ASSER International Sports Law Series

EU Sports Law
and Breakaway
Leagues
in Football

Katarina Pijetlovic
ASSER International Sports Law Series
More information about this series at http://www.springer.com/series/8858
Katarina Pijetlovic

EU Sports Law
and Breakaway Leagues
in Football

13
Katarina Pijetlovic
Helsinki
Finland

ISSN 1874-6926 ISSN 2215-003X (electronic)

ASSER International Sports Law Series
ISBN 978-94-6265-047-3 ISBN 978-94-6265-048-0 (eBook)
DOI 10.1007/978-94-6265-048-0

Library of Congress Control Number: 2014955793

© t.m.c. asser press and the author 2015

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Series Information

Books in the ASSER International Sports Law Series comprehensibly chart and
analyse legal and policy developments in the emerging field of European and inter-
national sports law. Within scholarly publishing, the series is the most cited in its
area and uniquely features contributions from the leading sports law scholars. It
is a valuable resource for practitioners, academics, sports officials, and anyone
­interested in or impacted by sports and the law.
The Series is developed, edited and published by the ASSER International Sports
Law Centre in The Hague. The Centre’s mission is to provide a centre of excellence
in particular by providing high-quality research, services and products to the sporting
world at large (sports ministries, international—intergovernmental—organisations and
federations, the professional sports industry, etc.) on both a national and an international
basis. As a pioneer in the field of European and international sports law, the Centre
has established a worldwide network of academics and practitioners and co-operation
agreements with various sports law institutes and centres in Europe and beyond.

Apart from the Series, the Centre edits and publishes The International Sports Law
Journal.

Series editors
Dr. David McArdle
e-mail: [email protected]

Prof. Dr. Ben Van Rompuy

e-mail: [email protected]

Marco A. van der Harst, LL.M.

e-mail: [email protected]

Editorial Office
ASSER International Sports Law Centre
T.M.C. Asser Instituut
P.O. Box 30461
2500 GL, The Hague
The Netherlands
www.sportslaw.nl
For Mum
Preface

I am delighted to be able to contribute the first English-language book on the topic

of the treatment of breakaway leagues under EU sports law. The book has been in
preparation over a period of several years and there were some longer breaks in
the research and in the writing. It was finally completed during this summer and
reflects the law as it stood in August 2014.
Each chapter of this book addresses different but connected topics. As the
reader moves through the chapters ‘the story’ progresses and incorporates increas-
ingly complex legal analysis. The first two chapters introduce the subjects of
sports law, EU sports law and policy, and the sporting industry with its specifici-
ties; the third chapter highlights the tensions and governance issues in European
football amid breakaway threats by elite clubs; Chaps. 4 and 5 are the core of EU
sports law and include a detailed analysis of the EU internal market and competi-
tion law as applied to legal issues in the sporting industry; Chap. 6 categorises
sporting exceptions through the prism of convergence between the internal mar-
ket and competition law and is the most significant contribution of this book to
­general EU law; and Chap. 7 analyses the legality of UEFA restrictive clauses
and the behaviour of elite clubs under EU law. Whereas the first two chapters are
­suitable for anyone interested in the subject of sports law, the third chapter is of
interest to sports lawyers, managers and journalists, and Chaps. 4–7 strongly focus
on the legal technical aspects of the case law and are therefore aimed at sports law
academics and practitioners.
My intention at all stages was to provide alternative viewpoints and novel per-
spectives in relation to what has already been said and written. Thus, the readers
will find, for example, unique comments on the home-grown rule in the light of
the 3 + 2 rule from the Bosman case, an original approach to categorising sporting
exceptions through converging EU internal market and competition law analytical
frameworks, proposals on the treatment of special responsibility of superdominant
undertakings under Article 102 TFEU, and details of the 1998 Media Partners pro-
posals which have not been published previously.

ix
x Preface

I am enormously grateful to those people who have supported and encouraged

me during this project—thanks are due to David McArdle, Samuli Miettinen,
Geoff Pearson, Ryan Gauthier and, most of all, to Daniel Lovric, who spent many
days on a linguistic review of this book without asking a cent in return. Many
thanks (hvala!) to my Serbian friend Mateja Sponza for his technical assistance in
creating the illustrations that appear in Chaps. 5 and 6.

New York, August 2014 Katarina Pijetlovic

Contents

1 Introduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.1 The Multidimensional Nature of Sport . . . . . . . . . . . . . . . . . . . . . . . 2
1.2 Commercialisation and Juridification of the Sports Sector . . . . . . . . 3
1.2.1 Commercialisation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.2.2 Juridification. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
1.3 Sports Law. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
1.3.1 Definition of Sport and Objectives of Sports Legislation. . . . 6
1.3.2 Lex Sportiva. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
1.3.3 Legal Status and Autonomy of the Global Governing
Bodies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
1.3.4 EU Sports Law and Policy. . . . . . . . . . . . . . . . . . . . . . . . . . . 12
1.3.5 Boundaries of Legal Intervention. . . . . . . . . . . . . . . . . . . . . . 22
1.4 The Subject Matter of the Volume. . . . . . . . . . . . . . . . . . . . . . . . . . . 24
1.4.1 The Arrangements in European Football Giving Rise
to Legal Problem Posed by Breakaway Structures. . . . . . . . . 24
1.4.2 Description of Chapters 1–7. . . . . . . . . . . . . . . . . . . . . . . . . . 26
References. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

2 The Sporting Industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31

2.1 Specificities/Special Characteristics of the Sporting Industry. . . . . . 31
2.1.1 Preliminary Remark on Phraseology. . . . . . . . . . . . . . . . . . . 31
2.1.2 The Concept of Specificity of Sport in EU Law
and Policy. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
2.1.3 Special Characteristics of Sport. . . . . . . . . . . . . . . . . . . . . . . 34
2.2 Structural Models of Sport. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
2.2.1 Classic European Model of Sport. . . . . . . . . . . . . . . . . . . . . . 36
2.2.2 US Model of Sport. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
2.2.3 Changing Characteristics of European Football. . . . . . . . . . . 40

xi
xii Contents

2.3 Financing of Sport. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42

2.3.1 Macroeconomic Aspects. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
2.3.2 Microeconomic Aspects. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
References. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45

3 Breakaway Leagues and Governance Issues in European Football. . . . 47

3.1 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
3.1.1 Concept of Breakaway/Alternative League. . . . . . . . . . . . . . 48
3.2 European Structural Ideals. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
3.2.1 Rhetoric in the EU Policy Instruments. . . . . . . . . . . . . . . . . . 49
3.2.2 Sports Associations and Other Stakeholders in Football. . . . 52
3.3 Breakaway Threats and UEFA/FIFA Concessions. . . . . . . . . . . . . . . 53
3.3.1 Rules on Alternative Competitions in the UEFA Statutes. . . 54
3.3.2 Media Partners Proposal: European Football League . . . . . . 55
3.3.3 UEFA Concessions in the 1998 Media Partners Case. . . . . . 59
3.3.4 Formation of the G14 Alliance. . . . . . . . . . . . . . . . . . . . . . . . 61
3.3.5 Plans for ‘European Golden Cup’ in 2003?. . . . . . . . . . . . . . 62
3.3.6 UEFA Concessions on Compulsory Player
Release Rule, the Oulmers Case and Formal
Dissolution of G14. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
3.3.7 July 2011: New Breakaway Threats, Old Strategies
of Old Allies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
3.3.8 Alternative Leagues in European Football. . . . . . . . . . . . . . . 70
3.4 New Trends in the Governance of European Football. . . . . . . . . . . . 74
3.4.1 Stakeholder Theory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
3.4.2 UEFA Mandate. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
3.4.3 European Club Association: A New Face of G14 . . . . . . . . . 77
3.4.4 Professional Football Strategy Council . . . . . . . . . . . . . . . . . 79
3.4.5 The UEFA Club Competitions Committee . . . . . . . . . . . . . . 81
3.4.6 Social Dialogue and Collective Agreements
in Professional Football. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
3.4.7 UEFA Club Licensing and Financial Fair
Play Regulations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
3.5 Risks in the Commercial and Legal Environment. . . . . . . . . . . . . . . 92
3.6 Is the UEFA Champions League an Open Competition?. . . . . . . . . . 94
3.7 Conclusion. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96
References. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97

4 EU Internal Market Law and Sport. . . . . . . . . . . . . . . . . . . . . . . . . . . . 99

4.1 Introduction to the General Principles and Analytical
Framework. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101
4.2 Case 36/74 Walrave and Koch [1974] . . . . . . . . . . . . . . . . . . . . . . . . 102
4.3 Case 13/76 Donà [1976]. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103
Contents xiii

4.4 Case C-415/93 Bosman [1995]. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104

4.4.1 Factual Background. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104
4.4.2 The Judgment of the Court. . . . . . . . . . . . . . . . . . . . . . . . . . . 105
4.4.3 Comment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 108
4.5 Joined Cases C-51/96 and C-191/97 Deliège [2000]. . . . . . . . . . . . . 118
4.6 Case C-176/96 Lehtonen [2000]. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 120
4.7 Case C-438/00 Kolpak [2003], Case C-265/03
Simutenkov [2005], and Case C-152/08 Kahveci [2008]. . . . . . . . . . 121
4.8 Case C-325/08 Bernard [2010] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 123
4.8.1 Facts of the Case. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 123
4.8.2 Analytical Overview of the Judgment. . . . . . . . . . . . . . . . . . 124
4.9 Cases T-385/07, T-55/08 and T-68/08 FIFA and UEFA
v Commission [2011]. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 134
4.10 Joined Cases C-403/08 and C-429/08 Murphy [2011]. . . . . . . . . . . . 136
4.10.1 Facts of the Case . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 136
4.10.2 Analytical Overview of the Judgment. . . . . . . . . . . . . . . . 137
References. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 147

5 EU Competition Law and Sport . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 149

5.1 Article 101 TFEU. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 150
5.1.1 Prohibition Provision: Article 101(1) TFEU . . . . . . . . . . . . . 150
5.1.2 Exemption Provision: Article 101(3) TFEU. . . . . . . . . . . . . . 154
5.1.3 Nullity Provision: Article 101(2). . . . . . . . . . . . . . . . . . . . . . 157
5.1.4 Commercialisation Agreements. . . . . . . . . . . . . . . . . . . . . . . 157
5.2 Article 102 TFEU. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 158
5.2.1 Definition of Relevant Market. . . . . . . . . . . . . . . . . . . . . . . . 158
5.2.2 Establishing Dominance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 159
5.2.3 Abuse of Dominant Position . . . . . . . . . . . . . . . . . . . . . . . . . 160
5.2.4 Objective Justification and the Efficiency Defence. . . . . . . . 161
5.3 Oligopolistic Market Structures and the Concept
of Collective Dominance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 162
5.3.1 The Oligopoly Problem . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 162
5.3.2 Collective Dominance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 163
5.4 Simultaneous Application of Articles 101 and 102 TFEU. . . . . . . . . 167
5.5 Articles 101 and 102 TFEU in the Sporting Context. . . . . . . . . . . . . 168
5.5.1 Basic Elements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 168
5.5.2 Relevant Market. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 170
5.5.3 Collective Dominance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 172
5.5.4 Analytical Framework for Commercial Rules in Sport. . . . . 173
5.5.5 Analytical Framework for Regulatory Rules:
C-519/04 Meca-Medina [2006]. . . . . . . . . . . . . . . . . . . . . . . 179
5.6 Blocking Competing Organisations. . . . . . . . . . . . . . . . . . . . . . . . . . 187
5.6.1 C-49/07 MOTOE [2008]. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 187
5.6.2 Commission Investigation in FIA/Formula One Case. . . . . . 196
5.6.3 Case C-250/92 DLG [1994]. . . . . . . . . . . . . . . . . . . . . . . . . . 199
xiv Contents

5.7 Superdominance and Special Responsibility. . . . . . . . . . . . . . . . . . . 202

5.7.1 The Concept of Superdominance. . . . . . . . . . . . . . . . . . . . . . 203
5.7.2 Special Responsibility of Dominant Undertakings:
The Sliding Scale Approach. . . . . . . . . . . . . . . . . . . . . . . . . . 206
5.7.3 The Content of Special Responsibility
of Superdominant Sports Undertakings. . . . . . . . . . . . . . . . . 208
5.8 Conclusion. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 211
References. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 212

6 A Quest for Convergence in the Application of EU Internal

Market and Competition Law to Sport. . . . . . . . . . . . . . . . . . . . . . . . . . 215
6.1 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 215
6.2 Addressees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 216
6.3 Prohibition Level Convergence—Categories I, II and III
of Sporting Exception. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 217
6.3.1 Sporting Rules That Do not Produce Any
Economic Effect. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 218
6.3.2 ‘Purely Sporting’ Rules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 218
6.3.3 Inherent Rules. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 224
6.4 Justification Level Convergence—Category IV
Sporting Exception. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 228
6.5 Burden of Proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 233
References. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 235

7 Treatment of UEFA Restrictions on Breakaway Leagues

in Football Under EU Law. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 237
7.1 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 237
7.2 The Conflict. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 239
7.3 Defining the Relevant Market. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 240
7.3.1 The Market for Organisational Services
for Transnational Club Football in Europe. . . . . . . . . . . . . . . 241
7.3.2 Connected Downstream Market: Exploitation Market. . . . . . 244
7.3.3 Connected Upstream Market: The Market
for Clubs’ Services. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 246
7.3.4 Relevant Geographic Market. . . . . . . . . . . . . . . . . . . . . . . . . 247
7.4 Classification of the Parties and the Restraints . . . . . . . . . . . . . . . . . 248
7.4.1 Undertaking or Association of Undertakings/Agreement
or Decision?. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 248
7.4.2 Market Power of UEFA on the Relevant Market. . . . . . . . . . 253
7.4.3 Article 49 of the UEFA Statutes: Restrictive Effects. . . . . . . 259
7.5 Applicable Justification Framework. . . . . . . . . . . . . . . . . . . . . . . . . . 267
7.6 The Existence of Elements of Justification . . . . . . . . . . . . . . . . . . . . 268
7.6.1 The Overall Context: Legitimate Aims in Public Interest . . . 269
7.6.2 Suitability of the Article 49 Rule: Effectiveness Test. . . . . . . 272
Contents xv

7.6.3 Inherency Requirement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 278

7.6.4 Proportionality. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 281
7.7 Effect on Intra-Union Trade. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 301
7.8 The Conditions of Article 101(3) TEFU . . . . . . . . . . . . . . . . . . . . . . 302
7.9 Collective Dominance and Collusion by Elite Clubs. . . . . . . . . . . . . 303
7.10 Concluding Remarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 308
References. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 309

Table of Cases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 311

Table of Legislative Acts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 319

Index. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 325
Abbreviations and Acronyms

AVMS Audio Visual Media Services

BSkyB British Sky Broadcasting
CAD Conditional Access Directive
CAS Court of Arbitration for Sport
CCC UEFA Club Competitions Committee
CJEU Court of Justice of the European Union
CLFFP Club Licensing and Financial Fair Play Regulations
CSR Corporate Social Responsibility
DG Directorate General
ECA European Club Association
ECF European Club Forum
EFL European Football League
ENIC English National Investment Company
EPFL European Professional Football Leagues Association
FAPL Football Association Premier League
FC Football Club
FFP Financial Fair Play
FIA Fédération Internationale d’Automobile
FIBA International Basketball Federation
FIFA Fédération Internationale de Football Association
FIFPro Federation Internationale Des Associations De Footballeurs Professionnels
FIGC Federazione Italiana Giuoco Calcio (Italian Football Federation)
G14 Group of 18 Wealthiest Football Clubs in Europe
IOC International Olympic Committee
MLB Major League Baseball
MPI Media Partners International Ltd.
NBA National Basketball Association
NFL National Football League
NHL National Hockey League

xvii
xviii Abbreviations and Acronyms

PFSC Professional Football Strategy Council

SSNIP Small but Significant Non-transitory Increase in Price
TEU Treaty on European Union
TFEU The Treaty on the Functioning of the European Union
UEFA Union des Associations Européennes de Football
Chapter 1
Introduction

In this year 1894 and in this city of Paris, whose joys and
­anxieties the world shares so closely that it has been linked
to the world’s nerve centre, we were able to bring together
the representatives of international athletics, who voted
­unanimously (so little controversial is the principle concerned)
for the restoration of a two-thousand-year-old idea which today
as in the past still quickens the human heart for it satisfies
one of the most vital, and whatever may have been said
on the subject, one of its most noble instincts. In the temple
of science these delegates heard echo in their ears a melody
also 2000 years old, reconstituted by an eminent archaeologist
through the successive labours of several generations.
And in the evening electricity transmitted everywhere the news
that Hellenic Olympism has re-entered the world after
an eclipse of several centuries.

Contents
1.1 The Multidimensional Nature of Sport................................................................................ 2
1.2 Commercialisation and Juridification of the Sports Sector.................................................. 3
1.2.1 Commercialisation..................................................................................................... 3
1.2.2 Juridification............................................................................................................... 5
1.3 Sports Law........................................................................................................................... 5
1.3.1 Definition of Sport and Objectives of Sports Legislation.......................................... 6
1.3.2 Lex Sportiva............................................................................................................... 7
1.3.3 Legal Status and Autonomy of the Global Governing Bodies................................... 9
1.3.4 EU Sports Law and Policy......................................................................................... 12
1.3.5 Boundaries of Legal Intervention............................................................................... 22

Speech by Pierre de Frédy, Baron de Coubertin at Paris Congress held at the Sorbonne on 16–23
June 1894, when International Olympic Committee was established.

© t.m.c. asser press and the author 2015 1

K. Pijetlovic, EU Sports Law and Breakaway Leagues in Football,
ASSER International Sports Law Series, DOI 10.1007/978-94-6265-048-0_1
2 1 Introduction

1.4 The Subject Matter of the Volume....................................................................................... 24

1.4.1 The Arrangements in European Football Giving Rise to Legal Problem
Posed by Breakaway Structures................................................................................. 24
1.4.2 Description of Chapters 1–7....................................................................................... 26
References................................................................................................................................... 29

1.1 The Multidimensional Nature of Sport

Sport is a global phenomenon that performs many important functions in

­contemporary society. It is most often mentioned in its positive role as a tool
­contributing towards education of children and young adults, a means of social inte-
gration and overcoming cultural differences, a major source of employment in mod-
ern society, and a vehicle towards better mental and physical health. In addition, in
its socio-cultural dimension, sport is a part of the popular culture that entertains bil-
lions of people worldwide. Many people identify with their local or national team,
follow their games ‘religiously’ and derive a sense of pride if their team wins. This
effect that sport has on masses and its immense cultural importance has made it a
most valuable content for broadcasters, as well as a target for political propaganda.1
Sporting activity crosses a wide range of legal subjects such as contract law,
tort law, intellectual property law, competition law, constitutional law, labour law,
internal market law and fundamental rights. It involves everyone (people of all
ages, genders, races, etc.) at all levels (beginners, recreationists, amateurs, semi-
professionals and professionals) and in all capacities (spectators and television
viewers, players, coaches, medical doctors, psychologists, agents, etc.). There are
more than 800,000 sport clubs with more than 70 million members, while as many
as 271 million people engage in some form of sport activity in the European
Union. Football alone has 23 million registered male and female players, in addi-
tion to 350,000 referees, with many more millions playing informally.2 Tennis
involves 75 million participants worldwide,3 24 million of whom are registered in

1 See Halgreen 2004, pp. 19–23. The decision of the International Olympic Committee to award
the 2008 Olympic Games to China was not well-received in the world and some saw it as an
opportunity for China to cover up its poor human rights record and maintain a totalitarian regime.
Throughout history, there have been boycotts of the Olympics because of the country in which it
was held, and also exclusion from participation by national teams from countries that were under
international sanctions. Some authors note that using sport as a political tool was vital in the fight
against apartheid in South Africa. Gardiner and Felix 1995, pp. 189–220.
2 Independent European Sport Review (2006) hereinafter referred to as ‘Arnaut Report’.
3 Pluim et al. 2007, pp. 703–704.
1.1 The Multidimensional Nature of Sport 3

Europe4 making it the most popular individual sport on the continent. The
­cumulative audience of the 64 matches of the 2010 Fédération Internationale de
Football Association (FIFA) World Cup was expected to be in excess of 26 billion
(i.e., around four times the world’s population) and was subsequently reported to
reach those figures by the news networks.5 These figures emphasise the scale and
the social importance of sports.
Many amateur clubs survive only thanks to the sponsorship from local
­businesses, while many sports clubs and governing bodies are, both in essence and
in legal form, not much more than commercial entities.

1.2 Commercialisation and Juridification of the Sports

Sector

1.2.1 Commercialisation

Much like in terms of the described socio-cultural impact, professional sport has
become equally comprehensive in its scope on a commercial level. In the 1990s,
changes in the structure of the demand for sports broadcasting took place resulting
in the transformation of the sports industry. Namely, the broadcasting sector used
to be characterised by the presence of only a few players on the market. In the
1980s there were only four commercial TV operators in all of Europe.6 The
de-cartelisation of the broadcasting sector and the emergence of an increasing
number of operators, coupled with advancements in mass media technology, have
brought about fierce competition for the broadcasting rights of sports events,
which caused their value to skyrocket.7
For example, when the live transmission of English football league matches
began in 1983 the BBC and ITV duopoly acted collusively in order to purchase the
rights to two seasons at a deflated value of £5.3 million.8 In comparison, the UK
domestic auction for the 2007–2010 broadcasting rights for the matches of the
English Premier League is valued at £1.7 billion, £1.3 billion of which were paid
by British Sky Broadcasting (BskyB) for its four packages of games,9 whereas the
2013–2016 seasons cost domestic broadcasters a total of over £3 billion. In the
2013–2016 seasons, as compared to 2010–2013, overseas markets have seen an
increase in value of 12,400 % in Burma, 432 % in Thailand and 273 % in the
USA, helping the Premier League to earn a record £2 billion on overseas

4 See Advantage by Tennis Europe at http://www.tenniseurope.org/file_download.aspx?id=28613.

5 ‘26 Billion People Watching the World Cup. True?’ by Pamela Falk, CBS News, June 14 2010.
6 Collins 1994, p. 146.
7 For more about broadcasting see Sect. 5.5.4.
8 Massey 2007, p. 88.
9 ‘Premiership in New £625 m TV Deal’ BBC News, 18 January 2008.
4 1 Introduction

broadcasting deals.10 Similarly, the acquisition of rights to the 1990, 1994 and
1998 Football World Cup cost the European Broadcasting Union cartel US$240
million. The contract for the same event for 2002, 2006 and 2010 saw a 900 %
increase in the value of the rights, which were purchased at a cost of US$2.36 bil-
lion by the Kirch Group.11
The more exposure the sport events had in the media, the more interest and
value it also had for the sponsors. Sports sponsorship and endorsement contracts
with star players are seen as a prestigious and effective means of advertisement for
products and services. According to the European Sponsoring Association (ESA),
91 % of all the sponsorship deals in 2005 went into sports. The value of world
sponsorship rights rose by US$25 billion between 1990 and 2000. In Formula One
motor racing this means that the 1.9 billion-person cumulative worldwide audi-
ence that follows the 17 or 18 annual Formula One (F1) races will be exposed to
100 sponsorship logos.12 Sponsorship brought EUR 664 million to 11 F1 teams in
2006 and big car manufacturers invested over a billion euros into their six teams.13
In 2004, sport generated EUR 407 billion accounting for 3.7 % of EU GDP, and
employed about 15 million people, or 5.4 % of the labour force.14 Consumer
spending has significantly increased, and millions of new jobs in the European
Union (EU) have been created directly or indirectly by the sports industry.15
Players have also been major beneficiaries in this changing landscape of the
sports business. According to Forbes, Tiger Woods has earned US$1 billion in
prize money during his career so far, making him the richest player in the history
of sports, while Michael Jordan and Michael Schumacher earned US$800 million
and US$700 million during their careers respectively.16 Many football players in
the English Premier League earn wages of £100,000 per week (and some earn
even more), with similar salaries paid to their continental counterparts.17
There are many other actors whose business includes strong ties with s­ porting
industry, such as travel agencies that profit from packet arrangements for c­ ertain
sporting events (notably, the Olympics and FIFA World Cup), while n­ ewspapers
and magazines often sell on the basis of their sport content and exclusive
­interviews with sportspeople.

10 See ‘£5.5bn: The Staggering Sum TV Companies Around the World Will Pay to Screen
Premier League’ by Nick Harris, Daily Mail, 24 November 2012.
11 Hoehn and Lancefield 2003, p. 555.
12 Cygan 2007, p. 75.
13 Ibid.
14 European Commission White Paper on Sport, COM (2007) 391 final, Chap. 3.
15 Mario Monti, European Commissioner for Competition. ‘Sport and Competition’

Speech/00/152 at a conference organised by the European Commission, Brussels 17 April 2000.

16 Source: ‘Report: Tiger Richest Athlete in History’, ESPN, 2 October 2009.
17 Contrast this with a narration in a film based on true events about football in 1930s: ‘Football

was still young. Back then, it was not the rich people running on the pitch while the poor people
were watching—it was the other way around’. Montevideo at 07:13.
1.2 Commercialisation and Juridification of the Sports Sector 5

1.2.2 Juridification

The described increase in commercialization of the sports industry was followed by

juridification. With regard to traditional sport as an autonomous social field, this term
is used to describe the process by which sport leaves the safe zone of internal self-
regulation and becomes a subject of legal control. Under such a process ‘what were
intrinsically social relationships between humans within a “social field” become
imbued with legal values and are understood as constituting legal r­ elationships—thus
social norms become legal norms.’18 Foster saw this concept as merely reproducing
the traditional idea of private and public realms, with private areas increasingly
becoming subject to public or judicial control.19 Indeed, the process of juridification
took place in many other social fields (notably, labour law) and the concept has been
in use for decades. Depending on the field regulated and degree of legal control, it is
possible to attach a negative meaning to it such as excessive control of social rela-
tionships, overregulation, ‘legal pollution’,20 or a positive meaning embodying the
benefits and beneficiaries of legal control within the regulated field. In its neutral
form it connotes the simple idea of legal control of self-regulation.
In the EU, the rules of sporting organisations regulating, for example, players’
contracts and transfers, training compensation fees, the profession of coaches and
agents, or eligibility for participation in certain matches and competitions, may
fall under the scrutiny of internal market and competition laws. The most extreme
example is the examination of the International Olympic Committee (IOC) anti-
doping rules under the provisions of EU competition law before the EU Courts.21
The sport sector caught the attention of the EU legal regulators, inter alia, by the
ability of the industry to profoundly affect the competition in and structure of the
downstream markets (for example the broadcasting market and ticketing market),
and to affect the commercial interests of clubs and professional careers of athletes,
and ultimately, the welfare of consumers. Hence, regulation and governance of
sport, which in the past exclusively belonged to the sport governing bodies’ sphere
of competence, have become judiciable.

1.3 Sports Law

There is no other area of law that is as diverse as sports law. The nature of this
activity requires a corresponding, all-comprehensive but well-balanced regulatory
approach covering amateurs and professionals, health and safety, doping and ethics,

18 For more detailed explanation of the concept see Gardiner et al. 2007, pp. 84–88.
19 Foster 1993, p. 108.
20 See Teubner and Bremen 1987, pp. 3–6.
21 Case T-313/02 David Meca-Medina and Igor Majcen v Commission [2004] ECR II-3291 and

Case C-519/04 David Meca-Medina and Igor Majcen v Commission [2006] ECR I-6991.
6 1 Introduction

broadcasters and spectators, licencing, and financial accountability, to mention a few

topics. This section will discuss the bodies, the legal and quasi-legal instruments
­regulating these issues, and the very sensitive and crucial issue of ‘distribution of com-
petences’ between international sporting organisations and the European institutions.
But first it is important to look at some basic concepts and the ideas behind them.

1.3.1 Definition of Sport and Objectives of Sports Legislation

Everyone knows what sport is. But defining sport presents an analogous predicament
to the one Hart described when, in his attempts to explain difficulty in defining the
concept of law, he said: ‘I can recognize an elephant when I see one but I cannot
define it’.22 As observed by Soek there is no homogeneous approach to the concept
of sport whatsoever and there are only definitions determined by the objective of
sport, the capacity in which sport is played, or the social function of sport.23
Indeed, various jurisdictions, organisations and academics provide very diverse
definitions.
The European Sports Charter of the Council of Europe defines sport as follows:
‘Sport means all forms of physical activity which, through casual or organised par-
ticipation, aim at expressing or improving physical fitness and mental well-being,
forming social relationships or obtaining results in competition at all levels.’24
Quite a different take is provided by a North American commentator, Malloy,
who considered that ‘despite the many sub-sectors of sport that are diverse and
often mutually exclusive, the common link with each is that sport is a vehicle
toward something (e.g., profit, friends, health).’25
The 1998 version of the Estonian Sport Act contained a definition of sport26 as
‘[…] playing activity of a predominantly competitive and physical nature, or a
corresponding educational activity.’ The Estonian Sport Act of 2005, as
amended,27 no longer contains this definition and instead focuses on the objectives
of the Act. The 2005 Act
…provides for the general organisational and legal bases of the organisation of sport, the
rights and obligations of sportsmen, sportswomen and coaches, the bases for application
for and grant of state support for winners of the Olympic Games, the bases for the

22 Hart 1961.
23 Soek 2006, p. 28.
24 Article 2(1) of the Recommendation No. R (92) 13 Rev. of the Council of Europe’s

Committee of Ministers to Member States on the Revised European Sports Law Charter (the
European Sports Law Charter).
25 Malloy 2003, p. 59. Available at http://www.cces.ca/files/pdfs/CCES-PAPER-Malloy-E.pdf.
26 Spordiseadus (Sports Act) passed on 15.6.1998 (RT I 1998, 61, 982), Chap. 1, General

Provisions, § 2.
27 Spordiseadus (Sports Act) passed on 6.4.2005 (RT I, 2005, 22, 148), as last amended on

29.12.2011.
1.3 Sports Law 7

financing of sport, the requirements for the organisation of sports events and liability for
violation of the requirements.28

So it is the organisational purpose of sport that underlies the adoption of this

­particular act.
In the UK, there is no formal definition of sport and the state has a more non-
interventionist approach to sports governance than many other countries.29
The Finnish Sports Act of 1998 also does not contain a definition of sports.
However, Chap. 1, Sect. 1 (second sentence) states that the purpose of the Act is
‘to promote equality and tolerance, cultural diversity and the sustainable develop-
ment of the environment through sports’.30 This indicates that the general goals of
sports policy in Finland are related to ethical values. The preamble of the
Nicaraguan Sports Act has an ideological ratio legis and states as follows:
The People’s Sandinista Revolution has as its historical purpose to contribute to the develop-
ment of a new mankind which is necessary to guarantee the physical and mental well-being
of the population. Sport promotes the integration of man in society and helps strengthen the
ties of brotherhood between the nations in an atmosphere of peace and mutual respect.31

Health is often a part of the sports legislation objectives. For instance, Canada’s
Physical Activity and Sports Act of 2003, Article 3 states that:
The objectives of the Government of Canada’s policy regarding physical activity are (a) to pro-
mote physical activity as a fundamental element of health and well-being; (b) to encourage all
Canadians to improve their health by integrating physical activity into their daily lives; and (c)
to assist in reducing barriers faced by all Canadians that prevent them from being active.32

Moreover, international participation, national prestige, recreation and entertain-

ment are a part of the legislative and policy goals of some countries.33 The
European Sports Charter aims include making the activity of sport accessible to
everyone (‘sports for all’).34
Still, despite their diversity, all these definitions and objectives put together do
not do justice to the proper explanation of the activity of sport.

1.3.2 Lex Sportiva

The term lex sportiva refers to the conditionally autonomous legal order in which
the body of norms that binds its subjects is created and enforced by national or

28 Ibid. § 1(1).
29 James 2010, p. 3.
30 Liikuntalaki (Sports Law) 18.12.1998/1054, as amended.
31 Soek 2006, p. 31.
32 Physical Activity and Sport Act, passed on 19.3.2003, S.C. 2003, c.2, as last amended on

17.10.2011.
33 Soek 2006, p. 33.
34 Article 1 of the European Sports Charter.
8 1 Introduction

international sports federations including, in particular, the jurisprudence of the

Court of Arbitration for Sport (CAS). ‘Global sports law’35 and ‘domestic sports
law’36 are two parts of lex sportiva and, within this concept, form an inseparable
whole, in particular in those sports where the organisational structure confers strict
hierarchy of authority (the pyramid structure). The former pertains to the rules cre-
ated and applied by private global bodes that govern international sport, and the lat-
ter to rules created and applied by the national sports governing bodies that govern
their respective sports on domestic level. The chief characteristics of global sports
law, according to Foster, are ‘first that it is a contractual order, with its binding force
coming from agreements to submit to the authority and jurisdiction of international
sporting federations, and second that it is not governed by national legal systems’.37
Sports governing bodies have their regulatory and organisational rules spelled
out in their statutes, charters, regulations, codes and other rulebooks and constitu-
tions, as the case may be. The impact that these regulations have on sportspersons
is no different than the impact of formal laws passed by the states. In addition,
they are far reaching in their scope as, when passed by the international federa-
tions, they apply globally to all the athletes and regulate in a collective manner
every aspect of their professional lives and often some aspects of their private
lives. For the administration of the whole body of rules and regulations issued by
sports organisations and the decisions of their dispute settlement bodies, the
Olympic Movement established the Court of Arbitration for Sport in 1984. CAS
has sole jurisdiction to rule on the commercial issues in disputes related to sport,
and it acts as an appellate body of the last instance in disciplinary cases, most of
which concern disputes involving employment contracts and breach of anti-doping
regulations by athletes. In the first instance disciplinary cases are usually dealt
with at the level of the competent authorities of the sport in question by their
quasi-judicial dispute settlement mechanisms.38 Hence, CAS jurisprudence itself
has become one of the main sources of lex sportiva.39
As juridification of the sector took place, more sophisticated and accountable
mechanisms of sporting justice were developed within the sporting community.
The restrictions on the scope of the autonomy of the governing bodies coming
from lex sportiva itself have become stricter. This is the consequence of the
increasing pressure of juridification, emerging unionisation of players, an increase

35 According to nuances made by Foster, ‘international sports law’ is a different concept and

deals with relations between nation states. Foster 2003, pp. 1–3.
36 As termed and defined in James 2010 , p. 6.
37 Foster 2003, p. 2.
38 For more information on the Court of Arbitration for Sport see, e.g., Blackshaw 2009,

pp. 45–99.
39 In as far as the dispute concerns a matter within the scope of the EU law, a party that loses

a case before the CAS may turn to the EU Commission to examine the sporting rule in ques-
tion (and not to contest the CAS decision), and appeal the Commission decision to the Court of
Justice of the European Union. In fact, there is no requirement in EU law to exhaust remedies
available in the sporting justice system in order to be able to turn to the Commission.
1.3 Sports Law 9

in representation, as well as recognition that if sport can provide for fair rules and
proper dispute settlement mechanisms the necessity for interference by non-sporting
entities (such as EU institutions) and ordinary laws is going to be reduced to a
minimum.40 Elias uses the term ‘sportisation’ to describe a process in the course
of which the framework of rules applying to sport becomes stricter, implying more
differentiated and just rules and more efficient supervision.41

1.3.3 Legal Status and Autonomy of the Global Governing

Bodies

The Fédération Internationale de Football Association (FIFA) and the Union des
Associations Européennes de Football (UEFA) are international sports associations
registered in the commercial register in accordance with the Swiss Civil Code, with
headquarters in Switzerland. Formally, therefore, they are private bodies. However,
in terms of their powers, and regardless of their formal classification, the true legal
status of these sport governing bodies can be found on the equilibrium between pri-
vate and public authorities.42 They rely on commercial sponsorship and sales of
broadcasting rights to sporting events rather than state funding and thus have a high
degree of financial autonomy. Furthermore, there is perhaps no other economic
sector in which private bodies have the same scope of regulatory latitude as in the
sports sector,43 within which they have constructed a virtually autonomous social
field. Attesting to this status is the fact that FIFA has direct contacts with many
heads of State44 and is a powerful participant in global affairs, whereas the
International Olympic Committee has been granted observer status at the United
Nations, enabling it to participate in the work and sessions of the United Nations
General Assembly.45 These private bodies take decisions that have profound eco-
nomic effects on many different actors in the world of sport and outside of it, and
they can affect the functioning of the internal market and the trade between
Member States within the meaning of the TFEU. Because sport federations possess
state-like competences whose regulatory effect is equivalent to those of state
action, the question of accountability for violations of law is a pressing one.46

40 Casini explains that creation of CAS was attributable to this necessity. See Casini 2010,

­available at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1621335.
41 Elias and Dunning 1986.
42 Pijetlovic 2013.
43 Paragraph 3.7 of the Arnaut Report.
44 Gardiner and Felix 1995, p. 189.
45 Resolution adopted by the UN General Assembly [on the report of Sixth Committee

(A/64/458)], 22 October 2009.

46 Brems and Lavrysen 2012, p. 227.
10 1 Introduction

During most of the twentienth century, the majority of European states allowed
sport organisations to function as bodies fully independent of the public
­authorities. In 1975 the Council of Europe adopted the Sport for All Charter,
which was replaced by the European Sport Charter in 1992 and so became the first
European intergovernmental organisation to take an interest in this sector.
Although the Court of Justice of the European Union (‘CJEU’ or ‘the Court’) had
passed its first judgment in the area of sport in 1974,47 it was not until the mid-90s
and the judgment in Bosman that the EU begun more active involvement in
sport.48 The judgment in Bosman forced global changes in UEFA regulations
which profoundly affected the way that football clubs do their business. Eleven
years later in Meca-Medina, the Court made it clear that any sporting rule that has
an economic effect, even an ethical rule of an anti-doping policy, may become
subject to scrutiny under EU law. This holding clashed with the understanding of
the scope of autonomy to which sporting federations thought they were entitled.
Through the process of juridification, sport became a semi-autonomous social field
within which it may govern itself internally but, according to Moore,
it is also vulnerable to rules and decisions and other forces emanating from the larger
world by which it is surrounded. The semi-autonomous social field has rule-making
capacity, and the means to induce or coerce compliance; but it is simultaneously set in a
larger social matrix which can, and does, affect and invade it.49

Article 7 of the UEFA Statues (2012) imposes an obligation on its member

associations to manage their affairs independently with no influence from third
parties, and to provide in their statutes for a procedure guaranteeing the completely
independent and free election and appointment of their executive and other bodies.
In the event of the non-fulfilment of this obligation, UEFA shall not recognise such
bodies, and may sanction that member association (for example, suspend and
exclude their national team from participation in competitions). Article 7 of the
UEFA Statutes is presumably an obligation on national associations to be free from
interference of their national governments. Article 60 of the UEFA Statutes further
obliges member associations to refer disputes of a national dimension in the last
instance to an independent and impartial court of arbitration, to the exclusion of
any ordinary court, subject to their national legislation. Disputes of a European
dimension50 fall under the exclusive jurisdiction of the Court of Arbitration for
Sport, to the exclusion of any ordinary court or any other court of arbitration,
unless they belong to the competence of a UEFA organ.51 A claim and desire for

47 Case 36/74Walrave and Koch v. Union Cycliste Internationale and others [1974] ECR 1405.
48 See Parrish 2003.
49 Moore 1973, p. 719.
50 Such as disputes between UEFA and associations, leagues, clubs, players or officials; or

disputes of a European dimension between associations, leagues, clubs, players or officials. See
Article 61 of the UEFA Statutes (2012 edition), available at http://www.uefa.com/MultimediaF
iles/Download/EuroExperience/uefaorg/WhatUEFAis/01/80/54/03/1805403_DOWNLOAD.pdf.
51 Article 61 of the UEFA Statutes (2012 edition).
1.3 Sports Law 11

autonomy is apparent from these articles but the transformed commercial landscape
and scrutiny by the Court and the Commission (i.e., juridification of the sector),
especially since Bosman, has downsized these aspirations for complete autonomy
to attempts to bring as many issues as possible into the realm of the so-called
‘sporting exception’. The precise contours and content of this concept, which relies
on the ‘specificity of sport’, have never been set in absolute terms and its applica-
tion is always assessed on a case-by-case basis. However, after the Meca-Medina
judgement eroded the perception that the ‘sporting exception’ sheltered many rules
from examination, sport governing bodies are gradually shifting the focus away
from relying ex ante on the sporting exception to creating a complaint-proof
internal system. Such a system implies, for example, representation of all the stake-
holders in decision-making, as rules that are commonly agreed by all the concerned
parties are unlikely to be challenged; a priori consultations with the EU
Commission; and creating reliable dispute settlement mechanisms that fully respect
the principles of natural justice, such as nemo judex in casua sua and audi alteram
partem. In short, it implies adhering to the principles of good governance.

1.3.3.1 Issues of Good Governance in the Light of Autonomy

Due to the high degree of discretion held by the sporting authorities in

­performance of their central roles, it is necessary that ‘various stakeholders must
be properly represented at both national and European levels because this is a pre-
condition for ensuring that these authorities are best equipped to speak on behalf
of all with interests in the game’.52 In its White Paper on Sport, the Commission
considered that ‘most challenges can be addressed through self-regulation respectful
of good governance principles, provided that EU law is respected’,53 and that it is
ready to play a facilitating role or take action if necessary. The Commission also
acknowledged the autonomy of sporting organisations and representative struc-
tures. Similarly, the 2000 Nice Declaration, adopted after the meeting of the EU
Heads of States and Governments, provided that:
The European Council stresses its support for the independence of sports organisations and
their right to organise themselves through appropriate associative structures. It recognises
that, with due regard for national and [EU] legislation and on the basis of a democratic
and transparent method of operation, it is the task of sporting organisations to organise
and promote their particular sports, particularly as regards the specifically sporting rules
applicable and the make-up of national teams, in the way which they think best reflects
their objectives [emphasis added].54

52 Paragraph 3.6 of the Arnaut Report.

53 White Paper on Sport, para 4 [emphasis added].
54 Declaration on the specific characteristics of sport and its social function in Europe, of which

account should be taken in implementing common policies 13948/00, Annex to the Presidency
Conclusions, Nice (‘Nice Declaration’).
12 1 Introduction

The Commission Communication on Developing the European Dimension in

Sport55 states in clear terms that ‘good governance in sport is a condition for the
autonomy and self-regulation of sport organisations.’56 In European policy
(as well as in application of EU law) the right to self-govern for the sporting organ-
isations is therefore subjected to certain conditions and sets of principles for good
governance in decision-making, such as transparency, democracy, ­accountability
and representation of stakeholders (associations, federations, players, clubs,
leagues, supporters, etc.). The sport governing bodies would derive their own bene-
fits if they were to provide for truly representative and democratic forums in their
decision-making, as this would be an effective mechanism to reduce litigation.

