Competition Law and Sport SYMPOSIUM

Edited by:

David Pérez de Lamo and Lewis Reed

Table of Contents

1. Editorial

David Pérez de Lamo and Lewis Reed

2. Is Sport ‘Special’?

Stephen Weatherill

3. The Court of Justice moves and then fixes the goalposts on how EU law applies to sport

Dr Andrea Cattaneo and Professor Richard Parrish

4. ISU, Superleague and Royal Antwerp Cases: from Specialty Towards Efficiency

Rusa Agafonova

5. The CJEU Rulings in ESL, ISU and Royal Antwerp: Looks like the Competition Cavalry’s Arrived!

Stefaan Van den Bogaert

6. Legality of UEFA’s Prior Authorisation System in C-333/21 European Super League

Dr. Katarina Pijetlovic

7. European Sports Model and Competitive Markets: Two Worlds Connected by European Superleague Company (C-333/21) and International Skating Union (C-124/21 P)

José Luís da Cruz Vilaça and Mariana Martins Pereira

8. Taking EU (Competition) Law outside of the Court of Arbitration for Sport (Case C-124/21 P International Skating Union v Commission)

Antoine Duval and Ben Van Rompuy

9. An Open Goal to Improve Sports Governance - Comments on Royal Antwerp Football Club (C -680/21)

Robby Houben and Jan Blockx

10. Agent Fees, Player Transfers, and Transnational Leagues: What Lies Ahead for EU Football Law? Guillermo Íñiguez

11. Who’s Next in the Queue? Sports Cases Pending before the European Court Marcos Araujo

12. FIFA Football Agents Case In The Wake Of Recent Competition Law Rulings

Oriol Armengol and Fiona Radley-Searle

David Pérez de Lamo and Lewis Reed

“Nobody roots for Goliath.”

Wilt Chamberlain

“Every kid around the world who plays soccer wants to be Pelé. I have a great responsibility to show them not just how to be like a soccer player, but how to be like a man.”

Pelé

“I’ll let the racket do the talking.”

John McEnroe

“We have to change from doubters to believers. Now.”

Jürgen Klopp

21 December 2023 was the most important day for the intersection between EU law and sport since Bosman (C415/93). The Grand Chamber of the Court of Justice delivered three much-awaited rulings in the landmark cases European Superleague Company (C-333/21), International Skating Union v Commission (C-124/21 P) and Royal Antwerp Football Club (C-680/21). In European Superleague and International Skating Union, the Court of Justice ruled on the compatibility of FIFA/UEFA’s and the International Skating Union (‘ISU’)’s pre-authorisation rules of parallel competitions with EU competition law and free movement rules. In International Skating Union, the Court of Justice also assessed whether dispute resolution rules in sports federations that attribute exclusive jurisdiction to the Court of Arbitration for Sport (‘CAS’) in Lausanne, Switzerland, offer an effective judicial remedy under EU law. Finally, in Royal Antwerp, the Court of Justice ruled on the compatibility of UEFA’s and the Belgian football association’s rules on ‘home-grown players’ with EU competition law and free movement of workers.

The three rulings discussed fundamental questions of EU competition law, which are bound to have important implications for the organisation of sport across the EU, but also for the system of EU competition law more broadly. Among others, the Court of Justice addressed the place of sport in EU law, the dual role of sports federations as governing bodies and market-participants, the procedural obligations that sports federations should abide by when limiting access by challengers to the market with the aim of pursuing legitimate objectives, the scope of the Wouters/ Meca-Medina ancillary restraints doctrine, the ‘by object’ vs ‘by effect’ classification, the relationship between free movement and competition rules, and judicial remedies in sport.

Given the broad-ranging issues, we structured the symposium in three parts.

First, to set the scene, certain authors had to present the relationship between EU law and sport from a general perspective:

− “Is Sport ‘Special’?” by Stephen Weatherill

− “ The Court of Justice moves and then fixes the goalposts on how EU law applies to sport ” by Dr Andrea Cattaneo and Professor Richard Parrish

Second, other authors had to discuss the details of the European Superleague, International Skating Union, and Royal Antwerp judgments. Due to the relevance of these cases, and the passionate debate surrounding them, we invited multiple authors from different backgrounds to discuss each of the judgments:

− “ISU, Superleague and Royal Antwerp Cases: from Specialty Towards Efficiency ” by Rusa Agafonova

− “ The CJEU Rulings in ESL, ISU and Royal Antwerp: Looks like the Competition Cavalry’s Arrived!” by Stefaan Van den Bogaert

− “Legality of UEFA’s Prior Authorisation System in C-333/21 European Super League” by Dr. Katarina Pijetlovic

− “European Sports Model and Competitive Markets: Two Worlds Connected by European Superleague Company (C-333/21) and International Skating Union (C-124/21 P)” by José Luís da Cruz Vilaça and Mariana Martins Pereira

− “ Taking EU (Competition) Law outside of the Court of Arbitration for Sport (Case C-124/21 P International Skating Union v Commission)” by Antoine Duval and Ben Van Rompuy

− “An Open Goal to Improve Sports Governance – Comments on Royal Antwerp Football Club (C-680/21)” by Robby Houben and Jan Blockx

Third, a final group of authors had to focus on the implications of the European Superleague, International Skating Union, and Royal Antwerp judgments for pending cases at the intersection between EU competition law and sport, such as the football agents case (RRC Sports and ROGON), Diarra, etc.:

− “Agent Fees, Player Transfers, and Transnational Leagues: What Lies Ahead for EU Football Law?” by Guillermo Íñiguez

− “ Who’s Next in the Queue? Sports Cases Pending before the European Court” by Marcos Araujo

− “FIFA Football Agents Case In The Wake Of Recent Competition Law Rulings” by Oriol Armengol and Fiona Radley-Searle

The outcome is a fascinating symposium that those who are passionate about EU competition law and/or sport definitely should not miss. Our grateful thanks to the authors for their brilliant pieces, as well as their availability and engagement with the editorial process.

We hope that you enjoy this symposium as much as we did.

In no way can the views set out in this symposium be attributed to the editors or their employers/clients.

Is Sport ‘Special’?

Stephen Weatherill

Is sport special? Of course it is. A sausage-maker dreams of the profits to be made as the world’s only supplier of sausages, but football clubs need opponents. And there is no entity which dictates the size and shape of sausages, whereas in sport there is typically a governing body which sets the ‘rules of the game’ for the whole world.

But sport is not as special as its governing bodies sometimes claim. They have a powerful thirst for autonomy from political intervention and legal regulation, and, although their case may on occasion be convincing, it may on others be no more than a device to protect entrenched interests. The intellectual heart of sports law is distinguishing between self-interested pleading for autonomy and instances where sport is genuinely ‘special’.

In the EU sporting practices with economic effects are subject to EU internal market law, just as practices with economic effects in any sector are subject to EU internal market law. EU law grants no absolute autonomy to sport. But the Court interprets EU law to allow a ‘conditional autonomy’ to sport: that is, sporting practices may be applied in the EU on condition that it be demonstrated that they are necessary to achieve legitimate objectives. And that formula opens up space to reflect on what truly is required to secure the integrity of a sport.

EU law’s sensitivity to sport’s special features is recognised by Article 165 TFEU. It provides that ‘[t]he Union shall contribute to the promotion of European sporting issues, while taking account of the specific nature of sport’. But this is simply another way to frame the question. It fails to tell us what is the specific nature of sport, it simply advises us that there is such a thing. Sport is special – but how, why, and with what legal implications?

The choice is beautifully captured by the difference of opinion between Advocate General Rantos in European Superleague Company SL v FIFA, UEFA (Case C-333/21) and Advocate General Szpunar in UL, SA Royal Antwerp Football Club v URBSFA, UEFA (Case C-680/21). For Rantos, Article 165 TFEU gives expression to the constitutional recognition of the European Sports Model. His Opinion is strongly and uncritically protective of the existing role of the governing body, in casu UEFA, as a defender of the pyramid or top-down structure of football governance which requires that any new entrant into the market to supply football competitions shall obtain authorisation from UEFA. Remember that UEFA itself is already a supplier of football competitions on this market. By contrast, Szpunar warned that UEFA cannot obtain a blank cheque for the purposes of restrictions on the fundamental freedom of Article 45 TFEU by reference to Article 165 TFEU, and he added the sceptical note that UEFA exercises both regulatory and economic functions which are not separated, and so conflicts of interest are bound to arise. UEFA, he noted, would be behaving irrationally if it attempted to further public objectives which ran directly counter to its commercial interests.

These are fundamentally different perspectives on the same phenomenon, namely the modern character of a governing body in sport. The Grand Chamber of the Court delivered its rulings in both these two cases (and also in International Skating Union v Commission (Case C-124/21 P)) on 21 December 2023. The Court’s rulings offer a different take again on Article 165 TFEU, which reveals just how unclear this area of law truly is, though the Court’s approach was a great deal closer to Szpunar than to Rantos. The Court treats Article 165 TFEU as a legal basis authorising the EU to exercise the defined supporting competence in the field covered, and rules that its location in Part Three of the TFEU, devoted to ‘Union policies and internal actions’, rather than in Part One, which contains provisions of principle including ‘provisions having general application’, means that Article 165 TFEU ‘is not a cross-cutting provision having general application’ (ESL, para 100, Royal Antwerp, para 68). This means that the objectives listed in and action taken pursuant to Article 165 TFEU need not be integrated or taken into account in a binding manner in the application of the Treaty provisions on the internal market. Moreover – and entirely unsurprisingly – the Court states that Article 165 TFEU is not a special rule exempting sport from primary EU law. And once the section of the rulings in ESL and Royal Antwerp which addresses Article 165 TFEU is concluded, the Court places no reliance on it in the subsequent extended legal analysis.

However, this does not mean that the Court shuts out sport’s special characteristics from its analysis. Quite the reverse! It chooses to root readiness to accommodate such concerns in the interpretation of internal market law in its own accumulated case law, but not according to the direction provided by Article 165 TFEU. Sporting activity carries considerable social and educational importance; it has specific characteristics; football is ‘of considerable social and cultural importance in the European Union’. Who says? The Court says! It cites Bosman (C-415/93), Olympique Lyonnais (C-325/08), TopFit and Biffi (C-22/18), and Lehtonen and Castors Braine (C-176/96). So the practices of governing bodies in sport must be assessed in the context in which they are to be implemented, including assessment of the nature, organisation or functioning of the sport concerned and, more specifically, how professionalised it is, the manner in which it is practised, the manner of interaction between the various participating stakeholders and the role played by the structures and bodies responsible for it at all levels (ESL 105, Royal Antwerp 73, ISU 96). Article 165 TFEU is downplayed by the Court in its rulings of 21 December, but the relevance of sport’s special features to the interpretation of internal market law, nurtured by the Court ever since its very first ruling applying EU law to sport in 1974 (Walrave and Koch v UCI, Case 36/74), is not altered.

UEFA, FIFA and many other similar bodies in other sports have their historical roots in the need to agree the way that a sport shall be organised – to set the rules of the game. But over time, as sport has become ever more commercially significant, they have incrementally gathered within their remit a wide range of functions, including sale of media rights, acquisition of sponsors, and more generally still the protection of minors, gender equality, the promotion of human rights and so on. This goes beyond the rules of the game. The principal anxiety is that the exercise of the regulatory role may be influenced by the governing body’s own commercial incentives – that the bundling of regulatory and commercial functions causes a conflict of interest. It is here that the most sensitive disputes arise. Designing the offside rule is one thing – increasing the number of participants in the World Cup, so that there are many more games to sell, is another. Or – to draw directly on the Court’s case law – excluding athletes who have fallen foul of an anti-doping regime is one thing (Meca-Medina and Majcen v Commission, Case C-519/04 P), whereas excluding athletes who propose to take part in a new competition which the governing body has chosen not to authorise is another (International Skating Union v Commission, Case C-124/21 P). The thematic question which binds together all of the Court’s rulings is not ‘is sport special?’ – it is – but rather ‘how and why is sport special, and with what consequences for the interpretation and application of EU law?’.

The rulings of 21 December 2023 are certainly important in helping us to answer these questions, but do not exaggerate their impact. The complete absence of due process in the prior approval schemes of UEFA and the ISU, and the consequent reek of suspicion that practice favoured the governing body’s commercial interests as organisers at the expense of third party market entrants, led easily to a finding that what was at stake was a restriction of competition by object. Sport is not ‘special’ enough to justify such pernicious practices! But most regulatory practices of governing bodies would – one would hope – not be contaminated by such obvious conflicts of interest, and so most regulatory practices of governing bodies would be unlikely to be treated as restrictions of competition by object, and so their effects fall to be assessed with reference to their objectives in order to consider whether the consequential effects restrictive of competition are inherent in the pursuit of those objectives and are proportionate to them (Wouters and Others, C-309/99, Meca-Medina and Majcen v Commission, C-519/04 P). This would seem to me to be the way in which practices such as anti-doping, transfers, Financial Fair Play, and the regulation of agents would be checked for compliance with EU law. Notice too that even in the rulings of 21 December 2023 the Court approves of sporting merit as the guiding criterion for access to competitions (ESL para 143, 144, 175, 176, 253), which appears to mean that refusing to approve a ‘closed’ league (and imposing penalties on participants) is a legitimate exercise of the gatekeeping function exercised by a governing body, even if such a refusal prevents the entry into the market of a new competition. It seems that certain types of competition – here, ones not based on sporting merit – are simply not legitimate: sporting reasons justify their suppression. EU law recognises that sport is ‘special’.

The immediate future of EU sports law is likely to focus on clarifying just when a governing body’s practices count as restrictions of competition by object which may be exempted only according to the criteria in Article 101(3) TFEU and when instead they may be assessed more broadly as means to protect the integrity of sport. The next test: the case brought by agents to challenge FIFA’s 2023 Football Agent Regulations (‘FFAR’) (Case C-209/23, Case C-428/23). An intriguing question is whether pressure will grow to move beyond EU sports law as an ad hoc collection of the accidents of litigation, apt only to generate ex post facto insight into whether chosen practices comply with EU law, and instead to craft another story, one involving more systematic EU rules. I do not underestimate the difficulty in generating the necessary political will, but I believe there would be huge value in the development of EU legislation defining a governance pattern for sport in the EU internal market, in order to achieve predictability and to address the governance failings laid bare in too many of the Court’s rulings on governance in sport, including those of 21 December 2023.

Stephen Weatherill is Jacques Delors Professor of European Law (Emeritus), Somerville College and Faculty of Law, University of Oxford.

SUGGESTED CITATION: Weatherill. S; “Is Sport ‘Special’?”, EU Law Live, 23/01/2024, https://eulawlive.com/competition-corner/op-ed-is-sport-special-by-stephen-weatherill/

The Court of Justice moves and then fixes the goalposts on how EU law applies to sport

Dr Andrea Cattaneo and Professor Richard Parrish

On 21st December 2023, the Grand Chamber of the Court of Justice of the European Union (CJEU) delivered three judgments that have implications for international sports governance and the approach judicial and arbitral bodies will adopt when applying EU law to sporting disputes.

ISU

The International Skating Union (ISU), as the governing body for figure skating and speed skating, has established rules for its discipline, including prior authorisation rules for international competitions, eligibility rules for athletes, and arbitration rules for the resolution of disputes. Under the authorisation rules, any third-party organiser needs to apply to ISU to have its event sanctioned. The eligibility rules included the prospect of a long ban for athletes participating in unauthorised competitions.

In 2014, two speed skaters complained to the European Commission arguing that as ISU was both organising events and exercising power to authorise third-party events, these rules violated EU competition law. The complaint led to a Decision in 2017, which was appealed by ISU before the General Court in 2020 and then to the Court of Justice.

In December 2023, the Court of Justice held that when an undertaking that is economically active in a market can exercise the power to decide which other entity is authorised to participate in such a market, the exercise of such power must be subject to restrictions, obligations and review. Ultimately, while the governing body’s authority to set rules remains untouched, such power cannot be exercised to unduly restrict the access of third parties to the market. The ISU’s rules were, in this regard, deficient and not compatible with EU competition law.

