Editor’s note: Stefano Bastianon is Associate Professor in EU Law and EU sports law at the University of Bergamo and lawyer admitted to the Busto Arsizio bar.

1. EU law and the CAS case-law

Bearing in mind these questions, it is possible to affirm that under EU law, the specificity of sport

i) refers to the inherent characteristics of sport that set it apart from other economic and social activities and which have to be taken into account in assessing the compatibility of sporting rules with EU law; and

ii) under EU law these inherent characteristics of sport must be  considered on a case by case  basis, per the Wouters test as developed by the ECJ in the Meca Medina ruling.

Both aspects can be found in the CAS case-law too, although the CAS case-law shows some remarkable differences and peculiarities. From a general point of view, the application of the principle of specificity of sport in the CAS case-law represents an aspect of the more general issue related to the application of EU law by the CAS. However, the purpose of this paper is not to fully examine if and to what extent the CAS arbitrators apply EU law rules on free movement and competition; rather, the aim is to analyse the way the CAS deals with the concept of the specificity of sport, highlighting similarities and differences compared to the ECJ.

Taking for granted that ‘a CAS panel is not only allowed, but also obliged to deal with the issues involving the application of [EU] law’,[1] as far as the compatibility of sporting rules with EU law is concerned the CAS case-law shows different degrees of engagement. For instance, in the ENIC award concerning the so-called UEFA integrity rule, the CAS panel went through a complete competition-law analysis in perfect harmony with the Wouters et al. ruling by the ECJ.[2] On the contrary, in the above-quoted Mutu case, the issue of compatibility of the FIFA’s transfer regulations with EU competition law was analysed in a rather simple way, merely stating that the FIFA rules at stake were not anti-competitive under EU competition law without giving any reason to support this conclusion. More recently, in the Galatasaray and Milan A.C. awards, concerning the UEFA’s financial fair-play regulations, the CAS  applied a detailed analysis of EU competition law. However, in both cases, according to the CAS the proportionate character of sanctions listed in the UEFA’s financial fair-play regulations cannot affect the evaluation of the legitimacy of these regulations under Art. 101 TFEU. This conclusion represents a clear breaking point with respect to the ECJ case-law, according to which the evaluation of the restrictive effects of a rule necessarily presupposes the analysis of the proportionate character of the sanction imposed in the event of a violation of that rule as well.[3]   In regard to EU free movement, the CAS case-law tends to be less analytical in terms of the principle of proportionality. For instance, in the RFC Seraing award  which concerned both EU free movement and competition law, the CAS panel mainly focused on the legitimate objectives of the contested rule (FIFA’s ban on Third-Party Ownership – TPO), merely affirming that the restrictive measures under EU free movement were justified and inherent in the pursuit of those objectives.

2. Art. 17 FIFA RSTP and the specificity of sport

In practice, the CAS case-law on the specificity of sport is mainly related to the application of Art. 17 (1) of the FIFA Regulations on the status and transfer of players concerning the consequences of terminating a contract without just cause.[4] According to Art. 17(1), ‘the party in breach shall pay compensation. Subject to the provisions of Art. 20 and Annexe 4 in relation to training compensation, and unless otherwise provided for in the contract, compensation for the breach shall be calculated with due consideration for the law of the country concerned, the specificity of sport, and any other objective criteria. These criteria shall include, in particular, the remuneration and other benefits due to the player under the existing contract and/or the new contract, the time remaining on the existing contract up to a maximum of five years, the fees and expenses paid or incurred by the former club (amortised over the term of the contract) and whether the contractual breach falls within a protected period’.

Although written in very general terms, from Art. 17(1) it is possible to derive that:

 i) it does not provide the legal basis for a party to freely terminate an existing contract at any time, prematurely, without just cause;

ii) the provision clarifies that  compensation is due;

iii) the amount of compensation to be awarded must necessarily take into account all of the specific circumstances of the case. It is for this reason that Art. 17.1 of the FIFA RSTP does not establish a single criterion or even a set of rigid rules, but rather provides guidelines to be applied to fix  just and fair compensation.