1.3.4 EU Sports Law and Policy

Unlike the set of rules developed by sporting community, ‘EU sports law’ is ‘the
law created by the EU institutions, in particular the European Court of Justice, that
affects the regulation or governance of sport or which has been developed to
resolve sports disputes’.57 ‘EU sports policy’ is the term that reflects the ideologi-
cal and political goals of the EU institutions in the area of sport. It is contained in
non-binding policy documents, some of which have been cited by the Court in its
sporting judgements.58

1.3.4.1 Theoretical Foundations and Emergence of EU Sports Law

and Policy

Sport was historically viewed as a self-regulating activity in which there was not
much scope for legal intervention. Legal and academic commentaries in this area
were virtually non-existent in Europe as recently as the early 1990s. Late in the
1990s, policy discussions sparked by the 1995 judgement of the Court in the
Bosman case and a number of policy documents tended to focus on the topic of
‘sport and the law’ rather than ‘sports law’. With the exception of the United

55 Communication from the Commission to the European Parliament, the Council, the European

Economic and Social Committee, and the Committee of the Regions ‘Developing the European
Dimension in Sport’ COM(2011) 12 final, 18. 1. 2011.
56 Ibid. para 4.1.
57 ‘National sports law’ is the law created by national parliaments, courts and enforcement

­agencies. It may directly affect the regulation, organisation, and governance of sport within a
national territory. See James 2010, p. 3.
58 For example, the Treaty of Amsterdam declaration on sport (declaration nr. 29) has been

cited in Joined Cases C-51/96 and C-191/97 Christelle Deliège v. Ligue francophone de judo et
­disciplines associées ASBL, Ligue belge de judo ASBL, Union européenne de judo and François
Pacquée [2000] ECR I-2549, para 42.
1.3 Sports Law 13

States, which already earlier had a comparatively developed system, similar trends
of gradual legal intervention were taking place globally. There is no official recog-
nition procedure to identify, constitute and name areas of law, and that procedure
is mostly effected through the gradual recognition by academics and practitioners
of the growing application of law to a new area of social life.59 Opie noted that
there seems to have always been court cases concerning sport but these were isolated and
are insignificant comparing with the variety and the volume of court proceedings that are
to be observed today. […] the courts pursued a policy of non-intervention by holding that
sport disputes were private matters which did not raise any justiciable issues. Any
informed observer will realise that the position is vastly different today.60

Beloff et al. recognised that ‘[…] the law is now beginning to treat sporting activ-
ity, sporting bodies and the resolution of disputes in sport, differently from other
activities or bodies. Discrete doctrines are gradually taking shape in the sporting
field.’61 It has to be acknowledged that at the present time academic discussions
on whether [EU] sports law has established itself as a discrete area of law are
somewhat outdated as it should be clear that there is indeed such a legal discipline.
Support for this proposition is presented by the inclusion of Article 165 TFEU (the
so-called ‘sports article’), the newly obtained EU sports competence, a solid body
of CJEU case law and Commission decisional practice, and the huge amount of
institutional action in the area that has taken place in the past 3 years. These
debates in any case, as Lewis and Taylor put it, bring out ‘an issue of academic
rather than practical interest’.62 The content of EU sports law, on the other hand,
remains somewhat of a puzzle.
When the Court handed down its judgment in the Bosman case in 1995, it
­provoked many different reactions. Critics of the ruling have seen it as an unaccep-
table intrusion of EU law into the dominion of the football governing body and an
extension of Union competence into areas not intended to be regulated by the EU
and its treaties. Others have welcomed the judgement as a necessary corollary of
freedoms guaranteed by EU internal market provisions. Lobbying inside the
European institutions and outside of them by the two rival opinion groups became
the norm behind the search for clearer sports policy. The birth of EU sports law
has been perceived by Parrish as attributable to post-Bosman dynamics of political
discussions that were at the heart of this process.63 His dissertation on ‘Sports Law
and Policy in the European Union’ is the most significant contribution to the theo-
retical discourse on the subject to date and deserves a closer look.

59 See Gardiner et al. 2007, p. 91. The emergence of any new field of law is normally preceded
by similar debates and its acceptance as a distinct area of law has undergone a similar process
(e.g. labour law). Cyber-law is an example of an area that has only recently in history achieved
such recognition.
60 Opie 1996, pp. 74–94.
61 Beloff et al. 1999, p. 3.
62 Lewis and Taylor 2003, preface.
63 Parrish 2003, p. 17.
14 1 Introduction

Parrish recognized that both EU sports law and EU sports policy developed
without the engine of legislation, as the Union did not have relevant competence to
adopt legally binding acts.64 EU sports law has thus emerged as an activity-led, as
opposed to rule-led discipline. According to the theory, within the EU there are a
number of policy-specific subsystems, the sports policy subsystem being one of
them. Two rival advocacy coalitions operating within this subsystem attempting to
steer the policy in the direction consistent with their belief system are the socio-
cultural coalition and the Single Market coalition.
Belonging to the socio-cultural coalition are the European Parliament and the
Education and Culture Directorate within the European Commission, whose man-
date closely aligns them to the people’s Europe project, Member States in the
European Council and the Council Presidency (which are in general opposed to
the idea of the expansion of Union competence), as well as sport bodies, Olympic
Committees, and the Council of Europe (who see sport as a social and cultural
pursuit rather than an economic activity). Deep core beliefs, not shared by all the
members of the coalition, encompass a concern for the promotion of positive inte-
gration. Core policy beliefs are related to the acknowledgment that sport is not
above the law but they emphasize the social and cultural characteristics which
require soft application of law. Within secondary beliefs there exist considerable
differences which suggest that the socio-cultural coalition is a coalition of conven-
ience. Namely, maximalists such as the Education and Culture DG and most of the
EU governments preferred a Treaty basis for sports which would clearly define the
application of EU law in the area and would give a base for the EU budget to sup-
port sporting activities. Moderates, such as sports governing bodies, did not want
to see further expansion of the Union’s influence in sports but who did want to see
a clarification of the legal environment. Minimalists, who cling to the concept of
subsidiarity did not favour granting sports a treaty base and believe that the EU
has no competence to regulate sports. For instance, the British, Danish and
Swedish governments belong to this category.65
Members of the Single Market advocacy coalition, on the other hand, seek to
ensure that the legal foundations of the single market are protected and view sport
rules as a significant economic activity which should comply with EU law. This
advocacy coalition is primarily composed of the Competition Policy Directorate in
the European Commission and the CJEU. Secondary members, whose affiliation is
fluid, enter the coalition depending on the topic under consideration and whether
and in which way it affects their legal and commercial interests. Thus, Parliament
can shift on specific issues from the socio-cultural coalition to the Single Market
coalition and it has done so in relation to, for example, lifting the restrictions on
players’ mobility in European sports. Sports federations also align themselves with
one or another coalition depending on the issue involved. Regardless of the fluidity
of membership, the author identifies certain common features of the belief system

64 Ibid. p. 2.
65 Ibid. pp. 68–71.
1.3 Sports Law 15

belonging to the Single Market advocacy coalition. Their deep core beliefs include
the belief in negative integration and the protection of the four fundamental free-
doms under the Treaty. Their policy core belief system goes no further than
emphasizing that sport is subject to EU law in as far as it constitutes economic
activity and that there cannot be any general exemption for the whole of the indus-
try. Secondary aspects of the coalition’s beliefs provide flexibility by acknowledg-
ing the socio-cultural dimension of sport which should be taken into account in the
application of law.66 Given that both advocacy coalitions have relatively equal
access to institutional resources, each one is able to influence policy in a manner
which has the potential to undermine the fundamental beliefs of the rival coalition.
A compromise is possible and coalitions would be willing to negotiate within
secondary aspects of their beliefs in order to protect the core beliefs. From this
process of mediation the separate territories approach—i.e., the definition of ter-
ritories for sporting autonomy and for legal intervention67—emerged, which in
turn meant that a particular legal approach to sports has been developed, establish-
ing a discrete body of sports law within the EU.68
In a different theory, a few Nordic scholars have discerned the scope of sports
law by dividing the law into two different areas: a core and a surrounding area. In
their view, the core consists of the rules and regulations of sports organisations
based on their autonomous rulemaking (such as the UEFA Statutes or the IOC
Charter), and the surrounding area consists of ‘ordinary laws’ in society. The only
way that these ordinary laws could interfere with the autonomy and influence of
sports organisations is in the case of a conflict of laws.69
Halgreen questioned both of these theories because they do not provide clearer
answers to what should be understood as sports law. Further, he correctly pointed
out that there is no hard evidence to support the idea that there is a core that is
untouched by traditional legal principles applied in the ‘real world’, as there seems
to be a constant risk of conflicts of law on every corner. Halgreen then proposed
that if sports law is to be recognised as a genuine legal discipline the solutions
posed by the disputes in the sporting community should sometimes be different
than solutions provided in the ‘real world’, or in his words, the ‘considerations
specific to the sporting community would lead to a result that would otherwise not
likely be achieved outside the sporting community’70 when ordinary laws are
applied to sports disputes.

66 Ibid. pp. 65–68.

67 However, see also Weatherill 2007, pp. 48–73. Therein, Weatherill considered that the legal
order established by the Treaty and the legal order that governs sports (a set of legal rules
­established by sports federations) overlap to a large extent. This is because of the economic
dimension of sport. The area of overlap is nourished by the appreciation that in some respects
sport is special. See p. 49.
68 Parrish 2003, p. 79.
69 Halgreen 2004, p. 26.
70 Ibid. p. 27 (emphasis added).
16 1 Introduction

In general, there are two kinds of sports law in Europe: one made by sport
f­ederations and specialised tribunals for resolving sports disputes, such as CAS,
and the other by national and European legislators and courts. It is clear that
the first category, lex sportiva, can be properly called sports law. This is not just
because it is adopted by sports bodies and organs for the regulation and organi-
sation of sport, but because it is adopted by sports bodies and organs that were
recognised by constitutions or legislation of the Member States, as well as by
European policy documents, as having autonomy to do so in relation to their sport-
ing discipline. Their autonomy is therefore based on its express or implied accept-
ance of national and European regulators. Although this autonomy was initially
self-proclaimed, subsequently it became a matter not unlike the delegation of com-
petence by public to private bodies to regulate themselves within the confines of
the law. In the EU, it is clear that sport has this kind of ‘conditional autonomy’ as
confirmed and reiterated by numerous policy documents.
The second kind of sports law is composed of various national and European
legislative acts and decisions by public authorities including the judiciary. In deter-
mining whether a case can be put into the ‘EU sports law box’, one of the impor-
tant questions to ask is whether a dispute entails (implicitly or explicitly)
considerations of the specificity of sport? If so, then it is sports law that is being
applied to resolve the dispute, even though it is also EU competition law or free-
dom of movement law being applied. This is due to the specificities of the sports
sector that must, as a matter of constitutional requirement, be taken into account in
the application of EU laws, and in this process the ordinary law is transformed into
its specific version that can be referred to as EU sports law. The specificity of sport
that brought about ‘sporting exceptions’ of various kinds71 is the very feature that
justifies the ‘EU sports law’ label but it is also one of the features that justifies the
autonomy of the sport governing bodies. Limiting the scope of that autonomy (i.e.
conditioning it), influencing those bodies’ considerations in decision-making and
confirming or remoulding their rules via judicial or administrative review is clearly
going to be a part of sports law. In fact, a different question could be asked to
approach the issue from another end of the process and enquire if any
­organisational or regulatory sports rule or practice has been amended/disposed of/
confirmed as a result of an administrative or judicial decision at the EU level? If
so, then the law applied should be taken as forming a part of sports law.
Finally, many rules that are adopted or not adopted by sporting bodies outside
the process of any dispute are influenced by the need to pay due regard to the ordi-
nary laws, in particular, EU competition and internal market principles. In Murphy
Advocate General Kokott said that Articles 6(e) and 165 TFEU ‘require account to
be taken of the specific nature of sport and its structures based on voluntary
a­ctivity’ which has been interpreted to ‘imply horizontal reach of Article 165 into
other Treaty competences’72 and this is true as regards the application of EU law.

71 See Chap. 6 on convergence and sporting exceptions.

72 Parrish 2012, p. 732. However, there is no need to take Article 165 TFEU into consideration
in any of the EU legislative procedures, as it is not a horizontal provision.
1.3 Sports Law 17

By taking due considerations of one another’s requirements, the first and the ­second
kind of sports law formed an inseparable unit in which discussion and consultation
have gradually replaced conflicts and confusions. This is very much reflected in the
modern practice of consultation between UEFA and the EU Commission on issues
of common interest, such as the implementation of the UEFA Club Licensing and
Financial Fair Play Regulations and legal certainty for sport, support and coopera-
tion in matters related to match-fixing, and issuing of common statements by the
Commission and UEFA.73 Compared to 15 years ago, EU sports law is certainly
developing in a different and more stable environment.

1.3.4.2 Relevant Institutional Actors

The Education and Culture Directorate-General of the European Commission

includes the Sport Unit which is responsible for cooperation within the
Commission and with other EU institutions on sport-related issues, and for coop-
eration and meetings with national and international sports institutions, organisa-
tions and federations.
Prior to the entry into force of the Lisbon Treaty, EU Sport Directors and
Ministers had been meeting regularly in an informal setting, outside the formal
structures of the EU Council of Ministers in order to address sport-related matters
of common concern, exchange good practice, and give political guidance to the
Commission. Following the entry into force of the Lisbon Treaty, the Ministers
responsible for sport of the 28 EU Member States can now meet in the formal set-
ting of the Council.74 However, the informal meetings will continue also after the
entry into force of the Treaty provisions for sport as they can be useful to exchange
views on matters of common concern and to prepare the ground for work in the
Council, where the formal decisions are taken. Six EU working groups have been
set up in recent years to co-operate more closely, at technical level, on specific top-
ics. Each working group includes representatives of at least ten Member States and
is chaired by the Commission.75 On 16 September 2010, the European Council
changed the name of the Council in charge of Education, Youth and Culture.
Officially the Council is now called the Education, Youth, Culture—including
Audiovisual Affairs—and Sport Council. Sport was discussed for the first time by
the Education, Youth and Culture Council, meeting in Brussels on 10–11 May 2010.

73 Joint Statement of UEFA and the EU Commission of 21 March 2012 is available at http:
//www.uefa.com/MultimediaFiles/Download/uefaorg/EuropeanUnion/01/77/21/58/17721
58_DOWNLOAD.pdf.
74 For e.g., meeting of EU Sports Directors in Genval 16–17 September 2010.
75 The following Working Groups were established: in 2005—Working Group ‘Sport & Health’,

in 2006—Working Group ‘Sport & Economics’, in 2007—Working Group ‘Non-Profit Sport

Organisations’; in 2008—Working Group ‘Anti-Doping’; in 2009—Working Group ‘Education
and Training in Sport’; in 2010—Working Group ‘Social Inclusion and Equal Opportunities in
Sport’.
18 1 Introduction

In addition to the structures within the Commission, the Council and the
European Council, it is important to mention the European Parliament’s standing
committee on culture and education, whose tasks include development of a sports
and leisure policy. Finally, in its role as interpreter of EU law, the CJEU played a
central role in interpretation of the existing economic provisions in the sporting
context. In the absence of binding legislation specifically enacted to govern aspects
of sport, these cases have for a long time provided a track for EU sports law to
develop, in so far as they involved the practice which constituted economic activity.
The European Commission, an institution known as ‘the guardian of the
Treaty’, may inquire about, and if necessary may open up formal proceedings
against, suspected cases of infringement. It may also receive complaints from third
parties. Commission decisions may be appealed to the CJEU under Article 263
TFEU. The case may also reach the CJEU via the preliminary reference procedure
under Article 267 TFEU. Until the entry into force of the Lisbon Treaty amend-
ments, the Commission played a reactive role to the legal issues posed by sport.
The paragraphs that follow will illustrate the effects of these amendments in prac-
tice and it will become clear that the Commission and other institutions involved
in the legislative process have assumed a more pro-active role in accordance with
their newly acquired mandate under Articles 2(5), 6(e) and 165 TFEU.

1.3.4.3 Applicable Legislation and Existing Policy Instruments

Until the entry into force of the Lisbon Treaty on 1 December 2009, the EU did
not have direct legislative competence to regulate sports. The traditional instru-
ments were (and still are) therefore essential to protecting the core objectives of
the Union when the rules and activities of sporting bodies obstruct the functioning
of internal market and distort competition. The primary articles in the TFEU
involved are the rules on competition in Articles 101 and 102, freedom of move-
ment for workers (Article 45–48), freedom of movement for self-employed
(Article 49–55) and freedom to provide services (Articles 56–62). Moreover, all
other Treaty provisions, such as those relating to EU citizenship and equal treat-
ment, also apply to sport. The Charter of Fundamental Rights of the EU ought to
be applicable to the rules and practices of the sport governing bodies due to their
state-like competences, as well as the scope and impact of their regulatory latitude.
However, it is only in the context of Union’s competence over sport in as far as it
constitutes economic activity that the Charter may be utilized to supplement ath-
letes’ legal arguments—for example, in the judicial test for regulatory rules in
sport devised by the Court in Meca-Medina and the equivalent internal market
objective justification framework. As such, it may provide a counterbalance to the
Article 165(1) TFEU concept of the ‘specificity of sport’ that sporting federations
rely on to justify their restrictive measures.76

76 As argued in Pijetlovic 2013.

1.3 Sports Law 19

Relevant secondary EU legislation includes the Audio-Visual Media Services

Directive,77 the Directive on the Legal Protection of Databases,78 the Citizens
Rights Directive79 and the Environmental Impact Assessment Directive,80 as well
as some general procedural instruments such as Regulation 1/200381—utilised
when a competition case is investigated by the Commission’s Directorate General
IV. The first piece of legislation mentioned is primarily adopted to regulate sports
broadcasting and allow Member States to designate the list of national and non-
national events of great importance to their society to be provided on free-to-air
television.82 None of the other instruments has played much role in practice so far.
There is a growing number of non-binding policy instruments on sport adopted
to articulate the position of the individual EU institutions on sporting issues and
set out an approach to EU regulation of the sport sector in general.83 They provide
an impetus for development of legal principles guiding the enforcement and inter-
pretation of traditional rules in this regulatory environment. The 2007 White Paper
on Sport, accompanied by the Commission Staff Working Document,84 is the most
comprehensive and high profile initiative adopted by the Commission, issued after
2 years of consultation with relevant stakeholders, each expressing different
observations and expectations. The White Paper includes all aspects of the EU
acquis that have an impact on sport, enhances visibility of sport in EU policy and

77 Directive 2010/13/EU of the European Parliament and of the Council of 10 March 2010 on
the coordination of certain provisions laid down by law, regulation or administrative action in
Member States concerning the provision of audiovisual media services (Audiovisual Media
Services Directive), OJ L 95, 15/4/2010, pp. 1–24.
78 Directive 96/9/EC of 11 March 1996 on the legal protection of databases OJ L 077,

27/3/1996.
79 Directive 2004/38/EC of the European Parliament and of the Council of 24 April 2004 on the

right of citizens of the Union and their family members to move and reside freely within the ter-
ritory of the Member States amending Regulation (EEC) No 1612/68 and repealing Directives
64/221/EEC, 68/360/EEC, 72/194/EEC, 73/148/EEC, 75/34/EEC, 75/35/EEC, 90/364/EEC,
90/365/EEC and 93/96/EEC, OJ L 158, 30/4/2004, pp. 77–128.
80 Council Directive of 27 June 1985 on the assessment of the effects of certain public and

p­rivate projects on the environment 85/337/EEC OJ L 175, 05/07/1985, pp. 40–48, as amended.
81 Council Regulation (EC) No 1/2003 of 16 December 2002 on the implementation of the rules

on competition laid down in Articles 81 and 82 of the Treaty OJ L 1, 04.01.2003, pp. 1–25.
82 For cases interpreting this rule see Sect. 4.9
83 Such as: Declaration on the specific characteristics of sport and its social function in Europe,

of which account should be taken in implementing common policies 13948/00, Annex to the
Presidency Conclusions, Nice (Nice Declaration); Declaration No. 29 in Amsterdam Treaty
(Amsterdam Declaration); Report from the Commission to the European Council with a view
to safeguarding current sports structures and maintaining the social function of sport within
the Community framework (‘The Helsinki Report on Sport’) Brussels, 10 December 1999
COM(1999) 644 final; and most notably, Commission White Paper on Sport, Brussels 11 July
2007 COM(2007) 391 final.
84 Ibid. See also Commission Staff Working Document, The EU and Sport: Background and

Context, Accompanying Document to the White Paper on Sport, COM (2007) 391 final.
20 1 Introduction

actions, acknowledges the specificities of the industry, and improves transparency

of the application of EU law to sport for all actors concerned.85
Four years later, in 2011, the Commission took another important step in defining
sports policy by adopting the Communication on Developing European Dimension
in Sport.86 The Communication credits the White Paper on Sport for greatly
enhancing EU-level cooperation and dialogue in the area. Similarly, a European
Parliament Resolution87 welcomed and, in general, supported the approach of the
White Paper on Sport. The EU Parliament called on the Commission to propose an
EU sport programme as well as preparatory actions in the field of sport from 2009.
From December 2008 onwards, the Parliament approved an annual budget for
such preparatory actions, and the Commission, by means of decision, adopted an
Annual Work Programme on grants and contracts for the preparatory actions. The
main objective is to implement the sport provisions in Article 165 TFEU by pro-
viding policy support for the identification of future policy actions in the area of
sport through studies, conferences, seminars and surveys; testing the establishment
and functioning of suitable networks and good practices through calls for propos-
als; and promoting greater European visibility at sport events.88
Furthermore, the Parliament asked the Commission to ‘have due respect for the
specificity of sports, by not taking a case-by-case approach and to provide more
legal certainty by creating clear guidelines on the applicability of European law to
sports in Europe […]’.89 This is in contrast to the view on the White Paper on
Sport expressed by the study group on the Lisbon Treaty and the European Union
sports policy that considered it unnecessary for the Commission to issue any addi-
tional guidelines,90 and it is also in contrast to the Commission’s case-by-case
approach outlined in the accompanying documents to the White Paper on Sport.91
The third EU Sport Forum took place in Budapest on 21–22 February 2011. This
is an annual event and the key platform for dialogue on sport at EU level (as fore-
seen in the White Paper), which gathers EU Sport Ministers, and all the main
stakeholders in sport including UEFA, FIFA and the European Olympic
Committees. Themes included reflections on the Commission Communication
‘Developing European Dimension in Sport’, developments in sport at the EU level
since the last EU sport forum in Madrid 2010, and the presentation of results of 18

85 See Velázquez Hernández 2008, pp. 78–79.

86 COM (2011) 12 final, 18. 1. 2011.
87 European Parliament resolution of 8 May 2008 on the White Paper on Sport (2007/2261

(INI)).
88 See http://ec.europa.eu/sport/preparatory_actions/studies-surveys-conferences-and-seminars_

en.htm.
89 Ibid. para 4, (emphasis added).
90 See the European Parliament, Directorate-General for Internal Policies, study on the Lisbon

Treaty and EU Sports Policy (2010), p. 12.

91 Commission Staff Working Document, para 4.1.
1.3 Sports Law 21

projects in the field of sport supported through Preparatory Action 2009.

In 2009–2010 the Commission provided more than €6 million to support around
40 sport projects, and in 2011 launched 12 new projects.92

1.3.4.4 TFEU: EU Competence in Sport and Article 165

On 1 December 2009, the Lisbon Treaty entered into force. The inclusion of sport in
Article 165 under Title XII on Education, Vocational Training Youth and Sport has
sparked many debates as to its precise effects on the powers of EU institutions in the
field, and ultimately its effects on sport. Article 165(1) states that ‘The Union shall
contribute to the promotion of European sporting issues, while taking account of the
specific nature of sport, its structures based on voluntary activity and its social and
educational function’ [emphasis added]. According to Article 165(2) ‘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 sports-
men and sportswomen, especially the youngest sportsmen and sportswomen’.
A study on the Lisbon Treaty and European Union Sports Policy that was
recently commissioned by the European Parliament reveals that, in general, Article
165 will have a limited impact on the EU’s legal powers over sport.93 Unlike the
Treaty provisions on environmental protection and public health, Article 165
TFEU does not contain a horizontal clause requiring EU institutions to take sport-
ing issues into account in the exercise of other powers and when making policies
in other areas, such as free movement and competition law, although they may
choose do so. There is no constitutional requirement to take into account the speci-
ficity of sports in either legislative or administrative action and therefore Article
165 TFEU should not alter the existing sports-related jurisprudence of the Court
and the decision making practice of the Commission.94
Two sport-related cases decided after the entry into force of the Lisbon Treaty
in which the Court made reference to the new article are the judgments in Bernard
and Murphy. The study on the Lisbon Treaty and European Union Sports Policy
concludes that reference to the ‘specific nature of sport’ in Bernard merely rein-
forces already existing judicial possibilities and that Article 165(1) TFEU will add
little further protection for contested sports rules beyond those already provided by
the Court and the Commission because the two institutions have already been
highly receptive to the ‘specific nature of sport’ concept.95 However, the study also

92 See the Commission Press Release IP/11/43 ‘Commission Strengthens European Dimension

of Sport’ 18 January 2011. Details of the budget are in the Final Report on evaluation of
­preparatory actions and special events in the field of sport that has become publicly available on
29 July 2011.
93 The Lisbon Treaty and EU Sports Policy 2010, p. 10.
94 Ibid.
95 Ibid. p. 11.
22 1 Introduction

finds that whereas Bernard has not opened any new previously undiscovered
­avenues of appeal, the Court’s treatment of Article 165 TFEU in that case supports
the view that ‘the new sports competence may have given further weight to sports-
related arguments’. On a different basis, namely, the treatment of certain sport-
specific issues in the 2010 Bernard case as compared to the 1995 Bosman
judgement, it is argued in Chap. 4 that the new ‘sports article’ has indeed given an
additional weight to the sports related arguments.96 This was later confirmed by
the Court’s approach in Murphy, also discussed in detail in Sect. 4.10.
Articles 2(5) in combination with Article 6 of the Treaty gives the Union the
competence to carry out actions that support, coordinate or supplement the actions
of the Member States in the area of sport and that do not entail harmonisation of
the Member States’ laws or regulations. Article 165(4) states that EU institutions
shall, in accordance with the ordinary legislative procedure, adopt incentive meas-
ures excluding any harmonisation of the laws and regulations of the Member
States, and the Council shall adopt recommendations on a proposal from the
Commission. However, the study group’s examination of the equivalent past prohi-
bitions of harmonisation and their treatment by the Court97 suggests that harmo-
nising measures can be taken so long as they are nominally based on another
Treaty competence and convergence can be achieved in practice by using another
legal basis to pass the harmonising legislation. Importantly, the new sports compe-
tence allows the EU to allocate part of the budget to sport directly without the
need to justify this by reference to other Treaty competencies, as has been the
practice so far.98

1.3.5 Boundaries of Legal Intervention

Thus far, the traditional starting point for all discussions on the delimitation of reg-
ulatory competences in sports has been the autonomy of sporting bodies followed
by an assessment of the appropriate level of intervention into that autonomy.
However, the categories of rules that do not produce economic effects (i.e. ‘rules
of the game’) may be mentioned subsequently, as an exception, to the dominant
fact that sporting rules and practices are subject to EU law. The White Paper on
Sport simply states: ‘Sport activity is subject to the application of EU law.’99 Only
then it does it go on to discuss specificity and nowhere does it mention that there
might be a sporting rule that is a priori not subject to the application of EU law.
Instead, Annex I to the Commission Staff Working Document accompanying the
White Paper on Sport talks about the rules that are ‘unlikely to infringe’ against

96 See also Pijetlovic 2010, pp. 858–869.

97 Such as in the fields of social policy, education, vocational training, culture, and public health.
98 See The Lisbon Treaty and EU Sports Policy Study 2010, p. 11.
99 Paragraph 4.1.
1.3 Sports Law 23

competition provisions, emphasising that there can be no general exemption for

any of the sporting rules and recognising that ‘each sport may require different
rules and each rule will have to be looked at individually’. This case-by-case
approach is all-inclusive and leaves a broad scope to challenge virtually any of the
sporting rules.
Furthermore, sports law cannot be understood in purely national terms at any
level and the debates on regulatory competences should be placed within the wider
European and international context.100 International sports federations are the
best-placed authorities to set the rules of the game, establish specialised dispute
resolution bodies, design codes of conduct on and off the playing field, and decide
on other matters that concern organisational and regulatory aspects of their respec-
tive disciplines. European policy instruments recognise this independent nature of
sport governing bodies and the need to support and protect their central role in
ensuring cohesion and financial solidarity. While it is true that the EU does not
have competence to interfere into sporting autonomy via legislative action, any
sphere of sporting activity and any sporting rule that produces cross-border eco-
nomic effects may become subject to scrutiny under EU law, the provisions on
non-discrimination, competition and free movement being the most relevant.
These provisions dictate what private and public authorities, including sporting
bodies, may not do. As such, EU law will interfere into sporting authority inas-
much as their rules and practices are in breach of negative Treaty provisions.101
What the EU policy documents have in common is their mission to reconcile
the interests of different stakeholders, in other words, to preserve the traditional
values of sport and the autonomy of sport governing bodies on the one hand, and
on the other hand to have sporting rules and practices comply with the EU law.
Accordingly, sport bodies enjoy a form of autonomy that allows them to organise
and regulate their respective sport conditionally upon compliance with these eco-
nomic provisions, whereas the Union has an equivalent duty to take into account
the specificity of the sector (including social, educational and cultural functions
inherent in it) in the implementation of common policies.
Furthermore, it is often emphasised that the practice of sport is subject to Union
law only in so far as it constitutes economic activity, and that ‘purely sporting
rules’ do not constitute such economic activity.102 In Weatherill’s theory, there is
an unavoidable overlap between the EU economic laws which regulate the sport
from the ‘outside’ and the network of governance which represents ‘internal’
sports law. The area of overlap is nourished by appreciation that in some way
‘sport is special’ (the concept which is referred to as ‘specificity of sport’103). It is
commonly thought that after the Court’s decision in Meca-Medina it is clear that

101 Weatherill 2009, p. 79.

102 See Sects. 4.1.2 and 4.1.3 for cases establishing the rules. See also Chap. 6 for detailed
­discussion on different categorises of sporting exceptions.
103 The concept is discussed below in Sect. 2.1.
100 Gardiner et al. 2007, p. 92.
24 1 Introduction

only a very small category of rules may be referred to as ‘purely sporting rules’
devoid of any economic effect.104 These conclusions came as a result of the
Court’s statement in paragraph 27 of the judgment that ‘the mere fact that a rule is
purely sporting in nature does not have the effect of removing from the scope of
the Treaty the person engaging in the activity governed by that rule or the body
which has laid it down’. Most sporting rules will actually belong to the area of
overlap, and the scope for unfettered autonomy virtually does not exist. However,
it is hard to imagine some rules being challenged in legal action, such as most of
the rules of the game, or nationality discrimination when selecting, say, football
players for World Cup or EURO to represent their countries. This will de facto
leave out some rules from the area of overlap.
As a final point, it is important to emphasise that the fact that the sporting rule
or practice falls under the scope of EU law, or that it is being challenged in a legal
action before the Commission or the CJEU, does not automatically render that rule
or practice in breach of any legal provision. In fact, at least half of the sporting
rules that have so far been examined by these EU institutions have been confirmed
as being in compliance with EU law.

1.4 The Subject Matter of the Volume

1.4.1 The Arrangements in European Football Giving Rise

to Legal Problem Posed by Breakaway Structures

In general, sports federations are responsible for creating rules that regulate all
important aspects of their respective disciplines. Decisions on the structure of the
sport, and regulatory and organisational matters are usually within their exclusive
competence. At the same time, sporting federations are also commercial actors
with economic interests in the sport they regulate. This intermingling of regulatory
and commercial functions in a single body often leads to a conflict of interests,
to the detriment of any actual or potential competitor on the relevant market. In
Europe, sport has traditionally been organised in a ‘pyramid’ structure with one
governing federation per sport. The EU sports policy led by the Commission,
European Council and the European Parliament expressed support for the
­preservation of such traditional organisational structures. However, the factor of
incremental commercialisation, coupled with the application of the internal market
and competition provisions of the Treaty in the area of sport, have made this politi-
cal and ideological goal increasingly difficult to maintain in practice.
Namely, European sports are characterised by a high degree of financial soli-
darity (or so the theory goes) between amateur and professional leagues, as well
as between clubs playing in the same league. Football is very representative of this

104 See, for e.g., Weatherill 2006, pp. 645–657.

1.4 The Subject Matter of the Volume 25

arrangement. Many football clubs are content with the terms of this arrangement
but the same cannot be said of the commercially most powerful clubs who share
a part of their proceeds with their less well-off competitors and with grassroots
football. Not surprisingly, financial solidarity is not self-imposed: UEFA, in its
capacity as the governing body mandated with organising and regulating European
football, conditions participation of the clubs in European competitions upon the
transfer of commercial rights to UEFA. UEFA then sells the rights collectively on
behalf of participants in the league and distributes the profits in accordance with
the principle of solidarity. The discontent of the top football clubs with the distri-
butional as well as other rules affecting their commercial interests (such as com-
pulsory and uncompensated player release for international matches of national
representative teams) has in the recent past resulted in threats of the elite group
of top-earning clubs to break away from their current organisational structures
and form their own closed private league on a pan-European level. Apart from the
standard commercial risks brought about by the market itself, another problem that
the actualisation of such a project faces is contained in the rules of Article 49 of
the UEFA Statutes (2012) that subjects the participation of the clubs in alternative
competitions to prior authorisation. Any deviation from these rules would result in
disciplinary and financial penalties. The other side of the story is that financial sol-
idarity is a fundamental mechanism enabling the governing body to fulfil its man-
date and promote its discipline at all levels. Without such solidarity, the traditional
European football structure would have to be substantially re-organised. UEFA
also provides organising services to the clubs participating in the pan-European
competitions and manages all practicalities involved in such organisation.
Sporting rules that produce economic effects, even if only indirect and poten-
tial, may come under the administrative and judicial scrutiny of EU institutions.
The TFEU competition rules in the Court’s sporting judgments treat the sporting
bodies and clubs as undertakings or an association of undertakings for the pur-
poses of bringing them under the scope of legal control. Rules of the sporting
bodies such as the one under Article 49 of the UEFA Statutes (2012) making par-
ticipation in alternative championships subject to prior authorisation (which would
probably not be given to the elite rival league) can therefore constitute a breach
of Articles 101 and 102 TFEU. Although the legal analysis should focus on the
application of competition law, the restrictive rule under examination produces
effects also in the area of the internal market, in particular regarding freedom to
provide services in Article 56 TEFU. A specific set of legal principles forming
the core of EU sports law was created by the Court in the interpretation of these
Treaty articles and their application to sporting rules and regulations. European
policy endeavours that are focused on maintenance of the traditional structures
will have to take into consideration a high degree of commercialisation of pro-
fessional sports and their relationship with the Treaty, and might therefore require
adjustment and reformulation to conform to the prevailing legal and commercial
realities. Hence, it will also be interesting to consider what kind of role, if any,
the EU policy goals in non-binding and declaratory instruments that expressed
support for preservation of traditional European sporting structures would play in
26 1 Introduction

the application of the principles of open market economy outlined in the Treaty as
interpreted by the CJEU.
This volume will: 1. set out the problems and highlight the power struggles in
European football governance in the light of the context of the topic of this book;
2. provide progressive interpretation of the applicable EU sports law; 3. set out
a novel theory of convergence between TFEU provisions on competition and the
internal market in the light of sporting exceptions and; 4. explore the legality of
the Article 49 rule in UEFA statutes and the case for formation of alternative struc-
tures in European football under the EU sports law.
Should the clubs be free to ‘take the ball and go home’ and under which condi-
tions, if any? Conversely, are the UEFA Statutes making the formation of alterna-
tive leagues subject to approval, which is in practice never given, in accordance
with the requirements of EU law? This legal problem has been looming since the
late 1990s but apart from a few shorter papers there exists no comprehensive legal
research in English on this topic to date. Football has been chosen as the focus of
this volume because it is the most important sport in Europe in terms of its com-
mercial impact, the most powerful sport in terms of its social impact, and more
than half of the cases before EU institutions were focused on football. This vol-
ume touches upon and interconnects many areas of EU law and policy including
different areas of competition law, internal market law, constitutional law, theories
of sports law and policy, and the discussion on corporate social responsibility in
this context.

1.4.2 Description of Chapters 1–7

The current chapter began by offering some guidance on the definitions and
­terminology used, while highlighting the differences in the way that the l­egislation
of individual countries and international organisations view the primary func-
tions that sport ought to perform. Sport’s internal self-regulation and the sources
of the autonomy of that self-regulation from the point of view of the statutes of
the governing bodies were then looked at. It was shown that claims for self-regu-
lation have been replaced by the aspirations towards a more expansive interpreta-
tion of the concept of sporting exception developed in the Court’s jurisprudence.
Self-regulation was also looked at from the point of view of the European insti-
tutions as expressed in their policy instruments. Respect for the principles of
good governance was seen as instrumental for the conditional autonomy offered
to sports governing bodies. The chapter further discussed what it later identifies
as two amalgamated types of sports law: first, sources of lex sportiva including
CAS decisions, and different documents spelling out regulatory and organisational
rules, and second, European sports law and policy. The latter was considered in
more detail, including theories on the historical development and acceptance of
sports law as an independent area of law, EU institutional actors and their rele-
vant functions and activities, and applicable EU policy and legislative instruments
1.4 The Subject Matter of the Volume 27

(in particular Article 165 TFEU, the so-called the sports article, added by the
Lisbon Treaty amendments).
The basic features of the sporting industry in Europe are outlined next in
Chap. 2, with emphasis on the concept of ‘specificity of sport’ in EU law and pol-
icy as the key rationale behind the ‘sporting exception’ in EU law. As the structural
set-up of sport is essential for understanding the application of the law, a section
is dedicated to a comparative overview of the European and American models of
sport, each with their own characteristics.
The underlying theme of Chap. 3 is rooted in the recognition of apparent con-
flict between, on the one hand, the EU policy goals to preserve the traditional
European sporting structures, and on the other hand, the neo-realities regarding
commercial aspects and governance of European football. Beneath the EU policy
goals and sporting organisations’ endeavours to maintain the structural status quo
in Europe, creeps the factor of incremental commercialisation with all its corol-
laries, which, in the view advanced by this book, renders the current organisa-
tional structure prone to breakaway challenges and power struggles resulting in
compromises at the expense of other stakeholders. Chapter 3 reveals the details
of the 1998 Media Partners proposal which offered an attractive package of finan-
cial benefits to elite football clubs to form an alternative breakaway league outside
the European pyramid structure. In order to keep the clubs under its roof, UEFA
reacted by establishing an expanded Champions League with more matches and
more money for the teams, and with several places in the Champions League guar-
anteed for the clubs coming from the ‘big five’ leagues. Consequently, the Media
Partners proposal never reached an implementation stage, but the economic inter-
est grouping known as the G14 was formed by some of the main proponents of the
proposal who apparently discovered how to gain an upper hand in the power strug-
gle. Due to the dissatisfaction of the G14 with the FIFA rules on compulsory and
uncompensated player release for international representative matches of national
teams, another threat of a breakaway took place in 2006. By January 2008, the
world governing body entered into a peace deal with the G14 that resulted in the
creation of a compensation pool for the clubs that release players and in changes
to the governance structure, in return for withdrawal of, inter alia, the Oulmers
case, and the dissolution of the G14. It is submitted that this compromise by FIFA
was not necessary as regards the outcome in the Oulmers case—the deal was
driven in big part by the fear of formation of an alternative closed league led by
the G14. The responses of FIFA and UEFA when presented with the prospect of
breakaway by elite clubs illustrate the influence that the group had on the deci-
sions of the governing bodies. That influence is used to change the rules governing
football every time important financial interests of the most powerful clubs are at
stake. Furthermore, Chap. 3 presents the relevant dynamics behind the governance
of European football. It portrays the threat of a breakaway competition as an on-
going latent disease of the pyramid structure. In particular, it is argued that not-
withstanding the formal disbandment of the G14, the group and its allies continue
to present a powerful lobby with special commercial interests not possessed by
any other competitors in their league. At the conclusion of the January 2008 deal
28 1 Introduction

with FIFA that resulted in formal disbandment of the G14, their role has not ended
de facto; it has just been deinstitutionalised, re-institutionalised, and legitimised
in the form of the European Club Association. The dominant representation of
the elite clubs on the Executive Board of the European Club Association coupled
with the changing economic reality of the sports sector has contributed toward a
gradual shift and unwelcome form of decentralization of the governance of the
European football. This body also represents European clubs on the Professional
Football Strategy Council (PFSC)—three out of four members are former G14
clubs. Central decision making without proper representation of all the affected
stakeholders might be a sign of bad governance, but decentralised decision mak-
ing to the advantage of big clubs as stakeholders and the disadvantage of football
as a whole, is potentially even worse. Although the PFSC appears to be a step in
the right direction, as long as the ECA remains ‘elitist’ and as long as European
Professional Football Leagues represent only the top leagues, democratic repre-
sentation in the governance of European football will remain a privilege of the
rich. Finally, it is stated that the legal and commercial environment for the sports
industry is in the process of changing, doubling the market risks involved in any
potential breakaway.
The purpose of Chaps. 4 and 5 is to set out and discern the principles under-
lying the application of EU freedom of movement and competition law to legal
disputes in the sports sector. These chapters present alternative views on several
sports judgments and contribute original ideas on the general framework relevant
to the enforcement of Treaty provisions in sporting disputes. Chapter 4 briefly
introduces the main analytical framework and legal principles in the field of free
movement of persons. Thereafter, all the important sports judgments of the Court
are analysed in chronological order, from Walrave decided in 1974 to Murphy
in 2011. The analysis of the seminal Bosman decision offers a fresh perspective
on the ‘3+2’ rule and its implications for the current UEFA home grown rule.
Judgment in the Bernard case is considered in detail as it is the first sporting judg-
ment of the Court after the Lisbon Treaty amendments. The issues considered in
Chap. 5 are custom-tailored to the extent possible to correspond to the title and the
purpose of this book. In the subheading on ‘Blocking competing organisations’,
three cases that are factually most relevant to the breakaway leagues are analysed:
MOTOE, FIA/Formula One and DLG. Moreover, contrary to suggestions from the
Arnaut Report, Article 106(2) TFEU is described as superfluous and undesirable
in terms of its applicability to sport. Finally, the subheading on ‘Superdominance
and special responsibility’ makes certain parallels between the expanded con-
cept of special responsibility of superdominant undertakings and corporate social
responsibility. It suggests that the content of the legitimate aim relied on by super-
dominant undertakings (such as sports governing bodies) to avoid application of
competition law by fulfilling the Meca-Medina/Wouters test, could be made bind-
ing by the Commission, via the procedure similar to commitment decisions under
Article 9 of Regulation 1/2003.
Chapter 6 sketches a novel way of looking at the different categories of s­ porting
exceptions through the prism of convergence between EU free movement law
1.4 The Subject Matter of the Volume 29

and competition law. It connects back to the Sect. 5.5.5.5 discussion on para 31
of the Meca-Medina case. The text is supported by graphic illustrations wherever
deemed useful. This is probably the most significant theoretical contribution of
this work to the study of EU sports law in general.
Chapter 7 is the most significant contribution to the topic of breakaway struc-
tures in the English language. It starts from the determination of the relevant mar-
ket, the position of the parties on the relevant market and the designation of the
restraints under EU competition and internal market law. The qualitative analy-
sis of the existence of UEFA dominance on the market, as supported by estab-
lished legal principles and the Court’s case law, lead to the unexpected result that
it would be a challenging task to demonstrate that such dominance indeed exists.
On the other hand, demonstrating market foreclosure is easier task despite the fact
that the specific traditional competition law doctrines have proven particularly
awkward to apply to the organisational rules in question. The core of the outcome
of the analysis in this chapter lies in the elements of justification framework that
are transposable and shared between competition and internal market provisions.
The proportionality of the rules on breakaway leagues is the culminating point of
these analyses.

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Chapter 2
The Sporting Industry

Contents
2.1 Specificities/Special Characteristics of the Sporting Industry............................................. 31
2.1.1 Preliminary Remark on Phraseology.......................................................................... 31
2.1.2 The Concept of Specificity of Sport in EU Law and Policy....................................... 32
2.1.3 Special Characteristics of Sport.................................................................................. 34
2.2 Structural Models of Sport................................................................................................... 36
2.2.1 Classic European Model of Sport............................................................................... 36
2.2.2 US Model of Sport...................................................................................................... 38
2.2.3 Changing Characteristics of European Football......................................................... 40
2.3 Financing of Sport................................................................................................................ 42
2.3.1 Macroeconomic Aspects............................................................................................. 42
2.3.2 Microeconomic Aspects.............................................................................................. 43
References................................................................................................................................... 45

2.1 Specificities/Special Characteristics of the Sporting

Industry

2.1.1 Preliminary Remark on Phraseology

A lot of academic discussions thus far have focused on the question of ‘is sport
special?’ in EU law and policy.1 The objection to this is not related to the debate
itself but to the phrasing of the theme of the debate. Regarding the general
approach under freedom of movement provisions, sport is in principle not treated
much differently than any other industry. The European Commission and the Court
of Justice of the European Union (‘CJEU’ or ‘the Court’) always take into

1 See, for e.g. Szyszczak 2007, pp. 3–32; and Siekmann 2008, pp. 37–49.

© t.m.c. asser press and the author 2015 31

K. Pijetlovic, EU Sports Law and Breakaway Leagues in Football,
ASSER International Sports Law Series, DOI 10.1007/978-94-6265-048-0_2
32 2 The Sporting Industry

consideration the specificities of each industry and special circumstances of each

case when enforcing and interpreting the provisions of the Treaty, and certain
industries are in fact separately regulated due to their own specific requirements. In
this sense, while it has its peculiar characteristics (specificities or special nature)
which have to be taken into account in the application and interpretation of EU law
as a matter of constitutional requirement under Article 165(1) TFEU, as well as a
matter of judicial and administrative practice so far, sport is not special. The Nice
Declaration on Sport states that ‘the Community must, in its action under the vari-
ous Treaty provisions, take account of the social, educational and cultural functions
inherent in sport and making it special’. This is not to say that sport is special
under EU law but that, as many other industries, it has its own specificities which
distinguish it from other sectors. By the same token, agriculture, fisheries, trans-
port and the financial sector each have their own specificities which make them
special in the sense that no other industry has that particular characteristic. Not
once in the Court’s jurisprudence or the Commission’s practice was there an indi-
cation that sport is ‘special’ or that such an interpretation might hold to justify the
wording in which the question is asked. In Walrave the Court made an exception
for rules on direct discrimination of workers/service providers in the sporting sec-
tor in the matters that pertain to the selection of athletes for national representative
teams. However, this is not incomparable to the exception for directly discrimina-
tory measures regarding employment in the public service under Article 45(4)
TFEU. In Meca-Medina the Court adopted a special approach under Article 101(1)
for regulatory rules in sport. But this approach was borrowed from Wouters and its
predecessor DLG, in which regulatory rules in a non-sporting context were exam-
ined and in both of which the Court applied the same test prior to Meca-Medina.
Therefore, the discussion should be reconceptualised and the question refocused
on the specificities of the industry that distinguish it from other ‘ordinary’ indus-
tries and merit consideration, the significance those specificities possess in EU law,
and the degree to which they [should] matter when applying EU law to the specific
sporting issues.2 The answers to these enquiries are very context-sensitive and
would have to be considered on a case-by-case basis. It is time to dispose of the
question ‘is sport special?’ in academic writing on the topic.