In a further section of the judgment, the CJEU also declared as being incompatible with EU competition law the system of mandatory arbitration operated by ISU, according to which appeals against authorisation and eligibility decisions must be heard before the Court of Arbitration for Sport (CAS).

ESL

Similarly to ISU, in European Superleague (ESL) the Court was called upon to assess the legitimacy of the prior authorisation rules of UEFA and FIFA and the enforcement of the sanctions for non-compliance. The statutes of the football governing bodies assert their authority to authorise any football competition, as well as their ownership of any commercial rights related to competitions they organise. In the event of lack of compliance, sanctions could include the exclusion of professional football clubs from all FIFA and UEFA-organised competitions, a ban on players participating in interclub competitions, and a prohibition on their involvement in matches between representative teams of national football associations.

The Court reiterated the reasoning expressed in ISU, confirming that undistorted competition on the market requires equality of opportunity between undertakings. A system of prior-authorisation and sanctioning is not per se illegal, but rather it is a legitimate means to guarantee the homogeneity and coordination of the match calendars, as well as

other characteristics of football such as equal opportunities and merit. However, when UEFA and FIFA are in a position to authorise access to the market for the organisation of football competitions to their competitors, this power must be exercised through criteria that are transparent, clear and precise, non-discriminatory and subject to effective review. These criteria must be the same that UEFA and FIFA adhere to when organising their own competitions, or – if they differ – they must not be impossible or excessively difficult to fulfil.

The CJEU also analysed the rules relating to the exploitation of commercial rights arising from UEFA (and FIFA) competitions. The combination of prior authorisation rules, with rules that attribute to the governing body the ownership of the rights, constitute a restriction of competition by object, that can only be justified if the efficiency created outweighs its negative impact. Such efficiency gains will have to be assessed by the referring court. The CJEU, however, notes that such efficiency gains must benefit consumers: in its assessment, the CJEU states that the redistribution of revenues to ensure solidarity between the various categories of stakeholders in football can amount to sufficient efficiency gains. However, the solidarity effect must be proven to be real and concrete.

Royal Antwerp

In 2005, UEFA adopted the Home Grome Player (HGP) Rule, establishing that professional football clubs participating in UEFA competitions must include in their roster a minimum number of players that were trained by the club themselves, or by an affiliated club of the same national football association for a minimum of 3 years between the ages of 15 and 21. Starting from the 2007/2008 season, clubs must include 8 ‘home grown players’ in a roster of maximum 25 players. Out of these 8, at least 4 must have been trained by the club that lists them. Various forms of HGP rules have been adopted by National Associations, including the Belgian Football Association, in order to incorporate similar obligations for domestic competitions.

In Royal Antwerp, the Court was asked to assess whether the rules restricted competition under Article 101 TFEU and freedom of movement under Article 45 TFEU by limiting the club’s ability to recruit players that do not fulfil the training requirements, and the player’s chances to be recruited by a club that does not meet the required number of HGP.

The Court, having reminded us that Article 165 TFEU does not provide an exception for rules restricting freedoms guaranteed by EU law, affirmed that it is for the referring court to assess whether parties have presented convincing evidence to demonstrate that the rules are suitable to achieve their legitimate objective, e.g., encouraging the recruitment and training of young players, or that they create efficiencies capable of outweighing the negative effects of the restriction, on the one hand, and that the restriction to free movement is proportionate to the pursuit of such an objective, on the other.

Impact on International Sports Governance

The judgments have implications regarding the extent to which sports governing bodies retain control over their respective sports. In ISU and ESL this relates to the ability of the governing body to operate pre-authorisation rules, which, the Court makes clear, must be produced within a framework of substantive criteria and detailed procedural rules which are suitable for ensuring that they are transparent, objective, non-discriminatory and proportionate. In essence, these requirements are designed to limit the discretionary powers of governing bodies in order to reduce the risk that conflicts of interest contaminate sports governance. Whilst sports bodies rarely welcome external influence over their affairs, they are likely to prefer this outcome over a potential alternative which is for the Court to require a structural separation of regulatory and commercial functions. Governing bodies have, for now, avoided this burden but must be far more attentive to governance standards.

The pre-authorisation rules at issue in ISU and ESL were clearly deficient, but the Court was not averse to sports governing bodies continuing to operate an improved set of rules. In this regard, the Court acknowledged that “sporting merit… can be guaranteed only if all the participating teams face each other in homogenous regulatory and technical conditions, thereby ensuring a certain level of equal opportunity”. Therefore, pre-authorisation rules, supported by a system of sanctions, have a role to play in safeguarding sporting merit and other legitimate sporting objectives. In that light, and despite some erroneous media reporting, in no way was December 21 an endorsement of the Superleague project.

But is a commitment to good governance, in itself, sufficient for governing bodies to claim that December 21 does not fundamentally alter their powers or the structural integrity of the so-called European model of sport? That assertion is cast into doubt in circumstances in which a third party makes a request for the pre-authorisation of an event that does not put sporting merit at risk. How would a governing body’s refusal to authorise such an event be compatible with the non-discriminatory criteria highlighted by the Court?

Furthermore, in ESL the Court questioned whether pre-authorisation rules stifle competition to the detriment of consumers, by denying them the opportunity to consume potentially innovative new events. It seems that what is at issue here is not the suitability of the framework that gave rise to the pre-authorisation rules, but the impact of such rules on the functioning of the market and the extent to which parties other than the one imposing the preauthorisation rules benefit. Competition law is the lens through which these issues will be interrogated.

The main thrust of the Court’s assessment across the three judgments is that the power of the governing body must be subject to effective review, and here its view on the place of arbitration in sport will no doubt trouble the sports movement. The Court agreed with the Commission’s initial Decision in ISU that the restrictive effects of the preauthorisation rules were reinforced by the arbitration rules. In doing so, the Court was not undermining the ability of sport to resolve disputes by way of arbitration, just requesting that judicial review of decisions of arbitral bodies be subject to EU law. In that regard, the reviewing court must be able to make requests for preliminary rulings to the Court of Justice, which is clearly not an option for the Swiss Federal Tribunal, the court that reviews decisions of the Court of Arbitration for Sport (CAS). Furthermore, remedy at the point of recognising and enforcing an award within the territory of the EU is insufficient. Unless the arbitration rules in ISU are to be considered fact specific, a review of the operation of arbitration clauses in sport will be required. The nuclear option would be for CAS to relocate to the EU. More realistically, the system of mandatory arbitration may need to be revisited.

Impact on EU Sports Law and Policy

The judgments also contain a number of nuances that adjust our understanding of EU sports law and policy. First, rather than offering sports bodies a wide margin of appreciation in the construction of their rules, the Court instead preferred to see a more detailed assessment of governance standards in sport, but this has been outsourced to national courts. In ESL and Royal Antwerp, the Court requested that national courts interrogate ‘convincing arguments and evidence’ brought forward by sports bodies. The danger is that divergent national practice could result in a fragmented landscape.

Second, the Court completely dismantled the assertion of Advocate General Rantos in ESL that Article 165 TFEU (the sports competence) is a horizontal provision that must be taken into account in the interpretation of other Treaty provisions. In ESL and Royal Antwerp the Court stated that Article 165 TFEU ‘is not a cross-cutting provision having general application’ and ‘need not be integrated or taken into account in a binding manner’ in the application of Articles 45 and 101 TFEU. Whilst constitutionally Article 165 TFEU has been put back into its box, in adjudicative

terms the Court seems receptive to claims that sport has a special nature. Sport, it stated, ‘undeniably has specific characteristics’ that can be taken into account when assessing the compatibility of sporting rules with EU law.

Indeed, at paragraph 105 of ESL and 73 of Royal Antwerp, the Court reminds us that when assessing whether a sporting rule offends EU law, that analysis must be based on a specific assessment of the content of that rule, which presumably involves an examination of specificity of sport arguments, given expression by Article 165 TFEU. Confusingly therefore, Article 165 TFEU is simultaneously binding and not binding.

Third, in a surprising move, the Court appears to have given new life to the ‘purely sporting rules’ defence first crafted in Walrave. Assumed expunged by Meca-Medina, across all three judgments the Court now considers that ‘certain specific rules which were adopted solely on non-economic grounds and which relate to questions of interest solely to sport per se must be regarded as being extraneous to any economic activity’ and are therefore compatible with EU law. However, the contested rules in question (pre-authorisation and home-grown player rules) do not fall into this category, and neither will the vast majority of sporting rules that are likely to give rise to conflict.

Finally, in an even more surprising move, the Court narrowed the scope of the so-called ancillary restraints doctrine. Following Meca-Medina, our assumption was that certain sporting rules were incapable of being defined as restrictive of competition if those restrictive effects were inherent in the pursuit of a legitimate objective and proportionate. If that was the case, there is no need to assess whether the rule gave rise to restrictions by object or effect. Now, the Court has clarified that this defence cannot apply to object restrictions or to conduct that per se infringes Article 102 TFEU (abuse of dominant positions). Nevertheless, as the Court explained above, specificity of sport arguments can still be invoked within the justificatory regime offered by competition law and free movement.

Dr Andrea Cattaneo and Professor Richard Parrish are members of the Centre for Sports Law Research at Edge Hill University, UK.

SUGGESTED CITATION: Cattaneo, A. and Parrish, R.; “The Court of Justice moves and then fixes the goalposts on how EU law applies to sport”, EU Law Live, 19/02/2024, https://eulawlive.com/competition-corner/the-court-of-justice-moves-andthen-fixes-the-goalposts-on-how-eu-law-applies-to-sport-by-dr-andrea-cattaneo-and-professor-richard-parrish/

ISU, Superleague and Royal Antwerp Cases: from Specialty Towards Efficiency

Rusa Agafonova

Introduction

On 21 December 2023, the European Court of Justice (‘the Court’) delivered three major sports antitrust cases, the highly acclaimed European Superleague Company (C-333/21) and a less known by general public but in many ways as interesting International Skating Union v Commission (C-124/21 P) and Royal Antwerp Football Club (C-680/21). These judgments are remarkable for multiple reasons: they assess sporting matters from a more economic and less formalist perspective, tackle multiple problems of the actual sports governance (gatekeeping, lack of transparency, forced arbitration, unilaterality of policymaking processes, etc.) and have sufficient potential to re-structure sports organisation.

The European sports model and breakaway leagues

The architecture of the latter is at the origin of the competition problems. The European sports model – the famous sports pyramid – intertwining several levels from grassroots and amateurs to semi-professionals and professionals, provides for only one organisation at the head of a sports discipline within a certain territory (a regulatory monopoly). As a rule, sports governing bodies (‘SGBs’) are private entities (associations). This setup is widely recognised by the sports community as the most efficient way to keep rules homogenous and decisions enforced. One of the regulatory sub-functions of SGBs is gatekeeping, e.g. deciding which events to authorise or who to make eligible to participate. In addition to their regulatory role, SGBs run their own competitions including the Olympic Games contests, World Championships, World Cups, Gran Prix, etc

Competitions are at the centre of every sport: they attract a lot of interest from fans and, thus, excellent business opportunities. This is where breakaway leagues and third-party organisers wishing to run and market their own sports events outside the realm of SGBs step in. To do so, they cannot avoid a pre-authorisation process instituted by SGBs within a certain procedural framework.

But, in sport, input (primarily, athletes’ services) is extremely limited, especially at the elite level. The calendar is not infinite either. Not surprisingly, it is not uncommon for SGBs to refuse prior authorisations. This may happen for purely sporting reasons: overlapping of third-party events with the official calendar of competitions, non-compliance with safety or technical requirements, sports integrity violations found in breakaway projects and others. It might also happen for purely pragmatic commercial motives of SGBs since nobody wants tough competition. And sports organisations have the legal means to suppress the access of competitors at their discretion. Whether such a decision is well-founded or arbitrary depends on the respective procedural framework and of how well it is drafted, e.g., whether there are clear objective criteria that would not discriminate against potential applicants. In the absence of such a framework – and it happens commonly among SGBs – the system of pre-authorisations can be qualified as an anticompetitive behaviour, both under Articles 101 and 102 TFEU.

In parallel, athletes, staff and officials licensed within a sports association can be statutorily - and contractually - prohibited by the latter from having any contacts with non-authorised organisers under the risk of serious sanctions. The disciplinary consequences include ineligibility from official competitions within the European sports model and, consequently, impossibility to compete for major sporting titles.

Gatekeeping and competing

The gist of the problem is the SGBs’ gatekeeping role in the situation of a conflict of interests between the regulatory and commercial roles (SGBs’ ‘being both ‘legislature and party’’ (Superleague, para. 43) and in the absence of sufficient procedural guarantees for other parties, be it organisers or athletes.

But, first, gatekeeping per se is not a competition law violation. Even if it is not a publicly delegated function. In fields like sport, gatekeeping is essential. Thus, separation of the regulatory and commercial roles could be a good structural solution tackling the very essence of the problem by removing a conflict of interests. However, it would be way too radical for many SGBs. Therefore, the Court does not develop this solution.

In this situation, the Court decides to tackle procedural deficiencies. According to it, to mitigate the risk of arbitrariness, SGBs should adopt a thorough procedural framework governed by the principles of transparency, clarity, objectivity, precision, proportionality and non-discrimination. On top of it, these rules should be accompanied by a proper mechanism of judicial review. (Once again: is mandatory arbitration able to fulfil this function?).

When not based on a procedural framework with substantive criteria, both the mechanisms of prior authorisations and disproportionate eligibility rules such as that instituted by the UEFA and FIFA as well as the ISU – and by extension practiced by many national and international organisations – constitute a restriction of competition by object under Article 101(1) TFEU and an abuse of dominant position under Article 102 TFEU.

Sporting and efficiency justifications

As a rule, SGBs (alongside other professional associations) justify their anticompetitive policies by proceeding via a three-fold Wouters test (the exception was first formulated by the Court in Wouters v Algemene Raad van de Nederlandse Orde van Advocaten judgment (C-309/99), a case on the Bar rules in the Netherlands; it was first applied to a sports case in the famous Meca-Medina case (C-519/04 P)). In the framework of Wouters, an undertaking should establish that the restrictive rules are meant to attain (1) a legitimate objective, (2) are suitable for it and (3) do not go beyond what is necessary to achieve it.

Given that sport is special and has many specific characteristics, this mechanism has been broadly used by many SGBs willing to justify their restrictive policies. However, the Court cuts short this possibility for the most restrictive case scenarios: once a restriction of competition by object in the sense of Article 101 TFEU is established, the possibility to invoke the Wouters exception becomes no longer available.

If the Court finds a hardcore restriction, it is possible to proceed only via Article 101(3) TFEU and its efficiency gains test. In the presence of a restriction by effect, however, one can still resort to the Wouters exception and demonstrate that the restriction is necessary for a certain legitimate sporting reason while there are no less intrusive alternatives to achieve this goal. Such SGBs can equally invoke an efficiency defence under Article 101(3) TFEU. That said, this scenario leaves less chances of success as the requirements are of purely economic nature and the specific features of sport will be then not given much weight: SGBs will need to find a way to demonstrate convincingly – and based on the objective data – how the respective sports market(s) benefit(s) from the restriction, e.g., how the rule(s) contribute to improving the sport market(s) and (2) benefit different categories of consumers (3) without going beyond what is necessary and (4) without creating the risk of eliminating competition.

Narrowing down the application scope of the Wouters exception is a game-changer: hardcore restrictions are more likely to fail the efficiency gains test while restrictions by effect are rather expected to withstand the sporting justifications test.

As a result, SGBs will be forced to abolish the most anti-competitive practices.

On the other hand, the sport-specific considerations still play an important – even if a limited – role. It is notably the case when such considerations are necessary for the very functioning of sport - and for the functioning of sports markets. In the end, the Court views sport as a full-fledged market and does not adopt any privileged treatment in this regard.

The future of the European sports model

But it seems – as paradoxical as it can be – that the Court’s position is more favourable to the European sports model than, for example, the one exposed in his Opinion in the Superleague case AG Rantos, who did not see any hardcore restriction in the practices of UEFA and FIFA as ‘there would be nothing, in principle, to prevent the clubs forming the ESL from following the example of other sporting disciplines and from creating their own competition outside the framework defined by UEFA’ (Opinion by AG Rantos, Superleague, para. 76). For Advocate General Rantos, the motivation of clubs supporting Superleague’s project amounts to aspiring for ‘dual membership’ and free riding, where they want ‘to set up a rival competition to UEFA’s in the most lucrative segment of the market for the organisation of European football competitions, whilst continuing to be part of the UEFA ecosystem by participating in some of those competitions (and in particular in the national championships)’ (Opinion by AG Rantos, Superleague, paras. 106, 107).