It is evident that Art. 17 of the FIFA RSTP involves or points to the specificity of sport. Beyond what Art. 17 implicitly states, the CAS case-law has contributed to defining the scope of the specificity of sport.

To fully understand the relevance of specificity of sport in the context of Art. 17 FIFA RSTP, it is important to investigate the rationale of this provision as well as the principle of positive interest. To expand, the rationale of the rule is to foster the maintenance of contractual stability between professionals and clubs. In the post-Bosman era, the concept of contractual stability was introduced to replace the former transfer-fee system by compensation due for the breach or undue termination of an existing agreement.[5] According to the CAS jurisprudence, Art. 17 of FIFA RSTP plays a central role: ‘the purpose of Art. 17 is basically nothing else than to reinforce contractual stability, i.e. to strengthen the principle of pacta sunt servanda in the world of international football, by acting as deterrent against unilateral contractual breaches and terminations, be it breaches committed by a club or by a player. This, because contractual stability is crucial for the well functioning of the international football. The principle pacta sunt servanda shall apply to all stakeholders, "small" and "big" clubs, unknown and top players, employees and employers, notwithstanding their importance, role or power. The deterrent effect of Art. 17 FIFA Regulations shall be achieved through the impending risk for a party to incur disciplinary sanctions, if some conditions are met (cf. Art. 17 para. 3 to 5 FIFA Regulations), and, in any event, the risk to have to pay a compensation for the damage caused by the breach or the unjustified termination. In other words, both players and club are warned: if one does breach or terminate a contract without just cause, a financial compensation is due, and such compensation is to be calculated in accordance with all those elements of Art. 17 FIFA Regulations that are applicable in the matter at stake, including all the non-exclusive criteria listed in para. 1 of said article that, based on the circumstances of the single case, the panel will consider appropriate to apply’.[6]

The concept of positive interest, is strictly linked to the way of calculating the compensation. In case of breach or unjustified termination of the contract, the judging body will have to establish the damage suffered by the injured party, taking into consideration the circumstances of the case, the arguments raised by the parties and the evidence produced. In so doing the judging authority shall be led by the principle of the so-called positive interest (or “expectation interest”), i.e. it will determine an amount geared towards placing the injured or aggrieved party in the position they would otherwise have been, had the contract been performed .[7] More specifically, according to the CAS case-law, ‘the principle of the “positive interest” shall apply not only in the event of an unjustified termination or a breach by a player, but also when the party in breach is the club. Accordingly, the judging authority should not satisfy itself in assessing the damage suffered by the player by only calculating the net difference between the remuneration due under the existing contract and a remuneration received by the player from a third party. Rather, the judging authority will have to apply the same degree of diligent and transparent review of all the objective criteria, including the specificity of sport, as foreseen in Art. 17 FIFA Regulations’.[8]

Pursuant to the above-mentioned jurisprudence, in the joint cases FC Shakhtar Donetsk (Ukraine) v/ Mr. Matuzalem Francelino da Silva (Brazil) & Real Zaragoza SAD (Spain) & FIFA and Mr. Matuzalem Francelino da Silva (Brazil) & Real Zaragoza SAD (Spain) v/ FC Shakhtar Donetsk (Ukraine) & FIFA, the Panel emphasised that ‘by asking the judging authorities, i.e. the competent FIFA bodies and, in the event of an appeal, the CAS, to duly consider a whole series of elements, including such a wide concept like "sport specificity", and asking the judging authority to even consider "any other objective criteria", the authors of Art. 17 FIFA Regulations achieved a balanced system according to which the judging body has on one side the duty to duly consider all the circumstances of the case and all the objective criteria available, and on the other side a considerable scope of discretion, so that any party should be well advised to respect an existing contract as the financial consequences of a breach or a termination without just cause would be, in their size and amount, rather unpredictable. At the end, however, the calculation made by the judging authority shall be not only just and fair, but also transparent and comprehensible’.^[9]