2.1.2 The Concept of Specificity of Sport in EU Law

and Policy

The legal concept of the specific nature of sport has been established, recognised
and taken into account in the jurisprudence of the Court and in the Commission’s
practice. In freedom of movement cases when the case does not fit into any of the

2 The only use of the idea and the word of sport being ‘special’ can be found in European policy

documents which represent political and ideological goals and should therefore not be taken as
conveying authoritative legal expressions. See, for instance, Nice Declaration.
2.1 Specificities/Special Characteristics of the Sporting Industry 33

sporting exceptions that apply at the level of restriction analysis (that themselves
take into consideration the specificity of sport), the specific nature of sport was
taken into consideration on the level of objective justification and proportionality
analysis.3 Similar analysis, which adopted the Wouters approach, was also con-
ducted in the sports cases falling under EU competition law.4 The European
Commission explained that in order to assess the compatibility of sporting rules
with any EU law, it considers the legitimacy of the objectives pursued by the rules,
whether any restrictive effects of those rules are inherent in the pursuit of the
objectives and whether they are proportionate to them.5 Some examples of the
objectives specific to the sporting community accepted as legitimate so far have
been ensuring regularity of competitions,6 maintaining the balance between clubs
by preserving a certain degree of equality and uncertainty as to results, encourag-
ing the recruitment and training of young players,7 and combating doping in order
for competitive sport to be conducted fairly including the need to safeguard equal
chances for athletes, athletes’ health, the integrity and objectivity of competitive
sport and ethical values in sport.8 However, ‘each sport has its specificities and
deserves to be treated differently according to these objectives. The EU will thus
not impose general rules applicable to all European sports’.9 This approach is
something that sport federations agree on with the Commission.10
The White Paper on Sport addressed some of the general aspects of, and
divided the approach to, the concept of specificity of sport into the specificity of
the sport structure (notably including the autonomy and diversity of sport organi-
sations, a pyramid structure of competitions from grassroots to the elite level,
organised solidarity mechanisms between the different levels and operators, the
organisation of sport on a national basis, and the principle of a single international
federation per sport), and the specificity of sporting activities and of sporting rules
(such as separate competitions for men and women, limitations on the number of
participants in competitions, and the need to ensure uncertainty of outcomes and
preserve a competitive balance between clubs taking part in the same competi-
tions).11 The Commission Staff Working Document on Sport and Free Movement

3 See, for e.g. Case C-325/08 Olympique Lyonnais SASP v. Olivier Bernard and Newcastle
United FC judgment of Grand Chamber of the Court delivered on 16 March 2010.
4 Case C-519/04 David Meca-Medina and Igor Majcen v. Commission [2006] ECR I-6991 dis-

cussed in detail in Sect. 5.5.5.

5 Commission Communication on Developing European Dimension in Sport (2011), para 4.2.
6 Case C-176/96 Lehtonen and Castors Braine [2000] ECR I-2681.
7 Case C-415/93 Union Royale Belge Sociétés de Football Association and others v. Bosman and

others [1995] ECR I-4921, and Case C-325/08 Bernard, judgment delivered on 16 March 2010.
8 Case 519/04 Meca-Medina.
9 Paragraph 4.1 of the Commission Staff Working Document.
10 See White Paper Consultation by Commissioner Figel with European Sport Federations, Sport

Governance in Europe, Brussels 20/09/2006. More than 30 European sports federations took part
in the meeting.
11 White Paper on Sport, para 4.1.
34 2 The Sporting Industry

of January 2011 states that ‘the specificity of sport cannot be used as an excuse for
making a general exception to the application of free movement rules to sports
activities. Exceptions from the EU’s fundamental principles must be limited and
based on specific circumstances’.12
Finally, the concept of specificity of sport has been included in the Article 165
of the Treaty. Whereas the general approach to sports cases and the analytical
structure have not been changed by this inclusion, there is an indication that after
the Lisbon Treaty amendments entered into force, the concept might have gained
some additional weight within the framework of the familiar analysis.13 The study
group on the Lisbon Treaty and EU sports policy recommended to the sports
movement to take a lead in defining the contested term, rather than passively rely-
ing on the reference to the ‘specific nature of sport’ contained in Article 165 to
seek to repel the influence of EU law in sport. They further recommended that the
‘definition should be built into the relevant sports regulations following an open
and transparent method of operation facilitated by the governing bodies but
involving affected stakeholders. The definition should be thoroughly reasoned and
backed with robust data’.14 Presumably, therefore, if the regulations and rules are
drafted in this way, they are likely to comply with the requirements of EU law.
Compliance with EU law is also the reason why after the Meca-Medina judgment
and the White Paper on Sport, governing bodies have been much concerned with
enhancing their adherence to the principles of good governance.
In case of doubt, the sport stakeholders are free to turn to the Commission for
guidance on the relation between EU law and sporting rules in professional and
amateur sport as well as ask about appropriate interpretation of the concept of the
specific nature of sport. Regarding the application of EU competition law, the pro-
cedure in Regulation 1/2003 will continue to apply.15

2.1.3 Special Characteristics of Sport

The typical list of general characteristics peculiar to the sporting industry includes
the following: First, mutual interdependence between the clubs fostered by the
need to preserve uncertainty of the result is a truly distinctive feature not possessed
by any other industry. It is not the purpose of clubs in their role as undertakings to
eliminate their competitors from the market because without competitors there
would be no purpose to running a club. The product of a certain sports league is
the game, and the game must be interesting and integrated into a structured compe-
tition in order to attract an audience. Accordingly, the more equal the competitors,

12 At p. 7.
13 See Sect. 1.3.4.4 above on Article 165 TFEU and Sect. 4.8 below on the Bernard case.
14 The Lisbon Treaty and EU Sports Policy Study (2010), pp. 11–12.
15 Commission Communication on Developing European Dimension in Sport (2011), para 4.2.
2.1 Specificities/Special Characteristics of the Sporting Industry 35

the more uncertain the result, and the more interesting the game—i.e. the product,
becomes more marketable.16
Second, the need to maintain competitive balance is a driving force behind
financial solidarity mechanisms that exist in many sports.17 The most common
ones are vertical and horizontal solidarity in the same discipline. For example, a
football club’s participation in a league is often conditioned upon the transfer of
the broadcasting rights to the league, which after collectively selling the rights
thus acquired, distributes the profits to all the participating clubs with a view to
improving competitive balance between them. Sometimes a part of this profit goes
to the lower leagues consisting of clubs that are, at least theoretically, potential
future competitors. In no other industry would the companies share a part of their
profits with their less well-off competitors, i.e. engage in horizontal solidarity.18
Vertical solidarity implies channelling part of the finances from the most profitable
leagues to the grassroots. Vertical investments and support for social causes, how-
ever, can find its parallels in other industries, albeit on a voluntary basis related to
social responsibility rather than as a matter of a compulsory rule of the association
or organisation to which they are affiliated.
Third, sports have a transient nature: individual sportsperson’s careers are short
and prone to many interruptions or abrupt endings due to injuries; sports broad-
casting must take place as the event occurs; sports betting is a time-restricted
game of chance and skill; commercial exploitation of, for example, certain sports
merchandise, is limited to a short period in which the theme affixed to the item is
popular; live attendance at the stadiums is a once-in-a-lifetime event and so on.
It is essential that the personal or commercial assets are used in timely fashion—
otherwise the possibility of their exploitation is lost.
Fourth, as recognised by the Court in its case law,19 sport performs an impor-
tant social, cultural and educational function. This function is confirmed by the
inclusion of sports into the framework of the Treaty, as well as by numerous policy
documents. Apart from the obvious, it includes issues such as social inclusion, the
health of the population, the fight against doping, and prevention of violence and
racial intolerance. It is mostly this aspect of sports that has formed the basis of
objective justifications accepted as such thus far in the Court’s jurisprudence. In
addition, the Association of European Team Sports (ETS) has drawn attention to
the importance of volunteering which is ‘deeply entrenched in the community and

16 Simmons 2009, p. 79. Scientific evidence on the correlation between uncertainty and popular-

ity varies as some researchers suggest that the game is to be more visited when the home team
has two times more chances of winning.
17 There are vertical and horizontal solidarity mechanisms: the former implies financial solidarity

between professional and amateur leagues and clubs, financing of various social causes, infrastruc-
ture, etc. The latter implies financial solidarity between the clubs participating in the same league.
18 This is not to say that the commercially most successful clubs are happy with the distribu-

tional solidarity system. See Chap. 3.

19 See, for e.g. Case C-415/93 Union Royale Belge Sociétés de Football Association and others

v. Bosman and others [1995] ECR I-4921.

36 2 The Sporting Industry

volunteer movements’ whose ‘selfless commitment underpins grassroots activities,

the development of the federations’ respective sports and the promotion of sport-
ing values’.20
Finally, specificities inbuilt in certain aspects of sport confer upon it a certain
degree of exemption from application of ordinary laws. This is most obvious in the
application of criminal laws. For example, hitting and injuring another person is
allowed in combat sports within the agreed-upon rules (such as boxing) and might
win a match rather than time in prison,21 and use of illegal drugs will subject
sportspersons to sporting sanctions such as prohibitions on competing for a certain
period of time rather than being subject to criminal proceedings. Similarly, normal
labour laws do not apply to players in their capacity as ‘workers’ in the sporting
industry. Their employment is still regulated differently from employment in the
ordinary private sector.22 A number of other regulatory and disciplinary aspects
are left entirely in the hands of sporting authorities but can be challenged before
the ordinary administrative and/or judicial authorities in addition to sport’s own
internal dispute settlement mechanisms.
These are some of the most distinctive features of the sector. While it is easy
to list them and recognise that no other industry possess quite the same charac-
teristics, it is much more difficult to develop specific guidelines as to the scope
and mode of application of the term ‘specificity of sport’ in legal disputes. This is
because the analysis is conducted on a case-by-case basis and the scope and mode
of application therefore depend on many different factors surrounding the dispute.
The White Paper on Sport provides a sufficient legal compass for assessment of
the sporting rules for their compatibility with the EU law.

2.2 Structural Models of Sport

2.2.1 Classic European Model of Sport

Sport in Europe is typically (but not necessarily and not in all sports) organised in
a pyramid structure. At the bottom of the pyramid are the amateur, semi-profes-
sional and professional clubs that play in various leagues according to their sport-
ing achievements. They are all members of the national federations for their
particular sport. The purpose of amateur clubs is largely recreation and the devel-
opment of young players, while the more professional clubs operate as commer-
cial undertakings with the main goal of maximising profits. National federations
organise competition and regulate the sport in question at the national level, and

20 The Position of the ETS on Article 165 of the Lisbon Treaty, p. 2.

21 See, however, Blackshaw 2008, pp. 106–107.
22 For instance, rules on transfer of players between clubs, contractual ties, as well as the ‘home

grown rule’ on fielding the players are a part of the debates on this topic. A related topic is the
application of internal market rules to the rules of sport bodies governing the players’ contracts.
2.2 Structural Models of Sport 37

represent their branch at the European and international level.23 European and
global governing bodies are at the apex of the structure. Only one federation per
country can be a member of the European or global governing body.24 European
and other regional confederations (usually organised roughly by continent) support
and share the organisation of sport with the world federation. Nafziger saw the
facilitation of an equitable distribution of revenue among the constituent sports
clubs with the purpose of encouraging mass participation and competitive balance
among clubs as the primary function of the pyramid structure.25
The described ‘one-federation-per-sport’ structure reveals the apparent monopolistic
position of the governing bodies that regulate everything from professional to amateur
and youth sports. They are able to pass the rules and regulations which affect the way
in which clubs buy and sell players, dispose of their commercial rights, conduct them-
selves on the stock market, impose disciplinary sanctions which in turn affect the clubs’
profits, and so on.
For example, in football, a club such as FC Milan is affiliated with the Federazione
Italiana Giuoco Calcio (Italian football federation—FIGC). The FIGC, the national
federation, governs the game of football in Italy from all levels of clubs as well as the
national team and is affiliated with Union des Associations Européennes de Football
(UEFA). UEFA has 53 such member national associations. In addition to playing
games in its Italian-based league, FC Milan, is (at the moment) one of the top four
teams in the Italian Serie A (the highest Italian league) and is thus eligible to play in
the UEFA-organised Champions League.26 The world governing body for football is
the Fédération Internationale de Football Association (FIFA). FIFA regulates matters
and organises football events that have worldwide importance, such as the men’s and
women’s World Cups. FIFA is comprised of six continental federations and 208
national federations. Many other sports in Europe have similar basic organizational
arrangements (such as basketball), while others do not (such as boxing).
However, as the European Commission points out, in view of the diversity and
complexities of European sport structures, it is unrealistic to try and define a uni-
fied model of organisation.27
[…]it must be recognised that any attempt at precisely defining the ‘European Sport
Model’ quickly reaches its limits. Some of the features often presented as ‘characteristic’,
such as the system of open competitions based on promotion and relegation, are actually

23 Most of the European countries also have a pan-federation of national federations acting as an
umbrella organisation for all national federations.
24 European Commission, The European Model of Sport, Consultation Document of DG X

(September 2008).
25 Nafziger 2009, p. 37.
26 The best performing football clubs in the highest national leagues are qualified to play in the

UEFA Champions League, the most prestigious pan-European league. Every European country
has a space for at least one club. The number of places in the competition depends on the national
association's rank in the UEFA coefficients table. Accordingly, countries such as Spain, England
and Italy have 4 places reserved for their best teams in the Champions League, whereas, for
instance, Finland, Sweden and Estonia have only one place.
27 White Paper on Sport, para 4.
38 2 The Sporting Industry

limited to a certain category of sport (team sport in this specific case). As a matter of fact,
even for team sports the system of open competitions is somewhat mitigated by a licens-
ing system that introduces financial criteria for participation in competitions.
Other sports present in Europe have adopted a totally or partially closed system for
participation in professional sport competitions, such as motor-sports or cycling. The rele-
vance of the pyramid structure for the organisation of competitions (and of the sport itself)
is thus greatly reduced. It should be noted that the organisation of competitions also
largely diverges from the pyramid structure in other sports, such as golf or tennis.28

European sports leagues are open and operate on the basis of a system of promo-
tion and relegation. Clubs are able to move up and down through the leagues
depending on their on-pitch performance. If a club is successful in its league dur-
ing a season, as measured by the number of points won, it can pass to compete in
the higher league as of next season (promotion), and conversely, if a club con-
stantly underperforms it can fall out into the lower league at the end of season
­(relegation). While there are different schemes for this system, depending on the
rules of the respective national associations, it is common that the three best teams
from the lower league pass into the higher league and are replaced by the three
worst performing team from that league. For example, in the English Football
League Championship, the two best performing teams are automatically promoted
into the Premier League while the next four teams compete for the third place in
the Premier League through play-offs.29 In practice, however, rich clubs are almost
never relegated as their financial resources ensure the acquisition of the star play-
ers helping them to win matches. Conversely, small clubs playing in the third or
fourth national division and depending on different model of financing30 are likely
to never make it to the first league. This performance-based ranking in an ‘open
league’ structure is not incomparable to the competitive ‘ordinary markets’ in
which undertakings operate, notwithstanding the lack of a formal league structure.

2.2.2 US Model of Sport

The European model of sport must be contrasted with the American model. What
follows is the orthodox (i.e. slightly exaggerated and often misjudged) European
description of the distinctive features of the American model. Following the descrip-
tion, it will be shown that there is more similarity between the two than commonly
described, and that the convergence is likely to grow in the years to come when
the European model of sport formally (by formation of breakaway structures) or
de facto (through concessions granted by the federations to the most powerful
clubs, which is already happening in European football) begins to crumble.
The United States model of sport is characterised by the clear separation of
amateur and professional sports. Professional sport leagues in the US are honest
28 Commission Staff Working Paper, para 4.1.
29 For more examples, see Szymanski 2009, p. 685.
30 For different models of financing see Sect. 2.3.2.
2.2 Structural Models of Sport 39

and unambiguous about profit maximising being their most important goal. The
four most popular professional team sports are organised in major leagues, each
currently with 30–32 teams: Major League Baseball (MLB), National Hockey
League (NHL), National Basketball Association (NBA) and National Football
League (NFL). Participating teams adopt a constitution similar to business corpo-
rations, and elect a Commissioner in charge of administration, interpretation and
enforcement of the rules and the discipline of the sport and the league.
Commercially the leagues operate as associations of franchises, but also as joint
ventures among the constituent teams. Each franchise is usually owned by either
very wealthy individuals or large corporations.31
Furthermore, in US sports the leagues consist of a collection of franchises and
do not operate the system of promotion and relegation. The leagues are closed for
their members and clubs cannot fall out of the league, nor is there is a possibility
for new clubs to enter the league, unless a super-majority of the participating
members decide to expand and admit new members or expel existing ones. Entry
is usually subject to substantial fees which are then divided between the existing
members. In this sense, the leagues are ‘hermetic’. But they are also ‘closed’
because teams belonging to different leagues in the same discipline do not com-
pete with each other, and play only within their own league.32 Their players nor-
mally do not participate in the World Cups to represent their country. However,
NBA ‘dream teams’ participate at the Olympic Games, MLB players have partici-
pated in the ‘World Baseball Classic’, and NHL players regularly participate in the
World Hockey Championships. The latter is qualified because the Championships
run during the same time as the NHL playoffs, so only those players who are not
in the playoffs, or who are eliminated in the first round show up. But, unlike in
European football, where the rules requiring national service are mandated by
FIFA, the NHL is not under the umbrella of the world governing body for ice
hockey, so even if there were such rules the NHL would not be bound by them.
Solidarity mechanisms that are designed to maintain the internal equilibrium in
competitions of US professional leagues include collective sales of media rights
(like in Europe), and the salary caps and draft system (unlike in Europe).
The lower level in the professional hierarchy is represented by the minor
leagues that compete at levels below that of major leagues. There can be many geo-
graphically distributed minor leagues. In baseball, all of the minor leagues are run
as independent businesses, and many are members of Minor League Baseball, an
umbrella organization for leagues that have agreements to operate as affiliates of
MLB. Each league affiliated with Minor League Baseball comprises teams that are
independently owned and operated but always directly affiliated with, and occa-
sionally named after, one major league team, enforced through the so-called Player
Development Contracts with that team. These are beneficial for the minor-league

31 Two exceptions to the rule are the NFL’s Green Bay Packers, who are owned by members
of the local community, and teams that end up under league stewardship, such as the NHL’s
Phoenix Coyotes, or the NBA’s New Orleans Hornets.
32 Halgreen 2004, p. 77.
40 2 The Sporting Industry

teams as they get borderline major-league talent, and usually funding/staff, etc.
from their major-league teams. This is why the lower levels of the professional
sports are sometimes referred to as ‘farm systems’. Independent leagues do not
have any links to MLB, and thus are not members of ‘organized baseball’.
Amateur sports in the US are separated from the professional structures.33 The
extent to which high-school and college sport is associated with education is
remarkable. Students often receive scholarships to universities and colleges in rec-
ognition of their sporting potential and some of the universities are more known
and respected for their sport teams than academic quality. These amateur sports
are seen as the incubators for talent from which professional leagues’ clubs often
draft top student athletes to sign professional contracts once they have completed
their education. European sporting organisations, by contrast, are traditionally
unconcerned with the education of young athletes alongside their sporting career.

2.2.3 Changing Characteristics of European Football

It has already been noted that the European description of the US model is exag-
gerated and that many features are not as extreme as commonly depicted by
European commentators. Grassroots involvement as well as the strong social role
of non-professional competition in North American sports culture is often ignored;
even though the American model is closed and horizontally integrated, there is a
subtle pyramid structure (albeit not formally organised as it is in Europe) which is
also ignored; the slow and gradual process of promotion and relegation mecha-
nisms do exist in a form with the possibility for teams to be relocated from big to
small cities (i.e. from big to small markets) when they fail to produce satisfactory
commercial revenues (from, for e.g. ticket sales) due to their poor competitive
standing such as Seattle to Oklahoma (in NBA); Atlanta to Winnipeg (in NHL);
LA to St. Louis and to Oakland (in NFL). Conversely, there are many examples of
clubs from small markets moving to big markets, such as Montreal to Washington
(in MLB); Winnipeg to Phoenix and Quebec to Denver (in NHL); Cleveland to
Baltimore (in NFL); and Charlotte to New Orleans (in NBA).34
On the other side of Atlantic, the changes in the club licensing system in foot-
ball have eroded the strict system of promotion and relegation. They were intro-
duced at the beginning of the 2004/2005 season and were modelled on the French
practice of replacing the competitive merit-based approach to the clubs’ standing
with more comprehensive criteria. A series of defined quality standards, which

33 Amateur sports—essentially competitions involving unpaid athletes—are governed by several

layers of authority: community leagues, school athletic associations, state and national regulatory
boards, the National Collegiate Athletic Association (NCAA) and other supervisory organisations
at the non-professional level, the Amateur Sport Act, and the rules and processes of the Olympic
movement. See Nafziger 2008, p. 102.
34 Thanks are due to Ryan Gauthier for interview, 2 May 2011.
2.2 Structural Models of Sport 41

now must be fulfilled in order for a club to be admitted to any of the UEFA club
competitions cover matters including youth football development, medical care,
experience of club staff, coaching standards, stadium and training facilities, legal
declarations, audited accounts, settlement of debts, additional financial disclosures
and financial budgets with supporting assumptions among the 34 specific crite-
ria.35 The result of the changed licensing rule is apt to be a semi-closed tourna-
ment system similar to the North American model.36 Apparently, the criteria will
be easier to fulfil for the clubs already in good financial standing than for those
that struggle with budgetary problems. Contrary to the goals related to preserving
competitive balance that UEFA relies on to defend some of its restrictive rules, this
is a way to solidify the imbalance that already exists in European football.37
Globalisation of the world’s economies, the technological revolution within the
broadcasting and telecommunication industries, and the subsequent explosion in
media revenues are seen as factors that have brought the European and American
sports industries closer to one another.38 The European Parliament Report on the
future of professional football in Europe recognises that the current trend of clubs
going to the stock market is one step closer to the US model. It can be questioned
whether the two goals (winning the game and maximising the shareholders’ profits)
can be combined within the traditional open European model.39 Furthermore, both
models of sport have certain shared ends such as the quest to find balance between
cooperation and competition, and to enhance competitive balance between the
clubs based on two principles of competition: equality of teams and uncertainty of
outcome. It is the means by which they achieve these ends that differ. In the US,
rules on annual players’ drafts, hard and soft salary caps, sharing of broadcasting
revenues, as well as the strong role of the players’ unions are intended to reinforce
the competitive balance. In European football ‘a traditional reluctance’ to adopt
such restraints has led to competitive imbalances with the result that well-estab-
lished elite clubs dominate the sport and reinforce those imbalances.40 It seems,
however, that despite the restraint mechanisms, the US sports are plagued with the
same disease of imbalance in competitive strengths of the teams. ESPN reported
that ‘[m]oney allows the NBA to ignore the fact that a third of its teams exist in an
underclass. Despite more than half of the league (16 of 30 teams) qualifying for the

35 UEFA Club Licensing and Financial Fair Play Regulations.

36 Nafziger 2008, p. 101.
37 Manchester United has won the Premier League (in which 20 teams compete) 10 times

since its creation in 1992, Arsenal 3 times and Chelsea 2 times. C.F. Real Madrid has won 9
times in the European Cup/Champion League, 31 times in the Spanish League, and 17 times
in the Spanish Cup. C.F. Real Madrid, AC Milan, Manchester United, FC Bayern Munich, and
Liverpool F.C have between themselves won 28 European Cups/Champions Leagues since the
creation of this competition in 1956.
38 Halgreen 2004, p. 42.
39 European Parliament Report on the future of professional football in Europe (2006/2130(INI)),

Committee on Culture and Education, final A6-0036/2007, p. 14.

40 Nafziger 2008, p. 104. See also Camatsos 2005, pp. 155–180.
42 2 The Sporting Industry

playoffs every year, 11 teams have either won no playoff series or gotten past the
first round just once in the last 10 years. The Washington Wizards have made it
past the first round exactly once in the last 30 years’.41 This leads to the conclusion
that the mechanisms aimed at enhancing competitive balance between the teams in
the league do not work if they are not accompanied by efficient financial solidarity
mechanisms, and conversely, financial solidarity (especially if insufficient) will not
contribute in any perceptible way towards competitive balance if unaccompanied
by effective restraints on competition.

2.3 Financing of Sport

2.3.1 Macroeconomic Aspects

On a macroeconomic level, European sport is directly financed from four major

sources. They are: (1) households (purchasing of sporting goods and services,
sports betting); (2) the central government; (3) the local government, and; (4)
enterprises (e.g. sponsorship, TV and media rights).42 Partial tax exemption is
available in most European countries as an indirect source of finance for sport
organisations supplying public utility sporting activities, or for private persons
who bring funds into sport.
Households are by far the most significant private sector contributor in all
European countries, whereas local and regional governments account for most of
the contributions in the public sector. Available data from 1990 that included 11
European countries attributed an average of 64 % of overall sport financing to
households, 9.5 % to enterprises, 20 % to local governments, and only 6.5 % to
central governments. Information dating back to 2000 showed a trend of increase
in household, and decrease in public (both local and central government) share of
sport finance.43 Unfortunately, a much-needed report of a newer date is lacking,
which prevents any conclusions on the current trends based on macroeconomic
indicators. Currently, the Commission is preparing a study to assess the sport sec-
tor’s contribution to the Europe 2020 strategy, with particular emphasis on contri-
bution to economic growth and employment in the EU.
A study taken during the French presidency of the EU distinguished between
three categories of sports participation (amateur sport contests, leisure and health
sports practice, and high level sport) and demonstrated that each source of finance is
predominantly allocated to one of those three categories. Households are geared
toward leisure and health sport practice and then to high level sport; enterprises pri-
oritise high level sport with high media exposure in a limited number of sport

41 ESPN ‘The Sports Bubble’ by Howard Bryant, 7 March 2013.

42 Andreff 2009a, p. 271.
43 Ibid. p. 272.
2.3 Financing of Sport 43

disciplines; local authorities allocate their sport budgets mostly to amateur sport con-
tests, and central government to high level sport.44 Several economists have
observed such allocation of central government contributions, accompanied by a ten-
dency for private finance to flow into media-exposed high level sport, is threatening
to break down the European pyramidal structure at its foundations due to the lack of
financing.45 Taking into consideration the organisation of sport in Europe, they sug-
gest that averting this threat will require adoption of a series of measures: strong sol-
idarity mechanisms at the Member State level; favouring private financing of mass
sport (sport governance matters here and it should be designed so as to avoid a take-
over of sport by purely financial concerns); supporting voluntary work, which is the
pillar of the European model, and; a more pro-active role for the local authorities in
defining sports public policy. Furthermore, betting and gambling revenue paybacks
to sport must be maintained as they can make up to three quarters of a sports minis-
ter’s budget (as was the case in Greece) and one quarter of overall public sport
financing.46 What this proposal actually entails is the concerted effort of different
stakeholders in sport necessary to bring about a series of measures to consolidate the
foundations of the pyramid structure, if such a structure is to be maintained.

2.3.2 Microeconomic Aspects

On a microeconomic level, it is important to distinguish between financing of

amateur and professional clubs. Economic viability of the former is primarily
dependent on subscriptions, private cash donations, subsidies and, in cases of
more advanced amateur clubs with a certain fan base, gate receipts and sponsor-
ship. All the sources of finances for amateur clubs are local.47
Regarding professional clubs, it is important to emphasise the differences
between traditional and contemporary models of financing. The traditional model
that prevailed in the 1960s until the 1990s relied on gate receipts, subsidies and cor-
porate sponsorship. TV revenues as sources of income appeared only in the 1980s
but were not an important contributor to the overall budget. In fact, in 1967, the
English Football Premier League turned down a £1 million offer from the BBC for
the live broadcasting of championship matches because it was afraid that accept-
ance of such a contract would lead to losses from declining gate receipts.48 As no
other broadcasting companies existed at the time, there was no competition for the

44 Cabinet Amnyos, ‘Etude du financement public et privé du sport’, Etude réalisée dans le cadre
de la présidence française de l’Union européenne, Ministère de la Santé, de la Jeunesse, des
Sports et de la Vie Associative et du Secrétariat d’Etat aux Sports, Paris (October 2008) cited in
Andreff and Szymanski 2009.
45 Andreff et al. 2009.
46 Ibid.
47 Andreff and Staudohar 2000, pp. 257–276.
48 Andreff 2009b, p. 690.
44 2 The Sporting Industry

TV rights and the offers remained confined to that of monopsony, usually held in
each country by one public channel. This situation, which prevailed until the early
1990s, changed dramatically. The emergence of private broadcasters and increase in
number of public broadcasters coupled with tremendous technological progress in
the audiovisual industry started a new era in football financing: TV rights became
the biggest part of the professional football club revenue. Broadcasting companies
were competing to make the best offer and the leagues or clubs were negotiating
the best possible deal for their rights.49 Sponsorship deals consequently became far
more lucrative due to television exposure. Merchandise was marketed more profes-
sionally and their sales made up a significant portion of the budget in some better-
known clubs. These changes led to the decline of the traditional model of
financing.50 The contemporary model is based on professional management in the
club administration, ownership by corporate giants including broadcasters, entry
into capital markets, and a sole concern for profit maximising and growth to gain
the competitive edge over other clubs’ financial performance (i.e. a strategy focused
on enhancing the main factor that determines the outcome of the matches).
The essence of successful on-pitch performance is the acquisition of star play-
ers through the liberalised player transfer market, a rare commodity. Excess
demand has inflated the salaries of the star players to a level that often placed clubs
into financial trouble. Deloitte’s Annual Review of Football Finance 2012 notes
that ‘control of player wages, in order to deliver robust and sustainable businesses,
continues to be football’s greatest commercial challenge’. The sustainability of the
contemporary model of financing for professional clubs therefore heavily depends
on a dynamic equilibrium between a club’s spending on wages and its media reve-
nues.51 Due to a trend of ownership by wealthy tycoons some clubs are able to
spend far more than they earn. Seeking to attain a better balance between revenue
and costs and reduce the burden of ongoing funding required from owners or other
sources, the new UEFA Financial Fair Play Regulations require the clubs to at least
break even and to be able to operate on the basis of their own revenues.
More recent business strategies of the most successful leagues and clubs
involve expanding to new markets such as Asia and North America. The Premier
League has been particularly effective in creating and exploiting these new mar-
kets. Only a few big clubs and leagues are able to engage in a profitable business
outside of Europe while for the rest of the clubs and leagues expanding to other
geographical markets would be an unrealistic goal.
The main shortcoming of the contemporary model of finance and governance in
European football is the dominance by rich clubs and the consequences associated
with such dominance. This is the undertone of the theme of breakaway leagues, to
which we turn in Chap. 3.

49 See Sect. 1.2.

50 This has been acknowledged by the Discussion Paper at the First European Conference on
Sport ‘Relations between Sport and Television’, Olympia, 21 and 22 May 1999, p. 2.
51 Andreff 2009b, p. 695.
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Szymanski S (2009) The promotion and relegation system. In: Andreff W, Szymanski S (eds)
Handbook on the economics of sport. Edward Elgar, UK, pp 685–688
Szyszczak E (2007) Is sport special? In: Bogusz B, Cygan A, Szyszczak E (eds) The regulation
of sport in the European Union. Edward Elgar, UK, pp 3–32
Chapter 3
Breakaway Leagues and Governance Issues
in European Football

Contents
3.1 Introduction.......................................................................................................................... 48
3.1.1 Concept of Breakaway/Alternative League................................................................ 48
3.2 European Structural Ideals................................................................................................... 49
3.2.1 Rhetoric in the EU Policy Instruments....................................................................... 49
3.2.2 Sports Associations and Other Stakeholders in Football............................................ 52
3.3 Breakaway Threats and UEFA/FIFA Concessions.............................................................. 53
3.3.1 Rules on Alternative Competitions in the UEFA Statutes.......................................... 54
3.3.2 Media Partners Proposal: European Football League................................................. 55
3.3.3 UEFA Concessions in the 1998 Media Partners Case................................................ 59
3.3.4 Formation of the G14 Alliance................................................................................... 61
3.3.5 Plans for ‘European Golden Cup’ in 2003?................................................................ 62
3.3.6 UEFA Concessions on Compulsory Player Release Rule, the Oulmers Case
and Formal Dissolution of G14................................................................................... 62
3.3.7 July 2011: New Breakaway Threats, Old Strategies of Old Allies............................. 68
3.3.8 Alternative Leagues in European Football.................................................................. 70
3.4 New Trends in the Governance of European Football......................................................... 74
3.4.1 Stakeholder Theory..................................................................................................... 74
3.4.2 UEFA Mandate........................................................................................................... 76
3.4.3 European Club Association: A New Face of G14....................................................... 77
3.4.4 Professional Football Strategy Council...................................................................... 79
3.4.5 The UEFA Club Competitions Committee................................................................. 81
3.4.6 Social Dialogue and Collective Agreements in Professional Football....................... 81
3.4.7 UEFA Club Licensing and Financial Fair Play Regulations...................................... 88
3.5 Risks in the Commercial and Legal Environment............................................................... 92
3.6 Is the UEFA Champions League an Open Competition?.................................................... 94
3.7 Conclusion........................................................................................................................... 96
References................................................................................................................................... 97

© t.m.c. asser press and the author 2015 47

K. Pijetlovic, EU Sports Law and Breakaway Leagues in Football,
ASSER International Sports Law Series, DOI 10.1007/978-94-6265-048-0_3
48 3 Breakaway Leagues and Governance Issues in European Football

3.1 Introduction

3.1.1 Concept of Breakaway/Alternative League

Breakaway leagues and alternative leagues are used as synonyms in this volume.
Breakaway or alternative structures can be generally defined as closed or partly
open private leagues created by a group of clubs that are joined by some common
commercial interest. Thorp and Shah defined a breakaway league (in cricket) as ‘a
league that has been set up without the sanction of the “official” national or supra-
national governing body for that sport’.1 Breakaway leagues are often established
without consent of a governing body and as such lack the recognition of a govern-
ing body. This would automatically remove such a league from the central regula-
tory and organisational control. At the same time, clubs participating in such a
league would miss out on the advantages offered by a governing body to its mem-
bers. A breakaway league can be based on a closed model as opposed to being
integrated into a system of promotion and relegation with the other leagues in a
given sport. The member clubs in alternative leagues are usually of comparable
competitive and financial standing and are often connected by geographic proxim-
ity and/or their elite status. The clubs’ decision to set up their own competition and
break away from their previous structural affiliations is triggered by what is per-
ceived as unused financial prospects existing outside the confines of that affilia-
tion. If the clubs belonging to a breakaway group are economically the most
powerful and participate in the most prestigious national and pan-European
leagues, they are also capable of producing the highest quality product with a cor-
respondingly high market value for their broadcasting rights, merchandise, tickets,
etc. They are the golden goose for their discipline in a system where solidarity
plays a big part in financing of the rest of the sport, and their governing bodies do
not want to lose them. It is exactly this feature in European football which gives
elite clubs the supreme bargaining power that enables them to influence the deci-
sions of the governing bodies.
So far, all the breakaway threats by elite clubs in pan-European football have
been successfully averted. However, while the pyramidal structure remains largely
unchanged in its external shape, changes within the pyramid have contributed
towards substantial decentralisation of the European football governance, but not
necessarily in a good way, and not according to standards compatible with good
governance and fair representation of all the stakeholders. The elite clubs represent
a separate group of stakeholders that has been able to exert pressure on Union des
Associations Européennes de Football (UEFA) and they have done so each time
their commercial interests have been adversely affected, as described below in this
chapter.
The underlying theme of this chapter is rooted in the recognition of apparent
conflict between, on the one hand, the EU policy goals to preserve the traditional

1 Thorp and Shah 2008, p. 6.

3.1 Introduction 49

European sporting structures, and on the other hand, the neo-realities regarding
commercial aspects and governance of European football. The endeavours of the
governing bodies and most of the stakeholders in football are naturally aligned
with the goals of policy-makers on the issue of structural changes. The pros-
pects for creation of a pan-European breakaway league can be analysed from the
point of view of football governance, the commercial environment and the legal
environment.

3.2 European Structural Ideals

3.2.1 Rhetoric in the EU Policy Instruments

A political consensus regarding the need to preserve the structures of sport in

Europe was emphasised by a number of EU policy documents, notably in the
Commission Helsinki Report, with a view to safeguarding the current sports struc-
tures.2 In this Report ‘the temptation for certain sporting operators and certain
large clubs to leave the federations in order to derive the maximum benefit from
the economic potential of sport for themselves alone’ was considered symptomatic
of several phenomena: the rise in popularity and internationalisation of sport, and
the unprecedented development in the economic dimension of sport.3 The
Amsterdam Declaration on Sport4 and the Nice Declaration5 both centred on
the social significance of sport. The Nice Declaration notes the developments in
the world of sport, but considers that federations must continue to be the key fea-
ture of a form of organisation providing a guarantee of sporting cohesion and par-
ticipatory democracy, and that ties of solidarity binding the practice of sport at
every level must be preserved.6 These policy statements are based on the desire to
preserve fundamental values such as the societal role of ‘sport for all’, self-regula-
tion and solidarity between professional and amateur levels, as well as the highly
beneficial effects that sports have on youth, health and social inclusion policies.7
The 2007 Parliament Report on the future of professional football in Europe
(Committee on Culture and Education) noted in a similar spirit that ‘European

2 Report from the Commission to the European Council with a view to safeguarding the current
sports structures and maintaining the social function of sport within the Community framework
(‘The Helsinki Report on Sport’) COM (1999) 644 final.
3 Ibid. section 2.
4 Declaration on sport in Amsterdam Treaty, Declaration no. 29 (‘Amsterdam Declaration’).
5 Declaration on the specific characteristics of sport and its social function in Europe, of which

account should be taken in implementing common policies 13948/00, Annex to the Presidency
Conclusions, Nice (‘Nice Declaration’).
6 Ibid.
7 Halgreen 2004, p. 64.
50 3 Breakaway Leagues and Governance Issues in European Football

sport, and football in particular, is an inalienable part of the European identity,

European culture and citizenship, and the European Football Model, characterised
by open sports competitions within a pyramid structure in which several hundred
thousand amateur clubs and millions of volunteers and players form the base for
the top professional clubs […]’ and identified the growing concentration of eco-
nomic wealth and sports power as a threat to the future of professional football in
Europe. It stressed ‘its attachment to the European Football Model, with its symbi-
otic relationship between amateur and professional football’.8
In 1998, the Commission published ‘The European Model of Sport’ that says:
‘There is a European model of sport with its own characteristics. This model has
been exported to almost all other continents and countries, with the exception of
North America. Sport in Europe has a unique structure. For the future development
of sport in Europe these special features should be taken into account’.9 This doc-
ument rejected the free market model for the future of European sport, resisting
the pressures of ‘Americanisation’ which is seen as the ultimate evil of excessive
commercialism (leading to destruction of European sporting values, the only true
sporting values). This is a prime example of one of the exaggerated European
depictions of the American model. As noted by Halgreen, ‘one should always
remember that globalisation and commercialisation are not just American inven-
tions’.10 In the Opinion given by the Committee of Regions on ‘The European
Model of Sport’, the American model is centred too much on a business and mar-
ket-oriented approach to sport making a clear distinction between professional and
amateur sport and giving them totally separate structures. The Committee of
Regions retained its faith in, and asserted its preference for, the European socio-
cultural model. It further emphasised the special characteristics of the European
model and said that the inclusion of an economic factor should not be allowed to
jeopardise traditional values.11 There are many more policy documents with an
identical take on the issue of organisational structure.
Nevertheless, there are some indications of the Commission’s readiness to
introduce some flexibility in the European policy regarding sporting structures.
The first hint of it was given in the 2001 speech by Mario Monti, addressing the
question of a single federation per sport. He acknowledged that ‘[w]hile the exist-
ence of a single federation overseeing both the regulatory and organisational
aspects of a sport is common in Europe […] other scenarios exist or can be envis-
aged’.12 In the Commission’s White Paper on Sport there is a small move in the

8 See Motion for the Parliament Resolution in the European Parliament Report on the future of
professional football in Europe (2006/2130(INI)), Committee on Culture and Education, final
A6-0036/2007.
9 European Commission, The European Model of Sports, Consultation Document of DG X

(September 2008) para 1.3, emphasis added.

10 Halgreen 2004, p. 64.
11 Opinion of the Committee of the Regions on ’The European Model of Sport’ 1999/C 374/14.
12 Mario Monti, European Commissioner for Competition. ‘Competition and Sport Rules of the

Game’ Speech/01/84. Conference on ‘Governance in Sport’, Brussels 26 February 2001.

3.2 European Structural Ideals 51

articulation of sports policy away from the prevalent socio-cultural approach

towards a more economic-based approach. The Commission first repeated the pre-
vious policy statements on the pyramid structure and labelled it as worthy of sup-
port. But it went on to recognise that there is no unified description of a ‘European
Sports Model’, as there exist partially or totally closed leagues in some sports such
as motorsports and cycling, and that organisation of competitions largely diverges
from the pyramid structure in other sports, such as tennis or golf. It further
acknowledged that:
[n]ew tendencies are challenging the traditional vision of a unified “European Sport
Model”. Economic and social developments that are common to the majority of the
Member States (increasing commercialisation and stagnation of public spending on
the one hand, and an increase in the number of participants together with stagnation in
the number of voluntary workers on the other) have resulted in new challenges for the
organisation of sport in Europe. The emergence of new stakeholders (participants out-
side the organised disciplines, professional sports clubs etc.) and the increasing recourse
to litigation are posing new questions as regards governance, democracy and representa-
tion of interests within the sports movement. […] The Commission considers that each
sport has its specificities and deserves to be treated differently according to these. The
EU will not impose general rules applicable to all European sports. However, EU law
will continue to apply to sport, particularly as far as competition, freedom of movement
and non-discrimination rules are concerned.13

The Commission Communication on Developing European Dimension in Sport

that came after the Lisbon Treaty amendments, however, interprets the ‘specificity
of sport’ referred to in Article 165 TFEU as the concept encompassing ‘all the
characteristics that make sport special, such as for instance the interdependence
between competing adversaries or the pyramid structure of open competitions’.14
There is no doubt that Article 49(1) and (3) of the UEFA Statutes15 on sanction-
ing alternative competitions and a pyramid structure find a firm support in
European sports policy. But this policy should be taken within its own limits as
having no binding force16 and within its own wording as not being absolute but
rather dependant on a rule in question which is to be examined against the require-
ments of EU law. On a careful reading, all that the Commission emphasised is the
need to take the pyramid structure with open leagues into account in the applica-
tion of EU economic provisions, as it falls under the concept of ‘specificity of
sport’ in Article 165 TFEU. It is the word of the Court, the original creator of the
concept, in the exercise of the functions conferred to it under the Treaty that can
ultimately decide the matter. The reasoning that the Court is likely to apply to the
UEFA rules on sanctioning of alternative leagues, if challenged, is explored in
Chap. 7 in detail.