The Court perceives the possible interaction between the European sports model and breakaway leagues not as a confrontational ‘dual membership’ but rather as a pragmatic co-existence anchored to the same common rules and sporting values (Superleague, paras. 143-144). Respecting these values (e.g., sporting merit, equality of opportunities, unity of calendar) would be a condition sine qua non for running any competition regardless of who organises it (Superleague, para. 144). This includes, ‘holding of sporting competitions based on equal opportunities and merit’ (Superleague, para. 144).

Conclusion

For the Court, the fix for the ‘free-riding’ problem lies in a detailed procedural framework, which now plays an essential role. It is for sports organisations to respond to this challenge. They still enjoy full – although conditional - autonomy to decide on the how. But there are a few elements that can be inferred from the judgments. Athletes – typically a weaker party in the relations with SGBs - should enjoy higher protection procedurally. Lifetime bans are now the biggest faux pas. A further gradation of sanctions for different types of violations is essential. Clarity and detailedness are highly desirable. Sport is special. But so too are sports markets.

Rusa Agafonova is a PhD Researcher at University of Zurich, Zurich, Switzerland. Contact: rusa.agafonova@gmail.com.

Recent publications include: “EU Competition Law and Sport: Checks and Balances ‘à l’européenne’” in Duval Antoine (Anthology Editor) , Krüger Alexander (Anthology Editor), Lindholm, Johan (Anthology Editor) “The European Roots of the Lex Sportiva: How Europe Rules Global Sport”, London: Bloomsbury Publishing, 2024 (forthcoming); “The International Skating Union case: On a mission to defend the weaker party?” in Kornbeck Jacob (ed.) “EU Antitrust Law and Sport Governance: The Next Frontier?”, London: Routledge, 2023; and “International Skating Union v. European Commission: Is the European Sports Model under Threat?”, International Sports Law Journal, 2019, Vol. 19 (1-2), pp. 87-101. https://doi.org/10.1007/s40318-01900155-6.

SUGGESTED CITATION: Agafonova, R.; “ISU, Superleague and Royal Antwerp Cases: from Specialty Towards Efficiency”, EU Law Live, 31/01/2024, https://eulawlive.com/competition-corner/isu-superleague-and-royal-antwerp-cases-from-specialty-towards-efficiency-by-rusa-agafonova/

The CJEU Rulings in ESL, ISU and Royal Antwerp: Looks like the Competition Cavalry’s Arrived!

Stefaan Van den Bogaert

On 21 December 2023, the Court of Justice rendered three judgments relating to the application of the EU competition rules to sports and the activities of sporting associations. That is more than in the fifty years preceding since the seminal Walrave judgment in which the Court, for the first time, held sport to be part of EU law to the extent that it constitutes an economic activity. This in itself already underscores the importance of the December rulings in the cases of the European Super League (ESL), the International Skating Union (ISU) and Royal Antwerp. They constitute both a serious reprimand and a warning to the sports governing bodies. The rulings require important changes to be implemented in sports, both in terms of governance and dispute resolution. The EU competition rules provide a robust tool to make these happen.

Competition law & sport: a slow start

That the highest judicial authority in the EU only adjudicated two sports cases on the basis of the competition rules before its December ’23 outburst of productivity is, of course, a remarkable observation. Arguably, the application of the EU antitrust rules to sport could have known a different development. In his famous Opinion in Bosman, AG Lenz considered the contested transfer rules and ‘3+2’ nationality clauses in professional football to fall foul of Article 101 TFEU (paras. 253-287). In its judgment, the Court, however, refrained from ruling on the interpretation of Articles 101 and 102 TFEU, having already reached the conclusion that these transfer rules and nationality clauses were contrary to Article 45 TFEU. Also in subsequent case law, when confronted with requests from national courts concerning the compatibility of sports practices with the Treaty free movement and competition rules, the Court opted for answering the preliminary questions on the basis of the free movement rules, when it had the opportunity to do so (see e.g. the ruling in Lehtonen). There was no clear and evident explanation for this approach. Once it had gone down the free movement road, it was probably more simple and straightforward for the Court to follow the same path on the next occasion as well. The potentially larger scope of application of the competition rules, aimed at tackling private behaviour, in comparison with that of the fundamental freedoms, primarily addressed to State measures, may have been a factor as well, possibly in combination with the limited competence of the Union in the field sport and the increased popular and media scrutiny of sports cases. The fact that before May 2004, only the European Commission could grant individual exemptions under Article 101(3) TFEU, may also have played a role. The one time the Court was expected to finally rule on the application of the Treaty competition rules to sport, in the case of Balog, concerning the remains of the transfer system in football still applicable to third-country players after Bosman, the case was settled out-of-court on the eve of the publication of the AG’s opinion.

Ultimately, the Court affirmed for the first time in July 2006 in Meca-Medina that nothing prevents the Treaty competition rules from being applicable to sporting rules, practices and activities, such as the contested anti-doping rules of the International Olympic Committee. Importantly, the Court held that rules which do not constitute restrictions on freedom of movement because they concern questions of purely sporting interest and, as such, have nothing to do with economic activity, do not necessarily also fall outside the scope of Articles 101 and 102 TFEU (para. 31). It further stipulated that the compatibility of rules with the Treaty competition rules cannot be assessed in the abstract and

emphasised that not every agreement between undertakings or every decision of an association of undertakings which restricts the freedom of action of the parties necessarily falls within the prohibition laid down in Article 101(1) TFEU.

For the purposes of application of that provision to a particular case: (1) account must, first of all, be taken of the overall context in which the decision of the association of undertakings was taken or produces its effects and, more specifically, of its objectives; (2) then it has to be considered whether the consequential effects restrictive of competition are inherent in the pursuit of those objectives; and (3) are also proportionate to them (para. 42). It made thus an application of the Wouters-test (para. 97) in the context of sport. In casu, the Court recognized that the IOC’s anti-doping rules pursued the legitimate objective of fairness in sporting competitions, including ‘the need to safeguard equal chances for athletes, athletes’ health, the integrity and objectivity of competitive sports’ (para. 43). In the end, neither the procedural aspects (‘the conditions for establishing the dividing line between circumstances which amount to doping and those which do not’), nor the severity of the penalties imposed, were considered to go beyond what is necessary to ensure the proper conduct of competitive sport.

Two years later, in MOTOE, a case that bears striking similarities with the ESL and ISU disputes, the Court was again asked to assess the compatibility with the competition rules, this time of rules of the Greek Motorcycling Federation instituting a system of prior approval for motorcycling events and competitions that would compete with its own sporting events. The Court ruled that this kind of power granted to a sports governing body, ‘if not made subject to restrictions, obligations and review, could lead it to deny other operators access to the relevant market and to distort competition by favouring events which it organises or those in whose organisation it participates’ (para. 51). This situation of unequal conditions of competition constituted a violation of Articles 102 and 106 TFEU.

Besides these two Court rulings, it must be signaled that the European Commission also adopted a number of decisions based on competition law in sports cases, such as, in particular, the decision clearing joint selling of the commercial rights of the UEFA Champions League or the decision establishing an abuse of dominance in relation to the sale of tickets for the France ’98 FIFA World Cup. Furthermore, it dedicated the first annex of its Staff Working Document accompanying the 2007 White Paper on Sport to sport & competition law. The General Court equally rendered a number of judgments in sports cases on the application of the competition rules, such as in Piau, dismissing the action for annulment of a Commission decision concerning the FIFA Regulations on player agents. Be that as it may, it is fair to say that on the eve of 21 December 2023, the EU competition rules were only occasionally applied to sporting practices, especially at EU level. After the recent December rulings, this might very well change.

The rulings of 21 December 2023: a robust competition approach

The three judgments were eagerly awaited, especially the one on the European Super League, given the enormous financial and sporting interests at stake, and the possible impact it might have on the future of sports governance. Anticipation grew as more time passed since the official hearing in July ’22 and the Opinion of AG Rantos in December later that year. An unprecedented number of twenty-two (!) EU Member States intervened in the proceedings, as well as two EEA States and the European Commission. Conspicuously, they all argued for a status quo at the top of the football pyramid, supposedly to protect the European sports model. So did the AG, who was even willing to accord constitutional status to the European model of sport and Article 165 TFEU.

The Court disagreed. Importantly, it did not question as such the legal autonomy of sport governing bodies to adopt rules on the organization of competitions, their proper functioning or the participation of sportspersons therein, but it stressed that sports associations ‘cannot limit the exercise of rights and freedoms conferred on individuals by EU law’, which include the rights that underlie Articles 101 and 102 TFEU (ESL, para. 75). Hence it firmly ruled that rules of sports associations, conferring on themselves the exclusive power of prior approval of sporting competitions and the power

to establish a framework for participation by clubs and players to these competitions, including sanctions, amount to an abuse of dominance under Article 102 TFEU as well as a restriction of competition under Article 101 TFEU and a restriction of the right to free movement protected under Article 56 TFEU, if they are not subject to limitations, obligations and review. It was left to the referring judge to determine whether these infringements of competition law and freedom of movement can be justified.

This outcome will undoubtedly have come as a serious blow to the sporting associations. The Court goes at length to make its point. Before entering the substantive analysis of the questions referred, it carefully outlines and delineates the framework for the application of EU law to sporting rules. In fact, at times, the judgments read as a vademecum on EU competition rules and sport, paving the way for a nuanced, but orthodox application of Articles 101 and 102 TFEU to sporting practices. It is recognized that sport ‘undeniably’ has specific characteristics which may ‘potentially’ be taken into account in the application of the Articles 45, 49, 56, 63, 101 and 102 TFEU, ‘provided they are relevant’ (ESL, paras. 103-104). The possible impact of Article 165 TFEU in this regard is minimized, for it ‘cannot be regarded as a special rule exempting sport from all or some of the provision of the treaty applicable to it or requiring special treatment for sport in this context’ (ESL, para. 101). The Court also reiterates that the same conduct may be caught by both Articles 101 and 102 TFEU, even though they pursue different scopes and have different scopes (ESL, para. 119), and brings this subsequently also into practice.

Three important observations can be made in relation to the substance of the judgments. Firstly, the Court has made it clear that equality of opportunity between undertakings must be ensured to guarantee the maintenance or development of undistorted competition in the internal market (ESL, para. 133). Therefore, a situation in which an undertaking has the power to unilaterally determine, ‘not subject to restrictions, obligations or review’ (ESL, para. 134), the conditions under which competing undertakings may enter the market, ‘by its very existence’ violates Article 102 TFEU (ESL, para. 135). More specifically, a framework is required with substantive criteria and detailed procedural rules to ensure that decisions on prior authorisation or participation are taken in a transparent, objective, precise and non-discriminatory way (ESL, para. 147). For these criteria and rules to be non-discriminatory, they must not make the organisation and marketing of third-party competitions and the participation of clubs and players therein subject to requirements that are either different from those applicable to competitions organised and marketed by the decision-making entity; nor must they be identical or similar to them but impossible or excessively difficult to fulfill in practice for an undertaking without the same status or powers as an association and therefore in a different situation. For sanctions not to be viewed as discretionary, they must be determined in accordance with the principle of proportionality (ESL, para. 151).

What does this mean concretely? Sporting associations and other gatekeepers who have the power to regulate access to the market and participation of competing undertakings are considered to have such an obvious advantage over their competitors that competition is automatically distorted by their conduct. In other words, they are sitting ducks under EU competition law, unless their power is subject to conditions, limitations and review. UEFA clearly anticipated this part of the ruling already, and introduced revised authorisation rules in June 2022. On the basis of the Court’s acknowledgment that it may be legitimate to subject the organisation and conduct of international football competitions to common rules intended to guarantee the homogeneity and coordination of these competitions within an overall match calendar, as well as the promotion of sporting competitions based on equal opportunities and merit, involving an element of solidarity redistribution, UEFA could arguably refuse authorisation to the European Super League in its original form. Whether it could also refuse the project in its revised form, is less obvious. It also remains to be seen whether these revised UEFA Authorisation Rules meet the required standards of transparency, objectivity, precision, neutrality and proportionality. To the extent that they require that new competitions ‘shall not adversely affect the good functioning of UEFA Champion Club Competitions’ (Article 7), that in any event does not seem to be the case. Such a rule gives priority to UEFA’s competitions, which is unacceptable from the perspective of non-discrimination,

as interpreted by the Court. Be that as it may, alternative formats and sporting competitions are almost bound to pop up in the years ahead. What is more, conceptually simple and straightforward as the thresholds imposed by the Court may appear to be, it may still turn out to be quite a challenge to formalise them in such a way that the risk of abuse of dominance by the sports governing body is eliminated, as required by Article 102 TFEU. This will require Chinese walls to be built between the regulatory and commercial roles of sports associations.

Secondly, the Court determined that this type of rules, which confer on sports governing bodies the power to authorize, control and set the conditions of access to the market for any potentially competing undertaking, and to determine the degree and conditions of competition, if not accompanied by an appropriate framework of substantive and procedural rules, make it possible, ‘by their nature, if not to exclude from that market any competing undertaking, at least to restrict the creation and marketing of alternative or new competitions in terms of format or content.’ (ESL, para. 176) They deprive clubs and players of the opportunity to take part in these new competitions, as well as spectators and television viewers to attend or watch these competitions. Consequently, it categorized them as rules which have as their object the prevention of competition prohibited by Article 101(1) TFEU. Moreover, the Court explicitly excludes restrictions by object from the scope of the Wouters / Meca Medina case law and stipulates that such conduct can only benefit from an exemption granted under Article 101(3) TFEU (ESL, paras. 185-186). The bar is set high: for an exemption to be granted, it must be demonstrated, by means of convincing arguments and evidence, that the contested conduct leads to genuine, quantifiable efficiency gains and that these compensate each category of users for the disadvantages caused in competition terms (ESL, paras. 189-200).

What to make of this? The exclusion of restrictions of object from the Wouters / Meca Medina case law is remarkable. The motivation that it was already ‘implicit, but necessarily apparent from the Court’s case law’ in para. 53 of MOTOE (ESL, para. 185) is unconvincing. It unnecessarily risks complicating the framework for justification of restrictions by object (and thus inevitably also of those by effect). In order to justify restrictions by object with public interest requirements in future case law, arguably either the scope of Article 101(3) TFEU will have to be broadened from purely economic considerations so as to include also these public interest requirements; or the category of restrictions by object will further have to be limited to only restrictions that are so harmful to competition that they cannot be justified with requirements in the public interest. This is not going to be easy. The Court could have avoided this by simply allowing restrictions by object the possibility to continue falling under the Wouters / Meca Medina case law. The requirement of proportionality that is part of this test is a sufficient guarantee in this respect.

Thirdly, the Court emphasised in ISU that prior authorization and eligibility rules must be subject to effective judicial review. In sports, arbitration is the preferred way of dispute resolution. The Court does not contest this as such, but it does require respect for the EU competition rules, which are of public policy nature (ISU, para. 192). Judicial review must, in any event, cover the question whether arbitral awards comply with Articles 101 and 102 TFEU (ISU, para. 193). In the absence of such judicial review, the use of an arbitration mechanism undermines the principle of effective legal protection (ISU, para. 194). Effective judicial review also entails that the courts reviewing awards must be entitled to refer a question for a preliminary ruling to the European Court of Justice (ISU, para. 198). It also stipulates that an action for damages or the possibility to complain to a competition authority of the infringement cannot compensate for the lack of remedy entitling a person to bring an action before the national courts to obtain protective measures (ISU, para. 201).

This aspect of the ISU ruling is inevitably going to have serious repercussions on dispute resolution in sports. Currently, many sports governing bodies subject sports disputes to compulsory arbitration by the Court of Arbitration for Sports, which is established in Switzerland, outside the EU. Appeal against CAS awards is only possible with the Swiss Federal Supreme Court, whose review excludes EU competition law. Clearly, this preferred method of dispute resolution in sports has become untenable as it stands, at least in cases involving competition law. Regardless of the changes to be made to the

system of CAS arbitration, this will, in all likelihood, result in national courts being seized more frequently with sports cases involving competition law issues.

