the sixteen members of ICAS listed above, chosen from among personalities independent of the bodies designating the other members of the ICAS. »

[8] The current president, Corinne Schmidhauser, is a member of the Legal Committee of the Fédération Internationale de Ski (International Ski Federation). It is surely telling that Thomas Bach, the current IOC president, was her predecessor at that post.

[9] The first instance Court (Landesgericht München) considered that due to Pechstein’s appeal and lack of contestation of the CAS’s competence, the award had gained res judicata effect. See paragraphs  IV.2) of the judgment.

[10] A point made by D. Yi, ‘Turning medals into metal:  Evaluating the Court of Arbitration for Sport as an International tribunal’, available at http://digitalcommons.law.yale.edu/cgi/viewcontent.cgi?article=1024&context=student_papers

[11] Antonio Rigozzi has highlighted these weaknesses in his Phd thesis, see A. Rigozzi L’arbitrage international en matière de sport, Bruylant, 2005, pp.273-349 and 421-426. See also, M. Maisonneuve, L’arbitrage des litiges sportifs, L.G.D.J, 2011, pp. 141-221 and pp. 267-313.

[12] In principle the Swiss Federal Tribunal has a similar view outlined in the Cañas case (4P.172/2006), but it considers that the CAS already offers « sufficient guarantees of independence and impartiality » (par. 4.3.2.3.). Thus, its assessment of the CAS’s independence is diametrically opposed to the one conducted by the Oberlandesgericht.

[13] Decision 4P.217/1992 of 15 March 1993 (Gundel v FEI), ATF 119 II 271, translated in CAS Digest I,.p. 545

[14] For an introduction on the Paris agreement see, http://www.tas-cas.org/en/general-information/history-of-the-cas.html#c74

[15] Decision 4P.267–270/2002 du 27 mai 2003, Lazutina c. CIO, ATF 129 III 445, Bull. ASA 2003, p. 601

[16] For a recent contribution to this debate see A. Vaitiekunas, The Court of Arbitration for Sport : Law-making and the question of independence, Stämpfli Publishers, 2014