13 Whiter Paper on Sport, para 4.1 [emphasis added].

14 Paragraph 4.2 of the Communication, COM (2011) 12 final, 18. 1. 2011.
15 Cited below in Sect. 3.3.1.
16 According to Article 288 TFEU.
52 3 Breakaway Leagues and Governance Issues in European Football

3.2.2 Sports Associations and Other Stakeholders in Football

The Memorandum of Understanding 2007 between UEFA and the Fédération

Internationale des Associations des Footballeurs Professionnels (FIFPro)17 con-
firms the commitment of these bodies to key values and recognition of: solidarity,
equitable distribution of wealth, collective rather than individual exploitation of
resources, the need for a correct balance between labour legislation and the spe-
cific characteristics of football as a sport (which might also be achieved through
collective bargaining agreements), the continuing participation of all players and
clubs in the main national leagues and UEFA club competitions as essential to sup-
porting the existence of a large and healthy professional football sector in Europe,
the specificity of the career of a professional footballer, the specificity of sport, the
autonomy of federations and the fact that football is best-served by the existing
football family structures (although the balance of representativeness of key stake-
holders within those structures can be developed further).18 According to this
memorandum, FIFPro and UEFA are opposed to the idea of breakaway involving
elite football clubs. The FIFPro statement, in particular, is significant. It is the
body which represents the interests of the potential employees of the breakaway
structure in football, for example in the process of European social dialogue.
The Association of European Team Sports (ETS),19 of which UEFA is a mem-
ber, has expressed their commitment to principles such as: the public interest role
of sports federations and their ability to regulate their respective sports; the princi-
ples of promotion and relegation and sporting merit; the financial solidarity of elite
competitions with amateur sport due to the centralised sale of media rights; the fun-
damental importance of youth player development and the central role of the feder-
ations in this area, as well as the importance of fair compensation for clubs training
players. This support is not surprising, as the core mission of the ETS is to strive
for recognition of the European sports model and its constituent parts, namely the
specificity of sport and the autonomy and central role of the sports federations. The
ETS also supported the Commission Communication: ‘The European Commission
gives its backing to several aspects of the European sports model by endorsing the
pyramidal governance structure, the autonomy of sports associations and open
competitions based on sporting merit and the principles of promotion and relega-
tion. The Communication also promotes financial solidarity between amateur and
professional sport, and welcomes UEFA’s Financial Fair Play Regulations’.20
The Professional Football Strategy Council within UEFA where players,
leagues and clubs are represented in equal numbers is said to ensure that football

17 Association of Professional Football Players.

18 Memorandum of Understanding between UEFA and FIFPro, 11 October 2007.
19 The ETS is an association of European team sports federations. It was created on 8 December

2009 and, to date, groups together the following federations: CEV (volleyball), EHF (handball),
FIBA Europe (basketball), FIRA-AER (rugby), IIHF (ice hockey) and UEFA (football).
20 News item by European Handball Federation ‘ETS Supports European Commission

Communication on Sport’ 25 January 2011.

3.2 European Structural Ideals 53

stays together as one family, with professional and amateur football living together
within the single sports structures of the pyramidal system.21 These bodies are
committed to preserving the essential values underpinning the current European
pyramid structure in sport. The fans, as stakeholders in football, are very much on
UEFA’s side on this issue.22
One of UEFA’s 11 values concerns the European sports model and the specificity
of sport. UEFA declares its total commitment to the European model of sport and its
defining characteristics which, in its opinion, is what sport, and especially football,
is all about. Protecting this model is important ‘because sport is not simply a busi-
ness like any other and [UEFA] cannot allow it to be treated as such’. Therefore, it
is convinced that its arguments will prevail for the good of football. Another one of
the 11 UEFA values concerns the pyramid structure and subsidiarity. The pyramid
at the international and European level is seen as reflecting the autonomy of foot-
ball, while the respect for the principle of subsidiarity in its work with the
Fédération Internationale de Football Association (FIFA) and national associations
allows UEFA to defend the interests of football in the best possible way.23
Beneath the EU policy goals and endeavours of numerous football bodies to main-
tain the structural status quo in Europe creeps the pressing factor of commercialisa-
tion and clubs’ quest for new sources of profits, the corollaries of which, in the view
advanced by this volume, render the pyramidal organisational structure with current
style of governance damaging to the interests of European football as a whole.

3.3 Breakaway Threats and UEFA/FIFA Concessions

The formation of alternative private leagues is seen as the number one structural
threat to the classic pyramidal model of football. Dissatisfaction of the elite clubs
with FIFA/UEFA so far mostly related to the long-standing football rules, which
further confirms the shift in power in the governance of European football. Elite
clubs, as any other business undertaking, are interested in profit alone and it can-
not be excluded that one day a rich Qatar corporation or an Asian tycoon will
make an attractive offer that they cannot refuse.24 According to their corporate
commitments, the management of the clubs is responsible to their shareholders
and not to the promotion of sport, fans or society and its causes. Their main task is
to maximise returns for the owners.

21 See http://www.uefa.com/uefa/stakeholders/professionalfootballstrategycouncil/index.html.
22 See, for example, Supporters Direct 2008, pp. 2–3.
23 UEFA—Eleven values: http://www.uefa.com/uefa/elevenvalues/index.html.
24 Just recently French Le Cahiers du Football published ‘Qatar Launches Dream Football

League’, a report on a breakaway group of 24 elite clubs that was later admitted to have been
falsified. This story was reported by many news networks, occupying several pages in The Times.
See ‘Dream League or the Fantasy Football—Has ‘The Times’ Scored an Own Goal?’ by John
Lichfield, The Independent, 17 March 2013.
54 3 Breakaway Leagues and Governance Issues in European Football

3.3.1 Rules on Alternative Competitions

in the UEFA Statutes

With a different agenda and a different mandate to fulfil, UEFA fiercely opposes
the formation of any such breakaway league by the elite clubs. Their rules are
designed to impose severe financial and sporting penalties on the teams participat-
ing in alternative competitions without their prior approval. Article 49(1) and (3)
of the UEFA Statutes provide that:
UEFA shall have the sole jurisdiction to organize or abolish international competitions in
Europe in which Member Associations and/or their clubs participate. […] International
matches, competitions or tournaments which are not organized by the UEFA but are
played on UEFA territory shall require the prior approval of FIFA and/or UEFA and/or the
relevant Member Associations in accordance with the FIFA Regulations Governing
International Matches and any additional implementing rules adopted by the UEFA
Executive Committee.25

Although existing as a possibility, the approval is highly unlikely to be given to

any alternative establishment by the elite clubs due to its terminal effect on the
crown jewels of UEFA’s respective dominion. In a UEFA press release that was
published after the Media Partners International threat was averted, as discussed in
Sects. 3.3.2 and 3.3.3, UEFA was opposed to ‘any concept susceptible of having a
negative influence on the existing domestic and European competitions and of
endangering the future of national teams’.26 In addition, Article 51(1) of the UEFA
Statutes prohibits
combinations or alliances between UEFA Member Associations or between leagues or
clubs affiliated, directly or indirectly, to different UEFA Member Associations [to] be
formed without the permission of UEFA.

Forming alliances between the participating clubs is the first step to the successful
establishment of any alternative league. Thus, Article 51(1) of the UEFA Statutes
may be seen as an additional hindrance for the formation of a breakaway structure.
Under the 2010 edition of the UEFA Statutes, Article 49(3), the prior approval
for unsanctioned cross-broader tournaments and competitions was entirely up
to UEFA and its Executive Committee. On 3 March 2011, FIFA Regulations
Governing International Matches were adopted by the FIFA Executive Committee
and entered into force in August the same year. The FIFA Regulations Governing
International Matches set forth the procedure for notification, authorisation and
other requirements for organising international matches that are relevant, inter
alia, in the context of breakaway leagues, and were included in Article 49(3) of
the UEFA Statutes (2012 edition).
The European Club Association expressly agreed to these rules via Memorandum
of Understanding 2012 that governs the relationship between the clubs and UEFA.

25UEFA Statutes, edition 2012.

26UEFA news item ‘European Club Football—National Associations, their leagues and clubs
want UEFA to remain in charge’, 30 July 1998.
3.3 Breakaway Threats and UEFA/FIFA Concessions 55

According to paras D.1, D.3 and D.4, clubs undertake ‘to recognise UEFA as the
governing body of football at European level in accordance with its Statutes […]; to
ensure that none of its member clubs participate in any competition that is not
organised or recognised by UEFA/FIFA’ and ‘to ensure that its member clubs are not
members of any other association or grouping involving clubs from more than one
country […]’.27
Over the years UEFA has demonstrated a willingness to compromise in order to
keep the pyramid structure together with itself at the apex, which brings into ques-
tion the actual effect of the rule in Article 49 of the UEFA Statutes. This strategy
has altered the power balance inside the pyramid and has decentralised the gov-
ernance of the European football from within. This is best illustrated by consider-
ing first, the history of breakaway attempts and UEFA’s responses, and second, the
current governance of European football.

3.3.2 Media Partners Proposal: European Football League

It was the 1998 Media Partners proposal for the establishment of an alternative
structure—which would have in all likelihood brought about the commercial death
of the Champions League—that set the ball rolling. The proposal detailed all the
aspects of the plan for the new pan-European football league, including finances,
in a document around 200 pages long. A concise summary of that document is set
out in the following paragraphs.

3.3.2.1 Notification to the Commission

The briefing paper that was presented to the Commission’s Directorate General for
Competition in 1998 set out the detailed plan to launch a new European Football
League (EFL) outside the FIFA/UEFA structures.28 The brief came at an advanced
stage of preparation and after substantial work and resources had been invested in
the project over many years. The architects of the project were the international
partnership Media Partners International Ltd. (MPI). A leading international finan-
cial institution had been chosen to act as an adviser to the project. The project lead-
ers recognised that the proposal to establish the EFL involved substantial financial
risks to MPI and other potential investors. For that reason they were willing to take
such risks only if a core group of clubs committed to playing in the EFL competi-
tions (SuperLeague and the Pro Cup) on an exclusive basis for a minimum period

27 Memorandum of Understanding between UEFA and ECA (2012).

28A series of agreements called ‘Project Gandalf’ on the establishment of the European Football
League was notified to the Commission in Case IV/37/400—‘Project Gandalf’ [1999] OJ 13, C 70/5.
56 3 Breakaway Leagues and Governance Issues in European Football

of 6 years, and all commercial rights to EFL competitions for the period of 6 years
would belong to the EFL. These conditions are restrictions that clearly raise an
issue of EU competition law, specifically, of Article 101 TFEU and therefore the
notification under the (now repealed) Regulation 1729 was deemed necessary.

3.3.2.2 Ownership and Selection Criteria

The EFL was to be 100 % owned by the 52 Founder30 and Candidate Clubs31 who
contractually agreed to take part in the EFL for a minimum of six seasons. These
clubs were given rights to decide on the rules and conduct of the competitions.
Clubs offered ownership were to be selected on an objective basis according to
their success in national and international competitions. The selection criteria for
Founder and Candidate Clubs used a weighted average of the following compo-
nents: success in European and domestic competitions over the last 10 years
(45 %); commercial value of their national premier league (20 %), UEFA 1996
country ranking (10 %); average attendance at home games (10 %); stadium
capacity (5 %); turnover (5 %); and number of supporters (5 %).
The EFL would have owned all of the intellectual property rights that related
to the competition itself including brand name, TV rights, merchandising rights,
sponsorship, advertising, licensing and multimedia rights. The marketing of
media/sponsor/advertising contracts under these rights were to be managed by
FootballCo, which would receive 5 % of the marketing fee. This entity was owned
by MPI (up to 100 %) and other potential investors and financial institutions. The
plan for FootballCo was to have a management contract with the EFL with a place
on the EFL board for an initial term of 6 years.
The EFL membership was to remain fluid, as the league took account of
clubs’ performances. Shareholders were to be able to grant new franchises if they
so decided, and to promote Candidate clubs into Founder clubs, and other clubs
into Candidate clubs. Each Founder club was to have the same shareholder rights
regardless of market value.

29 Regulation 17/62 (EEC), the first regulation implementing Articles 85 and 86 of the Treaty,

OJ 013, 21.2.1962, pp. 204–211. The system of prior notification was abolished by Council
Regulation (EC) No 1/2003 of 16 December 2002 on the implementation of the rules on compe-
tition laid down in Articles 81 and 82 of the Treaty OJ L 1, 04/01/2003, pp. 1–25, in force as of
1 May 2004.
30 Manchester United, Liverpool, Arsenal, Paris Saint-Germain, Olympique Marseille, Bayern

Munich, Borussia Dortmund, Panathinaikos, Juventus, AC Milan, Inter Milan, Benfica, Real
Madrid, Barcelona, Ajax and Galatasaray.
31 Rapid Wien, Anderlecht, Club Bruges, Broendby, Aston Villa, Chelsea, Newcastle United,

Blackburn Rovers, HJK Helsinki, Monaco, Bordeaux, Auxerre, Nantes, Kaiserslautern, Stuttgart,
Bayern Leverkusen, Werder Bremen, Hamburg, AEK Athens, Roma, Lazio, Napoli, Parma,
Rosenborg, Porto, Sporting Lisbon, Atletico Madrid, Valencia, Deportivo La Coruña, Atletico
Bilbao, Glasgow Rangers, Göteborg, Grasshopper Zürich, PSV Eindhoven, Feyenoord and
Fenerbahçe.
3.3 Breakaway Threats and UEFA/FIFA Concessions 57

3.3.2.3 Competitions

The proposal planned two competitions to be operated by the EFL as of

2000/2001 season: the SuperLeague and the Pro Cup. The SuperLeague would
consist of 32 top European Clubs (16 Franchise Clubs that automatically qualified
for the SuperLeague and 16 Candidate/Invited clubs) who would compete in a
league-style competition, whereas the Pro Cup would be a two-leg knockout com-
petition between another 55 European clubs (Candidates/Invited). The winners of
these two competitions would automatically qualify for the SuperLeague the fol-
lowing year. Additionally, the plan included a number of competitions called the
Shootouts: the 3 winners of the Shootouts would qualify for the SuperLeague and
the 9 losers for the Pro Cup. Invited clubs (clubs invited to participate in EFL on
the basis of their performance in the national leagues in the preceding season)
from certain countries would automatically qualify for the SuperLeague while oth-
ers would play in the Shootouts.32 These clubs would be free to choose on an
annual basis whether to play in EFL- or UEFA-organised competitions.
The EFL was intended to have its competitions compatible with national com-
petitions since the winners of national competitions would be entitled to participate
in the EFL. It was apparent from the proposal that only the other pan-European
competitions were considered competitors to EFL and not the national leagues.
Individual players would be eligible to represent their respective countries in
international matches organised under the auspices of FIFA and UEFA, unless
these governing bodies and the affiliated European national associations decided
to penalise them for participating in the EFL organised competitions by excluding
them from playing for their country.
As such, the EFL was intended to be a combination of the American franchise
system and the European merit-based system.

3.3.2.4 Benefits and Financial Aspects of the EFL

In the EFL, more high-quality games would be guaranteed for the top European
clubs. The SuperLeague undertook to ensure a minimum of 15 matches against
other top European clubs. In comparison, in the 1996–1997 season Bayern
Munich played only 2 European games (one home and one away match with
the same opponent) and Real Madrid did not play at all. In the EFL they would
both be guaranteed at least 15 European games per season, each against a differ-
ent club. Under the UEFA system at the time, even the most successful clubs that

32 Shootout was intended to be a competition divided into three draws of four teams. The

three shootouts were made up of Nordic Shootout (Sweden, Norway, Finland and Denmark),
Latin Shootout (Portugal, Italy, France and Spain) and Central Shootout (Austria, Switzerland,
Netherlands and Germany). The Shootout teams were the second highest placed non-Franchise
clubs in the previous season’s national leagues in each of the countries mentioned. The highest
placed non-Franchise clubs were automatically qualified for the SuperLeague.
58 3 Breakaway Leagues and Governance Issues in European Football

reach the finals of a UEFA competition typically play a maximum of 11 matches.

In a­ ddition, more games would mean more gate receipts. Significantly, more live
matches would be shown on both free and pay-TV in each country due to a greater
number of match nights, and more use of pay-TV. There would be 91 matches
in the EFL format as against 40 in UEFA’s three competitions at the time. There
would be greater predictability for clubs, fans, viewers and broadcasters in terms
of the number of matches between the most popular clubs in Europe.
As a result of an increased number of matches, greater predictability and bet-
ter management of competitions, the EFL was expected to generate revenues of
around US$ 1–2 billion per season, an amount which at the time had far greater
value than it has today. UEFA competitions generated, according to MPI esti-
mates, around US$ 500 million per season excluding gate receipts, and the clubs
competing in the Champions League only received approximately 55 % of the
gross revenues generated by the competition. Clubs participating in EFL would
substantially increase their revenues as compared to their income earned from
UEFA competitions at the time. All participating clubs would have guaranteed
incomes for competing in the EFL together with the prize money according to
their performance in the EFL.
FootballCo was to arrange for US$ 3.23 billion to be available over 3 years to
ensure the availability of funds for the guaranteed payments to clubs.33 Therefore,
under the terms of the proposal FootballCo was entitled to 10 % of the EFL net
income as a return for the cost and risk involved in setting up the EFL, including
putting in place the financial structure to be able to guarantee club payments. The
guaranteed payments in the SuperLeague were to be divided between the clubs in
relation to their market value, with clubs like Juventus, Milan, Real Madrid,
Barcelona, Manchester United and Bayern Munich being at the top of this list with
7 % of the market value each. Additional incentives in the first EFL season were
offered to Founder Clubs that signed the Founders’ Club Agreement.

3.3.2.5 Support for Football in Europe

A surprising feature of the proposal is that it included plans for the distribution of
resources for the benefit of the game, amateur football and the national leagues.
According to the UEFA’s latest publicly available accounts at the time, in the
1994–1995 season only US$ 14 million was paid out to the national associations
every season and approximately US$ 2.64 million was spent on development of
youth football. These amounts were paid from UEFA’s overall resources and not
just from revenues generated by the three main inter-club competitions organised
by UEFA every year. In contrast, the EFL planned to establish the ‘Special Fund’
to which 5 % of the EFL net annual revenues would be paid amounting to US$
50–100 million per year. These amounts would be channelled into development

33 J.P. Morgan was to launch the formal bank syndication process aimed at putting in place a

bank facility in this amount.

3.3 Breakaway Threats and UEFA/FIFA Concessions 59

of football in Europe through the existing institutions involved in administration

of football. The effect of this would be creation of job opportunities by setting up
youth football programmes with money received from the ‘Special Fund’.

3.3.2.6 Relationship with FIFA and UEFA

UEFA was expected to continue organising both inter-club competitions and inter-
national competitions between national representative teams. However, if most of
the European top clubs were to join the EFL, UEFA would have to alter the for-
mat of its inter-club competitions or even withdraw from that market entirely. The
drafters of the proposal believed that the major inter-club competitions in Europe
should be run on a professional basis and owned by the clubs themselves, similar
to models adopted in, for example the United Kingdom and in the Netherlands.
The EFL was to have a professional staff of approximately 150 who would
run a number of technical and advisory committees such as a Rules Committee,
a Disciplinary Committee, a Stadia and Security Committee and a Medical
Committee. The proposal intended to offer representations on these Committees to
FIFA and UEFA.
Some of the principles expressed in the Founders’ Club Agreement include
honouring the administrative functions of the existing global and European foot-
ball authorities of FIFA and UEFA and participating in the EFL within valid and
enforceable FIFA rules and regulations. By signing that agreement, the Founder
Clubs would have been under an obligation to ensure that all players participat-
ing in the EFL were eligible to play in the international competitions organised by
UEFA and FIFA, and to support UEFA in organising club competitions for terri-
tories outside the European Union but within the UEFA umbrella and which were
not included in the proposal at the outset but were to be included in the future
seasons, presumably after the first 6 years of the EFL and provided it proved suc-
cessful as planned.

3.3.3 UEFA Concessions in the 1998 Media Partners Case

Participation in the Champions League is conditioned upon the transfer of broad-

casting rights to Champions League matches to UEFA, which then collectively
sells them to the highest bidders in each territory (broadcasting is still very
national in character). Nearly 30 % of the proceeds from these collective sales are
not distributed back to the participating teams but are a part of the contributions to
European football in accordance with the principle of financial solidarity.34 So
when Media Partners made a proposal to elite football clubs to form a new
European Football League, UEFA reacted by establishing an expanded Champions

34 See UEFA Financial Report for 2009/2010 season.

60 3 Breakaway Leagues and Governance Issues in European Football

League with more matches and more money for the teams, and with several places
in the Champions League for the clubs coming from the ‘big five’ leagues
(Spanish, English, Italian, German and French).35 The qualification system has
been restructured so that the national champions from lower ranked countries have
to take part in one or more qualifying rounds before the group stages, while run-
ners-up from higher ranked countries enter in later rounds. The competition as
adjusted therefore included the features of both the system of promotion and rele-
gation, and a closed league. In 2000, UEFA issued a statement on club football
which included 10 principles for European club football:
1. Domestic club football is the lifeblood of the professional game and must be
protected.
2. UEFA’s club competitions should be in juxtaposition to the domestic
­programmes—a stimulant, not a dominant or damaging influence.
3. Club traditions should be recognised, respected and maintained.
4. The demands made of the players must always be considered.
5. Competitions must be authentic and based on sporting criteria.
6. Fan attendance must be the key objective—the safety and comfort of the
­supporters in the stadia must be a priority.
7. A balance must be maintained between commercial interests and football as a
sport.
8. Solidarity must be maintained.
9. The UEFA Champions League should be the benchmark for international club
football.
10. There can only be one governing body for European Association football
(UEFA) and transnational competitions in Europe.36
Today’s format of the UEFA Champions League was designed to fend off a
threat of formation of a semi-closed private league outside the UEFA structure. It
worked. Parrish and Miettinen note that:
serious consequences have flown from the creation of the Champions League which
amounts to a UEFA Super-league. Teams entering this competition are able to invest
­significantly more in squads than those not qualifying. This has implications for competi-
tive balance in national competitions as the richer Champions League teams continue to
compete with the poorer teams who do not qualify. This leads to a concentration of teams
regularly qualifying for the Champions League and a progressive diminution of domestic
competitive balance.37

It remains only to be speculated whether the Media Partners proposal would have
succeeded commercially had the clubs addressed decided to accept it. But it is a
fact that concessions from UEFA certainly made the choice easier for the clubs.

35 See ‘UEFA to Review Superleague’ BBC, 21 August 1998, and ‘UEFA Finalises Bid to Head
off European Super League’ Sports Illustrated, 28 August 1998.
36 UEFA Statement on club football, 15 December 2000. Available at http://kassiesa.home.xs4all.nl/

bert/uefa/news/001215.html.
37 Parrish and Miettinen 2008, pp. 212–213.
3.3 Breakaway Threats and UEFA/FIFA Concessions 61

As a rule of thumb, changing the status quo will only happen if the new venture
offers a good degree of certainty and more than just theoretical advantages. The
description of the project necessary for the clubs to take up an offer include clear
practical gains demonstrable from the terms of a proposal in a mature contractual
and implementation-ready stage that follows a thorough market feasibility test and
contains an acceptable degree of commercial risk for the clubs.

3.3.4 Formation of the G14 Alliance

The Media Partners case was quite instructive for those it addressed. In September
2000, 14 elite European football clubs formed the G14, an alliance intended to
ensure its members a unified voice in negotiations with UEFA and FIFA. The
founding members were Manchester United, Liverpool, Bayern Munich, Borussia
Dortmund, Juventus, Internazionale Milano, A.C. Milan, Ajax, PSV Eindhoven,
Porto, Marseille, Paris Saint-Germain, Real Madrid and Barcelona. Their geo-
graphical spread included seven different EU Member States. In 2002 Arsenal,
Olympique Lyonnais, Valencia and Bayer Leverkusen joined the G14 alliance. The
membership, which then stood at 18, was opened invitation only. The member
clubs were the top clubs in their own countries winning ca. 250 national league
titles between them, but also top European clubs winning UEFA Champions
League titles 41 times out of 51 seasons.38 Unambiguous in their profit maximis-
ing goals, ‘elitist’ in nature,39 richer and therefore superior in their on-field com-
petitive and off-field commercial performance, these clubs were, and still are, in
the hands of the owners who are generally unconcerned with the European sports
model and the financial solidarity underlying its structures. The G14 and its subse-
quent allies can be classified as a European Economic Interest Grouping under EU
law.40
The official face that the G14 initially presented was that of a group concerned
for the good of the game. The main objectives as they are specified in the G14
foundation agreement are: ‘to promote the cooperation, amicable relations and
unity of the member clubs; to promote and improve professional football in all its
aspects and safeguard the general interests of the member clubs; to promote coop-
eration and good relations between G14 and FIFA, UEFA and any other sporting
institutions and/or professional football clubs, paying special attention to negotiat-
ing the format, administration and operation of the club competitions in which the
member clubs are involved’. It seems that nobody, including fans and the media,

38 Prior to 1992 the UEFA Champions League was officially called the European Champion
Clubs’ Cup.
39 See ‘Platini calls for disbandment of elitist G14’ ESPN, 28 May 2007.
40 Council Regulation (EEC) No 2137/85 of 25 July 1985 on the European Economic Interest

Grouping (EEIG) OJ L 199, 31.7.1985.

62 3 Breakaway Leagues and Governance Issues in European Football

bought this ruse as suspicion of the real motives grew. The suspicions were con-
firmed in March 2006 when a G14 classified internal document entitled ‘G14
Vision Europe’ was leaked to The Guardian. The document laid out the plan of the
G14 to hijack the Champions League tournament from UEFA by asserting its right
to financial and regulatory independence.41

3.3.5 Plans for ‘European Golden Cup’ in 2003?

Earlier, in 2003, The Guardian reported on the G14’s consideration to establish the
Super League in the 2006–2007 season as a response to UEFA’s move to cut the
second phase of the Champions League from that season—a move that would
reduce each club’s number of potential European matches by four.42 Allegedly, a
group of Spanish businessmen said that they were aiming to establish a 16-team
competition called the ‘European Golden Cup’ as a rival to the UEFA Champions
League. Andreff and Bourg said that 110 million Euros was envisaged for the win-
ner of the European Golden Cup.43 No aspect of this plan was confirmed by the
G14. However, the organisation has never made secret its distrust of UEFA.44 By
forming the G14, its members created a powerful lobby group to counterweight
and influence the rules and decisions of UEFA and FIFA to their advantage.
Formally, the group has been disbanded by the FIFA-G14 deal in the beginning of
2008, but its activity continues. The relations of the former G14 with UEFA are
currently ordered through a Memorandum of Understanding (2012) between
UEFA and the European Club Association. The first version of this memorandum
was signed in January 2008 after the Oulmers affair.

3.3.6 UEFA Concessions on Compulsory Player

Release Rule, the Oulmers Case and Formal
Dissolution of G14

Article 1, Annex 1 of the FIFA Regulation on the Status and Transfer of Players
lays down an obligation on clubs to ‘release their registered players to the repre-
sentative teams of the country for which the player is eligible to play on the basis
of his nationality if they are called up by the association concerned. Any

41 See ‘Takeover Bid Could Change the Face of Football’ by Matt Scott, The Guardian, 18

March 2006.
42 See ‘G-14 Considering Super League’ The Guardian, 4 February 2003.
43 Andreff and Bourg 2006, p. 63, note 2.
44 See ‘Cash Windfall for Clubs as G14 Disbands’ by Mihir Bose, BBC, 18 January 2008.
3.3 Breakaway Threats and UEFA/FIFA Concessions 63

agreement between a player and a club to the contrary is prohibited’.45 There are
no serious objections that can be raised against this rule as it stands unqualified. It
is an honour (and possibly a right) for any athlete to represent his or her country if
called upon by national associations but also an opportunity for national associa-
tions to field their finest talent against that of other countries. International compe-
titions have special appeal to fans and promote a sense of national identity which
is inter alia a cultural aspect and value of sport that Europe is aspiring to protect.
Continental championships (EURO in Europe), the World Cup, as well as qualify-
ing matches for international tournaments are examples belonging to the category
of competitions for which compulsory release is required. In addition, these cham-
pionships provide an exposure for the clubs’ players and increase their value on
the player transfer market.
However, matters become more complicated when reading the rule in its
proper context, in conjunction with Article 2 of the Annex 1 which emphasises the
responsibility for financial and insurance matters:
Clubs releasing a player in accordance with the provisions of this annexe are not enti-
tled to financial compensation.[…] The club with which the player concerned is registered
shall be responsible for his insurance cover against illness and accident during the entire
period of his release. This cover must also extend to any injuries sustained by the player
during the international match(es) for which he was released.

Furthermore, disciplinary sanctions for failure to comply with Article 1 are laid
down in Article 6 of the Annex 1:
If a club refuses to release a player or neglects to do so despite the provisions of this
annexe, the FIFA Players’ Status Committee shall furthermore request the association to
which the club belongs to declare any match(es) in which the player took part to have
been lost by the club concerned. Any points thus gained by the club in question shall be
forfeited. Any match contested according to the cup system shall be regarded as having
been won by the opposing team, irrespective of the score.

These rules on compulsory and uncompensated release of players for international

matches of their national representative teams have attracted a lot of attention
since 2006 when the Oulmers case46 was brought before the CJEU. Apart from
giving up the player for the duration of the competition for which he was released,
the main problem is that players might get injured while playing for their country.
In that situation there is no possibility for the clubs to obtain financial compensa-
tion vis-à-vis the damages sustained. During the time their player is released, clubs
are responsible for his insurance against illness and accident, and have to continue
paying his salary.

45 FIFA Regulation on Status and Transfer on Players, edition 2010. The 2005 edition applicable
at the relevant time set out the same rule in identical terms.
46 Reference for a preliminary ruling from the Tribunal de commerce de Charleroi lodged on

30 May 2006, Case C-243/06 SA Sporting du Pays de Charleroi, G14 Groupment des clubs de
football européens v. Fédération internationale de football association (FIFA). The case was
removed from the Court register by order of the President of the Court of 25 November 2008.
64 3 Breakaway Leagues and Governance Issues in European Football

The pressure on FIFA to change these rules exerted by the G14 culminated in
the Oulmers case in 2006.47 The escalation of the conflicting priorities resulted in
the G14 threatening to break away from the rest of the football structure.48 It
began with the Belgian club Charleroi challenging the Annex 1 rules before a
Belgian national court when their player, Moroccan midfielder Abdelmajid
Oulmers, returned injured after being released to play for his national team in an
international friendly against Burkino Faso in November 2004. Charleroi claimed
that their chance to succeed in the national league had been damaged by his
8-month long absence. The G14 joined the action stating that:
G14’s objective in bringing this case is to avoid professional clubs being forced to incur
damages when they release their players for national team duty. G14 wants a situation in
which a fair percentage of the revenues of tournaments, notably the World Cup, are redis-
tributed among those clubs who release their players.49

On a preliminary reference, the Belgian national court in Charleroi asked the

CJEU to consider the compatibility with Articles 101 and 102 TFEU of the rule on
compulsory player release to national federations without compensation and the
unilateral and binding determination of the coordinated international match calen-
dar by the football governing bodies.50
While the case was pending, the G14 invited a further 22 teams to join it in
2007, which would more than double its membership and further increase its influ-
ence and geographic spread.51 Amid mounting tension, FIFA and the G14 entered
into a peace deal in January 2008, resulting in the creation of a monetary pool
compensating for player release, and in changes to the governance structure. In
return, the G14 had to formally disband as a group (it then reorganised in the form
of the European Club Association) and withdraw the Oulmers case and other law-
suits, but its executive said that its goals had already been met by these financial
concessions. Unfortunately for those that looked forward to the clarification on
release for international duty by the Court, the Oulmers case was settled shortly
before the judgment was due and it was withdrawn from the Court’s register as a
part of the broader deal struck between the G14 and FIFA.52
The amendments related to compensation for compulsory player release
­illustrate the power the group of elite football clubs in Europe has on the decisions

47 Ibid.
48 ‘Europe’s top football teams in plot to go it alone’ by Glen Moore, The Guardian, 18 March
2006.
49 ‘G14 clubs Demand the Share of the World Cup Gate Receipts’ by John Nisbet, The

Independent, 23 March 2006.

50 Case C-243/06 SA Sporting du Pays de Charleroi, G14 Groupment des clubs de football

européens v. Fédération internationale de football association (FIFA). A factually similar case

involved French club Olympique Lyon and a player Eric Abidal who broke a metatarsal bone
during a friendly match with Costa Rica.
51 See ‘Cells get slot but Gers snubbed’ Evening Times Reporter, 31 October 2007.
52 See, for example ‘G14 to Disband as Deal is Struck’ by Paul Kelso, The Guardian, 16 January

2008.
3.3 Breakaway Threats and UEFA/FIFA Concessions 65

of the world governing body. FIFA created a compensation pool for every player
released under Article 1 of the Annex 1. Sport Business International reported that:
the money will be drawn from a central pool financed by UEFA and FIFA from the com-
mercial money raised from the sale of TV rights and tournament sponsorships. Although
the exact amounts remain undecided, it is understood that each club will receive the same
amount for every player they provide - irrespective of the players’ club salaries.53

The idea of a compensation pool soon materialised and the amounts became
known before the start of the 2010 FIFA World Cup. The total prize money was
US$ 420 million (as compared to US$ 261 million in the FIFA 2006 World Cup)
of which US$ 40 million (ca. EUR 30 million) was provided by FIFA via the
member associations to the clubs whose players took part in the 2010 FIFA World
Cup as a contribution for their participation in the competition.54 The FIFA
Secretary General confirmed that the individual contributions to clubs amounted to
US$ 1,600 (EUR 1,208) per player per day of his commitment to the national
team, running from 2 weeks before the start of the World Cup until the team’s
elimination. It is expected that the fund in the player release compensation pool
will increase to US$ 70 m for the FIFA 2014 World Cup in Brazil.55 Barcelona
received EUR 654,237 (for its 13 players), Bayern Munich EUR 587,755, fol-
lowed by Chelsea, Liverpool, Real Madrid and other former G14 members, many
of which were also beneficiaries receiving similar sums. Given that the total com-
mitment in the compensation pool was ca. EUR 30 million (US$ 40 million)
encompassing ca. 400 clubs worldwide, this means that the system almost exclu-
sively contributes to the budget of the richest clubs. These sums were given even if
a player was not injured, even though the fixtures are set not to conflict with the
UEFA or national championships, and even if the World Cup provides an addi-
tional exposure and value to the player on the transfer market when later sold by
his club.
Similar arrangements were agreed between UEFA and the European Club
Association (the new institutional face of the G14) under the terms of the
Memorandum of Understanding from 2008 (and were reiterated in its
2012 ­version). UEFA allocated EUR 100 million for the clubs participating in the
quadrennial EURO competition. From this amount, EUR 40 million was meant to
be distributed equally on the ‘per player, per (qualifying) match’ basis to the clubs
that released their players for the qualifying games of UEFA EURO 2012. The
remaining EUR 60 million was distributed to those clubs that released their
player(s) for the UEFA EURO 2012 final tournament. This amount was broken
down into a fixed amount per player per day and weighted in accordance with a

53 ‘G14 Group to Disband after FIFA/UEFA Agree Compensation Deal’ Sports Business
International, 16 January 2008.
54 FIFA news item ‘FIFA Executive Committee Holds a Historic Meeting at Robben Island’

3 December 2009. Available at http://www.fifa.com/aboutfifa/organisation/news/newsid=1143269/

index.html.
55 ‘Prize money increased by 61 % for 2010 World Cup’ by Owen Gibson, The Guardian,

3 December 2009.
66 3 Breakaway Leagues and Governance Issues in European Football

club categorisation.56 It will come as no surprise that richer clubs are categorised
higher. For UEFA EURO 2016 the compensation pool will increase to EUR 150
million.57 According to Memorandum of Understanding between UEFA and
European Club Association,58 the latter undertakes to:
ensure that its member clubs and itself […] comply with the FIFA Regulations on release
of players as stipulated in articles E.4 and E.5 […] and make no further claims (a) in rela-
tion to the cost of insurance of players against UEFA and/or any National Association or
(b) in relation to any other matter relating to the release or participation of players to
European national teams in general against UEFA and/or any European National
Associations for all matches foreseen in the International Match Calendar.59

The reason that FIFA signed off on the deal was fear of the formation of an alter-
native league by the G14. When only Charleroi was involved in the case, the presi-
dent of FIFA Sepp Blatter refused an offer by the president of Charleroi to settle
the case for EUR 615,000. The alarms were set off in FIFA and national associa-
tions when the G14 joined the lawsuit and demanded their own compensation in
the amount of EUR 869 million. This is what ultimately brought the parties to the
negotiating table. FIFA finally yielded to pressures even though there would not be
much support in EU law for the legal action taken against its Annex 1 rules under
the Meca-Medina analytical framework. However, FIFA was one move away from
checkmate: winning Oulmers would possibly mean losing the clubs. Losing the
Oulmers litigation would mean a loss of up to EUR 869 million and all the sub-
sequent compensation payments for player release. Therefore, from the point of
view of FIFA, compromise was the safest option. It kept the clubs within the struc-
ture and at the same time formally disbanded the group. For the time being, the
pyramid survived once again.
In the following subsection it will be argued that had the Oulmers case been
litigated, it would have been won by FIFA.

3.3.6.1 The Compulsory and Uncompensated Player Release

Rule Is Compatible with EU Law

The power of the G14 on the world stage is best demonstrated by the fact that in
the 2006 FIFA World Cup it provided a stunning 22 % of participating players for
the national teams. While it is true that the richest clubs are the ones that have in
their squads, more so than the others, a lot of high-quality foreign players and that
the release for international matches will therefore affect their composition more
profoundly, certain factors are capable of countering any financial damage to the
clubs. For example, the exposure that the players get during their participation in

56 UEFA news item ‘Clubs to benefit from UEFA EURO 2012’ 30 June 2012.
57 Memorandum of Understanding between UEFA and ECA, para C.5.
58 See Sect. 3.4.3.
59 Paragraph D.6.
3.3 Breakaway Threats and UEFA/FIFA Concessions 67

the national representative teams can be invaluable in terms of raising the player’s
value on the transfer market.60 The big national team competitions that require
several weeks of player absence are staged in between seasons. The potential dam-
age that clubs might suffer could be considered a part of financial solidarity and a
mechanism of ensuring competitive balance between clubs that has been chroni-
cally lacking from European football for long time. In this context, it is submitted
that even if the player release rule would be considered as affecting the club’s
commercial interests, it represents one of the mechanisms for maintenance of
competitive balance between league participants in Europe, an objective recog-
nised as legitimate by the Court.61 Also UEFA envisioned the rule with this pur-
pose in mind; in its internal document entitled UEFA Vision Europe it stated that:
‘clubs releasing players to national teams is a form of solidarity that has existed
since the creation of football—this is UEFA’s main source of funding for grass
roots football in Europe and must be protected’.62 The (uncompensated) player
release rule might counterweight the fact that G14 clubs have better purchasing
power and can afford the contracts with the best players than many other less well-
off clubs.63 The risk of the released player getting injured is a part of sport, it is
the same upon everyone, the richest clubs more than others due to their high-­
profile composition, and the clubs take this into account when buying players on
the international football transfer market. It should be taken as an intrinsic charac-
teristic of the industry and of their business when operating on the supply market:
the clubs buy players in full knowledge that they are subject to the scheduled
release and this fact comes attached to the player himself. Usually, more expensive
players affordable only by the richer clubs are the ones being called upon by their
national association. Clubs in poor financial and competitive standing cannot
afford any high-quality players and will rarely have to release anyone from their
squad for international duty. The player release rule is therefore perfectly fit for
the exemption in EU law as it adds to the overall solidarity and competitive bal-
ance between the clubs, while creating compensation pools is in fact working
against those objectives. These arguments could provide a support to the compul-
sory player release rule in the application of the analytical framework provided for
in the Meca-Medina judgment discussed below in Sect. 5.5.5.64
In addition, EU competition law primarily exists to protect consumer welfare.
It is hard to argue against the compulsory release of players rule in this context.
What consumers want to see is their national representative teams composed of

60 See Weatherill 2009, p. 94.

61 In Case C-425/93 Bosman discussed in Sect. 4.4.
62 At p. 11. Available at http://www.uefa.com/newsfiles/374875.pdf.
63 The turnover of Real Madrid in the 2004–2005 financial year was EURO 275.7 million.
64 In the view of the authors of the 2006 Arnaut Report the ‘player release rule is (1) motivated

by purely sporting considerations; (2) necessary to protect the regularity and proper function of
international competitions; and (3) a key component of the overall system of financial solidarity
of European football’. This rule can be seen as a prime example of a ‘sports rule’ which should
fall outside of the scope of Union law. See para 3.47.
68 3 Breakaway Leagues and Governance Issues in European Football

their best players, and at the same time they need an interesting product of the
league matches which can best result from the league in which clubs are in relative
competitive balance.
The motivation of the G14 to deal away with the rule is purely commercial and
directed at their wealth maximisation at the expense of smaller clubs and the public
interest, which might not be a popular argument before the Court in the absence of
overwhelming efficiency gains, especially when presented by the collectively domi-
nant group of undertakings.65 Creating the compensation pool of the kind described
above went too far—if the clubs were to be compensated at all, the compensation
should have covered only the actual damages, i.e. the damages for injured players.
The system as it is actually pays the richest European clubs for the release of play-
ers, the poorer European clubs not having many, if any, players that were called
upon by their national association. It will be argued in Sect. 7.9 that this kind of
strategy of exerting influence over the regulatory bodies to adjust the system accord-
ing to commercial interests of the elite can amount to abuse of a collective dominant
position under Article 102 TFEU, and a concerted practice under Article 101 TFEU.
The compulsory player release rule also seems to have been proportionate to
achieve the objectives of competitive balance and proper functioning of interna-
tional competitions. Any system that provides compensation to the well-off clubs
further contributes towards competitive imbalance in European football and fur-
ther reduces the effectiveness of solidarity mechanisms.
The compromise made to accommodate the requests of the G14 reflects the
influence that the group is capable of exerting and contributes towards the shift in
the balance of power in football governance. Whereas before the decisions were
made from the centre and many objections related to the lack of representation, a
recognisable decentralisation has now taken place, still without proper representa-
tion of most of the clubs. Such decentralisation is therefore not a positive develop-
ment because the central body, unlike the elitist clubs, has a clear mandate to act
in the interest of all the stakeholders and represent ‘sport for all’. True, some of
the battles fought and won by G14 have incidentally been won for all clubs, not
just for the group itself, but nevertheless, G14 was the biggest beneficiary of the
compromises made by FIFA and UEFA and often the sole beneficiary. This in turn
rendered the gap between the clubs in European football even wider.

3.3.7 July 2011: New Breakaway Threats, Old Strategies

of Old Allies

On July 27, 2011, The Guardian reported a new breakaway threat by the elite
clubs and said that: ‘European clubs will break away from FIFA and UEFA and

65 It is argued in Sects. 7.4.2.2 and 7.9 that the elite clubs are collectively dominant

undertakings.
3.3 Breakaway Threats and UEFA/FIFA Concessions 69

create their own super league unless the world governing body urgently addresses
their growing concerns over international fixtures and finances’.66
Only a month before, the same newspapers reported (and FIFA denied67), that
it announced plans to expand international fixtures by five more games in interna-
tional friendlies raising the number to 17.68 The greatest net beneficiaries were
assumed to be the federations of smaller European nations. The ECA alleges
UEFA has pulled back from its commitment to provide insurance for players who
are called up for international duty.69 The ECA also complained that this was
driven through UEFA’s political structures without consultation with the clubs.70
The breakaway was set to happen after 31 July 2014 when the first term of the
Memorandum of Understanding between UEFA and the ECA expires. The chair-
man of the ECA, Karl-Heinz Rummenigge, made comments about a ‘revolution’
for football in the form of a European Super League that would see the clubs seize
control of their own affairs from the regulators. Furthermore, a board member is
reported to have said that after 31 July 2014 ‘we can no longer be forced to respect
FIFA statutes or UEFA regulations. And we won’t be obliged to compete in their
competitions’.71 Media reports suggested that the richest European clubs using the
institutional resources of the ECA managed to easily score a point in negotiations
with UEFA concerning international fixtures and insurance for players on interna-
tional duty.72 The deal involves cutting down the number of international matches
a year from 12 to 9 and it is yet to be approved by FIFA.73
This threat might have been deliberately timed to coincide with the corruption
scandal that was at the time shaking the world football governing body. The
bizarre election process and re-election of Sepp Blatter in June 2011 as FIFA’s
president did not help FIFA’s legitimacy.74

66 ‘Top European Clubs Threaten to Break Away from FIFA and UEFA’ by Matt Scott, The
Guardian, 27 July 2011.
67 See FIFA Statement on international matches, 17 June 2011, available at http://www.fifa.com/

aboutfifa/organisation/administration/news/newsid=1454155/index.html.
68 ‘FIFA Risks War with European Clubs Over International Friendlies’, by Matt Scott, The

Guardian, 14 June 2011.

69 The Guardian, 27 July 2011.
70 The Guardian, 14 June 2011.
71 The Guardian, 27 July 2011.
72 ‘European Clubs Clinch Deal with UEFA to Cut International Matches’ by Owen Gibson, The

Guardian, 28 February 2012.