Conclusion

The Court of Justice has confronted the sports associations with their responsibilities: the power to control, organise and market sporting events goes hand-in-hand with restrictions, obligations and review. Changes in the current statutes are needed. It will be interesting to see which follow-up the referring court and the sporting associations will give to these rulings in terms of governance and dispute resolution. If the ESL, ISU and Royal Antwerp judgments make anything clear, just like Bosman did almost thirty years ago in relation to free movement, it is that individual sportsmen and clubs derive rights from the directly effective provisions of Articles 101 and 102 TFEU and that these EU competition law rules must be effectively complied with. More rulings can be expected, both at national and EU level. The competition cavalry has arrived in Sports City.

Stefaan Van den Bogaert is Professor of European Law & Director Europa Institute at Leiden Law School.

SUGGESTED CITATION: Van den Bogaert, Stefaan.; “The CJEU Rulings in ESL, ISU and Royal Antwerp: Looks like the Competition Cavalry’s Arrived!”, EU Law Live, 07/02/2024, https://eulawlive.com/competition-corner/the-cjeu-rulings-inesl-isu-and-royal-antwerp-looks-like-the-competition-cavalrys-arrived-by-stefaan-van-den-bogaert/

Legality of UEFA’s Prior Authorisation System in C-333/21 European Super League

Dr. Katarina Pijetlovic

The applicable analytical framework for restrictions of competition emanating from the rules of regulatory monopolies, such as football governing bodies, is set out in para. 42 of C-519/04 Meca-Medina. Accordingly, not every restriction on competition is illegal, but assessment must be carried out against overall context in which the decision was taken or produces its effects, particularly its objectives. The restrictions also must be inherent in the pursuit of those objectives and proportionate to them. The Meca-Medina test reserved for prima facie restrictive regulatory rules was carried out under Art 101(1) TFEU, but the same test applies in Art 102 TFEU. Rules and decisions by sports governing bodies that satisfy this test constitute ancillary restraints that do not breach TFEU competition provisions. This enables sports federations to adopt rules pursuing legitimate public interest objectives that are inherent in proper organisation of competitions and enforce them by means of proportionate sanctions necessary to ensure compliance. The Meca-Medina test essentially reproduces the objective justification test from the internal market (such as under C-55/94 Gebhard) and when both sets of provisions apply to the case, the convergence of outcome is inevitable.

In April 2021, European Super League (ESL) proposed a new, virtually closed, cross-border football competition consisting of the top 20 elite European clubs to rival Champions League, the flagship competition organised by the European football governing body (UEFA). UEFA reacted by threatening the participating clubs with sanctions and exclusion from their domestic leagues from which the clubs derive most of their revenues. As a result of the threats, the Super League project was brought to a standstill. The agreement between elite clubs to form a closed league raises the suspicion of Art. 101 TFEU infringement in so far as it forecloses the most lucrative part of the market for other participants and acts as a detriment for financial viability of domestic leagues. Furthermore, according to Advocate General in para. 285 of C-415/93 Bosman, football clubs in a professional league are united by such economic links that they can constitute collectively dominant undertakings and are therefore not immune from violating Art. 102 TFEU either. However, in para. 80 of the ESL case, the Court of Justice specifically pointed out that the Super League project was not on trial. Instead, one of the key questions referred to it by the Madrid Commercial Court, in which ESL instituted legal challenge, related to legality of Article 49 of the UEFA Statutes and threatened sanctions. Art. 49 conferred onto UEFA the status of the exclusive organiser of cross-border competitions and required third parties to obtain UEFA’s prior approval should they wish to organise competition involving clubs from two or more UEFA associations. The criteria to obtain such approval were never specified. One of the objectives of the ESL lawsuit was to remove the regulatory authority of the football governing bodies to act as gatekeepers controlling the access to the market for organisation of cross-border club competitions. This is the relevant product market on which UEFA not only performs the gatekeeping function, but also holds a commercial monopoly. Despite the glaring conflict of interest, the conflation of the regulatory and commercial functions in a single sports federation and the legality of prior authorisation systems per se were never seriously questioned by the Court of Justice. In cases such as C-49/07 MOTOE, T-93/18 ISU, and C-1/12 OTOC, the existence of prior control mechanisms was not an issue and instead the focus was on examining the way that the monopolistic regulatory powers were exercised. According to MOTOE, the regulatory power of prior authorisation must be made subject to ‘restrictions, obligations and review’ to prevent arbitrary application and the distortion of competition by favouring own events. MOTOE also emphasised the obligation on the regulator to secure equality of opportunity between economic

operators on the organisational market, including the access of prospective operators. There can be no discrimination in the demands placed on UEFA’s own club competitions and those planned by the third parties. Citing para. 99 of the judgment in OTOC, the General Court in ISU outlined the criteria that a system of prior authorisation for alternative competitions must fulfil. It said that any such system must rest on non-discriminatory, objective, transparent, verifiable, reviewable and proportionate requirements that are capable of ensuring effective access to the relevant market for the organisers of alternative events. On appeal, the Court of Justice in C-124/21 ISU confirmed these principles.

Echoing its previous jurisprudence, the Court of Justice in ESL confirmed the authority of UEFA to regulate access of third parties to organisational market but found its system of prior control incompatible with the competition provisions (and Art. 56 TFEU). It is important to emphasise that this finding was due to the lack of a framework for prior approval and sanctioning powers providing for substantive criteria and detailed procedural rules capable of ensuring that they are transparent, objective, precise, non-discriminatory, and proportionate. These safeguards would eliminate the risk of abuse of dominant position and arbitrary decisions. The Court of Justice did not object to, or directly deal with the substance of the UEFA’s decision to issue threats of sanctions.

The judgment in ESL did not imply that the Super League project was legal. In fact, it is apparent from para. 144 that the closed format of the ESL competition would be found incompatible if tested under EU law. According to the same paragraph, the specific characteristics of sport support a finding that it is legitimate for UEFA to promote ‘the holding of sporting competitions based on equal opportunities and merit’ via prior control of competitions. The substance of UEFA’s decision to issue threats to a closed Super League was therefore very likely compatible with the legal requirements, had it been taken within the proper framework. On the day when the Court of Justice delivered its ESL judgment, A22 (the management agency for ESL) published its new proposed format for the ESL competition. It involved 64 clubs split into three league tiers. Only 20 clubs from the third tier are subject to promotion and relegation with the domestic leagues, representing about 31% of the ‘fluid places’ in the league in contrast to the widely criticised and rejected initial proposal where 25% (5 out of 20) places in the league were ‘fluid’. In this sense, there is not much difference between the new and the rejected ESL format.

While the judgment in ESL did not bring any groundbreaking legal novelties, the Court made an important adjustment in approach and reversed the order in which it carried out its assessment, which resulted in limiting the scope of MecaMedina justification framework. The adjusted analytical approach removed the benefit of recourse to Meca-Medina framework for the ‘by object’ restrictions under Art 101 TFEU and rules which or ‘by their very nature’ breach Article 102 TFEU. This is the category where the Court placed UEFA’s prior authorisation system enforced by sanctions. After ESL, it appears that ‘by object’ restrictions can only be exempted under Art. 101(3) TFEU and the equivalent economic efficiency under Art. 102 TFEU. It will be interesting to observe whether in the future the approach in internal market law will follow this pattern. In C-415/93 Bosman, a case decided under Art. 45 TFEU, the directly discriminatory rule benefited from open list of justifications, contrary to general jurisprudence that grants such benefit only to indirectly discriminatory measures. Direct discrimination for national representative teams will certainly remain justified, but if narrowing of the scope of justification in ESL is followed, other types of directly discriminatory measures might be confined to TFEU-based derogations (public policy, public security and public health).

In anticipation of the Court’s criticism of its prior authorisation system, in June 2022 UEFA has quietly issued Authorisation Rules Governing International Club Competitions. It supplied the detailed requirements and procedure implementing Art. 49 of UEFA Statutes, as well as applicable sanctions. Although it is clear which information must be submitted, there is no clarity for the applicants regarding the expected substantive value of some requirements. For example, Article 4(1)(d) of the Authorisation Rules makes it clear that the aspiring organiser must submit the details

of the proposed solidarity payments. The percentage of the revenues that will be accepted as adequate to comply with this condition is not specified and the requirement not precise enough. However, based on the now well-established legal parameters, it is safe to assume that solidarity contributions matching those made by equivalent UEFA’s competitions, will fulfil the solidarity criteria. The requirement in Art. 7(4) of the Authorisation Rules is more controversial as it reserves certain top clubs for UEFA’s competitions, including the winners of top domestic leagues and titleholders of UEFA Champions League and Europa League. The listed justifications for this rule include protecting the sporting merit of UEFA club competitions, the good functioning of the international calendar, and the health and safety of players. Whether these rules will be contested and whether the new ESL proposed format will be approved by UEFA Executive Council remains to be seen.

Dr. Katarina Pijetlovic is Associate Professor at Catolica Global School of Law, Lisbon.

SUGGESTED CITATION: Pijetlovic , K.; “Legality of UEFA’s Prior Authorisation System in C-333/21 European Super League”, EU Law Live, 22/02/2024, https://eulawlive.com/competition-corner/legality-of-uefas-prior-authorisation-system-in-c-333-21-european-super-league-by-dr-katarina-pijetlovic/

European Sports Model and Competitive Markets:

Two Worlds Connected by European Superleague Company (C-333/21) and International Skating Union (C-124/21 P)

José Luís da Cruz Vilaça and Mariana Martins Pereira

I . Introduction

21 December 2023 was the day when certain rules enacted by major international sports governing bodies were found contrary to EU law by the Court of Justice (European Superleague Company (ESLC), International Skating Union (ISU), and Royal Antwerp (C-680/21)). This general statement was immediately interpreted as challenging the governance model chosen by those organisations, and celebrated by Superleague as endorsing its project.

A closer look shows that such general statement, albeit true, is fraught with caveats. The judgments are extremely rich, each paragraph worth being ‘dissected’. They shed light not only on the Court’s approach to the relationship between EU law and sports, but also on the provisions whose interpretation was sought, irrespective of the economic sector in which they apply.

However, not all the answers were given. Namely, the Court made it clear that the existence, organisation and functioning of sports governing bodies as such were not being questioned (ESLC, para 75); and that its ruling in ESLC would not concern ‘the compatibility of the Superleague project itself with […] the Treaty’ (para 80). Moreover, as discussed below, certain of the Court’s findings may require further clarification in the future.

This contribution will focus on the ESLC and ISU judgments (and does not concern the judgment in Royal Antwerp Football Club (C-680/21)). Without claiming to be exhaustive, it will assess what remains of the European sports model, and the Court’s interpretation of competition law-

II . The European sports model after December 21

Article 165 TFEU played a central role in the Opinion of Advocate General Rantos in ESLC. He argued that this provision gives ‘constitutional’ recognition to the European sports model (this was also the position taken by the Portuguese Republic at the hearing), that it constitutes at the same time a ‘horizontal’ provision, and a specific provision, compared to Articles 101 and 102 TFEU (Opinion, para 35).

The Court disagreed, at least regarding the last two statements. Through contextual interpretation, it found that Article 165 TFEU is neither a ‘cross-cutting provision having general application’ (ESLC, para 100) nor a ‘special rule exempting sport from all or some of the other provisions of primary EU law liable to be applied to it or requiring special treatment for sport in the context of that application’ (ESLC, para 101).

The Court nonetheless found that the essential characteristics of sport enshrined in Article 165 TFEU are part of the ‘actual context in which [the contested rules] are to be implemented’ (ESLC, para 105). Thus, its statement that the elements of Article 165 TFEU ‘need not be integrated or taken into account in a binding manner in the application of [competition law and fundamental freedoms]’ must be taken with a grain of salt (ESLC, para 101). Indeed, as the Court recognised, such

a contextual assessment is a mandatory step to establish a violation of either competition law or free movement rules (ESLC, paras 105-106). While Article 165 TFEU certainly cannot be used as an exception to the application of these provisions, the elements contained therein must be taken into account when applying them.

Therefore, the Court did not completely deny the constitutional dimension of the European sports model. It still attributed a role to it, albeit a more limited one than that envisaged by Mr. Rantos. In particular, certain features, such as open competitions based on sporting merits and solidarity redistribution, are mentioned throughout the judgment as inherent in the model and potentially legitimate objectives, depending on the circumstances of the case. Still, in an obiter dictum, the ‘one-place’ principle (i.e., one governing association per sport) seemed to be excluded from the model. The Court noted that such a feature of European football did not prevail ‘in respect of other sporting disciplines’ (ESLC, para 117). By contrast, the Court found that features such as competition based on sporting merit and promotion and relegation were ‘in common with other sports’ and hence forming part of the European model (ESLC, para 143).

III . Assessing the rules in the light of EU law

The Court then interpreted the contested rules in the light of Article 101 (in both judgments), Article 102 TFEU and the rules on free movement (only in the ELSC judgment). Three rules were analysed: (i) the requirement of prior approval of all competitions organised by third parties; (ii) the conditions of participation of clubs and players in such competitions, including the application of sanctions; and (iii) the commercial exploitation of the rights associated with such events.

This contribution will focus on rules (i) and (ii), for which the Court’s main message was cross-cutting and straightforward:

In principle, certain characteristics of the European sports model, such as ensuring sporting merit, may require a prior approval system. In particular, the Court recognised that this feature depends on ‘homogeneous regulatory and technical conditions, thereby ensuring a certain level of equal opportunity’ (ESLC, para 144; ISU, paras 131-132). Consequently, a prior approval requirement cannot in itself be considered an abuse of a dominant position, nor a restriction of competition under Article 101 TFEU, or a violation of fundamental freedoms (ESLC, paras 145, 175 and 248; ISU, paras 93-94).

But the very same provisions are violated if the power to pre-authorise third-party competitions and to impose sanctions is not subject ‘to restrictions, obligations and review […] and, more specifically, where there is no framework for substantive criteria and detailed procedural rules for ensuring that they are transparent, objective, precise and non-discriminatory’ (ESLC, paras 147-148 and 178; ISU, para 133).

In essence, the specific rules adopted were found to be in breach of EU law due to the lack of substantive and procedural framework. However, sports governing bodies still retain the power to pre-authorise third-party competitions, provided that the requirements laid down by the Court are observed (ESLC, para 151; ISU, para 136).

a. Abuse of a dominant position

Despite the Court’s holistic approach to the various Treaty provisions, certain specificities are worth noting.

With regard to Article 102 TFEU (read in conjunction with Article 106 TFEU), the Court held that the ‘restrictions, obligations and review’ that must underpin the power of prior authorisation exercised by a body which also carries out an economic activity ‘are all the more necessary when an undertaking in a dominant position, through its own conduct and not by virtue of being granted exclusive or special rights by a Member State, places itself in a situation where it is able to deny potentially competing undertakings access to a given market’ (ESLC, para 137; ISU, para 126). While arguably not unanimous, this is a sensible finding: any entity that de facto plays such a dual role, with non-negligible social repercussions, must meet standards of good governance. It is irrelevant whether this power is self-attributed or delegated by Member States. In the absence of public oversight, these requirements may indeed be ‘all the more necessary’. Although the broad wording used

may raise doubts, we believe that the Court was only considering private actors whose prerogatives have a significant social and public impact (see Maxima Latvija, C-345/14, where no comparable requirements were imposed).

b. Restrictions of competition ‘by object’ and the Wouters test

FIFA, UEFA and ISU rules were also considered to be decisions of associations of undertakings within the meaning of Article 101(1) TFEU (ESLC, para 115; ISU, para 130).

In order to determine whether there was a restriction within the meaning of that provision, the Court followed its traditional analysis in competition cases, i.e., first assessing whether there was a restriction of competition ‘by object’. For this purpose, ‘it is necessary to examine, first, the content of the agreement, decision or practice in question; second, the economic and legal context of which it forms part; and, third, its objectives’ (ESLC, para 165; ISU, para 105).