Similarly, in the joint cases FC Sion v. Fédération Internationale de Football Association (FIFA) & Al-Ahly Sporting Club and E. v. Fédération Internationale de Football Association (FIFA) & Al-Ahly Sporting Club, according to the Panel ‘Art. 17.1 of the FIFA Transfer Regulations also asks the judging body to take into due consideration the “specificity of sport”, that is the specific nature and needs of sport, so as to attain a solution which takes into account not only the interests of the player and the club, but also, more broadly, those of the whole football community (…). Based on this criterion, the judging body should therefore assess the amount of compensation payable by a party keeping duly in mind that the dispute is taking place in the somehow special world of sport. In other words, the judging body should aim at reaching a solution that is legally correct, and that is also appropriate upon an analysis of the specific nature of the sporting interests at stake, the sporting circumstances and the sporting issues inherent to the single case (…). Taking into account the specific circumstances and the course of the events, a CAS panel might consider as guidance that, under certain national laws, a judging authority is allowed to grant a certain “special indemnity” in the event of an unjustified termination. The specific circumstances of a sports case might therefore lead a panel to either increase or decrease the amount of awarded compensation because of the specificity of sport (…). However, in the Panel’s view, the concept of specificity of sport only serves the purpose of verifying the solution reached otherwise prior to assessing the final amount of compensation. In other words, the specificity of sport is subordinated, as a possible correcting factor, to the other factors’.[10]

Pursuant to such case-law, in the well-known Webster cases the CAS referred to the specificity of sport from two different perspectives:

i) based on the fact that Art. 17.1 expressly refers to the specificity of sport and that it is in the interest of football that solutions to compensation be based on uniform criteria rather than on provisions of national law chosen by the parties led the panel to the conclusion that it was not appropriate to apply the general principles of Scottish law on damages for breach of contract;

ii) the Panel recalled that ‘in light of the history of Art. 17 (…) the specificity of sport is a reference to the goal of finding particular solutions for the football world which enable those applying the provision to strike a reasonable balance between the needs of contractual stability, on the one hand, and the needs of free movement of players, on the other hand, i.e. to find solutions that foster the good of football by reconciling in a fair manner the various and sometimes contradictory interests of clubs and players’.[11]

More specifically, in FC Pyunik Yerevan v. L., AFC Rapid Bucaresti & FIFA, the panel considered ‘that the specificity of the sport must obviously take the independent nature of the sport, the free movement of the players (…) but also the football as a market, into consideration. In the Panel's view, the specificity of the sport does not conflict with the principle of contractual stability and the right of the injured party to be compensated for all the loss and damage incurred as a consequence of the other party’s breach. This rule is valid whether the breach is by a player or a club. The criterion of specificity of sport shall be used by a panel to verify that the solution reached is just and fair not only under a strict civil (or common) law point of view, but also taking into due consideration the specific nature and needs of the football world (and of parties being stakeholders in such world) and reaching therefore a decision which can be recognised as being an appropriate evaluation of the interests at stake, and does so fit in the landscape of international football. Therefore, when weighing the specificity of the sport a panel may consider the specific nature of damages that a breach by a player of his employment contract with a club may cause. In particular, a panel may consider that in the world of football, players are the main asset of a club, both in terms of their sporting value in the service for the teams for which they play, but also from a rather economic view, like for instance in relation of their valuation in the balance sheet of a certain club, if any, their value for merchandising activities or the possible gain which can be made in the event of their transfer to another club. Taking into consideration all of the above, the asset comprised by a player is obviously an aspect which cannot be fully ignored when considering the compensation to be awarded for a breach of contract by a player’.[12]

In Al Gharafa S.C. & M. Bresciano v. Al Nasr S.C. & FIFA, the panel first identified the following basic principles:

i)  the fundamental importance to reach a solution that is legally correct and appropriate to the specific nature of the sporting interests at stake, and

ii)  the sporting circumstances and the sporting issues inherent to the single case;