73 Ibid.
74 For more on these topics see Andrew Jennings’ webpage at http://www.transparencyinsport.org/.
70 3 Breakaway Leagues and Governance Issues in European Football

3.3.8 Alternative Leagues in European Football

3.3.8.1 Atlantic League in 2000 and 2001

In 2000 and 2001 there was an attempt by the leading football clubs in smaller
countries75 to establish the Atlantic League. The clubs would play each other on
weekends and would no longer play in their national leagues. The commercial
motives such as revenues generated by increasing the target TV audience to 40
million and an estimated 30,000 average stadium attendance would make the
Atlantic League among the biggest leagues in Europe. The result would be more
lucrative broadcasting contracts and attracting more quality players. The idea
behind this proposal was to create a league that can pair with the most successful
national leagues in Europe and give a fair chance to the top clubs from smaller
markets to prevail over the top clubs coming from the ‘big five’ (Italy, Spain,
England, France and Germany). With the dominant clubs leaving, national leagues
would then become more competitive but also probably less profitable in terms of
TV rights. The ties through promotion and relegation would still remain with
national leagues and with European-wide leagues: the best clubs in the Atlantic
League would qualify for Europe-wide competitions such as the Champions
League and the UEFA Cup, and the worst performing clubs would be relegated
back to their top national leagues and replaced by the champions in those leagues.
However, UEFA and the six affected national leagues had rejected the idea of
the Atlantic League as envisaged by the clubs. The clubs were told they would not
be able to play in UEFA competitions any longer and the national associations
similarly said they would sever all ties with the would-be Atlantic League clubs.
To head off the threat of breakaway, UEFA promised an expanded and changed
format of UEFA Cup and the inclusion of a group phase in the tournament. The
clubs said they would still be committed to their own tournament if an expanded
UEFA Cup did not meet their needs. The group stages were introduced for the
2004–2005 season. Following the merger with the UEFA Intertoto Cup, the UEFA
Cup was rebranded into the UEFA Europa League in 2009.76
The Atlantic League should not be confused with the Atlantic Cup played
between the champions of the Icelandic Premier League and the Faroe Island
Premier League between 2002 and 2008.77

75 Celtic and Rangers (Scotland); Ajax, PSV and Feyenoord (the Netherlands); Benfica and
Sporting Lisbon (Portugal); Anderlecht and Club Bruges (Belgium); Gothenburg and AIK
Stockholm (Sweden); Brondby and FC Copenhagen (Denmark).
76 Sources: ‘Celtic Back Atlantic Breakaway’. BBC Sport, 16 January 2000; ‘Clubs step up

pressure for Atlantic League’ by Martyn Ziegler, The Independent, 1 February 2001; ‘Bold plan
for Europe’ by Gabriele Marcotti, The Times, 20 November 2006; ‘UEFA moves to head off
Atlantic League’ by Mark Tallentire, The Guardian, 8 February 2001: ‘UEFA warn clubs over
Atlantic League’, [http://www.sportbusiness.com] 27 September 2001.
77 For more on history of the cup see http://www.soccerandequipment.com/soccer-atlantic-cup.html.
3.3 Breakaway Threats and UEFA/FIFA Concessions 71

3.3.8.2 Royal League in 2004

A ‘successful’ establishment of a closed football league was accomplished with

different actors in April 2004 when an agreement was reached between UEFA,
football clubs, and federations in Denmark, Sweden and Norway. It was the short
lived Royal League whose members were the four best teams from each of these
Scandinavian countries. The 12 member clubs had among their aims to develop
football in Scandinavia in general, create a sporting and attractive offer to the top
clubs, improve the conditions for the Scandinavian clubs in order to compete
against the greatest in Europe (for instance by extending the season in order to
maintain player’s physical fitness by playing in the Royal League), and to
strengthen the development of talents in the Scandinavian countries.78
The Royal League staged championships in the 2004–2005, 2005–2006 and
2006–2007 seasons, which took place during the 3-month winter break and did not
interfere with the respective national tournaments in the relevant countries (with
the exception of Denmark). The profits were distributed among other Scandinavian
clubs that did not qualify for the league and there were talks of the expansion of
membership to include Finland and Iceland.79 Technically, the Royal League still
exists but it has not staged championships since the 2006–2007 season for finan-
cial reasons and an inability to sell TV rights.

3.3.8.3 Commonwealth of Independent States Cup (as of 1994)

and Channel One Cup 2006–2008

The Commonwealth of Independent States Cup (CIS Cup) is played between the
clubs from all of the former Soviet Union states, with occasional participation
from Serbian and Finnish clubs. It has organised contests in the second part of
January each year (which sometimes included also the beginning of February) as
of the 1994 season. Although it sounded attractive to arrange the competition dur-
ing the summer months to be played on natural grass, the window in the calendar
during the summer months was too short for many clubs and the CIS Cup
remained a winter tournament. The decision to stage this alternative competition
was enthusiastically adopted in June 1993 at a general meeting of the Executive
Committee of Football Association of CIS countries. The original idea behind the
CIS Cup was to preserve football ties throughout the countries of the former
Soviet Union. Naturally, the financial and sporting benefits for all the participants
were the main reason for keeping the competition alive until today. There are also
many examples of players from small peripheral clubs in the participating states
who were able to pursue a worthwhile career in a much stronger championship
than that offered on a domestic level.80

78 http://www.royalleague.com.
79 Halgreen 2004, p. 81.
80 Official website of the CIS Cup: http://www.ciscup.ru/2008_XVI/index.htm.
72 3 Breakaway Leagues and Governance Issues in European Football

In 2006–2008, the Russian TV Channel One and Roman Abramovich’s foun-

dation, the National Football Academy, organised the Channel One Cup that
involved champions and runners-up of Russian, Ukrainian, and later also the
champions of Israeli and Serbian premier leagues. As it was organised at the end
of January each year, it temporarily affected the CIS Cup with teams from Russia
and Ukraine participating in the Channel One Cup instead. Therefore, the idea of
uniting the two cups was briefly considered in 2007, but it never materialised. The
global economic crisis negatively affected the Channel One Cup and 2009 compe-
tition was cancelled for financial reasons. It was never staged again.

3.3.8.4 Other European Cross-Border Leagues

The Baltic League is played between 16 teams from Latvia, Lithuania, and Estonia
as of 2007.81 The Setanta Cup features teams from the Republic of Ireland and
Northern Ireland. It has staged competitions since 2005.82 On his visit to
Montenegro on 13 November 2010, the president of UEFA Michel Platini stated
that he would, in principle, not be opposed to a regional league between the coun-
tries from former Yugoslavia,83 but the president of the Football Association of
Montenegro was sceptical that such a Balkan league would ultimately get a green
light from UEFA.84 However, some unconfirmed media reports suggest that a
Balkan Super League involving countries from former Yugoslavia has been even-
tually approved by UEFA and is set to start in 2015.85 Finally, in 2012, UEFA
sanctioned a cross-border league in women’s football involving clubs from
Belgium and the Netherlands, the so-called BeNe league.86

3.3.8.5 Criteria for Successful Establishment of a Breakaway League

A common thread that connects all of the breakaway leagues in football that have
taken place so far concerns
• limited geographical area, geographical connection and proximity between the
clubs involved;
• use of vacant space in the international match calendar;
• short time frame of the competitions;
• participation of smaller European clubs.

81 http://www.balticleague.com.
82 http://www.setanta.com/ie/News/Football/Setanta-Sports-Cup.
83 ‘Platini Nije Protiv Regionalne Lige’ (Platini is not Against Regional League), B92,

13 November 2010.
84 ‘Savicevic o Regionalnoj Ligi’ (Savicevic on Regional League), Sportal, 14 November 2010.
85 ‘Balkan Super League Possibly on Tap for 2015’, SB Nation, 10 October 2012.
86 UEFA news item ‘Best of Belgian and Dutch Unite in the BeNe League’ 23 January 2013.
3.3 Breakaway Threats and UEFA/FIFA Concessions 73

Such competitions did not overlap with any of the UEFA-organised pan-European
events in which the clubs were engaged. Therefore, they did not affect the UEFA
competitions and financial balance sheets in any way. Resources that are at the
disposal of even the most successful clubs in such breakaway leagues were far
below that of their counterparts in the Western European countries, the ‘big five’
in particular. The Atlantic League that got a red light from both UEFA and the
concerned national associations did not fit these criteria. No breakaway league so
far has been expressly approved, but none has been a subject of the disciplinary
measures either.
Normally, committing to any form of participation in international club compe-
titions not organised or not approved by the concerned governing bodies will entail
disciplinary measures as specified in the codes implementing FIFA Regulations
Governing International Matches and disciplinary codes of national associations
(Article 19 of the FIFA Regulations Governing International Matches (2012),
Article 12 of the FIFA Disciplinary Code (2011), Article 53 of the UEFA Statutes
(2012), and Article 6 of the UEFA Disciplinary Regulations (2013)). The sanctions
that may be imposed by UEFA provide that any club in breach of the UEFA
Statutes may become subject to a withdrawal of their license, full or partial sta-
dium closure, disqualification from competitions in progress and/or exclusion from
future competitions, and fines in an amount of no more than EUR 1 million.87
In recent years, UEFA’s general attitude to the idea of cross-border leagues
became more moderate. After the meeting of the UEFA Management with UEFA
Member Association General Secretaries which was held on 26–27 October 2005
in Nyon, UEFA considers that a cross-border competition is conceivable, but only
if the proposal for such project a priori satisfies the following criteria:
1. The cross-border competition must be approved by the respective UEFA member asso-
ciations; 2. The cross-border competition must be organised by the respective UEFA
member associations; 3. All clubs planning to participate in the cross-border competition
must be affiliated to a UEFA member association (or to a league/regional football associa-
tion subordinated to such association); 4. Geographical aspects should be taken into con-
sideration when a cross-border competition is being assessed; 5. All clubs planning to
participate in the cross-border competition must recognise, as a condition of participation,

the competition organiser ‐ in this case the associations (not the league, clubs, etc.) ‐ not
that the ownership of the competition and its core commercial rights belong centrally to

to the individual clubs (same model as the UEFA Champions League); 6. Minimum stand-
ards should be fixed with regards to the levels of solidarity distributions from the commer-
cial rights revenues (core commercial rights commercialised centrally), for example:
i. Minimum 10 % of commercial rights revenues must be distributed to amateur football
in the countries concerned, via the associations involved; ii. Minimum 10 % of commer-
cial rights revenues must be distributed to professional football clubs of the associations
concerned but only clubs who are not participating in the cross-border competition con-
cerned (providing that they fulfil, as a minimum, the sporting criteria of the UEFA Club
Licensing System); iii. Of the remaining revenues divided amongst the participating clubs,
a minimum of 25 % (ideally a minimum of 50 %) must be distributed equally, with the

87 Similarly, the most severe sanction under Article 12 of the FIFA Disciplinary Code involves

expulsion from competitions and a fine of no more than CHF 1 million.

74 3 Breakaway Leagues and Governance Issues in European Football

remainder based on on-field performance. 7. The competition regulations must be in com-

pliance with the UEFA statutes/regulations and need to be approved by UEFA; 8.
Participating clubs must be licensed in accordance with the UEFA Club Licensing
System; 9. The competition regulations must include, among other things, provisions con-
cerning, for example: i. Refereeing; ii. Disciplinary matters; iii. Independence of clubs
(integrity of competition); iv. Anti-doping. 10. The cross-border competition must not
conflict with the international match calendar; 11. The matches of the cross-border com-
petition may not be played on the same day as UEFA club competitions; 12.. The cross-
border competition must not replace the national championships and must be arranged
around the calendar of the national championship; 13. Approval of FIFA.88

The criteria are particularly onerous: they do not allow a direct access to the exploi-
tation market,89 the proposed league has to be confined to a specific geographical
area and organised so as not to conflict with the international or national match cal-
endar, the matches in the proposed league cannot be played on the same day as
UEFA club competitions, both vertical and horizontal solidarity contribution is
required, regulatory competence remains mostly with UEFA including club licens-
ing, clubs presumably have to remain as participants in their national champion-
ships, and the approval of national associations, UEFA and FIFA is required, which
in all probability depends on the fulfilment of all the other conditions. UEFA per-
ceives these rules as a natural and legitimate part of their mandate and a necessary
means of the proper organisation and financing of football. In particular, it is seen as
a means of ensuring financial solidarity and a system of promotion and relegation
throughout the European pyramid. Conversely, clubs may claim that the Article 49
rule presents a restriction upon their commercial freedom in breach of TFEU compe-
tition provisions and free movement rules on services and establishment. The Article
49 rule in the UEFA Statutes is not likely to be challenged in abstract by the clubs,
but only when the conflict materialises, i.e. only if the authorisation by the relevant
governing body or bodies has not been obtained and/or the clause is used as a basis
to impose sanctions on the clubs participating in the unsanctioned breakaway league.

3.4 New Trends in the Governance of European Football

3.4.1 Stakeholder Theory

When deciding on their business strategies, including corporate social responsibility

(CSR),90 corporations should take into account the interests of all of the stakehold-
ers. Freeman broadly defines stakeholders as any group of individuals who can

88 Cited in Master Thesis by Jaka Lucu, Mico Petcovic, Mihai C. Tudoran and Victor Vasiliev,
‘Central European Football League: Dream or Reality’ (International Centre for Sports Studies
(CIES), Neuchatel, 2007), pp. 42–43.
89 For detailed analysis of relevant market from the point of view of competition law see

Sect. 7.3.
90 For definition of this term see Dahlsrud 2006, published online in Wiley InterScience at http://

www.mcxindia.com/csr/newsarticle/pdf/csr_news45.pdf.
3.4 New Trends in the Governance of European Football 75

affect, or is affected by, the performance of an organisation.91 The current and

future strategies of one organisation are affected by (1) external pressures (the
marketplace including competitors, buyers and suppliers; shareholders; pressure
groups; and government), (2) internal pressures (existing commitments, managers,
employees and their trade unions), and; (3) personal ethical and moral perspectives
of senior managers.92 Shareholders, managers, employees, consumers, distribu-
tors, suppliers, financiers, government and society in general were identified in a
non-exhaustive list as interested parties whose relative power will be a key varia-
ble, and the organisations will on occasion ‘trade-off’ one against the other, estab-
lishing a hierarchy of relative importance. Because their interests are different,
these various stakeholders are not affected in the same way by every strategic
decision and consequently their relative influence will vary from decision to deci-
sion.93 Thompson gives an example of a company’s investment into new technol-
ogy which can improve the quality of the product and bring an increase in profits.
This will satisfy the customers and shareholders but may lead to the loss of jobs
for employees and some managers.94 Shareholders, employees (including manag-
ers), and customers are seen as three key stakeholders that an undertaking must
satisfy, but in a competitive environment, if they fail with any group long term
invariably they will place the undertaking in jeopardy through a spiral of decline.95
The Arnaut report identified five different types of stakeholders in European
football: the leagues as represented by the European Professional Football Leagues
(EPFL), the clubs as represented the European Club Forum (ECF),96 the G14 as an
Economic Interest Group operating in parallel with the ECF, the players repre-
sented by FIFPro, and supporters (not organised in any pan-European representa-
tive body) as key stakeholders in football.97 After the G14 deal with FIFA, the ECF
and G14 have been merged into one body, the ECA. According to stakeholder the-
ories, this list can be expanded to include television broadcasters and other media
operators, football equipment suppliers and manufacturers, sponsors, amateur and
grassroots levels, trainers and all other employees of clubs and leagues, etc.
However, when it comes to strategic decisions and considering the interests of all
the stakeholders in European football, the Arnaut Report observes that:
The elite professional clubs and the biggest leagues (coming from the largest national TV
markets) consider themselves to be more important and, correspondingly, to be deserving
of greater involvement in the decision-making process, both at national and European

91 Freeman 1984.
92 Newbould and Luffman 1979.
93 Thompson 2001, p. 87.
94 Following the same logic, the Bosman case created a liberalised market for player ser-

vices whilst also playing into the hands of those clubs with the greatest disposable income
and resources to spend on players, widening the gulf between amateurs and professionals and
between the top and the bottom of sport in Europe. See para 4.20 of the Arnaut Report.
95 Thompson 2001, pp. 89–90.
96 ECF has been replaced with European Club Association after disbandment of G14.
97 Paragraph 4.32 of the Report.
76 3 Breakaway Leagues and Governance Issues in European Football

level. If the football authorities fail to take account of their views, there was a risk of
secession (‘breakaway’ leagues) and this fact also required the football authorities to
adapt.98

The elite clubs consider themselves at the top of the hierarchy of stakeholders and
threaten secession if the consideration of their interests falls below a high level of
importance in UEFA decision-making. The effect is the creation of new rules that
are often to the prejudice of all other stakeholders in football.

3.4.2 UEFA Mandate

The UEFA Mission Statement provides that ‘UEFA’s core mission is to ­promote,
protect and develop European football at every level of the game, to promote
the principles of unity and solidarity, and to deal with all questions relating to
European football.’ It further emphasises the principles of democracy, solidarity,
fairness, transparency, accountability, entrepreneurship, professionalism, pride,
and respect for the different stakeholders within European football in pursuing its
wide range of aims that include:
organisation of competitions for professional, youth, women’s and amateur football;
increase in access and participation; supporting growth in the grassroots of the game;
achieving commercial success and sound finances without distorting the sporting qualities
of our competitions; using UEFA’s revenues to support re-investment and redistribution in
the game in accordance with the principle of solidarity between all levels and areas of
sport; targeting specific aid and assistance to help member associations with the greatest
need; promoting positive sporting values (such as fair play, anti-racism, and safe and
secure match environment); running an anti-doping programme aiming at preserving the
ethics of sport, safeguarding the players’ health and ensuring equal chances for all com-
petitors; and ensuring that the needs of the different stakeholders are properly reflected in
UEFA’s thinking.99

When it comes to some aspects of CSR, UEFA is unlike ordinary commercial

undertakings because its mandate includes representing interests of all levels of
football equally, so support for certain social causes is a part of their c­ ompulsory
activities. The pressures of secession and endless compromises to accommo-
date the elite clubs create a wider and wider gulf of competitive imbalances in
European football and are making it harder for UEFA to fulfil its main regulatory
and organisational functions related to other stakeholders, especially those weak-
est in the bargaining process.
The internal UEFA document entitled ‘Vision Europe’ sets out the strategy for
development of European football over the period of 10 years starting from 2005
and poetically describes the ideal football world as the one in which there exists,
among other things: a stronger than ever football pyramid with a strong base as the

98 Ibid. para 4.21.

99 See UEFA Vision Europe 2005, p. 7.
3.4 New Trends in the Governance of European Football 77

only way to ensure a strong apex; a football world where UEFA deals with all
questions relating to European football, where it is the governing body of
European football and speaks for the whole of European football; UEFA shaping
and driving the debates and setting the agenda at European level based on football
priorities; solidarity at all levels and distribution mechanisms which guarantee an
equitable distribution of wealth.100 Furthermore, Vision Europe document also
foresaw the future with a UEFA that ‘has a unique position with regards to being
the exclusive organiser of the official European football club competitions’
because ‘this was always the case historically and it is only by virtue of this fact
that UEFA can effectively regulate European football’.101 Some of these ideals are
realities while others are not. Without a doubt, many of the statements in Vision
Europe insinuate that the breakaway structures would be profoundly damaging for
the interest of European football, and that pressures UEFA experiences from the
elite clubs and compromises it makes is taking an unwelcomed precedence over
the priorities of the football as a whole. Similarly, under Article 2 of the UEFA
Statutes (2012) the objectives of UEFA include preventing all methods or practices
which might jeopardise the regularity of matches or competitions or give rise to
the abuse of football; ensuring that sporting values always prevail over commercial
interests; and ensuring that the needs of the different stakeholders in European
football (leagues, clubs, players, supporters) are properly taken into account.
Under the terms of Articles 60 et seq. of the Swiss Civil Code, UEFA is a
­private non-profit-making association that formally does not have a public man-
date, although functionally it resembles some of the characteristics of a private
body with a public mandate. At the time of its creation in 1955 its main goal was
the organisation of pan-European national and club competitions. FIFA approved
of such club competitions but only if ‘directly organised’ by UEFA. Thus, the cre-
ation of the European Club Forum in 2002 that preceded the European Club
Association was seen as ‘a natural evolution in the relationship between UEFA
and the clubs playing in UEFA competitions’.102

3.4.3 European Club Association: A New Face of G14

The influence of the former G14 clubs is reflected in the neo-governance of

­football in Europe. UEFA has developed structures to give an institutional voice
to all the stakeholders: leagues, clubs, and players in particular. Clubs are cur-
rently represented in the European Club Association that was formed from the
former G14 members and a more representative European Club Forum after the
January 2008 peace deal between the G14 and FIFA. The ECA consists of club

100 Ibid. pp. 8–14.

101 Ibid. p. 12.
102 Ibid. p. 15.
78 3 Breakaway Leagues and Governance Issues in European Football

representatives of all 53 European associations, totalling 207 clubs, 103 of which

are ordinary members and 104 are associated members. The number of ordinary
members from each member association is distributed according to the UEFA
association ranking coefficients. Thus, the three highest ranking associations each
have five clubs; the next three, four clubs; the associations ranked from 7 to 15
will each have three clubs; associations ranked from 16 to 26 each have two clubs;
and associations ranked 27–53 will have one club each. The association ranking is
directly related to the performance of their clubs at the European championships,
which is directly related to the amount of money that the clubs have to spend on
their players and coaches. Therefore, the membership in the ECA is closely related
to clubs’ financial standing.
The ECA is chaired by Karl-Heinz Rummenigge of Bayern Munich, a former
G14 member. Two out of three vice-presidents are also former G14 members. The
ECA elects an Executive Board consisting of 11 members. Six out of the eleven of
the board members were included in the Media Partners proposal for the European
Football League. Three out of four board members who represent the ECA on the
Professional Football Strategy Council (PFSC) also used to belong to the G14.103
Under the Memorandum of Understanding signed with UEFA, the ECA is recog-
nised as the sole body representing the interests of clubs in Europe.104 The voice
of the clubs is therefore the voice of former G14 members, as well as other elite
clubs included in the Media Partners proposal. These clubs have special commer-
cial interests not shared with other member clubs of ECA, which is confirmed by
their former membership in the closed G14 interest group.
At a conference in The Hague in 2009, Michael Gerlinger, the Director of
Legal Affairs for FC Bayern Munich, spoke about the ECA. In his answer to a
comment concerning the undemocratic structure of the ECA and the fact that
power is in the hands of the former G14 members and other elite clubs, he said
that the ECA Executive Board is ‘trying to take into consideration also the needs
of the small clubs when making decisions’.105 Illustrative as it is, this statement
confirms that the elite clubs are in total control and that small clubs can only hope
their needs are ‘taken into consideration’. What is supposed to be a truly repre-
sentative body with the mandate to speak on behalf of all the member European
clubs has become another undemocratic forum, further contributing to the imbal-
ance in European football.
Therefore, it is possible to draw a rather firm conclusion that notwithstanding
its formal disbandment, the G14 and its allies will continue to present a powerful
lobby group with special commercial interests not possessed by any other

103 They are David Gill (Manchester United), Florentino Pérez (Real Madrid), Umberto Gandini
(AC Milan) and Maarten Fontein (Alkmaar).
104 See paras A.1 and D.10 of the Memorandum.
105 Michael Gerlinger, lawyer from Bayern Munich FC. ‘The European Club Association

(ECA): background, mission, composition, activities’. Speech at The Hague 19 February 2009,
VIII Asser-Clingendael Sports Lecture on ‘Current Topics in the Governance in Sport: ECA and
MOTOE’.
3.4 New Trends in the Governance of European Football 79

competitors in their league. On the conclusion of the January 2008 deal with
FIFA, their role has not ended de facto; it has just been deinstitutionalised, re-
institutionalised and legitimised by the broad membership of the ECA. The broad
membership is just a smoke screen to provide legitimacy to the ECA decisions and
portray them as decisions of an all representative body. The ECA is used as a plat-
form to represent the interests of the elite when their common commercial inter-
ests are affected. So long as there is football and financial interests involved in it,
the prospect of the formation of breakaway structures will be alive and well. This
is confirmed by an article in The Guardian citing the statement of the AC Milan
director and the first vice-president of the ECA Executive Board, Umberto
Gandini: ‘I still believe a European league will be an unavoidable step, though it
may take more time than expected.’ It further says that ‘the dissolution of the G14
pressure group of clubs and the institution of the European Club Association as a
UEFA talking shop was described as a ‘historic moment’ for football. However, it
is clear that despite its disappearance, the ambitions promoted by the G14 have not
been diluted and ambitions for more control remain.’106 Commenting on the latest
breakaway threat, the article in The Guardian notes:
[a]lthough the ECA has a broad constituency, representing [207] European clubs, it is the
interests of nine in particular that will drive this agenda. They are Real Madrid, Milan,
Liverpool, Internazionale, Manchester United, Barcelona, Arsenal, Chelsea and
Rummenigge’s Bayern. When the Guardian contacted the four English clubs for their
views on the matter, all declined to comment. However, a director at one of the clubs said:
‘[Financially] there is a lot of unfulfilled potential in football as it stands.’107

Whereas it is not disputed that UEFA’s power to govern the game has to be subject
to effective control and accountability, the decentralisation of the kind described is
probably the worst kind of decentralisation that could happen to European football
in terms of enhancing competitive balance between clubs, or strengthening soli-
darity mechanisms. On the top of this, a recent trend included the emergence of
new stakeholders outside of organised sports structures, such as, for example, local
communities. Central decision-making without proper representation of all the
affected stakeholders might be a sign of bad governance, but decentralised deci-
sion-making to the advantage of big clubs as stakeholders and the disadvantage of
football as a whole, is potentially even worse.

3.4.4 Professional Football Strategy Council

The creation of the Professional Football Strategy Council (PFSC) in June 2007
was a response to the 2006–2008 breakaway threat and the G14 demands for more

106 ‘Big Clubs Restate the Claim for European League’ by Matt Scott, The Guardian, 24

February 2009.
107 The Guardian, 27 July 2011.
80 3 Breakaway Leagues and Governance Issues in European Football

representation in the governance of European football. This move also happened

to correspond to the European policy demands for democratic stakeholder repre-
sentation within the UEFA structures.108 Article 11(4) of the UEFA Organisational
Regulations (2011) provides that ‘the purpose of the PFSC as a consultative body
is to make recommendations to the Executive Committee’, while considering the
interests of all stakeholders in European football recognised by UEFA. With this
purpose in mind the PFSC:
a) identifies solutions for improving collaboration between the various stakeholders in
European football, in particular by exploring the possibility of establishing a European
Professional Football Charter; b) deals with issues pertaining to the social dialogue in
European professional football matters; c) works with the existing professional football
consultative bodies on all relevant issues; d) ensures that football stays together as one
family, with professional and amateur football living together within the existing sports
structures and the pyramidal system; e) discusses the views of the clubs, leagues, players
and UEFA’s member associations and informs the Executive Committee accordingly.109

Members of the PFSC decide on the topics that can be brought to the discussion
table and that may include: ‘(a) UEFA club competitions and their calendars;
(b) the position of professional clubs within the international football e­ nvironment;
(c) financial and commercial aspects of European football, and; (d) issues related
to the European Union.’110
The PFSC is composed of 16 members: four UEFA vice-presidents, and the
same number of EPFL representatives, FIFPro representatives and ECA represent-
atives.111 The four bodies represented in the PFSC are also partners in the social
dialogue process at the European level. Their role and the part the PFSC plays in
that process will be discussed in Sect. 3.4.6.

108 See, for e.g., Nice Declaration on Sport (2000), point 10. See also Commission

Communication on Developing European Dimension in Sport (2011), para 4.1 for the most
recent policy document.
109 UEFA Organisational Regulations, edition 2011, Article 11(1).
110 Ibid. Article 11(2).
111 Ibid. Article 10. The EPFL representatives in the PFSC for the term 2011–2013 are

Frédéric Thiriez (Deputy Chairman of the EPFL and President of the French LFP), José Luis
Astiazarán (President of the Spanish Professional Football League and Member of the EPFL
Board), Frank Rutten (CEO of the Dutch Eredivisie and Member of the EPFL Board), and
Holger Hieronymus (COO of the DFL Bundesliga and Member of the EPFL Board). On behalf
of FIFPro Division Europe, the representatives appointed to attend the meetings of the PFSC
are Philippe Piat (president of FIFPro Division Europe, president of UNFP, France), Theo van
Seggelen (secretary general of FIFPro Division Europe), Bobby Barnes (board member FIFPro
Division Europe, deputy chief executive PFA, England), and Luis Rubiales (president AFE,
Spain). On 13 July 2011, the ECA Executive Board appointed the four members representing
ECA on the PFSC for the two upcoming seasons (2011–2013). They are Umberto Gandini (AC
Milan), David Gill (Manchester United FC), Maarten Fontein (AZ Alkmaar), and Florentino
Pérez (Real Madrid CF), in other words, three former G14 members out of four representatives.
3.4 New Trends in the Governance of European Football 81

3.4.5 The UEFA Club Competitions Committee

The UEFA Club Competitions Committee (CCC) exchanges views on the current
UEFA club competitions, draws up modifications to the existing competitions and
their regulations, assists in the process for selecting final venues, proposes models
for the distribution of revenues, and monitors the competitions while they are in
progress. The recommendations made by the CCC always receive close attention
from the UEFA Executive Committee, especially with regard to the revamping of
the club competitions in recent times through changes to the access list in the
UEFA Champions League and the launching of the UEFA Europa League. The
Committee is composed of a chairman, a deputy chairman, a first, second and third
vice-chairman (two vice-chairmen are elected by the ECA), as well as nine ordi-
nary members (five of whom are elected by the ECA). The CCC is chaired by
UEFA Executive Committee member Michael van Praag. On 13 July 2011 the
ECA appointed seven members to represent it on the CCC. Five of these seven
representatives are former G14 members.112

3.4.6 Social Dialogue and Collective Agreements

in Professional Football

3.4.6.1 EU Legislation

Articles 153–155 of the TFEU make the Commission responsible for promoting
and supporting the European social dialogue. Ideally, social dialogue results in
collective agreements entered into by representatives of both sides of the industry
and plays a significant role in shaping employment relations and working condi-
tions. Article 154 obliges the Commission to consult management and labour on
the content of legislative proposal in the social policy field before they are for-
mally submitted. According to Article 155, an agreement between the two sides
of the industry concluded at the Union level, depending on its content, may be
implemented in accordance with procedures and practices of the Member States or
by a Council decision on a proposal from the Commission at the joint request of
the signatories. The European Parliament is left out of this legislative procedure.
In order to participate in social dialogue at European level, the social
partner organisations must apply jointly to the European Commission. When
­
­submitting the joint application, those organisations must meet the cumulative
criteria set forth in Article 1 of the Commission Decision 98/500 of 1998 on the

112 Diogo P. Brandão (FC Porto), Umberto Gandini (AC Milan), David Gill (Manchester United

FC), Karl Hopfner (FC Bayern München), Sandro Rosell (FC Barcelona), John McClelland
(Rangers FC), Damir Vrbanovic (NK Dinamo Zagreb).
82 3 Breakaway Leagues and Governance Issues in European Football

establishment of Sectoral Dialogue Committees promoting the dialogue between

the social partners at European level. It provides that:
1. Sectoral Dialogue Committees […] are hereby established in those sectors where the
social partners make a joint request to take part in a dialogue at European level, and
where the organisations representing both sides of industry fulfil the following criteria:
(a) they shall relate to specific sectors or categories and be organised at European level;
(b) they shall consist of organisations which are themselves an integral and recog-
nized part of Member States’ social partner structures and have the capacity to
negotiate agreements, and which are representative of several Member States;
(c) they shall have adequate structures to ensure their effective participation in the
work of the Committees.113

The phrasing of the criterion of representativeness under Article 1(b) of the 1998
Decision and the words ‘[…]which are representative of several Member States’
have been subsequently rephrased to read ‘which are representative of all Member
States, as far as possible.’114
In terms of the application of EU competition law, the collective bargaining
agreements would normally fall outside of the ambit of competition law articles on
the basis of the well-established exemption in the Albany, Brentjens and Drijvende
Bokken line of case law.115 EU free movement law would remain applicable.

3.4.6.2 FIFPro, Social Partners and Developments So Far

In Europe, unlike in the US,116 the social dialogue and collective bargaining agree-
ments in sports are still in their infancy. Since 2001, the Commission has been support-
ing projects for the consolidation of social dialogue in the sport sector globally as well
as specifically in the football sector.117 Studies were conducted to identify the social
partners118 and the labour-related themes and issues suitable to be dealt by means of

113 Commission Decision of 20 May 1998 (98/500/EC) on the establishment of Sectoral

Dialogue Committees promoting the dialogue between the social partners at European level, OJ
L 225, 12.8.1998, p. 27.
114 See, for instance, Report on the Representativeness of European Social Partner Organisations

(1999).
115 Case C-67/96 Albany International BV v. Stichting Bedrijfspensioenfonds Textielindustrie

[1999] ECR I-5751, Cases C-115, 116 and 117/97 Brentjens’ Handelsonderneming BV v
Stichting Bedrijfspensioenfonds voor de Handel in Bouwmaterialen [1999] ECR I-6025 and Case
C-219/97 Drijvende Bokken [1999] ECR I-6121.
116 For the US see Halgreen 2004, p. 209.
117 See list of projects in fn. 6, Sect. 5.3 in Commission Staff Working Document, The EU and

Sport: Background and Context, Accompanying Document to the White Paper on Sport, COM
(2007) 391 final.
118 See Promoting Social Dialogue in European Professional Football (Candidate EU

Member States), Report for the European Commission (November 2004) and; Study on the
Representativeness of the Social Partner Organisations in the Professional Football Player Sector,
Report for the European Commission, Project No VC/2004/0547 (2006).
3.4 New Trends in the Governance of European Football 83

social dialogue in professional football,119 but also in some other professional

sports.120 Social partner organisations on the European level in professional football
whose representative nature was confirmed by those studies are the International
Federation of Professional Footballers’ Associations (FIFPro) Division Europe on the
side of employees and the EPFL complemented by the ECA on the side on employers.
The EPFL members are only from the top leagues in Europe, representing 16
out of 27 EU Member States, and 7 out of 26 non-EU countries. It was argued that
EPFL is not an independent organisation: its member professional leagues are
affiliated and subordinated to their respective national football associations while
EPFL itself is ‘directly and very closely linked to UEFA and FIFA’.121 Further,
because it represents only top leagues, it was thought that the role of EPFL ‘may
assume added importance as a potential vehicle for a breakaway super-league in
which the question of employer representativeness would be assured’.122
Nevertheless the EPFL was deemed to fulfil the sub-condition of representative-
ness under Article 1(b) of the Commission Decision 98/500.123 In addition, not all
of the EPFL members are ‘themselves an integral and recognized part of Member
States’ social partner structures’ and have ‘the capacity to negotiate agreements’
within the meaning of Article 1(b), first requirement.124
The ECA, as described above in Sect. 3.4.3, is dominated by the top European
clubs and may be used as a tool to pursue their common commercial interests
whenever necessary. The Memorandum of Understanding between UEFA and the
ECA recognises a ‘need to find the right balance between labour legislation and
the specific characteristics of football, for example through the vehicle of social
dialogue and/or collective bargaining agreements.’125 Adequately representing
only the interests of its top members (regardless of its much wider constituency)
makes the ECA, much like EFPL, a tool used by the elite in the European social
dialogue process. On 13 July 2011, the ECA Executive Board appointed five indi-
viduals to represent the ECA on EU Social Dialogue Committee.126 Four of them
were affiliated with the clubs of the former G14.

119 See Study into the Identification of Themes and Issues which can be Dealt with in a Social

Dialogue in the European Professional Football Sector, Report for the European Commission
(May 2008). See also the press release in 2008 The International Sports Law Review 1–2, p. 109.
120 Such as cycling. See Study into the Identification of Themes and Issues to be Dealt with

in a Social Dialogue in the European Professional Cycling Sector, report for the European
Commission (2009).
121 Siekmann 2006, p. 77.
122 Parrish and Miettinen 2008, p. 48.
123 Siekmann 2006, p. 79. See Report for the European Commission, Project No VC/2004/0547

(2006).
124 Such as for instance the Finnish Jalkapalloliiga or the English FA Premier League.
125 Paragraph A4, fifth indent, of the Memorandum.
126 Pedro Lopez Jimenez (Real Madrid CF), Jean-Michel Aulas (Olympique Lyonnais), Raúl

Sanllehí (FC Barcelona), Michael Gerlinger (FC Bayern München), and Michele Centenaro
(ECA General Secretary).
84 3 Breakaway Leagues and Governance Issues in European Football

FIFPro represents professional players all over the world and its membership
currently exceeds 50,000. The Board of FIFPro consists of eleven persons: five
representatives, from each of: the United Kingdom, France, The Netherlands,
Italy, and Spain, in their capacity of permanent representatives; two representa-
tives from each of the American Division and the European Division; and one rep-
resentative from each of the African Division and Asian Division.127 The FIFPro
Division Europe consists of 24 professional football players’ member associations.128
Responding to a joint request made by the EPFL and the FIFPro Division
Europe in December 2007, the Commission acknowledged the existence of condi-
tions for the creation of the EU sectorial Social Dialogue Committee in the profes-
sional football sector (the Committee).129 The Committee was formally established
by the Commission decision of 20 May 1998—98/500/EC. The public ceremony
establishing this Committee and adopting its rules of procedure took place in Paris
on July 1, 2008. By this time the ECA was also considered a party to the social
dialogue representing the employers.130 Furthermore, the EPFL and FIFPro agreed
to engage UEFA in this process as an associated partner. According to the rules of
procedure the Committee shall ‘work in harmony with the Professional Football
Strategy Council and submit any item for discussion in the Committee to the
Strategy Council for agreement’ before being formally placed on the Committee
agenda.131 The social partners agreed to invite the UEFA President to chair the
Committee.132 Via these rules of procedure UEFA became involved in the social
dialogue in which it previously did not have any formal role, as it does not repre-
sent employers or employees and thus cannot be considered a social partner.
Governing bodies should not have access to the social dialogue legislative pro-
cess133 of the type which UEFA has now obtained. The consequences of its
involvement may be that certain terms of collective bargaining agreements might
be considered ineligible for the competition law exemption if challenged before
the Court. It was argued that ‘although independence is not an official, explicit cri-
terion for admissibility to European Social Dialogue, on the basis of the funda-
mental consideration that in a democratic society social partner organisations

127 Article 10 of the FIFPro Articles of Association.

128 The Division board is led by president Philippe Piat, a former French professional player,
the other members of the board are Bobby Barnes a former English professional player, Joachim
Evangelista, a former German professional player, and three other members.
129 In its communication of March 13, 2008.
130 See the Commission Press Release IP/08/1064 ‘Footballers and Employers Launch New EU

Forum on Social Dialogue’ 1 July 2008.

131 Article 2 of the Rules of Procedure for the European Sectoral Social Dialogue Committee in

the Professional Football Sector. See also European Sectoral Social Dialogue Committee in the
Professional Football Sector Work Programme 2008–2009.
132 Ibid. Rules of Procedure, Article 4.
133 Parrish and Miettinen 2008, p. 48.
3.4 New Trends in the Governance of European Football 85

should be independent from national governments […] similar conclusion would

in principle apply to the issue of independence at European level.’134 The role of
UEFA as associate partner, and the crucial consensus of the PFSC, a body within
the UEFA structure, for the work of the Social Dialogue Committee, jeopardise
the independence of the social partners and the legitimacy of the entire process
that is supposed to be free from interference by the government or regulatory gov-
erning bodies such as UEFA. The utility of placing items before the PFSC which
consists of the same members as the Social Dialogue Committee is questionable.
The differences are the influence of the UEFA which is higher in the PFSC than in
the social dialogue, and the fact that the ECA and the EPFL are basically sharing
one voice in the Social Dialogue Committee, whereas in the PFSC they have two
separate voices.
The main goal of the Work Programme of the Committee for the years 2008–
2009 was to discuss and disseminate the concept of Minimum Requirements on
Professional Football Player Contract throughout the EU Member States and pro-
mote studies, conferences, workshops and round tables in the new Member States
or Candidate Members.135 Two working groups were set up: the first concerning
the Implementation of the Minimum Requirements of Professional Football Player
Contract and the second on The Transformation of the Minimum Requirements
into a Collective Agreement at the European level. In March 2011, FIFPro
expressed its ‘bitter disappointment’ with the reluctance of the other three parties
to sign the agreement on minimum requirements for standard player contracts.
According to it, the Commission set the date of 5 April 2011 for the official sign-
ing ceremony which it then had to cancel.136 On 8 August 2011 FIFPro appeared
far more optimistic and hoped to sign the agreement during the meeting of the
PFSC to be held on 26 August 2011.137 The minimum requirements for profes-
sional football players’ contracts in Europe were finally agreed between the social
partners and UEFA in April 2012. The first collective bargaining agreement in
European football includes inter alia provisions on dispute resolution and applica-
ble law; defines the basic rights and obligations of club and players (for example,
it specifies the matters which must be included in the contract, such as salary,
health insurance, social security, paid leave, etc. and provides that players must
play matches to the best of their abilities, maintain a healthy lifestyle and high
level of fitness, behave in a sporting manner, not bring their club into disrepute,
etc.); and contains provisions on exploitation of image rights.138 The substance of
the terms remains a matter for negotiation between the parties to the contracts,
until and unless new collective agreements regulating substantive aspects are

134 Siekmann 2008, p. 95.

135 Ibid. Work Programme 2008–2010.
136 FIFPro news item ‘Only FIFPro is Ready to Sign Minimum Requirements’ 1 March 2011.
137 For details see Carvalho 2010, pp. 48–51.
138 Agreement regarding the minimum requirements for standard player contracts in the profes-

sional football sector in the European Union and in the rest of the UEFA territory, available at
http://ec.europa.eu/sport/news/documents/agreement_football_contracts_en.pdf.
86 3 Breakaway Leagues and Governance Issues in European Football

concluded between the social partners. In January 2013, the study on transfer of
players commissioned by the European Commission recommended that FIFA
should be invited to participate in the social dialogue as it is the competent body in
the field of international transfers and sets minimum rules in case of contractual
disputes.139 The study proposed that the European social dialogue take up and
issue and regulate the use of ‘buyout clauses’ in order to prevent abuse and exces-
sive payments, so that retrospectively the power of control exercised by judges
may be a useful complement to Article 17 of the FIFA Regulations. It also sug-
gested that the Committee should consider the following points: protection of
minors; excessive transfer fees; solidarity; fair and balanced competition; and rules
on non-EU players.140
Whereas the minimal formal contractual requirements are supposed to be easy
to implement by all clubs, certain substantive requirements might prove too diffi-
cult to implement by the clubs operating in small markets. The good news for
these clubs is that less than 2 % of the texts adopted by European social partners
are binding agreements, while the rest are soft measures such as declarations and
recommendations.141 This quantitative measure, however, does not imply that non-
binding agreements are not effective.142 Some substantive items stipulating mini-
mum requirements are therefore more suitable to be dealt by national-level social
partners (if such partners exist in a given European state) due to the homogenous
economic conditions prevailing on the statewide markets. Salary caps, on the other
hand, might become a subject of discussion on a pan-European level before the
Committee. In order to counter the negative effects on competitive balance (such
as the effects of player market liberalisation and increasing foreign ownership with
all its financial consequences), in addition to the adoption of Financial Fair Play
Regulations, UEFA’s President suggested the introduction of salary caps. Although
this particular item is thought to be difficult to implement in an open league sys-
tem,143 it is not impossible and might be necessary to design a working method of
implementation in view of growing competitive imbalance that has plagued
European football since the mid-1990s. In this sense, as long as the threat of
breakaway is not used to force compromises in the social dialogue process, having
UEFA participate in the social dialogue appears to be beneficial for interests of
least well-off stakeholders and the game of football as a whole. In a pyramid
model in which there would be a democratic stakeholder representation with

139 Study on the Economic and Legal Aspects of Transfers of Players (2013), p. 255. Available at
http://ec.europa.eu/sport/library/documents/f-studies/cons-study-transfers-final-rpt.pdf.
140 Ibid. p. 258.
141 Pochet (2007) European Social Dialogue Between Hard and Soft Law. European Union

Studies Association (EUSA) Tenth Biennial International Conference, Montreal, 17–19 May,
cited in Parrish 2011, p. 224.
142 Parrish 2011, p. 245.
143 See Martins 2009, p. 397.
3.4 New Trends in the Governance of European Football 87

democratic composition of the Executive Boards of the representative bodies,

UEFA’s presence would not be necessary. However, the changes in the state of
affairs in the governance of European football makes their presence necessary
because ‘[t]he […] social partners are not so concerned with improving the work-
ing conditions of an already cosseted category of worker, but are motivated by a
desire to exercise greater influence within football in order to control the wealth
generated from it’.144 Both the players and the clubs view the social dialogue as a
tool for pressuring FIFA and UEFA to improve their position within the football
governance structures.145

3.4.6.3 Comments

Participation as a partner in European social dialogue has given a valuable

resource to FIFPro outside of the UEFA structure, and the power to influence the
affairs and protect the interests of its members. Similarly, representation on the
PFSC within the UEFA structure has also given FIFPro a voice in football govern-
ance. In fact, the social partners involved in social dialogue and the bodies repre-
sented in the PFSC are exactly the same parties. The worrying trend in European
football is that players, clubs and leagues from non-EU countries—save for
Switzerland where UEFA and FIFA have their headquarters—and other European
football nations that are not in the top 5–9 on the UEFA coefficient rankings have
no proper representation in any of the social partner bodies regardless of their
membership. It should be remembered that country ranking is directly related to
the performance of their clubs in European competitions, while competitive per-
formance is directly correlated to the amount of money that clubs have to spend.
Even though they will not be in any of the EPFL leagues, or on the ECA Executive
Board, and their players will not get to decide on any of the FIFPro affairs, the
collective bargaining agreements will apply to them. In this sense, it is absolutely
necessary to have proper representation on the ECA, FIFPro and the EPFL of
those belonging to the non-elite end of professional football. There are at least two
different stakeholders within each of these bodies (the best-off and the worst-off)
and their presence and difference of interests, to the extent it exists on specific
issues, should be acknowledged formally by giving them equal voice in decision-
making. Therefore, even though a form of stakeholder representation is taking
place, it is the rich that ultimately make the decisions in European football due
to the structure of the boards and the representatives of ECA, EPFL and FIFPro
in the social dialogue process and on the PFSC. It is exactly because of these
inequalities that the pyramid structure survives.