Let us focus on the objectives pursued by the contested rules. In essence, the Court held that, ‘although the stated reasons for the adoption of those rules on prior approval may include the pursuit of legitimate objectives, such as ensuring observance of the principles, values and rules of the game underpinning professional football’, ‘those contextual elements nevertheless are not capable of legitimising the absence of substantive criteria and detailed procedural rules suitable for ensuring that those rules are transparent, objective, precise and non-discriminatory’ (ESLC, paras 175-176; ISU, para 137). The Court hence found that, in the absence of substantive and procedural criteria, the rules actually adopted do not genuinely pursue these legitimate objectives, but in fact have an anticompetitive purpose, i.e., to exclude or restrict the possibility of alternative competitions (ESLC, para 176; ISU, para 146). It thus follows that, in the Court’s view, these rules restrict competition ‘by object’ (see in the same vein here).

Such a finding used to serve the purpose of allocating the burden of proof (ESLC, para 160; ISU, para 100). Since 21 December, it also has significant substantive consequences: restrictions of competition ‘by object’ cannot be justified by the proportionate pursuit of legitimate objectives (usually known as Wouters and Meca Medina criteria).

Against this background, the current role of legitimate objectives in the application of competition rules may be questioned. In reaching its conclusion, the Court recalled, inter alia, that ‘the pursuit of potentially legitimate objectives are not decisive for the purposes of application of Article 101(1) TFEU’ (ESLC, para 167; ISU, para 156). However, this case-law must be read in the light of cases such as OTOC (C-1/12) and Asnef-Equifax (C-238/05), where the contested rules were found not to have as their object the restriction of competition as they pursued legitimate objectives. Thus, anti-competitive and legitimate objectives may co-exist and the rules may still constitute a restriction ‘by object’. Only if legitimate objectives clearly outweigh anticompetitive ones, will the restriction not be ‘by object’. Apparently, the decisive test is which objective is more ‘manifest’.

Similarly, the judgments of 21 December seem to distinguish between merely alleged (therefore irrelevant) and genuine pursuit of legitimate objectives (which may be relevant). Otherwise, these judgments would probably be at odds with earlier ones, where the existence of anticompetitive objectives could hardly be denied and hence such distinction seemed implied. Consider, for example, CHEZ Elektro Bulgaria (C-427/16), which was cited in ISU and Superleague to support the non-application of Wouters to ‘by object’ restrictions. That case concerned the rules of a bar association setting minimum fees for the provision of legal services, described by the Court as the ‘horizontal fixing of mandatory minimum tariffs’ (para 51). The Court then held that the Wouters criteria could apply only if such rules ‘actually’ pursue legitimate objectives (paras 56 and 58). In the light of the case before it, the Court did not consider itself competent to make that assessment, leaving it for the national court (see also Em akaunt BG (C-438/22, para 34), which clarifies the judgment in CHEZ Elektro Bulgaria).

In the end, therefore, the finding that restrictions ‘by object’ cannot be justified under the Wouters test may not be so ground-breaking. This is because the first criterion of the Wouters test is essentially the same as that required to assess whether a particular practice restricts competition ‘by object’: authorities, claimants and courts must analyse the economic and legal context of the agreement and its objectives (Meca Medina, C-519/04 P, para 42; Wouters, C-309/99, para 97; on restrictions ‘by object’, ISU, para 105 and case-law cited). If this first step reveals an anticompetitive object, one should not proceed. This appears to have just been clarified by the Court in Em akaunt BG (C-438/22, paras 32 and 53). If, on the other hand, no anticompetitive object is identified, it is necessary to consider ‘whether the consequential effects restrictive of competition are inherent in the pursuit of those objectives and are proportionate to them’ (Wouters, para 97; Meca Medina, para 42). Since the Court refers to inherent ‘effects restrictive of competition’, the application of this second criterion arguably already depended on a finding that there was no anti-competitive objective. In this respect, the Court’s finding seems coherent.

Indeed, in Wouters the Court (implicitly) found that there was no restriction ‘by object’. The appellants in the main proceedings had put forward a number of arguments to show that the rules adopted by the Dutch Bar Association (prohibiting interdisciplinary practice) restricted competition ‘by object’ (paras 74-79). They also argued that the rules had restrictive effects in any event (para 80). Without commenting on the appellants’ arguments concerning the restriction ‘by object’, the Court went on to list the restrictive effects of the rules. It did so by applying a counterfactual test, pointing to the positive effects on the market if the rules had not been adopted (paras 81-83 and 87-89). Similarly, the rules adopted in OTOC were qualified as a restriction ‘by effect’ (paras 68-69). In Meca Medina, although no conclusion was reached, no anti-competitive object appeared to be manifest.

What seems puzzling, however, is applying this reasoning to cases falling under Article 102 TFEU. Indeed, pursuant to the Court, the conclusion that certain conduct cannot be assessed in the light of Wouters followed, ‘implicitly but necessarily’, from MOTOE (C-49/07) (ESLC, para 185). It is true that MOTOE concerned a similar system of prior authorisation for sports competitions, albeit established by law. The Court declared these rules to be contrary to Article 102 TFEU, as they were not subject to limitations, obligations and review, without further considering the application of Wouters (para 153). However, the qualification of infringements of Article 102 TFEU as ‘by object’ or ‘by its very nature’ (ESLC, paras 131 and 148) casts doubt on the direction in which the case-law was heading so far. Indeed, in judgments such as Intel (C-413/14 P), MEO (C-525/16) and more recently Unilever Italia (C-680/20) the Court appears to have rejected the existence of ‘ per se’ abuses, requiring competition authorities to carefully assess the arguments put forward by undertakings to show that their conduct was not capable of restricting competition. The Court’s statement in ESLC may be justified by the fact that both Articles 101 and 102 TFEU applied, and thus by the interest in ensuring a consistent interpretation between these provisions. However, the fact is that Article 101 is different from Article 102 TFEU, and this difference must be recognised. Doubts remain, thus. Only future judgments will clarify possible far-reaching consequences, both for the general application of Article 102 TFEU and for determining the scope of application of the Wouters test.

In any event, regarding Article 101 TFEU, the judgments mentioned above show that the assessment of the overall context and objectives of an agreement is a serious matter. In exceptional circumstances, it may exempt certain conduct from being qualified as a restriction ‘by object’, although it would in theory fit in that ‘box’. Although this was already established case-law (CB, C-67/13 P, Budapest Bank, C-228/18, Generics UK, C-307/18), the Court has now reaffirmed it: after drawing up a list of practices which typically ‘reveal a sufficient degree of harm to competition for the view to be taken that it is not necessary to assess their effects’ (ESLC, paras 163-164; ISU, para 102), the Court clarified that even these must be subject to the content, context and objectives analysis (ESLC, para 165; ISU, para 105).

That the judgments limited the regulatory discretion of sports governing bodies seems undeniable. Furthermore, a strong subliminal message emerges from the judgments: power, responsibility and accountability are inextricably linked and the abstract allegation of legitimate objectives, ‘however laudable’, will not suffice.

For the future, it remains to be seen whether some of the Court’s findings in relation to competition law are limited to sports or have a wider scope.

José Luís da Cruz Vilaça is the Managing Partner of a specialised law firm in Lisbon, Portugal. He is a former Judge and Advocate General at the Court of Justice. He is also former President of the Court of First Instance (now the General Court). The author represented Portugal at the oral hearing in the ESLC case. The views expressed here are personal and are in no way attributable to the Portuguese government.

Mariana Martins Pereira is a Lawyer working on EU and ECHR matters in a specialised law firm in Lisbon, Portugal. She has an L.L.M in Law and was a trainee at the Court of Justice and at the European Court of Human Rights.

The authors would like to thank Francisco Costa-Cabral for the fruitful discussions concerning the judgments under analysis.

SUGGESTED CITATION: da Cruz, J. L. and Martins, M.; “European Sports Model and Competitive Markets: Two Worlds Connected by European Superleague Company (C-333/21) and International Skating Union (C-124/21 P)”, EU Law Live, 05/02/2024, https://eulawlive.com/competition-corner/european-sports-model-and-competitive-markets-two-worlds-connected-by-european-superleague-company-c-333-21-and-international-skating-union-c-124-21-p-byjose-luis-da-cruz-vilac/

Taking EU (Competition) Law outside of the Court of Arbitration for Sport (Case C-124/21 P International Skating Union v Commission)

Antoine Duval and Ben Van Rompuy

Though overshadowed by the European Superleague Company (C-333/21) judgment of Grand Chamber of the Court of Justice (‘CJ’) of 21 December 2023, the ruling rendered on the same day in the International Skating Union (‘ISU’) v European Commission case (C-124/21 P) also demands particular attention. The main part of the ISU judgment similarly addresses the issue of ex ante control over the organisation of third-party competitions, but a small yet important section of the ruling is specific to it. It relates to the Court of Arbitration for Sport (CAS) and the bindingness of CAS arbitration clauses, which are ubiquitous in the statutes and regulations of international sports governing bodies (SGBs). Our contribution focuses on this issue.

The CAS, seated in Lausanne, Switzerland, is widely regarded as the “supreme court” of international sports dispute resolution. It primarily functions as an appeal body as it is exclusively competent to review de novo the final decisions of any SGB that imposes a CAS arbitration clause on its members (in 2022: 644 appeals were lodged, accounting for 80% of its caseload). Hence, the CAS has the exclusive competence to weigh in on the most high-profile international sports cases. CAS awards are final and binding and may only be challenged before the Swiss Federal Tribunal (SFT) on a limited number of grounds set forth in Article 190(2) of the Swiss Private International Law Act. These grounds include incompatibility with Swiss public policy, but the SFT takes the view that this does not include EU (competition) law. The SFT’s review is also extremely deferential to the CAS, with its awards being overturned only in rare instances and almost exclusively on procedural grounds.

In recent years, however, athletes and clubs have started to challenge in various courts the exclusive jurisdiction of the CAS, as well as the fairness of CAS proceedings. Notably, in 2018 the European Court of Human Rights (ECtHR) in Mutu and Pechstein v Switzerland recognised that CAS arbitration, at least insofar as disciplinary decisions are appealed there, constitutes forced arbitration. Therefore, the Strasbourg court held that CAS proceedings need to fully comply with Article 6(1) ECHR. More recently, in the Semenya v Switzerland case, the Third Chamber of the ECtHR concluded that Switzerland had violated Article 8 and 14 read together, as well as Article 13 of the Convention due to the failure of the SFT to review the compatibility of a CAS award (and the underlying DSD Regulations imposed by World Athletics) with the ECHR.

The European Commission’s decision on the ISU Eligibility Rules (AT.40208) and the CJ’s ruling on the action for annulment brought by the ISU must be seen within this broader context of mounting distrust vis-à-vis the CAS. It comes on the heels of several pending cases – such as the Lassana Diarra and Claudia Pechstein cases - in which athletes have attempted, with limited success until now, to relitigate before the national courts of the Member States disputes decided by the CAS, claiming that the decisions and underlying regulations conflict with EU law. Hence, the Grand Chamber seized the opportunity in ISU v Commission to weigh in on the relationship between the jurisdiction of the CAS and EU competition law. In the following sections, we aim to explain how CAS arbitration became a part of the case and reflect on the wider impact of the judgment on the structure and operation of transnational sports law and governance.

1. The European Commission’s ambiguous critique of CAS arbitration

The European Commission’s decision on the ISU Eligibility Rules of 8 December 2017 took many by surprise, even those involved in transnational sports governance who should have been in the know about the case. For over a decade and a half, the Commission had shied away from formally investigating the rule-making practices of SGBs, with only two of the largest and most popular sports (football and Formula One) previously in its crosshairs. Now, for the first time, the Commission issued a prohibition decision finding that a SGB, governing a small Olympic sport, had violated the EU antitrust rules. The fact that the Commission chose not to impose a fine for an infringement that lasted 19 years further underscored the unprecedented nature of that decision.

Another unexpected element of the decision was its section 8.7, in which the Commission conducted an analysis of the appeal arbitration rules contained in the ISU’s Constitution. Previous Commission statements on the case had made no mention of arbitration. The decision also made clear that the ISU was found to have infringed Article 101 TFEU by adopting and enforcing its Eligibility Rules in the context of speed skating. The arbitration rules were not part of that infringement. Yet the relevant section, which follows the conclusions concerning the application of Article 101(1) TFEU, was apparently inserted ‘for the sake of completeness’ (T-93/18, para. 132). In it, the Commission expressed worry that the compulsory recourse for athletes to CAS arbitration may shield anti-competitive ineligibility decisions of the ISU from effective judicial review by EU-based courts. Consequently, the Commission concluded that the arbitration rules “reinforce” the restrictions of competition caused by the Eligibility Rules. In the event the ISU would choose to maintain a pre-authorisation system, it could only effectively bring the infringement to an end if it also substantially amended its arbitration rules (AT.40208, para. 339).

The Commission’s designation of the mandatory use of CAS arbitration as a distinct but reinforcing factor, a novel concept for antitrust law, was bound to draw criticism. However, its ambiguous stance on CAS arbitration was not an outlier. It has been a recurring theme in its decision-making. For instance, in two decisions rejecting sports-related antitrust complaints about inter alia CAS arbitration clauses, the Commission similarly tried to walk a thin line between endorsing the CAS and critiquing it (see here and here). On the one hand, it acknowledged the legitimate role of the CAS as an institution for resolving international sporting disputes. On the other hand, it stressed that the conferral of exclusive jurisdiction on the CAS may serve to shield anti-competitive practices from EU competition law scrutiny. In such cases, the limitation of access to ordinary courts may even be viewed as part of the antitrust violation itself. This does raise the question of what structural solution the Commission has in mind to eliminate that risk without compromising the effectiveness of the CAS arbitration system. In previous cases, the Commission insisted that arbitration remains voluntary and does not prevent recourse to the national courts (see here and here). In its decision on the ISU Eligibility Rules, however, it did not provide any guidance on how the arbitration rules should be amended.

2. The GC and AG Rantos: in the CAS, we trust

It turns out, the CAS has some supporters in Luxembourg. In December 2020, the General Court (GC) largely dismissed the ISU’s action for annulment of the Commission’s decision, but it did overturn the decision’s operative part to the extent it made the lawfulness of the ISU’s pre-authorisation system conditional on the amendment of the arbitration rules. This could have been just a technical matter: because the arbitration rules were not directly implicated in the infringement, the Commission could not require the ISU to change them (T-93/18, paras. 171-173). However, the GC went a step further and determined that the Commission was wrong to consider that the arbitration rules reinforced the anti-competitive effects of the ISU Eligibility Rules. The GC observed that the exclusive and mandatory use of CAS arbitration ‘may be justified by legitimate interests linked to the specific nature of the sport’ (para. 156), notably the need for a quick, economic, and uniform dispute resolution system in international sport. And while it acknowledged that the

arbitration rules do not permit skaters (or third-party organisers) to have access to the national courts to seek annulment of anti-competitive ineligibility decisions (or refusals to grant authorisation) the Court emphasised that alternative legal remedies remain available. Skaters and organizers could file complaints with national competition authorities or the European Commission, whose decisions can be reviewed by national or EU courts (para. 160). Furthermore, they retain the right to pursue damages claims in national courts (paras. 157-159). These options would ensure that the effectiveness of EU competition law, as such, is not undermined.

When the ISU appealed the GC’s judgment in so far as it dismissed its action at first instance, the two complainants in the case, Mark Tuitert and Niels Kerstholt, along with EU Athletes, the federation of athlete associations and player unions, brought a cross-appeal challenging the validity of the GC’s findings regarding the ISU arbitration rules. Advocate General Rantos in his assessment of the cross-appeal was rather sanguine about the need to recognise the bindingness of a CAS arbitration clause. Ultimately, he concurred with the GC that the mandatory use of the CAS appears justified to avoid fragmentation of international sports dispute resolution. In his words, ‘[i]t would be difficult to imagine the organisation or conduct of any sports discipline or event if each participant (athlete or sports club) had the possibility of challenging some aspect of such an event on any legal basis before national courts or other judicial bodies’ (para. 158). Nevertheless, even this part of his Opinion did not escape the dire fate of almost all of AG Rantos’ musings.