The panel then underlined that ‘the “specificity of sport” is not an additional head of compensation, nor a criteria allowing to decide in ex aequo et bono, but a correcting factor which allows the Panel to take into consideration other objective elements which are not envisaged under the other criteria of Art. 17 RSTP”.[13] On that basis, the panel decided to increase the amount of compensation for  damages, taking into account the sporting importance of the player for the team and the behaviour of the player at the time of the termination. To the contrary, in FC Senica A.S. v. Vladimir Vukajlovic & FIFA, the panel referred to the specificity of sport and that neither club  or player was interested in maintaining their labour relationship, as the basis for excluding any compensation to the player.[14]

3. Concluding remarks

It should be rather clear that the concept of specificity of sport has different meanings and purposes in the ECJ and CAS jurisprudence. According to the ECJ case-law, ante its Meca Medina ruling, the reference to the special character of sport was a way to deal with purely sporting rules in the context of EU law; on the contrary, after the judgment in 2006, this approach seems rather questionable. Unfortunately, at present the specificity of sport looks less like a guiding principle than a concept in search of itself. Perhaps also for this reason the ECJ has always carefully avoided defining it or expressly mentioning it; at the same time, the 2011 definition by the Commission – i.e. the specificity of sport encompasses all the characteristics that make sport special – sounds rather tautological.On the contrary, in the CAS case-law the concept of specificity of sport is expressly referred to in cases of breach or unjustified termination of football contracts and amounts to a criterion, among others, to be taken into account to make the compensation just and fair not only under a strict civil law point of view but also taking into due consideration the specific nature and needs of the football world. In this context, according to the CAS jurisprudence the specificity of sport is neither an additional basis for compensation nor a criterion allowing a decision one way or the other in equity. Instead, it represents a correcting factor allowing the panel to award extra compensation in cases where the panel is not convinced that the costs so far awarded fully compensate the party entitled to compensation under Art. 17 FIFA RSTP. That said, the concept of specificity of sport remains rather unclear and vague in the CAS case-law as well.

[1] CAS 2008/A/1644 Adrian Mutu v. Chelsea Football Club Limited, award of 31 July 2009, para. 100,

[2] CAS 98/200 AEK Athens and SK Slavia Prague / Union of European Football Associations (UEFA).

[3] See S. Bastianon, The proportionality test under Art. 101 (1) TFEU and the legitimacy of UEFA Financial fair-play regulations: From the Meca Medina and Majcen ruling of the European Court of Justice to the Galatasaray and AC Milan awards of the Court of Arbitration for Sport, 14 October 2018, https://www.asser.nl/SportsLaw/Blog/

[4] M. Colucci, F. Majani, The specificity of sport as a way to calculate compensation in case of breach of contract, European Sports Law and Policy Bulletin, 1/2011, p. 125.

[5]M. Colucci, R. Favella, La stabilità contrattuale nei regolamenti FIFA e nella giurisprudenza rilevante, RDES, 1/2022, p. 39; K. Futtrup Kjær, Substituting at Half-Time: Contractual Stability in the World of Football, https://law.au.dk/fileadmin/Jura/dokumenter/forskning/rettid/Afh_2017/afh1-2017.pdf

[6] CAS 2008/A/1519-1520, para 80.

[7] ‘Given that the compensation to be granted derives from a breach or unjustified termination of a valid contract, it will be guided in calculating the compensation due by the principle of the so-called “positive interest” or “expectation interest”… [and] accordingly… determin[e] an amount which shall basically put the injured party in the position that the same party would have had if no contractual breach had occurred’ (CAS 2009/A/1880 & 1881, at para. 80).

[8] CAS 2008/A/1519-1520, para 88

[9] CAS 2008/A/1519 and CAS 2008/A/1520, para 89.

[10] CAS 2009/A/1880 and CAS 2009/A/1881, para 109.

[11] CAS 2007/A/1298; CAS 2007/A/1299; CAS 2007/A/1300, para 40.

[12] CAS 2007/A/1358, para 40.

[13] CAS 2013/A/3411, para 118.

[14] CAS 2013/A/3089, para 83.