144 Parrish and Miettinen 2008, p. 49.

145 Parrish 2011, p. 225.
88 3 Breakaway Leagues and Governance Issues in European Football

3.4.7 UEFA Club Licensing and Financial Fair Play

Regulations

The changes that have taken place since 2004 in regards to the club licensing
­system have led to yet another departure from promotion and relegation, the defin-
ing feature of the European football model. Changes to the club licensing system
are largely viewed as a positive development contributing towards good govern-
ance in sports, and are based on key principles of transparency, integrity, credi-
bility and capability. Article 2 of UEFA Club Licensing and Financial Fair Play
Regulations, edition 2012, (CLFFP Regulations) sets out as its objectives, inter
alia, to promote and improve the standard of all aspects of football in Europe, and
specifically to: ensure an adequate level of management and organisation; to adapt
clubs’ sporting infrastructure to provide players, spectators and media represent-
atives with suitable, well-equipped and safe facilities; to allow the development
of benchmarking for clubs in financial, sporting, legal, personnel and adminis-
trative, and infrastructure-related criteria throughout Europe; and to encourage
responsible spending for the long-term benefit of football. Each club that wishes
to compete in UEFA-organised competitions must fulfil a series of defined quality
standards annually to obtain a license and thus gain admittance to those competi-
tions. Licenses are granted by the national associations and confirm that a quality
level required by the CLFFP Regulations is achieved. There are 36 specific crite-
ria of the licensing system that can be broken down into five principal categories:
sporting criteria (Articles 17–23 of CLFFP Regulations), infrastructure criteria
(Articles 24–26 of CLFFP Regulations), personnel and administrative criteria
(Articles 27–42 of CLFFP Regulations), legal criteria (Articles 43–46 of CLFFP
Regulations), and financial criteria (Article 46bis-52 of CLFFP Regulations).
The club licensing system has been seen as a ‘good instrument to help improve
the financial stability of the clubs, to increase transparency and business credibility
of club operation and thus deliver the short and long-term benefits for clubs and
football as a whole’.146 Ensuring that clubs remain solvent throughout the compe-
tition and that they do not drop out or play with a depleted squad because they
cannot pay their players also acts to protect the interests of players and the pub-
lic.147 A Commission Staff Working Document mentions ensuring of financial sta-
bility of sport clubs/teams as one of the objective justifications as it relates to the
organisation and proper conduct of competitive sport.148 Whereas the introduction
of these rules seems like a positive step forward for European football as a whole,
the downside of it is that the criteria are easier to fulfil for the wealthier clubs in
good competitive standing which is another factor on the list contributing towards
the diminishing of the principle of promotion and relegation, and widening the

146 Arnaut Report, para 3.53.

147 Ibid. para 3.52.
148 Annex I, para 2.1.5.
3.4 New Trends in the Governance of European Football 89

gulf between the best and the rest.149 There are 730 clubs playing in the top
­divisions of the 53 national associations. Of these 730, only 608 applied for the
license for 2009/2010 season. Of the 608 clubs that applied, 110 were refused a
license for their inability to fulfil various criteria listed in CLFFP Regulations.
Between 2005 and 2009, 49 clubs that directly qualified for one of the UEFA
clubs competitions on sporting merit, were refused a license for their inability to
meet some of the licensing criteria. All of them came from some of the poorest
European countries.150 Refusal to license them directly denied them the access to,
and the benefits of participation in, the UEFA competitions, further worsening
their financial situation. Benefiting from the system of promotion and relegation is
no longer a matter of sporting merit alone—it is a privilege that must be paid for
by those who can afford it. In addition to a refusal to be licensed, the clubs also
may suffer sanctions ranging from warning to fines, and may be a subject to disci-
plinary proceedings on a national level.
The concept in the second part of CLFFP Regulations (FFP) was added in 2009
and regulates the score on the clubs’ balance sheets. In essence, the licensed clubs
are required to (at least) break even in a given monitoring period,151 and comply
with other designated criteria.152 The introduction of FFP into European football
was prompted by the increasing trend for the clubs to spend more than they earn.
In some cases such practice was enabled by the wealthy owners whose invest-
ments would set-off any financial losses,153 whereas in other cases it led clubs to
insolvency.154 It is to be remembered that the sustainability of the contemporary
model of financing for professional clubs depends on a dynamic equilibrium
between a club’s spending on wages and its media revenues.155 As discussed in
Sect. 1.2, the value of media rights has steadily increased over the past 15 years or
so. However, the player wages and their value on the transfer market increased at a
rate beyond that of revenues from the sales of media rights. Clubs were overspend-
ing on inflated player wages to remain competitive in the sporting sense, which
left many of them in financial trouble. Clubs accounts are being monitored under
FFP since the beginning of 2011/2012 season and the first assessment will take
place in the 2013/2014 season.
In May 2013, a legal challenge to FFP was brought before the European
Commission by the Belgian football player agent Daniel Striani. He argued that

149 Caldow 2002.

150 UEFA publication: The European Club Footballing Landscape—Club Licensing
Benchmarking Report Financial Year 2008, p. 21.
151 For definitions of break even requirement and temporal scope of a monitoring period see

Articles 57–63 of UEFA Club Licensing and Financial Fair Play Regulations 2012.
152 Articles 64–68 of UEFA Club Licensing and Financial Fair Play Regulations 2012.
153 Chelsea and Manchester City are the most well-known examples of such clubs.
154 Portsmouth Football Club was the only FA Premier League club to enter the formal insolvency

proceedings in 2010. See Szymanski 2012, p. 2, available at http://college.holycross.edu/RePEc/s

pe/Szymanski_Insolvency.pdf.
155 Andreff 2009, p. 695. For more on financing of the football clubs see Sect. 2.3.2.
90 3 Breakaway Leagues and Governance Issues in European Football

the break even rule restricts outside investment into clubs and slows down the
transfer market and salary levels, thus negatively affecting his revenue and
income. He also argued that the break even rule effectively entrenches the hegem-
ony of already dominant clubs, by preventing other clubs from breaking through
by operating at a loss (for example, by exploiting the benefactor owner model that
would allow them to compete with dominant clubs who utilised the benefits of this
model for years).156 Hence, free of movement of capital, free movement of
­workers and freedom to provide and receive services were at stake.
It has been generally accepted that a club’s ranking is directly correlated with
the club’s wage spending so that spending more on wages translates to on-pitch
success.157 At the time of writing, the Commission has not yet responded to
Striani’s complaint. In general, however, it has been supportive of FFP. Answering
to a Parliamentary Question in August 2010 (E-4628/10) Commissioner for
Internal Market and Services, Michel Barnier, declared that
[t]he Commission would also like to draw the Honourable Member’s attention to self-­
regulatory measures taken by the football sector to reduce the overall level of debt of
clubs. On 27 May 2010, UEFA’s Executive Committee approved the Financial Fair Play
Regulations with the aim of ensuring the long-term financial stability of European football
clubs. The Commission considers that the rationale of UEFA’s plan seems to be in
­accordance with one of the objectives of the EU’s action in the field of sport, namely with
the promotion of fairness in sporting competitions (Article 165 TFEU). The Commission
also notes that any measure taken in this framework has to respect the EU’s Internal
Market and competition rules.158

Furthermore, on 21 March 2012 the Commission issued a joint statement with

UEFA, drawing a parallel between the broad objectives of FFP and EU State Aid
rules under Article 107 TFEU, both of which are directed at encouraging under-
takings (i.e. the clubs) to operate within their own means without the need for
additional financial injections.159 EU State Aid rules are designed to prevent unau-
thorised public assistance in cases of undertakings in financial difficulties, as all
market operators should compete on a level playing field without receiving any
special advantage. According to the joint statement, there is a significant risk that
football clubs will increasingly apply for financial help to the public authorities in
order to be able to continue playing professional football.160 This might be more
related to fear that the application for assistance from the public purse could not be

156 See Nixon 2013, available at http://e-comlaw.com/sportslawblog/.

157 See, for example, Highlights of Deloitte Annual Review of Football Finance (2012), p. 10.
Available at http://www.deloitte.com/assets/DcomUnitedKingdom/Local%20Assets/Documents/
Industries/Sports%20Business%20Group/uk-sbg-annual-football-finance-review-2012-
highlights.pdf. See also Kuper and Szymanski 2012, p. 14.
158 Cited in Szymanski 2013 (guest post by Professor Stephen Weatherill), available at

http://www.soccernomics-agency.com/?p=469.
159 Joint Statement by Vice-President Joaquín Almunia and President Michel Platini, 21 March

2012, available at http://ec.europa.eu/competition/sectors/sports/joint_statement_en.pdf.

160 Ibid. para 12.
3.4 New Trends in the Governance of European Football 91

refused to clubs, than to the fact of application itself. As Weatherill points out, ‘in
a “normal” industry [the over-indebtedness] would be disciplined by bankruptcy.
In football we cannot simply send famous clubs into oblivion.’161
There is a general consensus among both economists and lawyers that FFP will
further reduce rapidly fading competitive balance in European football. Weatherill
says that ‘FFP does not contribute to competitive balance’ and ‘it may even turn
out to be a mechanism that stabilises competitive imbalance.’162 Simmons agrees
and contends that ‘overzealous application of the [FFP] rules generates a
­significant risk that the dominance of the strong clubs will be enhanced, while the
financial instability of lower division teams in national associations is not
addressed.’163 Having researched the direct correlation between wages and the
sporting success Flanagan noted that ‘it is ostensibly in the interest of healthy
competition to obviate imbalance. FFP will not do this; clubs remain at liberty to
spend the money they generate and there is a significant variation thereby.’164 This
could be one of the reasons for strong support given to FFP by the ECA.165 Had
the ECA been dissatisfied with the new regulations and had FFP had positive
effect on competitive balance
Europe’s leading clubs could chose to simply relieve themselves of UEFA’s regulations
altogether by forming a breakaway European competition, perhaps in the form of a
European ‘Super League’, the prospect of which has been mooted by leading authorities
within the game (for example, in 2009, Arsenal manager Wenger suggested that a
European Super League may be formed ‘in 10 years’ with the addition that such a change
would be more likely ‘if the rules become too restrictive for these [leading European]
clubs’).166

Commenting on FC Barcelona’s EUR 69 million loss on its 2009/10 balance

sheet, Simmons said that ‘a threat by UEFA to exclude Barcelona from the
Champions League cannot be credible. These clubs could join with others to
threaten formation of a rival league similar in format to the Champions
League.’167 This could have been the case had UEFA introduced in its initial
­proposal to apply the rule only to the clubs with turnover of more than EUR
50 million. ECA rejected this proposal and thought that all clubs should be treated
in the same way. However, treating the different situations (for example, clubs in

161 See his guest post in Szymanski 2013.

162 Ibid.
163 Simmons 2012, available at http://www.voxeu.org/article/own-goal-uefas-financial-fair-play-

initiative-misguided.
164 Flanagan 2013, p. 162. See also the comment of Bosman’s lawyer Jean-Louis Dupont in

‘Football’s Anticompetitive Streak’ Wall Street Journal, 25 March 2013.

165 European Club Association ‘ECA Calls on Member Clubs to Adhere to Financial Fair Play

Rules’ 11 September 2012. Available at http://www.ecaeurope.com/news/eca-calls-on-member-

clubs-to-adhere-to-financial-fair-play-rules/.
166 Flanagan 2013, p. 157.
167 Simmons 2012.
92 3 Breakaway Leagues and Governance Issues in European Football

the FA Premier League and clubs in the Estonian Premium Liiga) in the same way
may amount to discrimination as much as treating the same situations in a differ-
ent way. It also goes against competitive balance. Once again, wealthy clubs that
run the ECA improved their position in relation to the rest of the European clubs
who, if they had any vote in European football governance, would certainly not
reject UEFA’s initial proposal.
As the CLFFP Regulation demonstrates, the prospect of formation of breaka-
way league by European elite clubs is deeply ingrained in the mind of the gov-
erning body. UEFA will therefore continue to take outmost care of the wealthy
clubs’ interests when adopting important rules and regulations to govern European
football.

3.5 Risks in the Commercial and Legal Environment

There are several reasons which can explain why the breakaway league in football
has not materialised by now. First and foremost, there are certain commercial risks
involved. Operating within the wider regulatory and organisational monopoly of
UEFA is safer than going it alone. Were the clubs able to accurately anticipate a
positive response from the demand market in its broadest sense, and a favourable
response in the legal environment it would make commercial sense to part ways
with UEFA. However, economic evidence tells us that, in general, quantitative
increase in output (more games) will not necessarily create more profit.168 Data
from 2006 revealed the process of slowing down in TV rights fees paid to profes-
sional football,169 but the more recent figures illustrate that broadcasting market
has not reached its ceiling.170 Large adjustments in the production of the sporting
contests most often occur where the nature of the existing arrangements was
‘clearly not meeting objectives’ of the clubs, or where it failed to meet the demand
of the fans.171 Europe in general does not have problems with fan interest nor does
the current structure of the production process clearly go against clubs’ objectives.
The Chief Executive of Liverpool FC was of the opinion that an alternative league
did not materialise thus far because the Champions League was so successful and
the clubs were broadly happy with it.172 Nevertheless, he did not exclude the pos-
sibility that a trend of increase in foreign ownership may provoke a change of
heart. Indeed, there is no doubt that if an investment company from, say, China,
the UAE, or Russia offered the clubs a 10-figure sum that they cannot refuse, and a

168 See Andreff 2009, p. 693.

169 Andreff and Bourg 2006, p. 37.
170 See Sect. 1.2.
171 Borland 2009, p. 24.
172 An interview with Rick Parry, Chief Executive of Liverpool Football Club 1998–2007 and a

former head of the Premier League, 2 June 2011.

3.5 Risks in the Commercial and Legal Environment 93

deal that UEFA could not match with any concessions, the structure of football in
Europe would change. Basic economic theory suggests that sunk costs should not
be allowed to affect one’s investment decisions. In addition, the elite clubs them-
selves would probably have disagreements concerning their joint strategies and the
compromises made would entail missing out on many Pareto improvements. This
would be counterproductive to the economic efficiency objectives of a breakaway
league.
Secondly, as will be discussed in Sect. 7.9, clubs in breakaway leagues them-
selves may breach EU laws (in fact, they might already be doing so by abusing
collective dominant position), so there are legal issues which might interfere with
the optimal running of the league. Depending on the degree of separation from the
rest of the football community (i.e. how closed or open it would be to other
entrants, what access criteria would it adopt, its relationship with national associa-
tions, etc.), it is possible that the new league would be treated as a purely commer-
cial entity rather than as an entity that possesses specificities which can earn it a
soft application of the law and exempt it from, for example, application of Article
101 TFEU to collective sales of broadcasting rights. The breakaway leagues have
to remain integrated into the system of promotion and relegation, must make soli-
darity contributions to the rest of the football, and must remain under regulatory
purview of UEFA and national governing bodies to comply with the EU law.173 In
addition, the legal environment for the sporting industry is still in the process of
development, which makes it relatively unpredictable in certain situations (in this
case because the prospect of pan-European breakaway is a new issue that has
never been raised before). Both new and established rules are being challenged in
court and although the tests employed are familiar, the outcome might be surpris-
ing. One of the examples is the recent Murphy case.174 The Murphy case was
thought of as having the potential to bring big changes in the way that governing
bodies and leagues sell their rights, which could also have repercussions for the
alternative league’s prospects. Another potential constraint on such prospects
might be presented by the Article 14 of the Audiovisual Media Services
Directive175 that provides a possibility for Member States to draw up a list of
events which they consider to be of major importance for society to ensure that
broadcasters under their jurisdiction do not broadcast on an exclusive basis in such
a way as to deprive a substantial proportion of the public in that Member State of
the possibility of following such events via live coverage or deferred coverage on
free television. Judgments of the Court in a series of cases known as FIFA and

173 See Sect. 7.6.

174 For detailed analysis of this case see Sect. 4.10.
175 Directive 2010/13/EU of the European Parliament and of the Council of 10 March 2010

on the coordination of certain provisions laid down by law, regulation or administrative action
in Member States concerning the provision of audiovisual media services (Audiovisual Media
Services Directive), OJ L 95, 15/4/2010, pp. 1–24.
94 3 Breakaway Leagues and Governance Issues in European Football

UEFA v Commission176 confirmed that sporting events such as the FIFA World
Cup and the UEFA EURO are single events and may be enlisted by the EU
Member States to be shown on free-to-air TV in their totality (as opposed to
enlisting only individual matches of major interest to society). This ruling may
apply to club competitions at least in the countries where club football is impor-
tant to big number of people, such as the ‘big five’ which are also the most lucra-
tive football markets for sale of football media rights. Because it may reduce the
value of broadcasting rights for the rights holders and exclusive broadcasters,
Article 14 of the Audiovisual Media Services Directive is at least potentially
affecting the development of a pan-European breakaway league.177
Perhaps the most telling of the risks involved in the formation of a breakaway
structure is the statement by Tom Dunmore who thought that ‘breaking away,
whilst possible, would be a huge gamble of unprecedented proportions in world
sports: never would so much money and prestige have been staked on a venture of
unknown dimensions’.178

3.6 Is the UEFA Champions League an Open

Competition?

The issues discussed in this chapter lead to the conclusion that the elite clubs in
Europe should be generally content with their status and influence in European
football structures. They play top football, have unmatched financial resources,
employ the top players, and may exert decisive influence over the matters per-
taining to European (and sometimes global) football. Institutionally, they have
gained a supreme status among clubs in Europe and run the show in the ECA.
UEFA rules and regulations facilitate the consolidation of their supremacy, ease
their access to prestigious pan-European competitions, and add to their budget
at the expense of slogans such as competitive balance and the system of promo-
tion and relegation. Solidarity contribution, which does not enhance the competi-
tive balance, is a small price to pay to remain in the structure that enables such a
state of affairs and in which there is not much external commercial risk to be con-
cerned about. It is a system that has been tried over long period of time and that
has worked well thus far.
Regarding participation in the UEFA Champions League, a number of clubs per
UEFA member association is determined in accordance with Article 2 of the

176 Case T-385/07 Fédération Internationale de Football Association (FIFA) v. Commission,

judgment of 17 February 2011, Case T-55/08 Union des associations européennes de foot-
ball (UEFA) v. Commission, judgment of 17 February 2011; and Case T-68/08 Fédération
Internationale de Football Association (FIFA) v. Commission, judgment of 17 February 2011.
177 See Hoehn and Kastrianki 2012, p. 12.
178 ’The G-14, Michel Platini, and the Bluff of the European Superleague’ Tom Dunmore, Pitch

Invasion, 7 November 2007.

3.6 Is the UEFA Champions League an Open Competition? 95

Regulations of UEFA Champions League 2012/13.179 Each association may enter

a certain number of clubs for the Champions League, in accordance with its
­position in the coefficient rankings. The numbers of representative clubs that an
association may enter ranges from one (winner in the top domestic league) to four
(winner, runner-up, third- and fourth-placed clubs in the top domestic league).
Accordingly, the top domestic leagues in England, Spain and Germany have four
places reserved for their clubs, while Italian and French associations may enter
three of their top domestic clubs. Associations occupying spots 16–53 on the
UEFA coefficient rankings may enter only one team (Estonia, Croatia, Northern
Ireland, Poland and Slovakia are some of these associations).180 The percentage of
titles won by three most successful clubs in the period between seasons 2000/2001
and 2011/2012 is 92 % in England, 100 % in Spain, 83 % in Germany, 92 % in
Italy, and 75 % France (similar numbers are also found in other countries). In the
same period an average of 50 % of titles were won by one and the same club.181
The margin remaining for all other clubs is slim, and those clubs that only occa-
sionally qualify for the Champions League are usually the same clubs. Clubs that
participate on a regular basis gain a major competitive advantage over other clubs
in their domestic league due to the financial rewards brought about by participa-
tion in, and progress through the different stages of, the UEFA Champions
League. The clubs from the big five that progress to the final stages of the UEFA
Champions League have most to gain (benefits such as TV exposure, popularity,
value of current and future sponsorship agreements, prize money, etc., increase the
longer that a club remains in the championship race). It was commented that
[t]he UEFA CL makes some concessions to being a Europe-wide club competition that is
open to clubs from smaller countries but in reality the [Champions League] only comes
alive in the later stages when it is the top clubs from the top leagues who have the largest
share of places and greatest chances of qualifying for the final stages. In other words we
do have a de facto European Superleague system but one that largely excludes large clubs
from small countries. The four or five top leagues act as successful platforms benefiting
from economies of scale, network effects and cross-platform effects which leagues from
smaller countries cannot match. The platform effects have been magnified by Pay TV
which taps into the willingness to pay of viewers for a well-defined fixture list of races,
matches and games with an uncertain outcome.182

Similarly, the study on transfer of players (2013) funded by the European

Commission finds that Europe is slowly embracing a de facto system of closed
leagues at elite level.183 It is clear that for most of the football clubs in Europe
even a mere participation in the top domestic and European leagues would not be

179 The Regulation is available at http://www.uefa.com/MultimediaFiles/Download/Regulations/

competitions/Regulations/01/79/68/69/1796869_DOWNLOAD.pdf.
180 Ibid. Annex IA.
181 Study on the Economic and Legal Aspects of Transfers of Players (2013), p. 7. Available at

http://ec.europa.eu/sport/library/documents/f-studies/cons-study-transfers-final-rpt.pdf.
182 Hoehn and Kastrianki 2012, p. 30.
183 See Sect. 4.4.3.1 for details of the study.
96 3 Breakaway Leagues and Governance Issues in European Football

a realistic aspiration but a fantasy: they have not much say in governance, and
­solidarity payments are clearly insufficient to remedy their situation to the extent
that can give them any conceivable chance to benefit from the defining features of
the open league model. The study on transfer of players (2013) recognises the
­latter point and proposes that solidarity schemes managed by UEFA and FIFA
should better address competitive imbalance. The study concludes that the solidar-
ity system ‘is skewed towards supporting the most successful clubs, which happen
to be the wealthiest in their respective leagues’ and thus ‘contributes to consolidat-
ing existing supremacies and fails to address the competitive imbalance. It is
reflected in the results of UEFA competitions year after year’.184
With competitive balance and the system of promotion and relegation becom-
ing more catchphrases than concepts in action, it appears that the elite clubs have
nothing to complain about and that they are already a part of a semi-closed system.
Therefore, the elite breakaway will materialise only if the alternative presents
clear advantages with low financial risk involved, or if the current structures fail
to produce comparable benefits as thus far (for example, due to overhaul of UEFA
rules to enhance competitive balance and make promotion and relegation workable
in practice; changes in legal environment and adverse consequences on the exploita-
tion market, etc.) to the extent that even a medium to high risk alternative becomes
economically more rational choice. Calculation of risks is a matter of detailed and
long-term planning that requires concerted efforts of all the parties involved, in
particular by the entity that will perform the league functions. Also, any possible
elite breakaway could not happen abruptly due to the running commitments by the
clubs—broadcasting and sponsorship deals, obligations to national associations and
a Memorandum of Understanding with UEFA are some of such commitments.

3.7 Conclusion

Pyramid structure as a classical European sports model has found its support in
many of the EU policy documents to the delight of the governing bodies, including
UEFA. However, the Commission makes clear that despite the fact that governing
bodies have the right to organise their sport in a way they see fit, this is conditional
on respect for EU law.185 The EU policy also includes the requirements of open-
ness, transparency and democratic representation of all affected stakeholders in the
decision-making by the governing bodies. Therefore, in a single federation system
the standard of governance ought to correspond to these requirements.
Until very recently UEFA had virtually exclusive power to decide on issues
affecting all aspects of European football. A power shift in the commercially sen-
sitive football governance structure emerged from the strategy of breakaway and

184 Study on the Economic and Legal Aspects of Transfers of Players (2013), p. 7.
185 See para 4.1 of the Commission Staff Working Document.
3.7 Conclusion 97

litigation threats by the elite clubs. It brought about the establishment of the bodies
like the ECA and the PFSC. This chapter argued that the form of decentralisa-
tion and co-regulation that has emerged is not a positive development for football
as a whole. Due to the structure of the Executive Boards and their representation
on the Social Dialogue Committee, the PFSC and the CCC, the only stakeholders
that are properly represented in the governance of football are the elite clubs and
their players. Even without a formal voice, they were able to steer the decisions of
the governing body in the desired direction whenever their commercial interests
were at stake, using the threats of litigation and breakaway. The effect of this new
model of governance so far has been wealth redistribution that favours the wealthi-
est to the disadvantage of those worse-off. This further widens the gap that exists
in the competitive strength of the football clubs. For more than one reason, the
process of social dialogue in professional football has a long way to go. Before
it can be used in its normative function, the social partners need to change from
within to give a formal voice that represents the rich clubs and rich players, as well
as the worse-off clubs and players, equally. The current broad membership is just
a smokescreen giving external legitimacy to otherwise undemocratic bodies. The
changes that have so far taken place are neither the right basis nor a step in the
right direction to alter the pattern in, and establish a truly representative model of
governance in European football.

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Chapter 4
EU Internal Market Law and Sport

Contents
4.1 Introduction to the General Principles and Analytical Framework...................................... 101
4.2 Case 36/74 Walrave and Koch [1974].................................................................................. 102
4.3 Case 13/76 Donà [1976]...................................................................................................... 103
4.4 Case C-415/93 Bosman [1995]............................................................................................ 104
4.4.1 Factual Background.................................................................................................... 104
4.4.2 The Judgment of the Court......................................................................................... 105
4.4.3 Comment..................................................................................................................... 108
4.5 Joined Cases C-51/96 and C-191/97 Deliège [2000]........................................................... 118
4.6 Case C-176/96 Lehtonen [2000].......................................................................................... 120
4.7 Case C-438/00 Kolpak [2003], Case C-265/03 Simutenkov [2005],
and Case C-152/08 Kahveci [2008]..................................................................................... 121
4.8 Case C-325/08 Bernard [2010]............................................................................................ 123
4.8.1 Facts of the Case......................................................................................................... 123
4.8.2 Analytical Overview of the Judgment......................................................................... 124
4.9 Cases T-385/07, T-55/08 and T-68/08 FIFA
and UEFA v Commission [2011].......................................................................................... 134
4.10 Joined Cases C-403/08 and C-429/08 Murphy [2011]...................................................... 136
4.10.1 Facts of the Case....................................................................................................... 136
4.10.2 Analytical Overview of the Judgment....................................................................... 137
References................................................................................................................................... 147

This chapter and Chap. 5 share a common purpose: to set out and discern the
principles underlying the application of the EU economic law to legal disputes in
the sports sector. Relevant economic provisions of the Treaty are centred on the
concept of an internal or single market, the accomplishment of which represents a
principal economic rationale for the EU. Article 26(2) of the Treaty defines the
internal market as comprising ‘an area without internal frontiers in which the free
movement of goods, persons, services and capital is ensured in accordance with
the provisions of the Treaties’. An important tool through which the Union acts in

© t.m.c. asser press and the author 2015 99

K. Pijetlovic, EU Sports Law and Breakaway Leagues in Football,
ASSER International Sports Law Series, DOI 10.1007/978-94-6265-048-0_4
100 4 EU Internal Market Law and Sport

achieving the goals of the internal market is the development of competition

policy that adheres to the principles of an open market economy with free compe-
tition, and ensuring freedom of movement of all factors of production. Together
with the customs and monetary union and the common commercial policy, these
areas form the core of the economic constitutional law of the European Union.1
During the integration process and introduction of non-market elements by
various Treaty amendments, Europe moved from a purely economic constitution
designed for a market-oriented system to the constitutional model which resem-
bles characteristics of a modern welfare state. Hence, the realisation of the internal
market project necessarily implicates the questions on interrelationship and bal-
ance between economic and social dimensions of the Union’s policy.
In very broad terms, the TFEU provides some answers on this interrelationship.
The horizontal social clause in Article 9 TFEU states that ‘in defining and implement-
ing its policies and activities, the Union shall take into account requirements linked to
the promotion of a high level of employment, the guarantee of adequate social protec-
tion, the fight against social exclusion, and a high level of education, training and pro-
tection of human health’. This article provides a mechanism which obliges the Union
(and its Member States) to mainstream social protection and include social objectives
across all other policy areas.2 Article 165 TFEU does not contain such a horizontal
clause and it does not have to be taken into account in the administrative and legisla-
tive actions of the Union that are not specifically connected to the exercise of contrib-
utory competence related to sport. However, all the social policy provisions of the
Treaty, including Article 165 TFEU, give the horizontal social clause a specific
expression and must be fully respected when it is applied. The reference in Article
165 TFEU to ‘the specific nature of sport, its structures based on voluntary activity
and its social and educational function’ gave an additional boost to the relevance of
those factors when examining the legality of restrictions to freedom of movement.3
But in terms of innovation, this reference ‘merely reinforces judicial possibilities
which were already open prior to the passage of the Lisbon Treaty’.4
In more concrete terms, the social dimension of the internal market was
acknowledged much earlier by both the Court and the EU legislation. For instance,
even back in the days of the European Economic Community, a worker was recog-
nised as more than just a factor of production and issues regarding workers were
therefore placed and treated in their broader social context.5 Justifications for the

1 Baquero 2002, p. 85.

2 Articles 11 and 12 TFEU, the environmental protection must be integrated and consumer pro-
tection must be taken into account in the definition and implementation of the Union’s policies.
Articles 8 and 10 are aimed at eliminating all inequalities between men and women, and all
forms of discrimination.
3 See Case C-325/08 Bernard, discussed in Sect. 4.8.
4 The Lisbon Treaty and EU Sports Policy Study (2010), p. 10.
5 See Preamble of Regulation 1612/68 on freedom of movement for workers within Community

OJ L 257 19.10.1968; and the Opinion of AG Trabucchi in Case 7/75 Mr and Mrs F v Belgian
State [1975] ECR 679.
4 EU Internal Market Law and Sport 101

breach of free movement provisions include an open list of public interest objec-
tives, to the exclusion of economic objectives. Conversely, with regard to competi-
tion law provisions, many authors consider that the available exceptions should
not be polluted by non-competition arguments that cannot be translated into eco-
nomic efficiencies/benefits.6 The tensions created by similar considerations form
the underlying layer for many EU sports law analyses. Sports cases provide a good
example of the interplay between the Union’s economic and socio-cultural and
educational policy goals, as well as between certain aspects of the free movement
and competition law.

4.1 Introduction to the General Principles and Analytical

Framework

The relevant TFEU provisions on free movement are those applicable to: workers
in Articles 45–48; establishment in Articles 49–54; services in Articles 56–62 and
goods in Articles 28–37. The aim of these Treaty provisions is to eliminate all
physical, technical, fiscal and other obstacles to trade between Member States in
order to merge their markets into a single market reproducing as close as possible
the conditions of a domestic market.7 Moreover, the provisions conferring substan-
tive rights onto their respective subjects of protection are directly effective and as
such can be relied on before the national courts.8 In the case of conflict between
any directly effective provision of EU law and any Member State national law, the
conflicting national law will be ‘disapplied’ to the case at hand in accordance with
the principle of supremacy.9
Market access, and non-discrimination on the basis of nationality (equal treat-
ment) are at the core of the free movement provisions, and any departure from these
principles has to be justified. Offending Member States may rely on an exhaus-
tive list of derogations in the Treaty, or a non-exhaustive judicially-recognised
set of derogations, to objectively justify their restrictive or discriminatory measures.
The latter set of derogations is generally reserved only for indirectly discrimina-
tory measures (the measures which are non-discriminatory in law but are discrimi-
natory in fact) and non-discriminatory measures (measures which are genuinely
non-discriminative but impede market access). Finally, where it is accepted that
the measure pursues a legitimate aim in the public interest and therefore justifies
the restriction on the economic freedoms, a Member State will have to show that

6 See, for example, Semmelmann 2008, p. 15.

7 See Case 270/80 Polydor Limited and RSO Records Inc. v. Harlequen Records Shops Limited
and Simons Records Limited, [1982] ECR 329, para 18; and Case 15/81 Gaston Schul Douane
Expediteur BV v. Inspecteur der Invoerrechten en Accijnzen, Roosendaal [1982] ECR 1409.
8 See Barnard 2010, pp. 233–235.
9 See Case 106/77 Amministrazione delle Finanze dello Stato v. Simmenthal SpA [1978] ECR

629; and Cases C-10-22/97 Ministero delle Finanze v. IN.CO. GE’90 Srl [1998] ECR I-6307.
102 4 EU Internal Market Law and Sport

the measure is proportionate (i.e. suitable and necessary for the achievement of the
objective).
The debate surrounding the nature of the relationship between EU law and sport
began in 1974 with the Walrave judgment. Ever since, the Court has followed the
standard ‘restriction-justification-proportionality’ analytical framework in the
application of internal market rules in legal disputes involving the sports sector.
The only structural irregularity in the Court’s analysis is the opening of the ave-
nue of justification on the basis of non-Treaty derogations for directly discrimi-
natory measures. This irregularity became the rule rather than the exception in
sport-related cases. It is submitted that this exception should have general appli-
cation in internal market law. An open list of justifications should be available to
all measures whether directly discriminatory, indirectly discriminatory or merely
restrictive. The proportionality test is a sufficient means of control and directly dis-
criminatory rules will seldom satisfy its requirements. And should they satisfy it,
what is the harm in having the legitimate aim protected in the least restrictive way?
Despite the seemingly standard approach, accompanied by one structural irreg-
ularity, matters are in fact more complicated by the notion of ‘sporting exception’,
to which we will revert in Chap. 6 after having set out the application of the inter-
nal market and competition law in sports cases.

4.2 Case 36/74 Walrave and Koch [1974]

Two Dutch professional pacemakers, Walrave and Koch, competed in motor-paced

bicycle races. In this sport, each participant on a pedal-powered bicycle (the so-
called ‘stayer’) follows his own motor-powered pacemaker (‘pacer’). Due to the
vacuum that the pacers create, the stayers can achieve speeds of up to 100 km/h.
A stayer and a pacer form a team. Walrave and Koch were among the best pac-
ers in the world. When the Dutch representatives did not perform well in interna-
tional competitions, Walrave and Koch decided to offer their services to stayers of
other nationalities, in particular Belgians and Germans. But the rules of the Union
Cycliste International changed and provided that as of the year 1973, the pacer and
stayer in international competitions had to be of the same nationality. Walrave and
Koch saw this rule as discriminatory on the basis of nationality and as a severe
restriction on their professional opportunities. Therefore, they claimed a breach
of the general non-discrimination provision under Article 18 TFEU, of free move-
ment of employed persons under Article 45 TFEU, and of freedom to provide ser-
vices under Article 56 TFEU.
The Court had never before dealt with a sports case and it first had to be consid-
ered whether the Treaty extended to the area of sport. In para 4 of the judgment the
Court famously held that ‘the practice of sport is subject to Community law only in
so far as it constitutes economic activity […]’.10 As to the prohibition on nationality

10 Case 36/74 Walrave and Koch v. Union Cycliste Internationale and others [1974] ECR 1405.
4.2 Case 36/74 Walrave and Koch [1974] 103

discrimination in Articles 18, 45 and 56 the Court said in para 8 that it ‘does not
affect the composition of sport teams, in particular national teams, the formation of
which is a question of purely sporting interest and as such has nothing to do with
economic activity’, adding in para 9 that ‘this restriction on the scope of the provi-
sions in question must however remain limited to its proper objective’. This holding
became known as the sporting exception in EU law. Accordingly, the Treaty would
also not apply to economic sporting activities so long as the motive for the rules was
non-economic, in other words, ‘purely sporting’.
One of the important questions for general EU law that was raised in the Walrave
case related to the horizontal direct effect of the Treaty Articles 18, 45 and 56. The
respondent in the case, Union Cycliste International, was not a governmental body
governed by public law but a private organisation. The Court held that the prohibition
on discrimination in those articles ‘does not only apply to the action of public authori-
ties but extends likewise to rules of any other nature aimed at regulating in a collective
manner gainful employment and the provision of services’.11 A different approach by
the Court would risk creating inequality in the application of the law to legal relation-
ships in the private and public sectors and would jeopardise the accomplishment of
the internal market. Later in the non-sporting cases of Defrenne12 and Angonese13 it
was clarified that the respondent body need not regulate gainful employment in a col-
lective manner to be a subject of the discrimination prohibition, and that the rule on
horizontal direct effect in Walrave extends to contracts between individuals.14

4.3 Case 13/76 Donà [1976]

Under the rules of the Italian Football Federation (FIGC), players are required to
have a federation membership card. Only the FIGC could issue such cards and,
in principle, only players of Italian nationality residing in Italy could be issued
a card. As an exception from this rule, foreign nationals who have never been
members of a foreign federation, who were residents in Italy and who asked to
be enrolled as youths, amateurs or for recreational purposes could also obtain the
membership card. Thus, the precondition to take part in matches as professional or
semi-professional players (i.e. affiliation to the federation) was in practice limited
almost exclusively to Italian nationals. A challenge to these rules was brought by
Mr. Donà, an agent in Italy who was recruiting players from abroad at the request
of the president of an Italian football club. In essence, the Court was asked to
decide on whether the nationality requirement for playing professional football

11 Ibid. para 17.

12 Case 43/75 Gabrielle Defrenne v Société anonyme belge de navigation aérienne Sabena
[1976] ECR 455.
13 Case C-281/98 Roman Angonese v Cassa di Risparmio di Bolzano SpA [2000] ECR I-4139.
14 However, see Barnard 2010, p. 234, for the argument that the direct effect in this and other

sports cases is an extended form of vertical direct effect.

104 4 EU Internal Market Law and Sport

matches in Italy was compatible with Articles 18, 45 and 56 of the Treaty (origi-
nally in the case Articles 7, 48 and 59).
In Donà,15 the Court reformulated and confirmed the sporting exception from
Walrave. In paras 14 and 15 it held that those provisions of the Treaty do not prevent
14. […] the adoption of rules or of a practice excluding foreign players from participation
in certain matches for the reasons which are not of an economic nature, which relate to the
particular nature and context of such matches and are thus of sporting interest only, such
as, for example, the matches between national teams from different countries.
15. This restriction on the scope of the provisions in question must however remain lim-
ited to its proper objective.

The rule in Donà modified and restricted the rule in Walrave to the extent that the
exception for composition of national teams was reformulated to the exclusion of the
players from participation in certain matches for the reasons of ‘sporting interest only’.
Almost two decades after Donà, Advocate General Lenz said in the Bosman
case that
[…] the wording of the Donà judgment represents a limitation of the proposition adopted
in Walrave. That is evident merely from the fact that the Donà case concerned the compo-
sition of teams. If the question of the composition of teams was indeed ‘of purely sporting
interest’, as the Court appeared to assume in Walrave, the Court could have contented
itself in Donà with a simple reference to that judgment. It rightly did not do so, since it
was presumably not unaware that the question of the composition of teams may very well
be dominated by non-sporting motives.[…] Neither the basis of the ‘exception’ nor its
extent can be deduced with certainty from the judgments.16

In an answer to the referring national court, in para 19, the Court specifically men-
tioned professional and semi-professional players as subjects of protection. The
reason for this was to distinguish the rules covering their activity from the rules
applicable to amateur, non-economic activities which presumably do not fall under
the protection afforded by the Treaty freedom of movement provisions.

4.4 Case C-415/93 Bosman [1995]

4.4.1 Factual Background

In Bosman,17 the Court was asked to consider a directly discriminatory ‘3+2’ rule
and non-discriminatory international transfer rules which restricted the professional
activities of football players. As regards the latter, the international and national foot-
ball associations had developed a detailed set of rules governing the transfer of play-
ers from one club to another. At the material time, football players’ contracts ran
until 30 June and were normally entered into for the period of one to a maximum of

15 Case 13/76 Gaetano Donà v. Mario Mantero [1976] ECR 1333.

16 Paragraphs 138–139 of his Opinion in Case C-415/93 Bosman.
17 Case C-415/93 Union Royale Belge Sociétés de Football Association and others v. Bosman

and others [1995] ECR I-4921.

4.4 Case C-415/93 Bosman [1995] 105

5 years. If they wished to retain the player, clubs had to offer a new contract before
the expiry of the contract, by 26 April of that year at the latest. In the event the player
was either not offered another contract or he did not accept the terms, they were
placed on a ‘compulsory’ transfer list between 1 and 31 May, subject to payment of a
compensation fee for ‘training’ calculated by multiplying the player’s gross annual
income by a factor varying from 2 to 14 depending on the player’s age. If no transfer
took place in this period, a period of ‘free’ transfer commenced on 1 June in which
the transfer fees were negotiated and had to be agreed upon by the acquiring club
and the vendor. In any event, a club interested in hiring a player had to immediately
notify the old club, which in turn was to notify the national association, which issued
an international clearance certificate necessary for the international transfer to take
place. However, should the player’s transfer fail in the ‘free’ transfer period as well,
his old club was obliged to offer him a contract for one season on the same terms as
prior to April 26, and if the player refused he faced a suspension.
Jean Marc Bosman was a football player in the Belgian club, SA Royal Club
Liègeois (RC Liège). At the expiry of his contract in 1990 he refused an offer to
extend the contract at less favourable terms. After no club showed interest in him on
a compulsory transfer and the free transfer period started, he found a French club,
US Dunkerque, that wanted to hire him and agreed with RC Liège on the transfer
fee. However, concerned with the financial standing of the acquiring club, RC Liège
failed to apply for the necessary international clearance certificate from the Belgian
football association and the contracts between Bosman and US Dunkerque and
between RC Liège and US Dunkerque were not concluded. In accordance with the
rules of the Belgian football association, Bosman was then suspended by RC Liège
for the new season, which effectively prevented him from working anywhere. Via
a court order, Bosman secured the possibility to enter into a contract with any club
without the payment of transfer fee. However, he found it difficult to find steady
employment and suspected that he was being boycotted by most European clubs.
These transfer rules were challenged in the Belgian national court.
The other rule challenged was the so-called ‘3+2’ rule according to which each
national association was permitted to limit to three the number of foreign play-
ers whom a club may field in any first division match in their national champion-
ships and matches organised by Union des Associations Européennes de Football
(UEFA), plus two players who have played in the country of the relevant national
association for an uninterrupted period of 5 years, including 3 years as a junior
(‘assimilated players’). The effect of ‘3+2’ rule was to impose quotas on clubs as
regards nationality and residence of their players.