3. The CJ: in the SFT, we distrust (for EU competition law matters)

As the European Commission had not called into question the existence or independence of the CAS or even its exclusive jurisdiction to review ISU decisions, the CJ took care to delineate these matters from its narrow focus on the role played by the SFT. According to the CJ, the GC erred in law by failing to (adequately) examine whether the CAS arbitration rules allowed for effective judicial review of compliance with the EU antitrust rules, which are public policy provisions of EU law. Notably, the Court emphasised that CAS arbitration is imposed unilaterally on athletes, rendering effective judicial review ‘particularly necessary’ (C-124/21 P, para. 193) to safeguard their rights. This is where CAS arbitration falls short.

As the Commission had established, the SFT does not meet the standards outlined in the CJ’s Eco Swiss jurisprudence (C126/97). Its review of CAS awards does not extend to compliance with Articles 101 and 102 TFEU and the SFT, being a court external to the EU legal system, cannot make preliminary references under Article 267 TFEU. The CJ further reprimanded the GC for suggesting that alternative remedies, such as potential access to public enforcement or damages claims, could compensate for this lack of effective judicial review or the inability to seek (interim) injunctive relief from national courts, which may be particularly important for ‘persons practising professional sport, whose career may be especially short’ (paras. 201-203). Consequently, the CJ set aside the part of the GC judgment pertaining to CAS arbitration. Giving final judgment in the matter, it then summarily dismissed the ISU’s appeal that had prevailed before the GC. Remarkably, the Court disregarded the absence of a direct link between the eligibility and arbitration rules. It simply acknowledged that the Commission’s assessment of the arbitration rules in its decision was correct and that, therefore, it was entitled to consider that this reinforced the infringement and necessitated corrective measures (paras. 228-229).

4. Challenges and outlook

First, the silver lining for the CAS: the CJ solely took aim at the SFT’s shortcomings and refrained from calling into question the legitimacy of CAS arbitration. However, its judgment in ISU v Commission inevitably has implications for the position of CAS in the institutional system of governance of international sports. The Commission’s prohibition decision had only addressed the specific interplay of CAS arbitration clauses and the enforcement of the ISU Eligibility Rules. The CJ has now elevated this issue to a broader, more general concern.

For athletes, clubs, and other applicants deriving rights from the EU antitrust provisions (and other fundamental provisions in the EU treaties amounting to European public policy), the immediate consequence of the judgment is that it empowers them to bypass the CAS and seek to protect those rights before the national courts of the Member States. After all, the validity of CAS arbitration clauses is “impeached” by the fact that the requirements for effective judicial review cannot be met by the SFT. Similarly, even when a decision has been appealed to the CAS, the judgment should make it easier for a claimant to subsequently challenge the recognition or enforcement of the award for reasons of public policy. There are two caveats. Firstly, the competence of the courts of the Member States may still be contested on private international law rules (such as the Lugano Convention when the claimant is only indirectly affected by the decision). Secondly, this enhanced access to justice applies only to cases where EU (competition) law may be applicable. It would not cover, as the CJ noted, ‘disputes concerning merely the sport as such and therefore not falling under EU law’ (C124/21 P, para. 190). However, as the Court also recognises, in a professional sporting context, disciplinary decisions, as well as their underlying rules and regulations, have considerable economic implications. While proving a breach

Articles 101 or 102 TFEU may be challenging, such a violation may at least be asserted, which would be sufficient to trigger access to the courts.

For SGBs, the risk of a multiplication of national court proceedings will no doubt be a cause for concern. Indeed, national courts will be less deferential to SGBs than the CAS, which has so far never found a sporting rule or practice to violate EU competition law. Ultimately, much will depend on the rigor with which the courts will examine the decisions of SGBs under the EU antitrust rules. However, as explored elsewhere in this symposium, the judgments in ISU, ESLC, and Royal Antwerp do appear to place a stringent evidentiary burden on SGBs to offset a prima facie case of competitive harm, especially when the Wouters exception is not available. In any event, the main implication of the judgment for SGBs is that it restricts their ability to use the CAS as a shield to ward off EU (competition) law challenges or, at the very least, to impose exorbitant litigation costs and delays onto athletes seeking redress in national courts by challenging their jurisdiction.

Finally, what might be the impact for the CAS? In terms of its caseload, the consequences will likely be limited. Currently, the CAS deals with few disputes involving EU law. Most of its cases involve appeals against decisions of the FIFA Dispute Resolution Chamber and first instance anti-doping sanctions. The former are usually contractual disputes between clubs and players, where parties prefer to turn to the CAS due to the ease of enforcing its awards with FIFA’s support. As for the latter, the CJ’s Meca-Medina judgment (C-519/04 P) does not suggest a promising outlook for potential EU competition law challenges. In short, the ISU v Commission judgment is unlikely to threaten its survival. However, it might diminish its strategic importance in the eyes of the SGBs. This could motivate them to advocate for reforms within the CAS. A potential solution could be to establish an EU law chamber specifically tasked with handling appeals involving claims that SGBs’ regulations or decisions inter alia violate EU (competition) law. This chamber could have its seat in an EU Member State, subjecting CAS awards to review by the relevant national court and thus satisfying the CJ’s requirements of access to effective judicial review. This would reinstate the full bindingness of CAS arbitration clauses and limit the proliferation of EU (competition) law challenges before national courts throughout the EU.

Antoine Duval is Senior Researcher at the T.M.C. Asser Institute, the Netherlands, where he heads the Asser International Sports Law Centre and the Doing Business Right project.

Ben Van Rompuy is Assistant Professor of EU competition law at Leiden University.

Disclaimer: the authors advised and represented the complainants in the proceedings before the European Commission (Case AT.40208 – ISU’s Eligibility Rules) and have contributed to their cross-appeal against the ISU v Commission ruling of the General Court (Case T-93/18).

SUGGESTED CITATION: Duval, A. and Van Rompuy, B.: “Taking EU (Competition) Law outside of the Court of Arbitration for Sport (Case C-124/21 P International Skating Union v Commission)”, EU Law Live, 12/02/2024, https://eulawlive.com/ competition-corner/taking-eu-competition-law-outside-of-the-court-of-arbitration-for-sport-case-c-124-21-p-internationalskating-union-v-commission-by-antoine-duval-and-ben-van-rompuy/

An Open Goal to Improve Sports GovernanceComments on Royal Antwerp Football Club (C -680/21)

Robby Houben and Jan Blockx

21 December 2023 will go into the history books of sports governance. On this date, the Court of Justice issued its verdicts in European Superleague (C-333/21), International Skating Union (Case C-124/21 P) and Royal Antwerp Football Club (C-680/21). These verdicts set the new law of the land for sports governance. In European Superleague, the Court clarifies that new football competitions, challenging the existing UEFA competitions, deserve a fair chance, and cannot be denied at will. The International Skating Union verdict constitutes a major setback to the Swiss-based International Court of Arbitration for Sport’s privatisation of EU law jurisprudence, as the Court of Justice rules that for matters relating to EU competition law, access to an EU judge should be available (para. 198). In Royal Antwerp Football Club, the so-called ‘home grown player rule’ is at stake. This rule requires clubs to include at least 8 locally trained players in the list of 25 players that make the A team. In this case, the Court of Justice sets out the framework to assess the ‘home grown player rule’ under EU competition and free movement law. Whether that rule actually constitutes an infringement is left to the referring court.

In this piece, we focus on Royal Antwerp Football Club, especially the aspects of the verdict that are of broader relevance to sports governance and its compliance with EU competition law. Because the three verdicts are related to each other, we will, however, also ponder on some of the consequences of European Superleague and International Skating Union.

A key takeaway from Royal Antwerp Football Club (and European Superleague) is the clarification of the meaning of Article 165 TFEU for sports. The second paragraph of said article reads that ‘Union action shall be aimed at: …developing the European dimension in sport, by promoting fairness and openness in sporting competitions and cooperation between bodies responsible for sports, and by protecting the physical and moral integrity of sportsmen and sportswomen, especially the youngest sportsmen and sportswomen.’ In his Opinion in European Superleague, based on this provision, Advocate General Rantos attached constitutional value to the open sports competition, with promotion and relegation. He went as far as to allow UEFA, a private Swiss organisation, to watch over the correct application of the open competition. Remarkably, first Advocate General Szpunar, in his Opinion in Royal Antwerp Football Club, took a different approach. In a nutshell, he argued that Article 165 TFEU was directed to the Union itself, and does not confer rights on private parties such as UEFA (para. 54). Moreover, the provision does not elevate any form of sports competition to be a European constitutional model. Such communication between two Advocate Generals, in two pending cases, who differ views, is quite unique. It explains to a large extent why Royal Antwerp Football Club was tried together with European Superleague and International Skating Union, although initially only the latter two cases were on the same timeline.

The Court of Justice clearly ruled along the lines of Szpunar. Instead of analysing Article 165 TFEU as a constitutional provision creating an unique regulatory environment for sports, the Court of Justice finds that Article 165 TFEU ‘is not a cross-cutting provision having general application’ (Royal Antwerp Football Club, para. 68). Furthermore, its content ‘need not be integrated or taken into account in a binding manner in the application of the rules on the interpretation of which the referring court is seeking guidance from the Court, irrespective of whether they concern the freedom of movement for workers (Article 45 TFEU) or competition law (Article 101 TFEU). More broadly, nor must Article 165 TFEU be regarded as being a special rule exempting sport from all or some of the other provisions of primary EU law liable to be applied to it or requiring

special treatment for sport in the context of that application.’ (para. 69). Hence, those who argued that the provision somehow exempted sports from free movement and competition law, came home empty-handed.

A second attempt by the football governing bodies to escape competition law similarly failed. UEFA and the other organising bodies argued that any restrictions they imposed on clubs and players could be justified by the legitimate objective of organising a sports competition, in line with the Court’s earlier case law of Wouters (C-309/99) and MecaMedina (C-519/04). The Court rejected this argument, pointing out that, while doping rules may be justified by such an objective (as in the Meca-Medina case), such a justification cannot be invoked if a sporting body does not provide for criteria for clubs and players to participate in alternative competitions (as in the European Superleague and International Skating Union cases) since the latter are restrictions of competition by their very nature or ‘by object’ in the words of Article 101 TFEU, which distinguishes this from restrictions merely ‘by effect’. The exclusion of restrictions by object from the Wouters and Meca-Medina case-law is certainly a helpful circumscription of that case law, but it does not get us out of the woods entirely, since it means that everything turns on whether a sporting rule is a restriction by object or by effect – and that question is akin to theological discussions over the nature of the divine. The difficulty is already apparent in the Royal Antwerp Football Club case, where the Court itself declined to categorise the ‘home grown player rule’ in either bucket and passed the hot potato to the national court. But even for the foundational Wouters case, which concerned a prohibition of partnerships between lawyers and other professions, the qualification as merely a restriction by effect, is far from obvious.

In any event, even for restrictions by effect, it seems to us that the burden of proof to demonstrate that a legitimate objective exists to justify that restriction should lie firmly with the party that alleges such objective (and that imposes the restrictions) – in this case the sports governing bodies. This is consistent with the approach under free movement law. This might also provide the answer to the pending Diarra case (C-650/22). This case relates to the legality of the FIFA transfer system, especially the so-called co-debtor principle. This principle makes an engaging club jointly liable with a player if the player breached his ongoing contract with his former club. Assuming the Court follows the claimants and finds an infringement in this case, it might fall upon FIFA to effectively demonstrate the proportionality of its transfer system – something that until now was silently presumed, but never actually proven. This is important. As argued by one of us before, if rules are simply assumed to pursue legitimate objectives instead of being evidenced to do so, this is an open invitation for ‘sports washing’, the equivalent of green washing in sports.

Where do we go from here? The Court of Justice adopted its rulings in the highly politicised context of the European Superleague. The background to this was identified by Advocate General Szpunar. In his Opinion in Royal Antwerp Football Club, he pointed out that, because UEFA is both the regulator and monopolist of European club football, conflicts of interest are ‘bound to arise’, and UEFA [and domestic football regulators] will have a natural reflex to let their own commercial interests prevail over the public interest (para. 58). In the European Superleague judgment, the Court of Justice is now effectively inviting UEFA to develop a transparent, objective, non-discriminatory and proportionate framework for the approval of novel competitions. Yet, is UEFA really able to develop such a framework when it is intrinsically programmed to protect its own monopoly? The first signs are not very promising. In its statement following the verdict in European Superleague, UEFA stated: ‘This ruling does not signify an endorsement or validation of the so-called ‘super league’; it rather underscores a pre-existing shortfall within UEFA’s pre-authorisation framework, a technical aspect that has already been acknowledged and addressed in June 2022. UEFA is confident in the robustness of its new rules, and specifically that they comply with all relevant European laws and regulations.’ Indeed, anticipating defeat, on 10 June 2022, UEFA adopted a set of Authorisation Rules for alternative competitions, which are now public and include procedural steps. However, in spite of UEFA’s statements, these rules do not seem to pass the Court of Justice’s bar (as set out in particular in para. 151 of European Superleague). The ex-ante refusal of a new football competition such as a Superleague 2.0 has for instance already

been made explicit, as the new rules include the provision that a new competition may not adversely affect the good functioning of the UEFA Champions League (Article 7 of said rules). This prohibits the best teams from participating in an alternative competition, making such initiatives less appealing, from both a sporting and a commercial perspective, thus in effect writing it off. Furthermore, the new rules continue to show disregard for the application of the EU rule of law by imposing mandatory arbitration in Switzerland. This is not an ’effective judicial review’ under EU law, as now explicitly recognised by the Court of Justice in International Skating Union (paras. 198 and 225).

It seems that any real reform will not come from UEFA itself, but will need to be enforced, either by clubs, leagues and players that leverage their increased bargaining power in the new now, or by politicians. From a policy perspective, adhering to the principles of good governance is a prerequisite for self-regulation of sports governing bodies. In its verdicts, the Court censored underperforming sports governance. Whether deliberately or not, it thereby brings the political horse to the water. Will it drink? After the verdicts have paved the way, there has probably never been a better momentum. Substantially, as argued by esteemed colleagues before, the best way forward to solve the conflict of interest in football once and for all is arguably for the EU to separate the regulation of sports competitions from their commercial exploitation, and to put adequate controls and supervision in place, conducted by a neutral body.

Robby Houben is a professor of sports law at the University of Antwerp and founder of the Football College powered by UAntwerp.

Jan Blockx is a professor of EU law and EU competition law at the University of Antwerp.

SUGGESTED CITATION: Houben, R, and Blockx, J.; “An Open Goal to Improve Sports Governance - Comments on Royal Antwerp Football Club (C-680/21)”, EU Law Live, 25/01/2024, https://eulawlive.com/competition-corner/an-open-goalto-improve-sports-governance-comments-on-royal-antwerp-football-club-c%e2%80%91680-21-by-robby-houben-and-janblockx/

Agent Fees, Player Transfers, and Transnational Leagues: What Lies Ahead for EU Football Law? Guillermo Íñiguez

On 21 December 2023, the Court of Justice handed down three landmark judgments on the interaction between EU law and sport. European Super League Company (“ESLC”, C-333/21), International Skating Union (C-124/21 P) and Royal Antwerp FC (“RA”, C-680/21) (“the December judgments”) all raise issues of competition, internal market, and even constitutional law, many of which have been analysed by other contributors to this symposium. The present Op-Ed will therefore adopt a somewhat different angle. Instead of discussing the rulings in themselves, it will explore how some of their key findings may shape three pending cases: RRC Sports, Diarra, and Hesperange. In doing so, it will seek to understand what lies ahead for EU football (and sport) law.

RRC Sports: Can FIFA cap agents’ fees?

On 26 May 2023, the Court of Justice received a request for a preliminary ruling from the Regional Court in Mainz (Germany). RRC Sports GmbH, a German company providing football agent services, challenged FIFA’s Football Agent Regulations (“FFAR”). Among others, the Regulations introduce a cap on the fees which agents can charge for their services; subject to some exception, they also prevent agents from representing the player, the buying club, and the selling club in the same commercial transaction. In its request, the referring court queries whether these rules breach Articles 101 and 102 TFEU, Article 56 TFEU, and Article 6 of the GDPR.

In a sense, RRC Sports (C-209/23) is the most straightforward of the cases pending before the Court of Justice. The key question is how, if at all, sport-related considerations will feature in the Court’s analysis of the FFAR. In December 2023, in a circular announcing that it was suspending the FFAR’s application following a preliminary injunction from a court in Dortmund, FIFA claimed that its rules constitute ‘a necessary, proportionate and fully legal regulatory step to address systemic failures within the international transfer system.’ Previously, it had argued that these rules serve the objectives of ‘reinforcing contractual stability, protecting the integrity of the transfer system and achieving greater financial transparency’.

For the purposes of this dispute, two main lessons can be gleaned from the December judgments. On the one hand, and in accordance with settled case law, there is nothing inherently unlawful about football governing bodies restricting EU competition law provided that such restrictions can be justified under Articles 101(3) or 102 TFEU. Nor will the internal market provisions be breached provided that such restrictions constitute a proportionate means to a legitimate end. Therefore, and building on the above, the mere fact that FIFA introduces rules limiting the fees which agents can charge for their services cannot in itself be deemed a violation of Union law.

More interesting, however, is whether the Court of Justice will choose to apply football’s ‘specific characteristics’ to the litigation before it. Will the dispute be stripped of its football context, instead being reduced to a ‘pure’ competition (or internal market)-related one? Conversely, if this dimension does feature in the Court’s analysis, which of the aforementioned characteristics will be drawn on, and how will the competing considerations at stake – such as the need to ensure a fair and transparent market and agents’ freedom to provide their services across the internal market – be balanced? Although it may not break new ground, RRC Sports could provide another example of how football-related reasoning can shape the Court’s analysis of the TFEU’s competition and internal market provisions.

Diarra: a new Bosman?

More consequential – and perhaps most interesting – is the Diarra case (also known as the Charleroi case), a longstanding dispute which could reach the CJEU following a preliminary reference from a Belgian court.

Diarra concerns the rules on the International Transfer Certificate (“ITC”), a document which players registered at one national football association must obtain before being able to register with another football association. According to the FIFA rules, national associations are not to issue an ITC if the player in question is engaged in a contractual dispute with a former club. In the dispute giving rise to the main proceedings, Lassana Diarra, a French professional football player, was not allowed to sign with Sporting Charleroi, a Belgian football club: according to both FIFA and the Belgian football federation (“URBSFA”), the player could not be issued an ITC because a contractual dispute with Lokomotiv Moscow, a previous employer of his, was still pending before FIFA’s Dispute Resolution Chamber.

The applicants challenge FIFA’s regulations on the transfer of players on two grounds: first, they constitute anticompetitive agreements in breach of Article 101 TFEU; second, they violate Article 45 TFEU by restricting the free movement of players. Conversely, FIFA argues that the ITC – and its underlying rules – comply with Union law, and that in analysing their legality, account must be taken of the specific characteristics of sport. Following Royal Antwerp, however, it is unlikely that this lex specialis argument will suffice to convince the Court of Justice: if the latter has shown itself open to striking down the ‘home-grown player’ rules, a set of regulations which were arguably less restrictive than the ITC, it is hard to see how the latter could survive its scrutiny

In any case, FIFA will have to clear three hurdles in order to do so. First, it will have to find a legitimate objective in the public interest: such an objective which is by no means intuitive on the facts. Second, it will have to demonstrate that its rules are ‘suitable for ensuring, in a consistent and systematic manner, the attainment of [that] objective’ (RA, para 151). Finally, it will have to prove that its restrictions ‘do not go beyond what is necessary to achieve that objective’ (RA, para 151). If it fails to do so, and if the transfer rules came under judicial scrutiny, European football could witness a new Bosman moment.

Hesperange: National partitions and the status of football fans

In the third possible pending case, FC Swift Hesperange, a Luxembourg-based football club, brought legal proceedings against UEFA and the Luxembourg Football Federation (“FLF”), arguing that several of its rules are anticompetitive and restrict the free movement of both workers and capital. For present purposes, and beyond the competition and free movement disputes, Hesperange raises two novel issues. On the one hand, the applicants challenge the territorial model upon which European football rests. Among others, they claim that the UEFA-FLF rules, which ‘divid[e] up the EU territory on the basis of national borders’, have a negative impact upon clubs’ economic growth by, among others, ‘prohibiting clubs from creating and running transnational competitions’ (for example, by impeding the creation of a Benelux league). UEFA’s authorisation rules for cross-border competitions are depicted by the applicants as a ‘territorial lock-in’, which ‘harms smaller clubs in smaller countries’ and which ‘reflects UEFA’s unwavering desire to maintain a total monopoly on transnational and pan-European competitions’.

Despite its apparent similarity to ESLC, the emphasis in Hesperange is not on the manner in which breakaway competitions are authorised by UEFA, but on the national territorial division which (allegedly) prevents the creation of transnational competitions within UEFA’s ecosystem. The December judgments provide little indication of how this territorial dimension is to be analysed. In Royal Antwerp, the fact that football ‘gives rise to the organisation of numerous competitions at both European and national levels’ is listed as one the ‘specific characteristics’ of football (RA, para 105).

Conversely, the role of national football associations in the market for the organisation of interclub football competitions, and the potentially detrimental impact this can have on competition law, is highlighted by the Court of Justice when addressing Article 102 TFEU in the Superleague judgment (ESLC, para 149). If the dispute reaches the Court of Justice, the latter will have to decide (i) whether the national partition of European football constitutes a violation of EU law; (ii) whether this national organisation of football competition constitutes a ‘specific characteristic’ of football; and (iii) whether the latter can justify a potential breach.

No less interesting is the question, raised by the applicants, of whether football fans can be classified as ‘consumers’ under Union law. If entertained by the Court, this seemingly innocuous claim could have major repercussions: for example, by allowing follow-on actions for damages to be brought against UEFA or FIFA if a court were to find an infringement of EU competition law. Once again, the December judgments provide some indications on this matter. In Royal Antwerp, the Court of Justice notes (in the context of interpreting Article 101(3) TFEU) that ‘in the present case, the ‘users’ [of football] include, first and foremost, professional football clubs and the players themselves. Added to that, more broadly, are the final ‘consumers’ who are, in the economic sense of the term, the spectators or television viewers.’ However, the question of whether football fans can be classified as ‘consumers’ – in the technical, EU law sense – has not been expressly addressed so far. A preliminary reference in Hesperange could therefore expose football to a whole new area of Union law.

Conclusio

Instead of closing the floodgates, the December judgments may have flung them wide open. The ESLC judgment, which will return to the referring court for a final determination, is likely to be embroiled in several more years’ worth of legal battles, potentially making its way back to the Court of Justice at a subsequent appellate stage. The Court’s judgment could also constitute a bargaining chip in the broader negotiation – on the season calendar, TV rights, and new tournaments –which football’s numerous stakeholders will have to conduct in the coming years.

Beyond the Superleague, however, the pending cases discussed in this Op-Ed will continue to shape the future of EU sports law. The most imminent one, RRC Sports, has already reached the Court of Justice; others, such as Diarra or Hesperange, could do so in the next few years. All of them could provide Bosman-like moments, radically reshaping how EU law interacts with as powerful a global industry as football. For the time being, therefore, football is likely to prove a fertile ground for both EU law academics and practitioners.

Guillermo Íñiguez is a DPhil candidate in EU Law at Somerville College, Oxford.

SUGGESTED CITATION: Íñiguez, G.; “Agent Fees, Player Transfers, and Transnational Leagues: What Lies Ahead for EU Football Law?”, EU Law Live, 29/01/2024, https://eulawlive.com/competition-corner/op-ed-agent-fees-player-transfers-andtransnational-leagues-what-lies-ahead-for-eu-football-law-by-guillermo-iniguez/

Who’s Next in the Queue? Sports Cases Pending before the European Court

Marcos Araujo

In ESL C-333/21, ISU C-124/21 P and Royal Antwerp C-680/21, the Court of Justice of the European Union (‘the Court’ or ‘CJEU’) has clarified the limits that EU law imposes on sports organisations, furthering the principles already set since the seventies in cases, such as Walrave 36/74 or Donà 13/76, and the later, but no longer recent, judgments in Bosman C-415/93 or Meca-Medina C-519/04, in addition to adopting significant pronouncements relevant to competition law and the treatment of arbitration more broadly.

The decision to rule on the three cases simultaneously by a Grand Chamber reflects the intention to seek consistency in an area that has traditionally been tackled on a case-by-case basis. However, there is only so much that case accumulation can do. As these judgments were dictated, other procedures on sports matters had already been placed before the CJEU – cases that may be affected, to a lesser or greater degree, by the judgments now adopted and eventually qualify or develop their solutions.

This contribution identifies these pending cases, which have been ordered by case number and, therefore, from older to newer. It does not cover cases not yet listed on the Court’s webpage, such as the Diarra/Charleroi dispute or the more recent Hesperange case. Information on these two intriguing cases is available in Guillermo Íñiguez’s excellent Op-Ed at EU Law Live here

NADA, C-115/22

The Unabhängige Schiedskommission Wien (Independent Arbitration Commission, hereafter ‘USK’) lodged on 17 February 2022 a reference concerning the impact of the GDPR on national rules providing for the publication of the identity of an athlete having been found to infringe anti-doping rules. The question is of significant interest for the intersection between rights to information and privacy; however, for the purposes of this note, it is especially relevant to look at the procedural question if an ‘independent arbitration commission’ may refer a preliminary question under Article 267 TFEU, especially after the findings in ISU C-124/21 P concerning the role of arbitral courts when enforcing sports rules.

In her Opinion of 14 September 2023 on this matter, which evidently predated ISU, AG Capeta notes that, of the different elements that are relevant to that determination of whether the USK may refer questions to the Court, the most difficult one concerns its independence. In her view, that requirement must be the same for Article 267 TFEU purposes as when independence is evaluated in the context of Article 19 TEU (rule of law) cases (see para 57 of her Opinion), which enables tapping into the lessons learned in this latter field. From that viewpoint, AG Capeta considers that the USK is independent, referring to both internal elements such as the process of appointment and means to influence its members, and to external elements which discard a risk of interest in the outcome of the case. She goes as far as placing the USK as a last instance court arguing that Austrian law places the USK into the judicial structure of that country. As concerns the substance of the questions, AG Capeta accepts that the GDPR does not impede in this case the disclosure of the identity of the athlete sanctioned under anti-doping rules.

There is little doubt that the decision in this case, and especially if the USK is recognised as a court within the meaning of Article 267 TFEU, will be read carefully by sport arbitral institutions wishing to emulate its features. Being aware of that, the Court may consider sending a message, either to keep the door closed to arbitral tribunals making preliminary references (as the Court did with respect to investment arbitration in Achmea when it chose not to follow AG Wathelet’s Opinion) or, conversely, establishing a framework whereby certain arbitral tribunals, with defined features, may make preliminary references. A good occasion to choose either route that justifies paying close attention to the judgment on this matter.

FIFA, C-650/22

This is a reference by the Cour d’appel de Mons lodged on 17 October 2022. The case originates in the termination of employment of BZ, a football player, with Lokomotiv Moscow. While that dispute was under way, the player was prevented from accepting an offer by a Belgian football team by reason of certain provisions of FIFA Regulations on the Status and Transfer of Players (‘the RSTP’). The applicant considers these obstacles contrary to Articles 45 and 101 TFEU and seeks compensation for the loss of earnings (especially of offers of employment from clubs). The case is run against FIFA and the Belgian sports football association, the URBSFA.

The reference identifies the illegal constraints in the RSTP as: (i) the principle that the player and the club wishing to employ him are jointly and severally liable in respect of the compensation due to the club whose contract with the player has been terminated without just cause, as stipulated in Article 17.2 of the FIFA RSTP, in conjunction with the sporting sanctions provided for in Article 17.4 of those regulations and the financial sanctions provided for in Article 17.1; and (ii) the ability of the association to which the player’s former club belongs not to deliver the international transfer certificate required if the player is to be employed by a new club, where there is a dispute between that former club and the player (Article 9.1 of the RSTP and Article 8.2.7 of Annex 3 to the RSTP).

As initially formulated, the case relies mainly on Bosman C-415/93, where FIFA’s transfer rules were examined by the Court. The 21 December cases have added interest to the case in various respects. Among them, there is a question as to how will the Court read the eligibility constraints (especially the release of the international transfer certificate) in this case; in contrast with ISU C-124/21 P, their goal would not initially be impeding competing events, but arguably reducing the risk of disputes resulting from transfers, potentially at a cost for the procedural rights of the players. Another element of interest is the legitimate expectations claimed by football organisations, who argue that the Commission had blessed the current transfer rules following Bosman – good luck with that one!

The hearing for this case took place on 18 January 2023.

RRC Sports, C-209/23

RRC Sports results from a reference from the Landgericht Mainz (Germany) lodged on 31 March 2023. The case discusses the conformity of FIFA’s Football Agent Regulations (‘the FFAR’) with competition law and the General Data Protection Regulation or GDPR.

The dispute concerning the FFAR has been widely reported (see for instance the extensive comment of Tim Lichtenberg here), which facilitates the task of summarising a very long story. In short, the FFAR contain various limitations on football agents, including notably limits on the fees that they may validly agree with football players and conflict-ofinterest provisions. Unsurprisingly challenged under competition law arguments, the Landgericht (Regional Court) in Dortmund suspended on 24 May 2023 their operation in Germany (see here) and a Commercial Court in Spain likewise suspended these rules in Spain last November (see here), but the courts in Netherlands rejected similar requests. Besides

these interim measures, the conformity of the FFAR with EU law has resulted in two preliminary references, both from German courts: this case C-209/23 from Landgericht Mainz, and case C-428/23 by the Federal Supreme Court, discussed below. Following these challenges, FIFA announced on 30 December 2023 the suspension of these rules pending the resolution of these cases (see here). There is also the parallel initiative of a most interesting ruling from the Court of Arbitration for Sport (TAS/CAS) which has looked at the compatibility of the FFAR with competition law, which I have discussed elsewhere (see here) and another award by an UK panel discussing the same issues under UK competition rules adopted in December 2023 (available here).

The impact of the 21 December judgments over the FFAR dispute is at the same time evident and complex. If there was any doubt, the question of the general applicability of competition law and the weakening of a ‘European sports model’ defence based on Article 165 TFEU seem clear; on the other, the three judgments, and especially Royal Antwerp C-680/21, provide room for Article 101(3) TFEU arguments and promise a challenging debate over the nature of ‘by object’ of the disputed limitations. And indeed the question if competition law issues may validly be arbitrated before the TAS/CAS will be read differently following ISU C-124/21 P.

ROGON, C-428/23

ROGON is the second preliminary reference concerning the regulation of sports agents by football associations alluded to some lines above, sent this time by the German Supreme Federal Court or Bundesgerichtshof (BGH) on 11 July 2023.

In contrast with RRC Sports, which as noted discusses FIFA’s FFAR conformity with competition rules and the GDPR, this reference concerns the conformity with Articles 101 and 102 TFEU of the Reglement für die Spielervermittlung; (the RfSV) adopted by the German Football Association (Deutscher Fußballbund e. V., DFB). However, as the reference notes, the RfSV was issued ‘in the wake of FIFA’s adoption of regulations on working with players’ agents’ and contains similar limitations as the FFAR. The main difference concerns the extension of the control that is sought in this case: the BGH questions the conformity with competition rules of multiple aspects of these regulations, including the registration obligation imposed on agents, the obligation imposed on agents to submit to various statutes, regulations and rules of FIFA and DFL; the obligations that natural persons must assume when registering legal persons; the prohibition to have a share in future transfer proceeds of the club in the case of an inward transfer; the prohibition on commissions for services in respect of minors; and an obligation to disclose fees paid and payments made to agents. This suggests that the BGH considers necessary to have precise guidance on the criteria to comprehensively evaluate the activities of (DFB and eventually FIFA).