4.4.2 The Judgment of the Court

4.4.2.1 Transfer Rules

Interpreting Article 45 TFEU with regard to its application to transfer rules, the Court
cited Donà and emphasised ‘the difficulty of severing the economic aspects from the
106 4 EU Internal Market Law and Sport

sporting aspects of football’, thus in a clear language extending the ‘sporting excep-
tion’ originating in Walrave to further exclude from the scope of the Treaty non-dis-
criminatory sporting practices and rules which, although economic in nature, can be
justified on non-economic grounds related to the particular nature and context of cer-
tain matches, and which are limited to their proper objectives.18 This was, in fact,
implied in paras 14 and 15 of Donà, however, in the context of nationality restrictions
and directly discriminatory rules. Having established that Article 45 applied to transfer
rules at issue because those rules regulated the terms on which professional sportsmen
can engage in gainful employment, and regardless of the fact that those rules regulated
business relationships between clubs, and not between a club and a player, the Court
found the existence of an obstacle to freedom of movement for workers.
It then brought the case under the standard objective justification analytical
framework established in Kraus and Gebhard19 under which those rules that
(1) pursued a legitimate aim compatible with the Treaty and were justified by press-
ing reasons of public interest, and that (2) were compatible with the principle of pro-
portionality will not breach the provisions on freedom of movement for persons.
Against this setting, ‘in view of the considerable social importance of sporting activ-
ities and in particular football in the [Union]’, the Court accepted as legitimate the
objectives of ‘maintaining a balance between clubs by preserving a certain degree of
equality and uncertainty as to results’, and of ‘encouraging the recruitment and train-
ing of young players’ in para 106 of the judgment. Finally, transfer rules were found
unsuitable for the attainment of the said objectives and failed the proportionality test:
107. […] the application of the transfer rules is not an adequate means of maintaining
financial and competitive balance in the world of football. Those rules neither preclude
the richest clubs from securing the services of the best players nor prevent the availability
of financial resources from being a decisive factor in competitive sport, thus considerably
altering the balance between clubs.
108. As regards the second aim, it must be accepted that the prospect of receiving transfer,
development or training fees is indeed likely to encourage football clubs to seek new tal-
ent and train young players.
109. However, because it is impossible to predict the sporting future of young players
with any certainty and because only a limited number of such players go on to play pro-
fessionally, those fees are by nature contingent and uncertain and are in any event unre-
lated to the actual cost borne by clubs of training both future professional players and
those who will never play professionally. The prospect of receiving such fees cannot,
therefore, be either a decisive factor in encouraging recruitment and training of young
players or an adequate means of financing such activities, particularly in the case of
smaller clubs.

This quote gained increased importance in the comparative perspective in the

Bernard case discussed below.
After the Court’s holding on the transfer system, the international transfer rules
had to be remodelled. The new rules provided that the players whose contract with

18 Ibid. para 76.

19 Case C-19/92 Kraus [1993] ECR I-1663 para 32; and Case C-55/94 Gebhard [1995] ECR
I-4165 para 37.
4.4 Case C-415/93 Bosman [1995] 107

their club had expired were ‘free agents’ and could be transferred without any fees.
The transfer fees were still applicable for in-contract players. The decision does
not concern the following: internal transfer rules between the clubs in the same
national association regarding their national players as it concerns a wholly inter-
nal situation (although national transfers must also abide by the same rules as a
matter of football regulations); transfer of non-EU nationals from one EU Member
State from another; transfers from the EU to third countries20 and the composition
of national teams. The legal principles devised in the judgment are applicable to
all sports, not only to football.

4.4.2.2 Nationality Clauses

Interpreting Article 45 of the Treaty with regard to nationality clauses, the Court
took an ‘obstacle approach’ and referred to Article 4 of Regulation 1612/6821 to
find that quotas such as those described are as much a restriction in the sporting
community as they would be in any other sector. Next, it assessed the application
of non-Treaty objective justifications with regard to the directly discriminatory
‘3+2’ rule, after it found that the rule cannot benefit from the exception estab-
lished in Walrave and Donà because it affected not just the participation in certain
matches but applied to all official matches and thus to ‘the essence of the activity
of professional players’. It brushed aside attempts to justify the ‘3+2’ rule under
the ordinary justification framework. First, it did not accept the argument that
quota clauses served to maintain the traditional link between each club and their
country, a factor submitted as enabling the public to identify with their favourite
teams and to ensure that clubs effectively represented their countries when taking
part in international competitions. The Court considered that a club’s link with a
Member State is no different than its link with locality, town or region in it that
there is no limit on fielding the players on the basis of those links when playing
national championships. Clubs participating in international competitions are not
chosen on the basis of nationality of their players but on the basis of results
achieved in their national leagues. Second, the Court dismissed the argument that
the quotas were necessary to create a sufficient pool of top national players to be
fielded in national representative team, by referring to the rule on compulsory
release of the players for representative matches which does not require players to
be registered with a club of the country they represent. Third, quotas were not

20 However, Fédération Internationale de Football Association (FIFA) later adapted its world-
wide international transfer rules to Bosman ruling as well.
21 Regulation (EEC) No. 1612/68 of the Council of 15 October 1968 on freedom of movement

for workers within the Community (OJ, English special edition, 1968 (II), p. 475). Article 4(1)
of this regulation reads: Provisions laid down by law, regulation or administrative action of the
Member States which restrict by number or percentage the employment of foreign nationals in
any undertaking, branch of activity or region, or at a national level, are not to apply to nationals
of the other Member States’.
108 4 EU Internal Market Law and Sport

suitable to maintain competitive balance between clubs, because the richest clubs
will be able to secure the services of the top national players just as they would be
able to engage the best foreign players. Finally, the fact that the quota rule was
drawn up in collaboration with the Commission did not shield it from judicial
scrutiny or provide any guarantees as to its compatibility with the Treaty as the
Commission does not have the power to authorise rules and practices that are con-
trary to the Treaty.22

4.4.2.3 Competition Law

Finally, it is interesting to note that the questions forwarded to the Court for pre-
liminary ruling also concerned the interpretation of competition law provisions
under Articles 101 and 102. Having found both types of rule contrary to Article
45, the Court considered it unnecessary to rule on the interpretation of competition
articles of the Treaty.23

4.4.3 Comment

Much has been said and written about every aspect of Bosman by academic law-
yers and economists, including its effects on the football industry and its applica-
tion to various issues in sport today.24 Therefore, rather than going into details of
everything that has already been said, the comment here is intended to contribute a
new perspective on certain aspects of the judgment to the extent possible in regard
to such a ‘congested’ research topic. Bosman has been credited as a case that insti-
gated the birth of EU sports law25 and increased player mobility.26 It is commonly
blamed for deepening the competitive imbalance between the rich and other clubs
in European football, and is criticised for refocusing the clubs’ business strategies
on buying players from the international market for football players rather than
working to develop homegrown talent and investing in youth training programmes,
thus inflating the value of the players on the international transfer market and con-
tributing to the financial instability of the clubs.

22 After this judgment, Arsenal and Chelsea were the first clubs to field an all-foreign start-up
line in their official matches. On a different note, even though the Court in Bosman was explicit
about prohibition of nationality quotas, in basketball they are maintained until today and nobody
has challenged them in a private action.
23 But see the Opinion of AG Lenz in Case C-415/93 Bosman that did address the competition

law issues.
24 See, for example, Blanpain 2003; Miettinen and Parrish 2008; Blanpain and Inston 1996; and

Késenne 2009.
25 See Parrish 2003, p. 17.
26 Gardiner and Welch 2000, pp. 107–126.
4.4 Case C-415/93 Bosman [1995] 109

The judgment in Bosman loosened the grip of monopsony held by the clubs and
the federations on the player labour market. In 2005, UEFA identified the following
problems that, in its opinion, threaten to damage the long-term interest of European
football: lack of investment in player training, reduction in competitive balance,
hoarding of players, weakening of national teams and erosion of local identity.27
Although UEFA never directly referred to these problems as being the results of the
Court’s judgment in Bosman, this was clearly implied for it would be impossible for
some of these problems to arise without the prior liberalisation of the player market.

4.4.3.1 The Current Transfer System in Football

The overhaul of the transfer system had far less effect on the player labour market
in comparison to abolition of quotas. The clubs easily adapted to modified trans-
fer rules as the system of rolling contracts became a part of their new strategy.
Such a system ensured that clubs maintained a transfer value of employed players
who were effectively prevented from acquiring a free agent status. This contractual
strategy is aided by Articles 13–18 of the Fédération Internationale de Football
Association (FIFA) Regulations on the Status and Transfer of Players outlining
the principles for maintenance of contractual stability between players and clubs
(which apply particularly strictly during the course of a season). Accordingly, a
player wishing to terminate his employment relationship with his club unilaterally
and without just cause may be subject to a buy-out clause set out in his contract
requiring him to compensate damages suffered by the club. The amount of com-
pensation is usually set so high, making it extremely unattractive, if not impos-
sible, for a player to leave. In addition, under Article 17(4) of the said FIFA
Regulations, sporting sanctions of up to 6 months of restriction on playing in offi-
cial matches may be imposed on a player, while a ban on registration of new play-
ers for two entire and consecutive seasons is imposed upon the club signing him
up. Regardless of these regulations and contractual restrictions, that were always
present in football in one or another form, professional players have been one of
the principal beneficiaries of Bosman as their wages have significantly increased
due to the liberalisation of the labour market by the abolition of the quota system.
In general, transfer of a player may be made against the following payments,
as applicable: fixed transfer fee between the clubs, fee compensation for breach
of contract due to the former club, conditional transfer fees, training compensa-
tion and solidarity contribution.28 Players can also be temporarily transferred (on
loan) to another club and such transfer is a subject to the same rules that apply to
‘ordinary’ transfers.29 In January, the study on transfer of players commissioned
by the European Commission revealed that in the period between 1995

27 UEFA—Investing in Local Training of Players: Key Messages. Available at http://www.uefa.c

om/multimediafiles/download/uefa/uefamedia/273604_download.pdf.
28 FIFA Regulations on the Status and Transfer of Players (2012), Annexe 3, Article 4(2).
29 Ibid. Article 10(1) of the Regulations.
110 4 EU Internal Market Law and Sport

(when the Bosman judgment was published) and 2011 the clubs’ transfer
expenditure in the EU (including both international and domestic transfers)
increased by 744 % (from ca. EUR 400 million to ca. EUR 3 billion) while the
number of transfers increased by 320 % (from 5,735 to 18,307).30 These
increases may be largely ascribed to two factors: one is the abolition of quotas
by the decision in Bosman, and another is the technological and structural
changes that took place in the media sector. The part of the judgment that relates
to transfers did not have such profound impact on the number of transfers or
their value. It simply enables those players that find themselves unemployed to
be free from any additional restrictions on their prospects to become employed
again. An aspect of the study on transfers that is relevant for the overall theme of
this volume relates to the competitive imbalance between clubs in European
football and the inability of the existing solidarity payments to positively affect
such imbalance. The line of logic that emerges from the study is as follows:
1. The study reports that 60 % of the value of transfer market is generated by the
clubs in the ‘big five’ leagues that include the German Bundesliga, the English
Premier League, the Italian Serie A, the Spanish La Liga and the French Ligue 131
(the value of transfer of superstar players reached a record EUR 94 million in
Cristiano Ronaldo’s transfer from Manchester United to Real Madrid32); the
evolution that has taken place in the transfer market affects the openness of
the competitions and questions the system of promotion and relegation and the
‘imperative of uncertainty’ in sport results33; and the percentage of titles rang-
ing from 75 % in France to 100 % in Germany were won by the three most
successful teams in the domestic league.34 Therefore, the study says, there is a
‘strong link’ between transfer expenditures and competitive strength/sporting
results at both national and European level—and current transfer rules do not
effectively address the competitive imbalance.35
2. Training compensations and solidarity mechanisms that are directly linked to
transfers account for only 1.84 % of the fixed transfer fees in Europe. This is insuf-
ficient to affect competitive balance in a positive way. At the same time, solidarity
schemes operated by UEFA tend to support the most successful and wealthiest
clubs in their domestic leagues. Solidarity payments to clubs that do not participate
in the UEFA Champions League represent less than 6 % of the total received by 32
clubs that do participate in that competition. Contrary to its goal of enhancing
competitive balance, this system is ‘consolidating existing supremacies’.36

30 Study on the Economic and Legal Aspects of Transfers of Players, p. 159. Available at

http://ec.europa.eu/sport/library/documents/f-studies/cons-study-transfers-final-rpt.pdf.
31 Ibid. p. 242.
32 Ibid. p. 196.
33 Ibid. p. 6.
34 Ibid. p. 7.
35 Ibid. p. 6.
36 Ibid. p. 7.
4.4 Case C-415/93 Bosman [1995] 111

3. The UEFA Champions League increasingly demonstrates the characteristics of

a closed league in which the same clubs compete for the title and they are the
main beneficiaries of the current transfer system which reinforces their domi-
nance at domestic and European level. Therefore, Europe is slowly embracing
the system of de facto closed leagues at the elite level.37
This conclusion is not surprising, but it is significant that an independent study
spelled it out and supported it with robust data. It is, however, submitted that the
conclusions drawn from the facts that exist on the transfer market are symptomatic
conclusions. The real causes of competitive imbalance are to be found elsewhere.
First and foremost, they may be traced back to the structure of the bodies that par-
ticipate in the governance of European football and the European social dialogue
(the European Club Association in particular), as well as in the possibility of for-
mation of a breakaway structure by big clubs that have used that prospect as a
threat in the game of power struggles with UEFA. Transfer rules are far from
being the only set of rules that produce data indicating the consolidating suprem-
acy of the elite clubs. As discussed in Chap. 3, creating the pool to compensate
clubs for player release for international representative matches of their national
teams benefited mostly rich clubs (18 clubs of G14 alone supplied 22 % of the
participating players in the World Cup 2006) and added to their budget.38

4.4.3.2 Legality of the Current UEFA Home-Grown Players Rule

In order to counter some of the negative effects of quota abolition by the Court’s
judgment in Bosman, UEFA proposed the introduction of the ‘home grown players
rule’.39 The rule requires clubs participating in the competitions organised by
UEFA (the Champions League, UEFA Europa League, and UEFA Super Cup) to
have a minimum number of home-grown players, i.e. players who, regardless of
their nationality, have been trained by their club or by another club in the same
national association for at least 3 years between the ages of 15 and 21. This num-
ber was set at 4 players in a maximum squad of 25 in the first season of applica-
tion (2006–2007), and it increased to 6 in 2007–2008. It finally rose to 8 out of the
maximum squad of 25 players in the 2008–2009 season.40
While the attempts of FIFA to re-introduce the directly discriminatory ‘6+5’
rule41 did not meet much sympathy in European institutions and was eventually

37 pp. 245–247.
38 For details see Sect. 3.3.6.1.
39 At the Ordinary Congress in Estonia in April 2005.
40 The home-grown players rule can be found in Article 18 of the Regulations of the UEFA

Champions League 2010/2011, Article 18 of the Regulations of the UEFA Europa League
2010/2011, and Article 15 of the Regulations of the UEFA Super Cup 2010.
41 According to the 6+5 rule, at the start of each match football clubs must field in at least six

players eligible to play for the national team of the country of the club.
112 4 EU Internal Market Law and Sport

dropped in 2010,42 some uncertainty still surrounds the legality of the home-
grown players rule. Generally, the rule found the support in the Commission43 and
the European Parliament.44 The latter reaffirmed ‘its commitment to the home-
grown player rule’ considering it as a possible model for other professional
leagues in Europe and supporting ‘efforts of sports governing bodies that stimulate
the training of local young players within the limits of EU law thus strengthening
the competitive balance within competitions and the healthy development of the
European sports model’.45 The reason for strong support might have been that it
was the part of the judgment in Bosman that abolished the player quota (rather
than the one that abolished the player transfer system and introduced free agency)
that has contributed to competitive imbalance and refocused clubs’ strategy away
from the home talent.46 But as the Court’s decision in Bosman coincided with the
boom in the commercialisation of the sports industry, it is difficult to apportion the
negative effects on competitive balance in football between player market liberali-
sation and a changing commercial environment. Influences were presumably
shared and the problems were brought about by a blend of both. In any case, tak-
ing a proportionate action to reverse some of the identified evils in order to attain
legitimate objectives is likely to be permitted under EU law. The Commission con-
sidered that these requirements were met by the home-grown players rule.47
To continue with a novel perspective on the issue of quotas, it should not be
overlooked that, although commonly referred to as directly discriminatory, there
were in fact two distinct parts of the ‘3+2’ rule in Bosman: one that was indeed
directly discriminatory as it limited the number of foreign players in clubs,
and the other one that limited the number of ‘assimilated players’ and as such
was only indirectly discriminatory. Nevertheless, the Court did not distinguish
between 3 and 2 in ‘3+2’ rule at any stage of analysis and instead it assessed the
rule in its entirety. The exact wording of the rule is contained in the Regulations
of the European Champion Club’s Cup for the 1992–1993 season, Title VIII on
‘Eligibility of Players’, Article 12 of which reads:
[…] 3. The sixteen (or fewer) players chosen by a club to take part in any match in the
competitions as indicated on the referee’s report form under article 10 para 3, of these
Regulations, shall not include more than three players who are not eligible to play for the
national team of the national association to which that club belongs.

42 At the 60th FIFA Congress meeting in Johannesburg in June Barnard 2010 it was decided to
withdraw the 6+5 proposal.
43 See Commission Press Release IP/08/807 ‘UEFA Rule on ‘Home-Grown Players’:

Compatibility with the Principle of Free Movement of Persons’ 28 May 2008.

44 See, for instance, European Parliament Resolution on the White Paper on Sport,

2007/2261(INI) and European Parliament Resolution of 2 February 2011 on the European

Dimension in Sport, 2011/2087(INI).
45 Ibid. 2011/2087(INI), para 72.
46 Ibid. p. 638.
47 Commission Press Release IP/08/807 ‘UEFA Rule on ‘Home-Grown Players’: Compatibility

with the Principle of Free Movement of Persons’ 28 May 2008.

4.4 Case C-415/93 Bosman [1995] 113

4. In addition, two names of assimilated (*) players may also appear on the referee’s offi-
cial report form if they have played for an uninterrupted period of five years in the country
of the National Association concerned, three years of which must have been spent in play-
ing youth football. Players who fulfil these conditions on the 1st July 1992 will be consid-
ered retrospectively assimilated.
[…]
(*) In clause 2 of the agreement between EC Commission and UEFA concerning the
reduction in the number of “non-selectable” players, the term “matches in the youth sec-
tor” is understood to mean all competitive activity by players younger than 19 years of
age on the deadline of 1st August. The matches must be played under the auspices of the
National Association of affiliated organisations.

Hence, in isolation from the first part, the second part of the ‘3+2’ rule reads as
follows:
The sixteen (or fewer) players chosen by a club to take part in any match in the com-
petitions as indicated on the referee’s report form under article 10 para 3, of these
Regulations, shall not include more than two names of assimilated (*) players.

In the eyes of EU law, the second part of the ‘3+2’ rule largely resembles the
home-grown players rule. It provides for the maximum of two assimilated players
of any nationality to be included in the list of 16 players who, when read in isola-
tion from the first part of the ‘3+2’ rule, may be of any nationality. There are some
quantitative differences between the indirect discrimination under the home-grown
rule and the isolated ‘assimilated players rule’ contained in Article 12(4) of the
Regulations of the European Champion Clubs’ Cup for the 1992–1993 season.
Whereas the latter limits the number of ‘assimilated players’ to maximum of two in
the squad of sixteen, the former has eight places reserved for home-grown players
in the squad of twenty-five. The home-grown rule also differs in terms of relevant
definitions. The assimilated player is someone who has ‘played for an uninter-
rupted period of 5 years in the country of the National Association concerned,
3 years of which must have been spent in playing youth football’ defined to
include ‘all competitive activity by players younger than 19 years of age’. The
home-grown player is a ‘locally-trained player’ which includes ‘club-trained’ and
‘association-trained’ players. ‘Club-trained’ is any player who, between the ages of
15 and 21 has been registered with his current club for a period, continuous or not,
of three entire seasons. The only differing criteria to qualify as ‘association-
trained’ is that a player has been registered with a club or clubs affiliated to the
same national association as his current club. There is a limit of four ‘association-
trained players’ per eight places reserved for ‘locally-trained players’. The main
distinction, however, is that under the home-grown rule, the match list of 18 play-
ers to be submitted before each match must have a minimum of one locally-trained
player who does not have to be fielded during the official matches, whereas the
rest of the squad may be all-foreign. Under the assimilated player rule, a maximum
of two assimilated players may be included on the match list of 16, or the club can
choose to have all-foreign list. The clubs that do not have eight home-grown play-
ers in their current squad are still able to comply with the UEFA rule by reducing
the size of their squad accordingly. In reality a club could contain no home-grown
114 4 EU Internal Market Law and Sport

players, but it would only be able to register 17 players in the squad.48 This would
make the home-grown rule equal to the assimilated players rule.
In accordance with the principles of subsidiarity and proportionality set out in
Article 5 of the Treaty on the European Union (TEU), the Court does not have
the competence to nullify Member States’ laws, private agreements between par-
ties, or rules of sporting organisations that are severable and can function indepen-
dently from the part of the law, agreement, or rule that was held in breach of any
provision of EU law, including the Treaty. In the context of competition, the Court
held that
[t]he automatic nullity […] only applies to those parts of the agreement affected by the
prohibition, or to the agreement as a whole if it appears that those parts are not severable
from the agreement itself. Consequently any other contractual provisions which are not
affected by the prohibition, and which therefore do not involve the application of the
Treaty, fall outside [Union] law.49

Principles of subsidiarity and proportionality dictate that the equivalent rule

should apply in the free movement area. In fact, Article 7(4) of Regulation
1612/68 on the free movement of workers makes a reference to nullifying ‘clauses
in collective or individual agreements’, implying their severability from the rest of
the agreement.50 By the same token, paragraphs in articles should be severable
from the articles wherever possible, and only the paragraph(s) of an article of
sporting rules and regulations that are held in breach of EU law should be
amended, replaced or deleted.
The ‘3+2’ rule is severable, as it is possible for Article 12(4) of the Regulations
of the European Champion Clubs’ Cup to exist and operate without the third para-
graph of that article, in other words, the assimilated player rule is logically and
operationally distinct from the nationality clause. Thus, treating the ‘3+2’ rule in
its entirety and declaring it in breach of Article 45 TFEU in its entirety, could be
read as the Court’s signal that indirect discrimination imposing player quotas on
all club’s matches will be treated in the same manner as nationality clauses impos-
ing player quotas on all club’s matches. Looking at UEFA’s current home-grown
rule through this prism, it appears prima facie that the ruling in Bosman unequivo-
cally dismissed any possible justifications for such an indirectly discriminatory

48 Study on the Assessment of the UEFA’s ‘Home Grown Players Rule’, negotiated procedure
EAC 07/2012, 30 April 2013, p. 58.
49 Case 56/65 Société La Technique Minière v. Maschinenbau Ulm GmbH [1966] ECR 235.

Similarly, in CEPSA, the Court held that ‘the automatic nullity provided for in Article [101(2)]
EC affects a contract in its entirety only if the clauses which are incompatible with Article
[101(1)] are not severable from the contract itself. Otherwise, the consequences of the nullity, in
respect of all the other parts of the contract, are not a matter for [Union] law’. See Case 279/06
CEPSA Estaciones de Servicio SA v. LV Tobar e Hijos SL, judgement of 11 September, 2008,
para 80.
50 The full text of this provision is: ‘Any clause of a collective or individual agreement or of any

other collective regulation concerning eligibility for employment, employment, remuneration and
other conditions of work or dismissal shall be null and void in so far as it lays down or authorises
discriminatory conditions in respect of workers who are nationals of the other Member States’.
4.4 Case C-415/93 Bosman [1995] 115

quota-setting rule: the ‘3+2’ rule as a whole was not suitable to maintain com-
petitive balance, maintain the traditional link between each club and its country
or create a sufficient pool of national players to provide the national team with top
players. Additionally, the fact that the rule was drawn up in collaboration with the
Commission did not shield the rule from the law nor did it provide any guarantees
in that regard. Aware of the principles of subsidiarity and proportionality, and the
severability of Article 12(4) in the Regulations of the European Champion Clubs’
Cup for 1992–1993 season, the Court would have clearly taken out of its reason-
ing the indirectly discriminatory ‘assimilated players’ rule, had it intended to pro-
duce no effects upon it. The home-grown rule being analogous to the ‘assimilated
players rule’ in its legal denomination as indirectly discriminatory (and being more
restrictive in quantitative terms as explained below) would clearly breach Article
45 TFEU if one is to formalistically apply this line of reasoning. However, things
are more complicated than this and there are two important qualifications to this
conclusion.
First, the reference to nationality alone in the Court’s answer in para 137 of the
judgment is somewhat puzzling:
…Article [45] of the Treaty precludes the application of rules laid down by sporting associa-
tions under which, in matches in competitions which they organize, football clubs may field
only a limited number of professional players who are nationals of other Member States.

One explanation for this reference might be, as already mentioned, that in the eyes
of the Court there is no difference between the direct and indirect nationality dis-
crimination when it comes to player quotas being imposed on all of the club’s
matches, and this attitude is merely reflected in the answer to the national court.
However, in the next paragraph the point will be made that the Court has only
treated this particular indirectly discriminatory rule as if it were directly discrimi-
natory, and that such treatment will not always apply in relation to rules which can
be formally classified as indirectly discriminatory quota-setting rules. Another
possible explanation, a more radical one and going against all Bosman interpreta-
tions for the past 18 years, would be that the Court never intended for its decision
to affect ‘the assimilated players’ rule. Taking into consideration that in applying
Article 101 TFEU in the area of competition law, the Court held that the questions
of severability of any clause in the agreement must be decided by national, not
Union law,51 perhaps the wording of the answer in para 137 was an indication to
the referring national court that it is only the nationality rule that is prohibited in
the ‘3+2’ rule? This line of argument would render the current UEFA home-grown
rule valid under the EU law, and all the past and ongoing discussions on the sub-
ject of its legality would become meaningless. But this is probably not the case.
Second, the inclusion of the sports article in the Treaty might prove significant
enough of a factor to warrant a different approach to the home-grown, in contrast
to ‘assimilated’, player rule, especially when it is considered in conjunction with

51 See, for example, Case 319/82 Société de Vente de Ciments et Bétons de l’Est v. Kerpen &

Kerpen GmbH & Co KG [1983] ECR 4173, para 11.

116 4 EU Internal Market Law and Sport

the fact that the Court’s recognition of the sporting arguments in the post-Lisbon
judgment of Bernard has somewhat changed due to the specificity of sport and its
socio-educational function, the relevance of which has been ‘corroborated by their
being mentioned in the second subparagraph of Article 165(1) TFEU’.52 Namely,
in Bernard the Court reversed the point made in para 109 of Bosman regarding the
unsuitability of transfer and training fees for the attainment of the objective of
encouraging recruitment and training of young players. This will be explained in
detail below when addressing the Bernard ruling, where I will argue that this
reversal is attributable to the additional weight that Article 165(1) TFEU gave to
the sporting arguments within the analytical framework of the Treaty’s economic
provisions. Analogical reasoning implies that this should be good news for UEFA’s
home-grown rule.

4.4.3.3 Study on the Home-Grown Players Rule

As a part of the strategy of moving towards evidence-based sports policies set out
in the White Paper on Sport, para 3.1, the European Commission has recently
funded a study53 to assess the impact of the home-grown players rule on competi-
tive balance and the training and development of young players, the two objective
justifications put forth by UEFA in defence of the restrictive effects of that rule on
the free movement of employed persons (Article 45 TFEU). If the home-grown
players rule could be shown to contribute to the achievement of these objectives,
and that other less-restrictive measures are not available, this would lead to the
conclusion that it is compatible with Article 45 TFEU. The statistics produced by
the study indicated that
[t]he number of home grown players actively taking part in both Champions League and
Europa League matches has increased dramatically since 2007 from 30 % to over 50 % in
2012. While it was a concern that home grown players were simply ‘making up the num-
bers’ and not actually participating in starting XIs this has been found not to be the case.
The data suggests that the Rule is not restricting the free movement of players across bor-
ders; in fact there has been an increase in the number of foreign players that qualify as
home grown.54

As it was not possible from that data alone to infer causation in relation to the
impact of the home-grown players rule, a regression analysis was performed (sep-
arately for the Champions League and the Europa League). From such analysis it
emerged that, by the time the home-grown players rule had been fully imple-
mented, there was a reduction in the performance of the teams in the Champions
League group stages possibly due to the fact that the teams’ purchases of players
from the international market were also somewhat reduced. Similar evidence was

52 Case C-325/08 Bernard, para 40.

53 Study on the Assessment of the UEFA’s ‘Home Grown Players Rule’, negotiated procedure
EAC 07/2012, 30 April 2013.
54 Ibid. p. 58.
4.4 Case C-415/93 Bosman [1995] 117

found, to a more modest extent, in the Europa League group stages. There was no
perceptible effect on the success of teams in reaching the finals’ stages of the
Champions League or becoming Champion. The contrary evidence of effects on
finals’ stages was found in the Europa League regarding the quarter-finals and
semi-finals, possibly due to the fact that the teams in that competition have less
access to the international market than the typical Champions League team.55
While it did appear from these facts that ‘some limitation of the players’ labour
market through encouraging the recruitment and retention of players from a home
association can constrain the success of higher ranked teams’, and while there has
been a small improvement in competitive balance in certain areas as a direct result
of the home-grown players rule, the study team considered it insufficient to make
an accurate scientific assessment of trajectory in the long run and avoided specu-
lating on whether the effect of the rule on competitive balance will increase or
decrease in the future.56 Therefore, ‘[f]or the purposes of the legal analysis, future
trajectory should be viewed as neutral until further data is available to measure the
effect over the longer term’.57 This recommendation suggests that the study was
undertaken too soon after the introduction of the rule to make any conclusive
statements in regard to the legality of the rule under Article 45 TFEU.
Nevertheless, the findings might provide useful data for other purposes.
Quantitative data regarding the effect of the home-grown players rule on the
training and development of young players in the clubs in the EU was inconclusive.
Qualitative interviews with UEFA, the Federation Internationale Des Associations
De Footballeurs Professionnels (FIFPro), the European Clubs Association (ECA),
the Association of European Professional Football Leagues (EPFL), and a number of
domestic federations and leagues revealed that the rule had ‘between “no impact”
and “little impact” upon their strategies for training and development of players’.58
Some clubs, particularly those with smaller turnovers and/or based in smaller mem-
ber states, suggested ‘that this was because the minimum number of home grown
players was too small’ to have any impact.59 Translated to the legal language of
Article 45 TFEU analysis, this means that, in the opinion of these clubs, the home-
grown players rule is unsuitable (i.e. incapable of achieving the goal) because it is
not restrictive enough. Only four clubs said that the home-grown players rule had a
significant positive impact on their strategy and investments in the training and
development of young players.60 Thus, very little evidence was found ‘that the
[home grown players rule] has had any significant impact on the quality of, or
investment in, the training and development of young EU players’.61

55 Ibid. pp. 60–61.

56 Ibid. pp. 61–62.
57 Ibid. p. 62.
58 Ibid. p. 68.
59 Ibid.
60 Ibid. p. 70.
61 Ibid. p. 71.
118 4 EU Internal Market Law and Sport

As the study team implied, these data should be taken as providing an interim result.
Similar information should be gathered again (in ca. 5 years) in order to assess the real
effect of the rule and reach more conclusive results, while at the same avoiding the post
hoc ergo propter hoc logical fallacy to the extent possible. The legal analysis of the
rule on the basis of data available revealed that ‘the neutrality or very limited positive
effect’ of the home-grown players rule on the twin objectives it was set to attain ‘must be
balanced against the impact the rule has on restricting a player’s freedom of movement’
as the restriction is currently not manifestly restrictive. Therefore, the rule seems propor-
tionate as its ‘limited restrictive effects do not appear to be disproportionate to the mod-
est benefits generated thus far’.62 This outcome was conditioned by two considerations:
[f]irst, should the benefits of the Rule diminish over time, the cost/benefit balance would
shift, thus rendering current proportionality arguments less persuasive. In order to establish
this, an additional future study into the Rule would be required. Second, alternative measures
could potentially achieve a more uniform and substantial impact in terms of competitive bal-
ance and youth development, and be less restrictive on the fundamental freedoms of EU
workers. If this were the case, the proportionality of the measure could not be made out.63

So the proportionality of the home-grown players rule could not be conclusively

established. It was proposed that UEFA should demonstrate that less restrictive alter-
native measures are not capable of securing the said objectives by discussing the
alternative measures with key stakeholders—a further study (in 3 years) should
assess the outcome of these discussions and report the results to the Commission.64

4.5 Joined Cases C-51/96 and C-191/97 Deliège [2000]

The governing body for judo in Belgium refused to give authorization to a Belgian
judoka, Christelle Deliège, to participate in a series of international competitions
(some of which were taking place in other EU Member States) because she failed to
achieve the necessary qualification criteria. Although judo governing bodies classi-
fied its members as amateurs, she believed she was carrying out an economic activ-
ity and relied on the economic rights guaranteed by Articles 56, 101 and 102 of the
Treaty. She brought two separate proceedings before the Tribunal de Première de
Namur. On a preliminary reference procedure, the Court was asked to rule on
whether it was contrary to those articles to ‘require professional or semi-professional
athletes, or persons aspiring to professional or semi-professional activity, to be
authorised by their federation in order to be able to compete in international compe-
tition which does not involve national teams competing against each other’.65

62 Ibid. p. 110.
63 Ibid.
64 Ibid. p. 112.
65 Joined Cases C-51/96 and C-191/97 Christelle Deliège v. Ligue francophone de judo et dis-

ciplines associées ASBL, Ligue belge de judo ASBL, Union européenne de judo and François
Pacquée [2000] ECR I-2549, para 22.
4.5 Joined Cases C-51/96 and C-191/97 Deliège [2000] 119

The Court first reiterated its previous decisions.66 It confirmed that sport is sub-
ject to EU law ‘only in so far as it constitutes an economic activity’ (Walrave para
4 and Bosman para 73), and that sporting activities are of considerable social
importance (Bosman para 106). It then added:
That case law is also supported by the Declaration on Sport (Declaration 29) annexed to
the final act of the Conference which adopted the text of the Amsterdam Treaty, which
emphasises the social significance of sport and calls on the bodies of the European Union
to give special consideration to the particular characteristics of amateur sport. In particu-
lar, that declaration is consistent with the abovementioned case law in so far as it relates to
situations in which sport constitutes an economic activity.67

The Court also confirmed the scope of the sporting exception as set out in Donà (paras
14 and 15) and Bosman (paras 76 and 127), but found that the selection rules at issue
cannot benefit from it. Henceforth, it confined itself to assessing the nature of the activ-
ity in question in the light of Article 56 on freedom to provide services. It said that ‘the
mere fact that a sports association or federation unilaterally classifies its members as
amateurs does not in itself mean that those member do not engage in economic activi-
ties’.68 The Court referred to the rule from Levin (para 17) and Steymann (para 13)
which requires that ‘the work performed must be genuine and effective and not such as
to be regarded as purely marginal and ancillary’,69 and the rule from Bond which
essentially states that services do not have to be paid by those for whom they are per-
formed.70 A high-ranking athlete’s participation in international competitions, such as
the Olympic Games, involves a number of separate but closely related services which
may fall under Article 56.71 First, organising a sporting contest offers an opportunity
for athletes to compete while giving exposure to their personal sponsors as a result of
their sporting activity. Second, it allows organisers to exploit the broadcasting rights
and sell tickets to events, which is in turn a great commercial interest to sponsors and
advertisers. Finally, Deliège received grants to train and compete on the basis of her
sporting achievements. Amateur athletes therefore do not automatically fall outside the
Treaty scope, but their activity has to be examined in the light of criteria as specified
by the Court. If, after such examination, it transpires that the activity in question con-
stitutes an economic activity (provision of services), it is necessary to consider whether
the rules governing the exercise of that activity (the rules on selection of athletes) con-
stitute a restriction within the meaning of Article 56 of the Treaty.72
The Court considered that selection rules which limited the number of partici-
pants in the high-level international competitions, and which did not involve

66 It cited paras 4, 17 and 18 from Walrave, paras 14 and 15 from Donà and paras 73, 76, 82, 83

and 127 from Bosman.

67 Joined cases C-51/96 and C-191/97 Deliège, para 42.
68 Ibid. para 46.
69 Ibid. para 54.
70 Ibid. para 56.
71 Ibid.
72 Ibid. para 60.
120 4 EU Internal Market Law and Sport

national teams competing against each other, could not in themselves constitute an
obstacle on the freedom to provide services under Article 56 because ‘such a limi-
tation is inherent in the conduct of an international high-level sports event, which
necessarily involves certain selection rules or criteria being adopted’.73
Inherent rules therefore constitute yet another category of the sporting excep-
tion.74 The sports organisations also must be able to demonstrate that selection
rules are based on objective criteria unconnected with the personal circumstances
of the athletes.75
Finally, it is noteworthy that in Deliège, much like in Bosman, the Court did not
touch upon the questions related to competition law provisions. Unlike in Bosman,
where the Court already found both rules contrary to Article 45 TFEU and consid-
ered it unnecessary to rule on the interpretation of competition provisions in Articles
101 and 102, in Deliège it considered the competition questions inadmissible due to
the insufficient factual information provided by the referring national court.

4.6 Case C-176/96 Lehtonen [2000]

Finnish basketball player Jyri Lehtonen was transferred from his Finnish team to
the Belgian basketball team Castors Braine. However, the necessary license, which
should have been approved by International Basketball Federation (FIBA) to allow
Lehtonen to play for Castors Braine, was refused because the transfer had not
taken place within the specified time period, the so-called ‘transfer window’. This
in turn meant that he could not compete in Belgian competitions for that season.
But Castors Braine already fielded him in one game and listed Lehtonen on a team
sheet in another official game, both of which it won. The results were overturned
and registered as a 20:0 defeat because the club fielded the unregistered player. In
order to avoid further sanctions, Castors Braine did not select or play Lehtonen
in the remaining play-off matches. Jyri Lehtonen and Castors Braine brought the
case to the Tribunal de Première Instance in Brussels which forwarded to the
Court the question on the legality of the transfer windows under Articles 18, 45,
101 and 102 of the Treaty.
The Court confirmed its previous case law in a virtually identical manner as in
Deliège, including a reference to the Amsterdam Declaration, and found that the
rules on transfer windows created an obstacle to freedoms guaranteed under
Article 45 even though they related to fielding players and not to employing
them.76 Citing para 120 of Bosman, the Court explained that being fielded is the

73 Ibid. para 64, (emphasis added).

74 See Parrish and Miettinen 2008, p. 90. For discussion on sporting exceptions see Chap. 6, and
specifically on inherent rules see Sect. 6.3.3.
75 Joined cases C-51/96 and C-191/97 Deliège, para 65.
76 Case C-176/96 Jyri Lehtonen and Castors Canada Dry Namur-Braine ASBL v. Fédération

royale belge des sociétés de basket-ball ASBL (FRBSB) [2000] ECR I-2681.
4.6 Case C-176/96 Lehtonen [2000] 121

‘essential purpose of a professional player’s activity’ and the rules prohibiting

fielding therefore restrict the chances of being employed. However, such rules
were found to be justified on non-economic grounds, by the need for proper organ-
isation of the game because mid-season transfers could substantially alter the
sporting strength and thus the competition between teams in the course of a
championship.
Nevertheless, the transfer windows in this particular case were found to be dis-
proportionate and in breach of Article 45 of the Treaty because they were opened
substantially longer for the players from outside the EU. Differential treatment
between international and EU players proved that the transfers could have taken
place even after the deadline for EU players and not stood in the way of effective
organisation of the game. In para 59 of the judgment, the Court suggested that there
might be an objective justification for this discrimination, but it did not elaborate on
or give any examples of such a justification, and the respondent did not raise any
arguments in this regard to support its case. The questions on the interpretation of
EU competition law provisions were, like in Deliège, considered inadmissible due to
the insufficient factual information provided by the referring national court.

4.7 Case C-438/00 Kolpak [2003], Case C-265/03

Simutenkov [2005], and Case C-152/08 Kahveci [2008]

The Kolpak case77 concerned a Slovakian handball player who was under contract
with a German handball club. The rules of the German Handball Federation stated
that the licenses of all non-EU players should be marked with the letter ‘A’. Clubs
were allowed to use only two players with ‘A’ licenses in their competition
matches. The Simutenkov case78 involved a Russian football player who was
employed by a Spanish football club Deportivo Tenerife. There was a limit of
three ‘non-Community’ players allowed on the clubs playing in the Spanish First
Division. In Kahveci79 the factual background was virtually the same as in
Simutekov, involving a Turkish player in a Spanish football club. At the time
Kolpak brought his claim, Slovakia was not an EU Member State but it had
entered into an Association Agreement with the EU.80 Russia had a Partnership

77 Case C-438/00 Deutscher Handballbund v. Kolpak [2003] ECR I-4135.

78 Case C-265/03 Igor Simutenkov v. Ministerio de Educación y Cultura, Real Federación
Española de Fútbol [2005] ECR I-2579.
79 Case C-152/08 Real Sociedad de Fútbol SAD and Nihat Kahveci v Consejo Superior de

Deportes and Real Federación Española de Fútbol [2008] ECR I-6291.

80 Europe Agreement establishing an association between the European Communities and

their Member States, of the one part, and the Slovak Republic, of the other part, signed in
Luxembourg on 4 October 1993 and approved on behalf of the Communities by Decision
94/909/EC, ECSC, Euratom of the Council and the Commission of 19 December 1994 (OJ 1993
L 359, p. 1) (‘the Association Agreement with Slovakia’).
122 4 EU Internal Market Law and Sport

and Cooperation Agreement81 and Turkey had an Association Agreement (the so-
called ‘Ankara Agreement’ with an annexed Additional Protocol).82 The sportsmen
challenged the restrictive rules of the sporting federations on the basis of their
countries’ agreements with the EU, relying in particular on non-discrimination
provisions in those agreements.83
The Court held that the provisions in the agreements on which the sportsmen
were relying had direct effect. They laid down, in clear, precise and uncondi-
tional terms, a prohibition precluding any Member State from discriminating on
grounds of nationality against non-Union workers vis-à-vis their own nationals
as far as their conditions of employment, remuneration and dismissal were con-
cerned. The quotas on numbers of the non-Union players related to ‘working con-
ditions’ within the meaning of those provisions, which were considered analogous
to Article 45 of the Treaty. Furthermore, the provisions apply to rules drawn up
by a sports federation which determines the conditions under which professional
sportsmen engage in gainful employment.
The judgments, however, did not create rights concerning the cross-border
movement of workers from the countries with which the EU has entered into simi-
lar agreements.84 The benefits were confined to equal treatment with regard to
conditions of work, remuneration, or dismissal in a Member State in which they
are already lawfully employed, i.e. have already entered the labour market. In con-
trast to Article 45 of the Treaty, those provisions therefore do not extend to
national rules, or rules of private bodies, including sporting organisations,

81 Agreement on partnership and cooperation establishing a partnership between the European

Communities and their Member States, of the one part, and the Russian Federation, of the other
part, signed in Corfu on 24 June 1994 and approved on behalf of the Communities by Decision
97/800/EC ECSC, Euratom: Council and Commission Decision of 30 October 1997 (OJ 1994 L
327, p. 1) (‘the Communities-Russia Partnership Agreement’).
82 The Additional Protocol, signed on 23 November 1970 in Brussels and concluded, approved

and confirmed on behalf of the Community by Council Regulation (EEC) No 2760/72 of

19 December 1972 (OJ 1973 C 133, p. 17) (‘the Additional Protocol’), annexed to the Agreement
establishing an Association between the European Economic Community and Turkey, signed at
Ankara on 12 September 1963 by the Republic of Turkey, of the one part, and by the Member
States of the EEC and the Community, on the other part, and concluded, approved and confirmed
on behalf of the Community by Council Decision 64/732/EEC of 23 December 1963 (OJ 1973 C
113, p. 1) (‘the EEC-Turkey Association Agreement’).
83 Article 23(1) of the Partnership and Cooperation Agreement provides: ‘Subject to the laws,

conditions and procedures applicable in each Member State, the Community and its Member
States shall ensure that the treatment accorded to Russian nationals, legally employed in the ter-
ritory of a Member State shall be free from any discrimination based on nationality, as regards
working conditions, remuneration or dismissal, as compared to its own nationals.’ Article 38
of the Europe Agreement between the Community and Slovakia reads: ‘Subject to the condi-
tions and modalities applicable in each Member State: treatment accorded to workers of Slovak
Republic nationality legally employed in the territory of a Member State shall be free from any
discrimination based on nationality, as regards working conditions, remuneration or dismissal, as
compared to its own nationals’.
84 For example, Georgia, Serbia, Moldova, Ukraine, Algeria, Morocco, Armenia and many

others.
4.7 Case C-438/00 Kolpak [2003], Case C-265/03 … 123

concerning access to the labour market. This means that those employed and sub-
jected to discriminatory conditions of work in a Member State could have a valid
basis to challenge a rule imposing nationality restrictions, while those that have
difficulty accessing the labour market of a Member State due to the very same
rule, do not have a claim against the body that laid it down.