In the request for a preliminary reference, the BGH appears to express concerns with the consequences of a potentially overly generous reading of the regulatory deference of FIFA in the Opinion of AG Rantos in Superleague, and in particular on the power of sports organisations to regulate issues that “do not directly concern the competitive sport itself and (…) concerns undertakings that are not members of the sports association and are therefore unable to influence the content of those regulations” (see para 30 of the request), revealing a concern over the regulatory reach of the sport organisation in the light of principles of representative governance. If that was intended to be a message for the Court, the judgments of 21 December suggest that it was received loud and clear. At the same time, the fact that the BGH has made such a long and detailed list of potential obstacles in regulation is a clear invitation for the Court to go further and specify in greater precision if the requirement to have transparent, objective and non-discriminatory criteria when limiting economic activities is constrained to the organisation of rival competitions or if it should be applied more broadly. A decision to watch indeed.

Royal Football Club Seraing, 600/23

This recent case lodged on 2 October 2023 comes from the Cour de cassation de Belgique (Court of Cassation, Belgium) in a most interesting procedure case that discusses both regulations adopted by FIFA and UEFA, on the one hand, and the mandatory arbitration rules before the TAS/CAS on the other.

The case originates in the adoption by FIFA of its ‘Regulations on the Status and Transfer of Players’ (STP Regulations) and particularly the prohibition, announced on 26 September 2014, of third-party ownership of players’ economic rights. The applicant in the original proceedings, Doyen Sports, had signed agreements seemingly contrary to these prohibitions, for which he was fined on 4 September 2015 by FIFA’s Disciplinary Committee. The appeal against that decision was dismissed on 7 January 2016 by the FIFA Appeal Committee. On 9 March 2016, the applicant lodged an appeal against that decision of 7 January 2016 before the Court of Arbitration for Sport, in accordance with an arbitration clause in FIFA’s statutes. That appeal was dismissed in an award dated 9 March 2017. On 15 May 2017, the applicant filed an application for annulment of the award before the Swiss Federal Tribunal. That court dismissed that application by judgment of 20 February 2018.

In parallel to these proceedings in Switzerland, on 3 April 2015, Doyen Sports had introduced a claim before Belgian courts requesting a declaration that a total prohibition of the practices as provided for in the STP Regulations would be unlawful under EU law and more specifically the right to the free movement of capital, the right to the freedom to provide services, the right to the free movement of workers and competition law; to declare as null and void any regulation containing such a total prohibition; to order UEFA to amend its ‘Club Licensing and Financial Fair Play Regulations’ so as to make them compatible with the practice of third-party ownership or third-party investment, and to pay it compensation for the damage suffered as a result of the application of the STP Regulations. By judgment of 17 November 2016, the Brussels Commercial Court declined jurisdiction to hear the applicant’s claims. The appeal introduced before the Court of Appeal was dismissed by a judgment delivered on 12 December 2019.

In the appeal against this latter judgment introduced before the Court of Cassation, the applicant argued that the compulsory arbitration before the TAS/CAS would be contrary to EU law, referring to the European Commission decision in ISU (see para 57 of that decision). The applicant also submitted that, following Achmea, C-284/16, a Member State is in breach of its obligation to ensure the full effectiveness of EU law and its autonomy if it consents to arbitration in a manner that deprives judicial review with the possibility of referring questions for a preliminary ruling to ensure consistency with the public policy of the European Union (Achmea, paras 54 and 55).

It will immediately be noted that this case raises two groups of issues. One concerns the rules from sports organisation, and in particular the legality of the ban on the ownership of the players’ economic rights; on the other, the binding force of final judgments from an arbitral authority, which are recognised legal force under Belgian law. It is clear that both will be influenced by the judgments of 21 December 2023, which clearly limit the regulatory powers of sports organisations and TAS/CAS arbitration (albeit without quoting Achmea, unlike AG Rantos’ Opinion in ISU). Lots to unpack, however, on the potential justification of the restriction here anyway.

Other Sports Cases Pending before the CJEU

Besides the cases discussed in the preceding paragraphs, there are other appeals and preliminary references before the Court in the field of sport where the 21 December judgments are of at best indirect relevance. Among them, the following two deserve a mention here.

Nikita Dmitrievich Mazepin, T-743/22

On 9 March 2022, the EU added the name of Nikita Dmitrievich Mazepin to the list of persons, entities and bodies subject to restrictive measures following the military attack of the Russian Federation over Ukraine. The reason was that Mr Mazepin is the son of Dmitry Arkadievich Mazepin, General Director of JSC UCC Uralchem, which sponsors the Haas F1 Team.

While this case is still pending before the General Court, it has already made headlines as a result of the adoption of several interim measures. In the first decision (T-743/22 R), the General Court suspended in part the original decision affecting the applicant, arguing inter alia that the Council had not produced conclusive evidence based on the applicant’s conduct to explain why, apart from the family connection, he had to be regarded as being connected with his father after the termination of his contract as a Formula 1 driver and the sponsorship agreement concluded between Uralkali and Haas F1 Team. Following this Order, the Council readopted its decision on 13 March 2023, only to find that new decision also suspended by the Order of 19 July 2023 T-743/22 R II. After a fresh reintroduction of Mr Mazepin (son) in the list by the Council, the President if the GC granted him another suspension on 7 September 2023; however, following an appeal by the Council, on 28 September 2023 the Vice-President of the Court of Justice set the order of the President of the GC aside and referred the case back to the president of the GC, who dismissed the interim measures that had been initially granted through an Order of 27 October 2023, T-743/22 R III. The last on this list is the Order of 22 December 2023, T-743/22 R IV, which again rejects a request that had been granted by an initial order by the president of the GC on 3 October 2023, corrected following an appeal by the Council decided by the Vice-President of the Court of Justice on 22 November 2023

This convoluted series of decisions highlight the technical difficulties encountered in the judicial review of restrictive measures adopted following the Russian attack on Ukraine, as well as the differing perspectives of the General Court and the Court of Justice. That said, it is hard to see any impact of the judgments of 21 December 2023 on the case of Mr Nikita Mazepin.

Arce, C-365/23

This very interesting reference from the Augstākā tiesa (Senāts) (Supreme Court (Senate) of the Republic of Latvia), lodged on 9 June 2023, concerns an agreement between a young sportsperson and his parents, on one side, and a service provider, on the other, following the refusal to pay the agreed amounts.

The request for a ruling does not specify the sport concerned, vaguely mentioning ‘a particular sport’. The services to be provided included ‘coaching and training, sports medicine and psychology services, career guidance – development, application and monitoring of a career plan and the conclusion of contracts between the sportsperson and sports clubs –, marketing and legal and accountancy services.’ The remuneration, agreed when the sportsperson was 17, amounted to 10% of all net income from playing activities in the sport in question, advertising, marketing and media appearances, apparently during the term of the agreement (15 years).

The referring court seems inclined to consider these clauses as abusive, but has doubts concerning the applicability to the situation of Directive 93/13 on unfair terms in consumer contracts, both on the consideration of the sportsperson as a consumer and on the temporal applicability of the Directive. In that latter respect, the referring court draws attention to the fact that the transposition of the relevant part of the Directive into national law came into force after the agreement was concluded.

While from a different legal perspective to that of sports regulation, the case raises questions on how to best protect sportspersons from potential abuse by professionals. That connects this reference with some of the arguments raised in the cases discussed in section 2 above on football agents (especially RRC Sports and ROGON) and perhaps even with the prohibition of ownership that is at the core of Royal Football Club Seraing.

Closing remarks

In the coming months, the Court of Justice will issue several important judgments in the field of sport. These decisions will complement the pronouncements of 21 December with clarifications, additions and perhaps raise new questions, fuelling a much needed conversation about this special field in the realm of law. The questions already placed before the Court will perhaps clarify when sports arbitral bodies may make preliminary references, and also consider the compatibility of FIFA’s regulations on sports agents or FIFA’s transfer rules with EU competition law. The answers from the Court will likely be as hotly debated as the 21 December judgments themselves and prompt additional questions, as the upcoming Diarra/Charleroi and Hesperange cases show.

Not all will be equally content with the answers, but many will coincide that the judgments of 21 December have inaugurated a new era where the legal treatment of sports organisations has become part of our conversation, a place they may not leave soon.

Marcos Araujo is a Spanish practitioner, lecturer, and Chairperson Elect of the Spanish Association for the Defence of Competition (AEDC).

Marcos holds a PhD from the University of Glasgow.

SUGGESTED CITATION: Araujo, M.; “Who’s Next in the Queue? Sports Cases Pending before the European Court”, EU Law Live, 14/02/2024, https://eulawlive.com/competition-corner/op-ed-whos-next-in-the-queue-sports-cases-pending-beforethe-european-court-by-marcos-araujo/

FIFA Football Agents Case In The Wake Of Recent Competition Law Rulings

Oriol Armengol and Fiona Radley-Searle

A Closer Look at FIFA’s Football Agents Regulation

At the end of 2022, FIFA, football’s global governing body, adopted a set of rules aimed at governing the activity of football agents (the FIFA Football Agents Regulations or ‘FFAR’). Amongst a wide variety of measures, FFAR establish a cap on the agents’ fees, which is different depending on whom the agent represents in a given transaction, and impose information and transparency obligations to agents. This forces them to make public the details of every transaction in which they intervene, including the fees they receive. Since its publication, the FFAR’s ambitious agenda has become a focal point of legal contention in the realm of competition law.

FIFA justified the adoption of the FFAR as a solution to certain dysfunctions that allegedly have arisen in recent years in the market of representation services to football players and coaches, such as an alleged excessive increase in fees received by football agents as a result of transfers, harm to the contractual stability of players as a result of an alleged incentive for agents to carry out the highest number of transactions possible, an alleged increase in conflicts of interest in the market, and a series of problems in the signing of minors that would necessitate increased protection for them.

However, since its adoption, the FFAR have given rise to significant litigation in the European Union, as football agents consider that its provisions, and especially the fee cap, would not only genuinely undermine the viability of their business model, but also constitute a serious restriction of competition incompatible with Articles 101 and 102 of the Treaty on the Functioning of the European Union (‘TFEU’).

At the time of the publication of this piece, there are ongoing proceedings against the FFAR in a number of EU Member States (Belgium, France, Germany, the Netherlands and Spain), as well as in England and Switzerland. Within these proceedings, in Germany (Dortmund) and Spain, interim measures were adopted in 2023, prohibiting FIFA and the respective national federation to apply the FFAR, particularly the fee cap. Moreover, in Germany (Mainz) the court submitted a request for a preliminary ruling to the Court of Justice of the European Union (‘CJEU’) (Case C-209/23, hereinafter the FIFA Football Agents Case).

Evolution of Regulatory Framework

FIFA’s venture into regulating football agents commenced in 1994 with the “Regulations governing Players’ Agents” (‘RGPA 1994’). Modified in 1995 and effective from 1996, it introduced a licensing system, exclusive reservation of the profession for natural persons, a bank guarantee requirement, and limits on representation contract durations. Two agents lodged a complaint with the European Commission, which led FIFA to amend certain provisions in 2001. The case was dismissed in April 2002, and later appealed by one of the agents, which resulted in the landmark Piau judgment on 26th January 2005 (Case T-193/02).

In 2007, FIFA introduced RGPA 2008, maintaining restrictions and prescribing agent compensation calculations. In 2014, FIFA decided to abandon international agent regulation for the more liberal “Regulations on Working with

Intermediaries” in 2015. This shift eliminated the need for a FIFA license, suggested transaction fees capped at 3% of the player’s base income, allowed club payments to intermediaries, prohibited fees for minors’ representatives, and advocated vigilance against conflicts of interest.

In summary, FIFA’s agent regulations have undergone a two-decade evolution, swinging between interventionist and liberal models, culminating in the contentious FFAR, which represent a shift towards more interventionist regulation.

Recent CJEU Rulings: Illuminating Common Threads

The FFAR’s legal challenges unfold against the backdrop of three significant CJEU rulings – the Superleague case (Case C-333/21), the ISU case (Case C-124/21 P) and Royal Antwerp case (Case C-680/21) – all published on 21st December 2023. These rulings provide crucial insights and reveal common threads that offer a glimpse into the potential fate of the FIFA Football Agents Case.

Commonalities in Recent Rulings

• The recent rulings emphasise that sports governing bodies, including FIFA, can protect their competitions. However, any protection measures FIFA may want to adopt shall adhere to specific substantial and procedural conditions (i.e., transparency, objectivity, non-discrimination and proportionality) in order to comply with EU law. This sets the benchmark for scrutinising the legitimacy of FIFA’s regulations in the context of the Football Agents Case, which will likely see a parallel application of this rationale.

• The CJEU downplayed the uniqueness of sports and the European Sports Model, thus adopting a different approach from that taken by Advocate General Rantos in his Opinion in the Superleague case. While recognising sports’ specificity, the CJEU stressed that this should not lead to a more lax application of competition legislation, thus conveying the message that sports regulations align with general competition principles. This approach may spill over to the FIFA Football Agents Case, particularly with regards to the application of Articles 101 and 102 TFEU and the fundamental freedoms provisions.

• The CJEU examines the conduct in each case to determine whether it constitutes a restriction of competition “by object”. This involves an analysis of the conduct’s content, objectives, and of its economic and legal context. The FIFA Football Agents Case may undergo similar scrutiny, focusing on assessing the specific provisions of the FFAR and their impact on competition in the football agent market. Thus, if the rules are deemed not to restrict competition “by object”, a fully-fledged effects assessment would be necessary.

• In the Meca-Medina case (Case C-519/04 P), the CJEU admitted that a restrictive measure of a sports organisation may be justified by a legitimate public interest purpose, as long as it is genuinely necessary for that purpose and generates restrictive effects that are inherent to this purpose and do not go beyond what is necessary. However, the CJEU clarified that the Meca-Medina test does not apply to restrictions of competition “by object”, a crucial point for cases like the FIFA Football Agents Regulation dispute. This non-application of the Meca-Medina test may also come into play when assessing FIFA’s Football Agents Regulations if the courts finally conclude that the controversial FFAR provisions qualify as a restriction of competition by object, a contention put forth by several agents in the dispute.

• The CJEU emphasises reading Articles 101 and 102 TFEU in conjunction with Article 106 TFEU, especially when sports federations act as “private regulators”. This common thread signals a broader application of competition law principles, potentially challenging FIFA’s dual role as a regulator and an economic stakeholder in the football agent market.

• The CJEU aligns the interpretation of Articles 101 and 102 TFEU, ensuring consistency in the substantial and procedural safeguards required in sports governing bodies’ statutes. This consistency could set a precedent for evaluating the compliance of FIFA’s regulations with Articles 101 and 102 TFEU (and the corresponding national rules), as well as the fundamental freedoms provisions of the EU. The FIFA Football Agents Case stands to gain valuable insights from the harmonised interpretation observed in these judgments, potentially leading to a parallel ruling in its assessment.

FIFA Football Agents Case in Perspective

As the FIFA Football Agents Case navigates this evolving legal terrain, it stands at a crucial juncture. Recent CJEU rulings underscore the imperative for sports federations to align their practices with EU internal market and competition rules. The case resonates beyond football, symbolising the dynamic interplay between law and sport, necessitating ongoing dialogue and scrutiny to foster a harmonious coexistence.

In conclusion, the FIFA Football Agents Case, amid legal challenges and against the backdrop of recent CJEU rulings, epitomises the intricate relationship between sports regulation and EU competition law. The football world awaits the resolution of this case, keenly aware of its potential to shape the future of football agent representation and the broader governance of international sports.

Oriol Armengol is a partner in the EU and competition law practice at a Spanish international law firm in Madrid. He is representing the Spanish Football Agents Association and several agents in litigation against FIFA and the Royal Spanish Football Federation.

Fiona Radley-Searle is a lawyer in the EU and competition law practice at a Spanish international law firm in Madrid, and a visiting professor at Universidad CEU San Pablo. She is representing the Spanish Football Agents Association and several agents in litigation against FIFA and the Royal Spanish Football Federation.

SUGGESTED CITATION: Armengol, O. and Radley-Searle F.; “FIFA Football Agents Case In The Wake Of Recent Competition Law Rulings”, EU Law Live, 27/02/2024, https://eulawlive.com/competition-corner/fifa-football-agents-case-in-thewake-of-recent-competition-law-rulings-by-oriol-armengol-and-fiona-radley-searle/