4.8 Case C-325/08 Bernard [2010]

In December 2009, the Lisbon Treaty amendments gave ‘complementary’ compe-

tence to the Union in the area of sport and introduced the concept of ‘specificity of
sport’ in Article 165(1) TFEU. The ruling of the Grand Chamber of the Court in
Bernard85 is the first to make reference to this ‘sports article’ (even though the facts
of the case pre-date the entry into force of the Lisbon Treaty). It is therefore neces-
sary to dissect the case and examine each part of the judgment in detail with the pur-
pose of identifying the extent and the nature of changes in legal approach to the
sports sector in the EU, if any. Bernard embraces the sentiment of European sports
policy and insists on certain parameters for the application of law in the sports sector
within the established objective justification framework. It legitimises restrictions on
player mobility by means of proportionate training compensation schemes which
rely on ‘real training costs’. Although this case does not conflict with Bosman, in the
sense that it does not depart in any way from the well-established analytical frame-
work applied in the free movement case law, it nevertheless does conflict with that
judgment in terms of the Court’s appraisal of the suitability of training compensation
within the confines of the free movement framework and, ultimately, in the effects
produced. It is exactly this fact that gives some weight to the otherwise largely sym-
bolic and unnecessary reference to Article 165(1) TFEU in Bernard and leads to the
assumption that a new ‘sport article’ might have led to minor but permanent altera-
tion on the score board in favour of sporting autonomy. Nevertheless, until we have
another case to confirm or deny this assumption, it would be premature to draw any
firm conclusions about the impact of Bernard in this respect.

4.8.1 Facts of the Case

In 1997, the French football club Olympique Lyonnais (Lyon) and the 17-year
old Olivier Bernard entered into a training contract for three seasons with effect
from 1 July that year. The legal dispute between the parties arose three seasons

85 Case C-325/08 Olympique Lyonnais SASP v. Olivier Bernard and Newcastle United FC judg-

ment of grand Chamber of the Court delivered on 16 March 2010. The following case com-
ment was first published in Pijetlovic 2010 Another Classic of EU Sports Jurisprudence: Legal
Implications of Olympique Lyonnais SASP v. Olivier Bernard and Newcastle UFC (C-325/08)
European Law Review (35), pp. 858–869.
124 4 EU Internal Market Law and Sport

later when Bernard refused to accept a 1-year professional contract offered to him
by Lyon, which was to take effect as of 1 July 2000. Instead, in August 2000, he
signed a professional contract with Newcastle United FC and moved to England.
At the material time, the employment of football players in France was regulated
by the Charte du Football Professionne (the Charter), which had the status of a col-
lective agreement. Trainee players between the ages of 16 and 22 and employed
by a professional club under a fixed-term training contract belonged to a category
known as joueurs espoir. Article 23 of the Charter provided that the club is enti-
tled to require a trainee to sign a contract as a professional player on the expiry of
the training contract. Should the player refuse, he was prohibited from signing with
another French club for a period of 3 years without the written agreement of the club
in which he was a joueur espoir. If the club did not offer him a professional contract,
he was free to sign with a club of his choice without any compensation being due to
the club that trained him. Although this rule implied that compensation is due if the
player refuses to sign a professional contract with that club, the Charter contained no
scheme for compensation. The club could nevertheless rely on Article L. 122-3-8 of
the French Code du travail (Employment Code) to bring an action for ‘damages cor-
responding to the loss suffered’ against the joueur espoir for breach of contractual
obligations flowing from Article 23 of the Charter.
When Bernard left for Newcastle United FC, Lyon considered that the compen-
sation principle should extend outside of France and sued him and his new club. It
sought an award of EUR 53,357 in damages, the amount corresponding to the remu-
neration Bernard would have received over the period of 1 year under the profes-
sional contract with Lyon which he had refused to sign. The judgment of the Conseil
de prud’hommes, ordering Bernard and Newcastle United FC jointly to pay Lyon
damages of EUR 22,867, was quashed by the Cour d’appel which considered that
the obligation on joueurs espoir under Article 23 of the Charter contravened free-
dom of movement under Article 39 EC (now Article 45 TFEU). Lyon then appealed
to the Cour de cassation which, in July 2008, referred two related questions to
the Court of Justice for a preliminary ruling, essentially asking (i) whether Article
39 EC (now Article 45 TFEU) precludes the provision of a national law requiring
joueurs espoir to pay damages in the described context, and (ii) if so, does the need
to encourage the recruitment and training of young professional players constitute a
legitimate objective capable of justifying such a restriction.

4.8.2 Analytical Overview of the Judgment

Bernard faithfully follows the standard analytical structure applied in order to

consider measures restricting free movement. However, three themes are of key
importance for understanding the impact of the judgment: (i) the standard of appli-
cation of the proportionality principle in the sports sector outlined in para 40 of
Bernard, which surely provides classic lines to be cited in sports cases still to
come before the Court; (ii) the suitability of training compensation schemes as a
4.8 Case C-325/08 Bernard [2010] 125

means to attain the aim of encouraging training and recruitment of young play-
ers and (iii) criteria for accepted methods of calculating training compensation.
Following a brief overview of the restriction and justification elements of the free
movement framework as applied in Bernard, these themes will then be discussed
in turn, considering the Opinion of the Advocate General in Bernard and the
Court’s judgment in Bosman where relevant.

4.8.2.1 The Existence of a Restriction on Freedom

of Movement for Workers

The Court first dealt with the question of the restrictive nature of the compensation
scheme. This part of the judgment does little but confirm settled case law. Citing
Bosman (and the reference to Walrave and Koch in that judgment), the Court
reminded us that Article 45 TFEU applies not only to actions of public authorities
but also to rules of any other nature aimed at regulating gainful employment in a
collective manner, thus bringing the Charter under the scope of the Treaty.86
Furthermore, the Court used the obstacle approach to find that the Charter, consti-
tuting neither a prohibition on signing a contract with a club in another Member
State nor discrimination on the basis of nationality, nevertheless discourages the
player from exercising his right of free movement and makes the exercise of that
right less attractive. Thus, it constitutes a restriction contrary to Article 45 TFEU.
The Court makes no distinction between sport and any other sector at this stage of
its analysis. The contested rules or practices are either restrictive or not, notwith-
standing the specific characteristics of the sector.87

4.8.2.2 Justification of the Restriction: Legitimate Objective

Paragraph 38 of the Court’s judgment follows a familiar roadmap for analysing

the existence of justifications for measures restricting the free movement provi-
sions of the Treaty. Accordingly, a restriction may be accepted only if it pursues ‘a
legitimate aim compatible with the Treaty and is justified by overriding reasons in
the public interest’, and the application of that restrictive measure is (a) capable of
ensuring achievement of that aim and (b) does not go beyond what is necessary for
that purpose. The Court goes on to confirm para 106 of Bosman:
[…]in view of the considerable social importance of sporting activities and in particular
football in the European Union, the objective of encouraging the recruitment and training
of young players must be accepted as legitimate.88

86 C-325/08 Bernard, para 30.

87 Paragraph 30 of the AG Sharpston’s opinion in C-325/08 Bernard says that ‘the specific charac-
teristics of sport in general, and football in particular, do not seem to me to be of paramount impor-
tance when considering whether there is a prohibited restriction on freedom of movement. […]’.
88 Case C-325/08 Bernard, para 39.
126 4 EU Internal Market Law and Sport

Therefore, the said objective was easily recognised as legitimate by reference to

previous case law. It is apparent from the language of the Court that the social
importance of sport plays a crucial role in legitimating this objective and that it
would probably not be accepted as such in (m)any other employment sectors.

4.8.2.3 Standard of Application of the Proportionality Principle

This aspect of the judgment deserves more attention. The Court states that
In considering whether a system which restricts the freedom of movement of such play-
ers is suitable to ensure that the said objective is attained and does not go beyond what
is necessary to attain it, account must be taken, as the Advocate General states in points
30 and 47 of her Opinion, of the specific characteristics of sport in general, and football
in particular, and of their social and educational function. The relevance of those factors
is also corroborated by their being mentioned in the second subparagraph of Article
165(1) TFEU.89

For the first time, the Court mentions the social and educational function of sport at
this stage of analysis and refers expressly to sport as a sector which requires specific
characteristics to be taken into account in the examination of possible justifications.
This does not represent a novelty in terms of the relevant factors taken into account
by the Court at different stages of objective justification analysis. The novelty is in the
express language of the Court, coupled with the reference to Article 165(1) TFEU.
Although not relevant in Bernard itself (since, here, a non-discriminatory restric-
tion was at issue), it is interesting to remember that under the traditional approach, the
analytical framework first required labelling the measure as directly discriminatory,
indirectly discriminatory or non-discriminatory but restrictive on the exercise of the
freedoms conferred. By allowing the directly discriminatory ‘3+2’ rule in Bosman,
discriminatory transfer windows in Lehtonen,90 and quotas on foreign players in
Kolpak91 and Simutenkov92 to be considered under the objective justification frame-
work as opposed to the express derogation framework, and therefore treating these
measures as if they were indirectly discriminatory or non-discriminatory restrictions,
it could be thought that the Court has effectively introduced the concept of the ‘speci-
ficity of sport’ to the traditional classification process.93 Sport is not the only sector in
which the Court has taken such a detour for directly discriminatory measures.94 But

89 Ibid. para 40.

90 Case 176/96 Lehtonen [2000] ECR I-2681.
91 Case C-438/00 Kolpak [2003] ECR I-4135.
92 Case C-265/03 Simutenkov [2005] ECR I-2579.
93 The traditional measure-classification stage in the analysis is nonetheless still evident in the

Court’s analytical structure in several cases. See Barnard 2010, pp. 246–257.
94 See, for e.g., Case C-67/97 Bluhme [1998] ECR I-6717 (biodiversity), Case C-2/90

Commission v. Belgium (Walloon Waste) [1992] ECR I-4431 (environmental protection), Case
C-19/92 Kraus [1993] ECR I-1663 (protection of public against misleading use of academic
titles).
4.8 Case C-325/08 Bernard [2010] 127

sport is the only sector where it has taken this approach ­consistently, thus making it a
rule in the application of EU free movement law to sports, which could be attributed
to the specificity of sport. In Bernard, the Court’s novel reference to Article 165(1)
TFEU might signal that the provision has not just confirmed but has in fact given
some additional weight to the specificity and socio-educational function of sport,
which could prove just enough to influence the outcome in certain cases. This is,
however, evident only when considered in the context of the suitability assessment
and the Court’s departure on that matter from the judgment in Bosman. The discus-
sion in the following section illustrates this point.

4.8.2.4 Suitability of Training Compensation Systems

Turning to the issue of the suitability of training compensation schemes in light of the
specificities of sport and its social and educational function, it is important for purposes
of discussion to set out the Court’s reasoning at paras 41–45 of the judgment in full:
The prospect of receiving training fees is likely to encourage football clubs to seek new
talent and train young players (see Bosman, para 108). The returns on the investments in
training made by the clubs providing it are uncertain by their very nature since the clubs
bear the expenditure incurred in respect of all the young players they recruit and train,
sometimes over several years, whereas only some of those players undertake a profes-
sional career at the end of their training, whether with the club which provided the training
or another club (see, to that effect, Bosman, para 109). […] Under those circumstances,
the clubs which provided the training could be discouraged from investing in the train-
ing of young players if they could not obtain reimbursement of the amounts spent for that
purpose where, at the end of his training, a player enters into a professional contract with
another club. […] It follows that a scheme providing for the payment of compensation for
training where a young player, at the end of his training, signs a professional contract with
a club other than the one which trained him can, in principle, be justified by the objective
of encouraging the recruitment and training of young players. However, such a scheme
must be actually capable of attaining that objective and be proportionate to it, taking due
account of the costs borne by the clubs in training both future professional players and
those who will never play professionally (see, to that effect, Bosman, para 109).

This reasoning can be compared with para 109 of Bosman, in which the Court
held that ‘[…] because it is impossible to predict the sporting future of young
players with any certainty and because only a limited number of such players go
on to play professionally, those fees are by nature contingent and uncertain and are
in any event unrelated to the actual cost borne by clubs of training both future pro-
fessional players and those who will never play professionally. The prospect of
receiving such fees cannot, therefore, be either a decisive factor in encouraging
recruitment and training of young players or an adequate means of financing such
activities, particularly in the case of smaller clubs’.95 Thus, in Bosman, training
compensation schemes were viewed as unsuitable for the achievement of the
objective of encouraging the recruitment and training of young players, in
Bernard they were deemed suitable. Furthermore, in para 46 of her Opinion in

95 C-415/93 Bosman, para 109.

128 4 EU Internal Market Law and Sport

Bernard, AG Sharpston said: ‘[…] Rules such as the one in question here are
therefore perhaps not decisive in encouraging clubs to recruit and train young
players. None the less, such rules ensure that clubs are not discouraged from
recruitment and training by the prospect of seeing their investment in training
applied to the benefit of some other club, with no compensation for themselves’.
Interpreting the word ‘encourage’96 as meaning to ‘not discourage’ seems to be
a linguistic modification, enabling the Advocate General to depart from the deci-
sion in Bosman as regards the suitability of training compensation schemes.97 But
why would AG Sharpston undertake such a linguistic manoeuvre and why would
the Court follow her Opinion on that point? One possible reason is discussed
above and relates to the change of direction with regard to the weight given to the
socio-educational functions of sport. The other explanation would be that the
Court simply did not expressly acknowledge the departure from Bosman in this
respect, when it in fact changed its opinion as regards the importance of the con-
tingent and uncertain nature of compensation fees in assessing the suitability of
the measure. AG Lenz in Bosman did not find that the nature of compensation fees
prevented him from reaching the conclusion that they are appropriate means for
attaining the aim of encouraging training and recruitment of young players, but the
Court, back then, did not follow him on this point.

4.8.2.5 Proportionality: Calculation of Training Compensation

Finally, addressing the system of compensation in Bernard in paras 46–48 of the

judgment, the Court said that payment of damages to the club which provided
training calculated on the basis of total loss for breach of contractual obligations
by the player (the amount of which was unrelated to the ‘real training costs’), went
beyond what was necessary to encourage recruitment and training of young play-
ers and to fund those activities. The Court offered only very general guidelines
on the accepted methods of calculating compensation. Accordingly, such methods
should be related to compensation for the real training costs incurred by the club
(the criteria for calculation of which should ideally be determined in advance).
What constitutes ‘real training cost’ is the issue left open. Moreover, para 45 tells
us that the costs to take into account in designing a scheme are not just those asso-
ciated with training future professional players but, also, costs associated with
training those players who will never turn professional.

96 As required by the objective accepted as legitimate in para 39 of C-325/08 Bernard and para
108 of C-415/93 Bosman.
97 The objective required that the restrictive rule encourages clubs to train and recruit young

players, and not that it did not discourage clubs from doing so. The aim of ’not discouraging’
presents a lower bar in terms of finding the restrictive rule suitable for the attainment of the
objective than the aim of ’encouraging’. Therefore, the restrictive rule (training compensation)
used to attain the objective as re-worded and modified in Bernard will more likely be found suit-
able in the former (i.e. not discouraging) but not in the latter.
4.8 Case C-325/08 Bernard [2010] 129

Weatherill suggests that interpreting the criteria noted in paras 46–47 of the
judgment in Bernard to mean that only a scheme tied directly to the actual costs of
training one player is permitted ‘might be too narrow an interpretation’, and that
the criterion in para 45 ‘might conceivably be interpreted to mean that the com-
pensation payable by those who succeed as professionals might be inflated beyond
the costs incurred in their particular case to allow also some coverage of training
costs incurred but wasted on those players who fall by the wayside’.98 Lindholm
also argues that the Court favoured a total-training-cost-model and ‘appeared’ to
have rejected the Advocate General’s suggestions of an individual-training-cost-
model.99 Although this is a possible interpretation of the judgment, there is an
alternative explanation which, although not as straightforward, appears more con-
vincing. There are several considerations which lead to the conclusion that the cri-
terion in para 45 is an additional criterion that applies only in schemes in which
the new employer, as opposed to a player, is liable to pay the compensation, and
that the Court has in fact followed the suggestions of AG Sharpston on the point of
setting different criteria for ‘employer pays’ and ‘player pays’ schemes.
First, para 45 appears in the part of the judgment in which the Court addresses
compensation schemes in general and not ‘player pays’ schemes in particular,
whereas paras 46–47 address the scheme in the main proceedings, i.e. a ‘player
pays’ scheme. It would be unreasonable to expect the Cour de cassation to recog-
nise this criterion as applicable to the case before it. The Court has left out the cri-
terion of ‘and those who never play professionally’ in its answer to the preliminary
reference because it did not want the Cour de cassation to reach the decision using
that criterion to determine the dispute. If it were applicable, the Court could easily
have added this criterion at the end of para 49.100 Additionally, in para 45, as well
as in the preceding reasoning, the Court cites Bosman, in which the ‘employer
pays’ scheme was at issue. It would have made all the difference were the attain-
ment of the ends in that case dependant on ‘player pays’ means. If it were, the
Court in Bosman would not have implied that training compensation had to be
related to the ‘actual cost borne by the clubs of training both future professional
players and those that will never play professionally’.
This leads to my second point. Namely, the Court could not have intended to
subject a young trainee to the burden of a total-training-cost-model, because that
could have the disproportionate effect of actually preventing him from moving to a
club in another Member State. This is especially true with respect to sports other
than football in which the costs of training might be as high but the players’ ser-
vices are much less valued. Such an approach would fail to satisfy proportionality
stricto sensu. To illustrate this in more concrete terms, we can look at the FIFA
training compensation system, according to which an employer is liable to pay up
to EUR 90,000 per year of training if it offers the first professional contract to a

98 Weatherill 2010, p. 5.
99 Lindholm 2010, p. 1192.
100 See Sect. 4.8.2.6 below for the text of para 49.
130 4 EU Internal Market Law and Sport

young player. The costs are supposed to reflect approximate total training costs.
According to a FIFPro comment on FIFA’s compensation rules, history has shown
that ‘such fees operate as a significant and sometimes definite restraint that can not
only undermine player earnings but also put players out of the game’.101 If there is
any truth to this claim regarding the FIFA ‘employer pays’ scheme, for football
trainees to be held liable for similar total-training-cost-covering-sums, and for
trainees in other sports to be held liable for equivalently restrictive amounts in
their respective sports (which could be legally attached to any sport if para 45 is
interpreted as applying to ‘player pays’ schemes), would mean preventing most
players from moving anywhere after completing their training. Has the social and
educational function along with the specificity of sport really been raised to such
high level of importance to be capable of justifying these consequences for free-
doms guaranteed by Article 45 TFEU? Although it could become more important
in the future, depending on how the sport governing bodies react to Bernard, this
discussion is currently of more theoretical than practical value when placed in the
context of the present-day state of affairs, to which we now turn.
In the 10 years since the litigation started, FIFA has introduced a system oper-
ated on the ‘employer pays’ basis, France has changed its rules for internal transfers
in football to reflect that system, Bernard finished his footballing career, and Lyon’s
lawyers probably forgot they ever started the litigation as the club’s budget would not
be affected at any detectable level by whatever Bernard would have been held liable to
owe. In addition, sports today do not apply ‘player pays’ schemes. For example, bas-
ketball, handball, football and rugby run ‘employer pays’ schemes. Cricket, fencing,
hockey, cycling, polo, volleyball, ice-hockey, skiing, swimming and baseball have no
training compensation at all. One explanation which renders the judgment valuable in
the present day is that the criterion in para 45 applies to any type of scheme including
‘player pays’ schemes, which is something that I have argued against above. The only
other possible explanation is that the para 45 criterion is strictly intended to apply to
systems in which employer bears the burden of training compensation.
This explanation of the judgment is in line with AG Sharpston’s suggestions.
She rejected two models of compensation: one based on the player’s prospective
earnings, because it is susceptible to manipulation; and the other based on the
club’s prospective loss of profits, because it is too uncertain.102 Two other models
discussed in the Opinion were the total-training-cost-model and the individual-
training-cost-model: ‘[…] If it is necessary to train n players in order to produce
one who will be successful professionally, then the cost to the training club (and
the saving to the new club) is the cost of training those n players. It seems appro-
priate and proportionate for compensation between clubs to be based on that cost.
For the individual player, however, only the individual cost seems relevant’,
regardless of the overall training costs.103 So, the Advocate General suggested the

101 FIFPro report on the Joint FIFA/UEFA Negotiation Document (International Transfer of

Players).
102 See paras 50–51 of her Opinion in Case C-325/08 Bernard.
103 Ibid. para 57.
4.8 Case C-325/08 Bernard [2010] 131

total-training-cost-model as appropriate for ‘employer pays’ schemes and the indi-

vidual-training-cost-model in any instance of ‘player pays’ schemes.
Weatherill considers that the Court chose not to explore the nuances suggested
by AG Sharpston because ‘calculation is in any event complicated by the practical
reality that players are trained in groups, not individually: the cost of training
twenty players is lower than the cost of training one multiplied by twenty thanks
to realisation of economies of scale’.104 But it may well be that the Court has left
the nuisance of the nuances to the clubs and/or their governing bodies. After all,
football clubs nowadays, especially those playing in the higher divisions of a
national league, are professional undertakings with huge turnovers that must have
proper accounting systems to manage their revenues and expenditures and, there-
fore, they should be able to assess quite precisely the expenses involved in the
training of young players.105 It does not seem to be too different or too much
harder to calculate the costs of training one player than it is to calculate the costs
of training one player plus the fluctuating number of other players but not of entire
trainee squad.106 It is true that the calculations may prove to be more difficult for
smaller clubs. However, even small clubs have to manage their accounts during the
financial year. If they do not have an in-house accountant, they can hire one specif-
ically to devise a cost template and demonstrate how to calculate costs of training,
which fixed and variable costs to include/exclude, which deductions to make, and
so on. It is a one-time hire and a one-time expense (which can then possibly be
labelled as a cost of training and shifted to another party).
Regardless of the method used for calculating costs, sums of compensation
must be set between suitability and necessity, i.e. they must be high enough to be
capable of attaining the objective but they must be the lowest possible that can
achieve that objective. It can be rightfully claimed that ‘player pays’ schemes
based on the individual-training-cost-model are not suitable to achieve the objec-
tive of encouraging clubs to train and recruit young players, simply because of the
very low amounts of compensation involved. This is also recognised by AG
Sharpston: ‘[…] investment in training would be discouraged if only the cost of
training the individual player were taken into account when determining the
appropriate compensation’.107 Therefore, in team sports, ‘employer pays’ schemes
based on total training cost seem to be the only model that can satisfy all of the
legal criteria, and are therefore the right way to go. The reason that the Court ruled
that individuals should compensate only for the costs of their own training (under
the interpretation of judgment presented in this article) in a team sport such as
football is to enable the Cour de cassation to settle the issue between the parties to
the main proceedings. This ruling can also be important for the future, however, in

104 Weatherill 2010, p. 5.

105 Van den Bogaert 2005, pp. 256–257.
106 It takes an average of 10 players to produce one professional. See European Commission,

Education of Young Sportspersons, Final Report by PMP in partnership with the Institute of Sport
and Leisure Policy Loughborough University (August 2004), p. 49, and Blanpain 2003, p. 52.
107 See para 52 of her Opinion in Case C-325/08 Bernard.
132 4 EU Internal Market Law and Sport

the event of the establishment of mixed systems where the duty to compensate is
divided between the player and the employer, or the player and the common com-
pensation pool (which would make the system pass the suitability test).
Regarding the applicability of the judgment to schemes existing today, the cri-
teria for team sports and ‘employer pays’ schemes are set out in para 45 of the
judgment. In addition to this, ‘real training costs’ (in paras 46 and 50) should be
taken as meaning (i) costs for training one individual player in ‘player pays’
schemes (to settle the case at hand and any eventual future systems where individ-
ual would be liable to pay) and (ii) costs for training one individual player plus the
number of players that do not make it professionally taking into consideration the
appropriate ‘player factor’ (the ratio of players who need to be trained to produce
one professional player) in ‘employer pays’ schemes. Paragraphs 46 and 50 refer
only to the link between the compensation payable and the actual costs incurred—
the Court does not insist on precise congruence.108 It is enough that the relevant
calculations are based on the broad criteria set by the Court.

4.8.2.6 The Answer to the Questions Referred

[…] the answer to the questions referred is that Article 45 TFEU does not preclude a
scheme which, in order to attain the objective of encouraging the recruitment and training
of young players, guarantees compensation to the club which provided the training if, at
the end of his training period, a young player signs a professional contract with a club in
another Member State, provided that the scheme is suitable to ensure the attainment of
that objective and does not go beyond what is necessary to attain it.109

Here, the Court omitted to complete the sentence with the para 45 criterion ‘taking
due account of the costs borne by the clubs in training both future professional
players and those who will never play professionally’. The final word flowing
from the reasoning in paras 46–48 was that the ‘player pays’ scheme in Bernard
failed to satisfy the necessity principle because damages were calculated, ‘in a
way which is unrelated to the actual costs of the training’.110 So the ruling of the
Court was in favour of Bernard and Newcastle United FC. But the reason for that
is not because the Court considered training compensation schemes in sports ille-
gal, but because this particular compensation scheme was considered illegal.

4.8.2.7 The Current FIFA Training Compensation System

Article 20 and Annex 4 of the FIFA Regulations for the Status and Transfer of
Players set out the rules for training compensation. Accordingly, training compensa-
tion shall be paid to a player’s training club(s): (1) when a player signs his first

108 See Weatherill 2010, p. 4.

109 Case C-325/08 Bernard, para 49.
110 Ibid. para 50 (emphasis added).
4.8 Case C-325/08 Bernard [2010] 133

contract as a professional and (2) on each transfer of a professional until the end of
the season of his 23rd birthday.111 The obligation to compensate applies whether the
player is transferred during or at the end of his contract.112 A special provision that
applies for transfers from one association to another within the EU/EEA stipulates
that if the former club does not offer the player a contract, no training compensation
is payable unless the former club can justify that it is entitled to such compensation.
Such an offer must be at least of an equivalent value to the current contract.113
In order to calculate the compensation due for training and education costs,
national football associations divide their clubs into a maximum of four categories in
accordance with the clubs’ financial investment in training players. The training
costs are set for each category and are said to correspond to the amount needed to
train one player for 1 year multiplied by an average ’player factor’, which is the ratio
of players who need to be trained to produce one professional player. The flat
amounts of training costs are established on a confederation basis for each category
of club.114 UEFA has established the following sums for Europe: category I clubs
EUR 90,000, category II clubs EUR 60,000, category III clubs EUR 30,000 and cat-
egory IV clubs EUR 10,000.115 So, when a player that has been trained for 5 years
by club X, a category III club refuses to sign their first professional contract with
club X and instead signs with club Y, a category II club, club Y will owe 45,000
EUR times the number of years that the player spent with club X (when a player
moves from a lower to a higher category, the average amount between the two cate-
gories applies). The total amount owed for 5 years of training a player in this case
would come to EUR 225,000. If a player were to move after 5 years of training from
a club belonging to the first category to another club also categorised as belonging to
the first category, EUR 450,000 would be the applicable amount. In Europe, only six
national associations have clubs classified as belonging to category I. About half of
the national associations have only category III and IV clubs.
The FIFA Dispute Resolution Chamber reviews disputes concerning the
amount of training compensation payable and has discretion to adjust this amount
if it is clearly disproportionate in the case under review.116 A question which has
received increased attention after Bernard is whether the FIFA training compensa-
tion system is compatible with the requirements of EU law. Prima facie, it appears
that Article 20 and Annex 4 of the FIFA Regulations satisfy the general criteria of
the judgment in Bernard. The European Commission has already given an infor-
mal green light to these rules. However, until someone actually pursues a chal-
lenge, we will not be able to say with certainty which provisions are perhaps
precluded by the EU law and need amendment.

111 Ibid. Article 20.

112 Ibid.
113 Annex 4, FIFA Regulations for the Status and Transfer of Players.
114 Ibid.
115 FIFA circular letter nr. 1223.
116 Annex 4, FIFA Regulations for the Status and Transfer of Players.
134 4 EU Internal Market Law and Sport

The feature of the system that appears most controversial is the fact that payable flat
sums are set on the level of confederation.117 The actual costs of training are not the
same or even similar in all European countries due to differences in economic condi-
tions. Therefore, it seems more desirable that the flat rate sums for different categories
of clubs should be set by national associations to reflect more accurately the real costs
of training incurred, as required by Bernard.118 On the other hand, the existence of a
FIFA Dispute Settlement Chamber that has the power to adjust the sums in individual
cases is a positive feature of the system which can be used as an argument against
claims that sums are clearly disproportionate. It follows implicitly from the judgment in
Bernard that the precise sum of the real training costs is not a must.

4.8.2.8 Final Remarks

Let us remind ourselves that the judgment in Bosman led to the abolition of transfer
fees for out-of-contract professional players who then became free agents whereas,
under Bernard, out-of-contract trainee players were not considered to be free agents
and compensation fees were given a green light. This differential treatment of young
trainees who embark upon a professional career and professional players can, inter
alia, be considered to be an exception to the prohibition on age discrimination in EU
law.119 It can also be a preliminary indication of the validity of FIFA rules that have
for years maintained, contrary to Bosman, transfer fees for out-of-contract trainees. In
this sense, Bernard represents a restriction on, or clarification of, the scope of
Bosman. Given what could prove to be a minor but permanent increase in the signifi-
cance of the specific characteristics and socio-educational function of sport, now cap-
tured by Article 165(1) TFEU, the judgment in Bernard may yet become the ‘classic’
touchstone in EU sports law.

4.9 Cases T-385/07, T-55/08 and T-68/08 FIFA

and UEFA v Commission [2011]

On 17 February 2011, the General Court delivered three separate but closely
related judgments in the cases FIFA and UEFA v Commission.120 Article 14(1) of
the Council Directive 2010/13/EU on Audiovisual Media Services (AVMS

117 In other words, UEFA as a confederative body sets sums for all European national football

associations, and other regional governing bodies set the sums in their respective regions.
118 See on this point also Van den Bogaert 2005, pp. 256–257, and Drolet 2009, pp. 167–190.
119 See Article 10 TFEU and Council Directive 2000/78 establishing a general framework for

equal treatment in employment and occupation OJ L 303/16, 2 December 2000.

120 Case T-385/07 Fédération Internationale de Football Association (FIFA) v. Commission,

judgment of 17 February 2011, Case T-55/08 Union des associations européennes de foot-
ball (UEFA) v. Commission, judgment of 17 February 2011; and Case T-68/08 Fédération
Internationale de Football Association (FIFA) v. Commission, judgment of 17 February 2011.
See also the General Court’s Press Release No. 9/11 ‘Judgments in Cases T-385/07, T-55/08 and
T-68/08 FIFA and UEFA v Commission’ Luxembourg, 17 February 2011.
4.9 Cases T-385/07, T-55/08 and T-68/08 FIFA and UEFA v Commission [2011] 135

Directive) provides a possibility for Member States to draw up a list of events

which they consider to be of major importance for society to ensure that broad-
casters under its jurisdiction do not broadcast on an exclusive basis in such a way
as to deprive a substantial proportion of the public in that Member State of the
possibility of following such events via live coverage or deferred coverage on free
television.121 According to Article 14(2), Member States exercising this possibility
are to send the list of ‘designated events’ to the Commission for confirmation that
they are compatible with EU law.
The Commission approved the lists sent to it via this procedure by the Belgian
federal authorities, and the UK. The list included, among other events, all matches
of the FIFA World Cup and the UEFA EURO football championship. The appli-
cants, FIFA and UEFA, argued that all such matches cannot be regarded as events
of major importance for the public of those States.
The General Court referred to Article 10 of the European Convention of Human
Rights on the freedom of expression, including the right to receive information,
as a fundamental right capable of justifying the restrictions on the economic free-
doms guaranteed by the Treaty. As the measures contemplated in Article 14 of
the AVMS Directive are intended to protect the right to information and to ensure
wide public access to television broadcasts of national or non-national events of
major importance for society, they were held justified by overriding reasons in
public interest. The General Court further clarified that the World Cup and EURO
are to be regarded as single events rather than as a series of individual events
divided into ‘prime’ and ‘non-prime’ matches (the semi-finals, the final and the
matches involving the relevant national team of the country in question are consid-
ered as ‘prime’) or into ‘gala’ and ‘non-gala’ (opening match and final match are
‘gala’) matches. It cannot be specified in advance, at the time when the national
lists are drawn up or broadcasting rights acquired, which matches will be deci-
sive for the subsequent stages of those competitions or which ones may affect
the fate of a given national team. For that reason, the Court held that a Member
State’s decision to consider that all of the matches of those competitions are of
major importance for society may be justified. The restrictions on freedom to pro-
vide services under Article 56 TFEU and freedom of establishment under Article
49 TFEU were therefore found to be compatible with EU law.
An obvious question after these judgments is their effect on the commercial value
of the property rights for the listed events held by FIFA and UEFA. The General Court
admits that the legislation in question and the contested Commission decisions are lia-
ble to negatively affect the property rights, but that such fact does not destroy their com-
mercial value as FIFA and UEFA are not obliged to sell them on whatever conditions
they can obtain. Earlier in the judgment it was held that ‘the principle of protection of
the fundamental right to property under [Union] law is not absolute but must be viewed
in relation to its social function’. As in this balance of social interests and property rights

121 Directive 2010/13/EU of the European Parliament and of the Council of 10 March 2010

on the coordination of certain provisions laid down by law, regulation or administrative action
in Member States concerning the provision of audiovisual media services (Audiovisual Media
Services Directive), OJ L 95, 15/4/2010, pp. 1–24.
136 4 EU Internal Market Law and Sport

the former prevailed, it is interesting for a moment to think of this reference to social
function as a reference to specificity of sport. Indeed, the AVMS Directive (much like
its predecessor, Council Directive 89/552/EEC) was adopted primarily with sport in
mind and the designated events are usually exclusively sports events. In this sense, the
judgments quite paradoxically represent a victory for specificity of sport, but a loss for
FIFA and UEFA, the main proponents of the concept. Deciding a case in favour of the
socio-cultural function of sport will not necessarily produce benefits for sporting organi-
sations. Specificity of sport is therefore a double-edged sword.

4.10 Joined Cases C-403/08 and C-429/08 Murphy [2011]

4.10.1 Facts of the Case

The English Football Association Premier League (FAPL) grants its licensees the
right to live broadcasting and exploitation of Premier League matches within the spe-
cific country-wide territory on an exclusive 3-year basis. In order to safeguard their
exclusivity and the value of the rights for FAPL, the broadcasters are at the same time
required by their license agreements to prevent their broadcasts from being viewed
outside the specified broadcasting area. In practice, this is done by requiring broad-
casters to encrypt the programme-carrying satellite signal and restrict the circulation
of authorised decoder cards only to persons residing within their exclusive territory.
In one of the Murphy joined cases,122 FAPL and other applicants brought pro-
ceedings against suppliers whose business included importing and marketing in the
United Kingdom foreign decoder cards and equipment used to access foreign satel-
lite transmissions of live Premier Leagues football matches in pubs and bars.123
They also brought an action against four pub operators who used foreign decoder
cards to screen live Premier League matches.124 In another joined case, unhappy
with the price that exclusive broadcaster in UK charged pubs for its Sky Sports ser-
vices,125 one of those pub operators, Karen Murphy, obtained a cheaper decoder
from Greece and begun showing Premier League matches in her Portsmouth pub. In
criminal proceedings launched against her in the UK, she was fined on the ground
that the Greek decoder card was an illicit access device. Ms Murphy appealed to the
High Court, which then referred the case to the Court under Article 267 TFEU.126

122 Joined Cases C-403/08 and C-429/08 FAPL and others v. QC Leisure and others; and Karen
Murphy v Media Protection Services Ltd., judgment of 4 October 2011. Section 4.10 on the
Murphy case has been analysed in detail by Pijetlovic and Nyman-Metcalf 2013.
123 Case C-403/08 Football Association Premier League v QC Leisure YouTube. that was joined

with Case C-429/08 Karen Murphy v Media Protection Services Ltd.

124 Ibid.
125 The price was ca. £1000 per month.
126 Case C-429/08 Karen Murphy v Media Protection Services Ltd. that was joined with Case

C-403/08 Football Association Premier League v QC Leisure YouTube.

4.10 Joined Cases C–403/08 and C–429/08 Murphy [2011] 137

The FAPL and others complained that the practice of importing and marketing
foreign decoders, as well as their use, constituted an infringement of their rights
under the provisions of national law127 designed to implement Conditional Access
Directive (CAD) 98/84128 and of the copyright in various artistic and musical
works, films and sound recordings embodied in the Premier League match cover-
age. The main issue in these cases was whether Articles 56 TFEU and 101 TFEU
preclude national legislation and licence agreements that prohibit the use of for-
eign decoding devices.

4.10.2 Analytical Overview of the Judgment

4.10.2.1 Preliminary Issues Under the Conditional Access Directive:

Notions of ‘Illicit Device’ ‘Abuse of Rights’ Under the EU Law

The main objective of the CAD is the approximation of Member State laws con-
cerning measures against illicit devices giving unauthorised access to broadcasting
services.129 Under Article 4 CAD, Member States are obliged to take measures to
prohibit on their territory
(a) the manufacture, import, distribution, sale, rental or possession for commercial pur-
poses of illicit devices; (b) the installation, maintenance or replacement for commercial
purposes of an illicit device […]

On the other hand, Article 3 CAD specifies that Member States are not allowed for
these reasons to restrict the provision of protected services (broadcasting) which
originate in another Member State or the free movement of conditional access
devices (decoders). Should they do so, they have to provide an objective justifica-
tion (i.e. a different reason from those listed under Article 4 CAD) for their restric-
tive measures, and satisfy the requirements of proportionality to escape falling
foul of TFEU free movement provisions. When such restrictions on economic
freedoms originate from agreements or practices of private undertakings they have
to comply with the competition provisions of the TFEU. The distinction between a
decoding device having the status of a ‘conditional access device’ and one falling
under the definition of ‘illicit device’ therefore plays a crucial role in the initial
assessment of the legality of Member States’ measures that restrict commercial
activities in decoding equipment. The sole difference between the two is that the
latter is used without the authorisation of the service provider.130

127 See sections 297(1) and 298 of the UK Copyright, Designs and Patents Act of 1988, as

amended.
128 Council Directive 98/84/EC on the legal protection of services based on, or consisting of,

conditional access. OJ L 320/54, 28.11.1998.

129 Article 1 of CAD.
130 Article 2(c) and (e) of CAD.
138 4 EU Internal Market Law and Sport

The Grand Chamber of the Court first answered questions concerning the
meaning of these crucial concepts under the factual circumstances in casu. It
found that a foreign decoding device does not constitute an ‘illicit device’ within
the meaning of Article 2(e) CAD.131 This is because ‘illicit device’ within the
meaning of the CAD covers access to broadcasting ‘free of charge’ (see para 6 the
preamble), and placing it on market ‘without the authorisation of the service pro-
vider’. In Murphy, decoding devices were purchased in Greece and remuneration
had been duly paid to the Greek service provider who authorised their marketing
within its exclusive broadcasting territory. Importantly, this conclusion was not
affected by the fact that the foreign decoders were procured by provision of a false
name and address, and that they were used in breach of a contractual limitation
permitting use only for private purposes.132 In essence, the Court here, in the
framework of CAD, added another specific use of EU-conferred rights to the list
of those it accepted as not constituting ‘abuse of rights’.
The prohibition of abuse of rights has been recognised as a general principle of
EU law, although the Court’s approach in most areas has been to treat it solely as
an interpretative principle (which is not directly effective without national anti-
abuse measures), rather than as a self-standing general principle.133 In Emsland-
Stärke, the Commission contended that the prohibition of abuse of rights is a
general principle that exists in the legal systems of all Member States and that it
has already been applied in the case law of the Court without being expressly rec-
ognised as a general principle.134 However, the Court did not recognise it
expressly as such in Emsland-Stärke. Only later, in Kofoed, did the Court hold that
the anti-abuse provision in Directive 90/434 reflects the general [EU] law princi-
ple that abuse of rights is prohibited.135 After a series of incoherent cases, the cur-
rent position is that an act of an individual who is exercising fundamental
freedoms under the Treaty can only constitute abuse if the two cumulative condi-
tions laid down by the Court in Emsland-Stärke are met:
A finding of an abuse requires, first, a combination of objective circumstances in which,
despite formal observance of the conditions laid down by the [EU] rules, the purpose of
those rules has not been achieved. It requires, second, a subjective element consisting in
the intention to obtain an advantage from the [EU] rules by creating artificially the condi-
tions laid down for obtaining it.136

The entire CAD could possibly be seen as an anti-abuse measure, for it listed the
specific situations when Member States can and must restrict abuses of freedom of

131 Joined Cases C-403/08 and C-429/08 Murphy, paras 62–67.

132 Ibid. paras 68–74.
133 Generally, there are three types of abuses of rights under EU law: circumvention (or U-turn

transactions), fraud and misuse. For explanation of the concepts see, for example, Kjellgren
2000, pp. 179–194.
134 Case C-110/99, Emsland-Stärke GmbH v Hauptzollamt Hamburg-Jonas, (2000) ECR I-1569.
135 Case C-321/05, Hans Markus Kofoed v Skatteministeriet (2007), ECR I-05795, para 38.
136 Case C-110/99, Emsland-Stärke, paras 52–53.
4.10 Joined Cases C–403/08 and C–429/08 Murphy [2011] 139

movement: namely, in the case of ‘illicit devices’. In such cases, traders cannot rely
on economic freedoms to claim their rights under the TFEU because, according to
a ‘ghost provision’ of the CAD, that would amount to abuse of rights. Therefore,
the Court did not have to fall back on the general case law and Emsland-Stärke cri-
teria discussed above, but instead focused on the meaning of ‘illicit device’. That,
in itself, was an exercise in finding out whether there was an abuse of rights in the
area as specifically covered by the CAD. Deciding that the decoders were not illicit
devices meant that traders were not abusing their rights, and vice versa.
Against this background, the Court in Murphy could have gone either way in
determining whether the provision of a false name and address to procure decod-
ers and their supply to another EU Member State constituted abuse of rights. It
could have easily interpreted the concept of ‘illicit device’ under Article 2(e) CAD
as meaning that the authorisation given by the Greek broadcaster was not genu-
ine and valid because the broadcaster was unaware that the devices would be used
outside its authorised territory and in breach of a contractual limitation permitting
the use of decoders only for private purposes. Authorization implies conscious
agreement, and not an agreement given on the basis of a fraudulent misrepresen-
tation by another party. This is a fundamental rule of any law of obligations and
the Greek broadcaster could have brought an action for breach of contract before
a national court. It is true that placing devices on the market was authorised, but
‘authorization’ is an expandable concept and can be interpreted as entailing con-
ditions under which the devices are placed on the market. The broadcaster was
relying on the terms of the contract for the conditions of use and had given an
authorization only for a particular purpose.
Thus, the outcome of the case could have been different, and in reaching such a
different outcome the Court would not even have had to apply counter-textual
interpretation. Instead, the decoders procured by the provision of a false name and
address were considered ‘conditional access devices’ within the meaning of
Article 2(c) CAD. As seen above, Article 3 CAD neither imposes a mandatory
requirement on such devices, nor prohibits EU Member States from restricting
their use. Having found that the CAD does not harmonise national legislation pro-
hibiting their use,137 the Court did not further elaborate on the legality of the
devices and instead turned its attention to the compatibility of UK measures under
the TFEU provisions on the internal market.

4.10.2.2 Existence of the Restriction Under Article 56 TFEU

Examining the case under Article 56 TFEU, the Court did not take much time to
find that the national legislation conferring legal protection on contested contrac-
tual clauses in broadcasting agreements restricts the freedom to provide services
by preventing the access to service by recipients outside the Member State of

137 This finding indirectly subsequently freed Ms Murphy from criminal liability in the national

proceedings. See Murphy v. Media Protection Services Ltd [2012] EWHC 466 (Admin).
140 4 EU Internal Market Law and Sport

broadcast.138 It then considered the applicability of two objective justifications put

forth: protection of intellectual property rights and encouraging the public to
attend football matches at stadia in person.

4.10.2.3 Objective Justification: Intellectual Property Protection

The protection of intellectual property rights was accepted as a part of the public
policy derogation already in previous case law.139 Sporting events were held in
Murphy as forming the subject of that protection. Importantly, however, the start-
ing point in reaching this conclusion was the Court’s refusal to classify Premier
League matches as ‘works’ within the meaning of the Copyright Directive as they
were not original product of the author’s own intellectual creation. It was also
made clear that the EU has no other basis in intellectual property legislation to
protect sporting events.140 But the Court then held sporting events to be of such
unique and original character as to make them capable of being transformed into a
subject-matter of protection by intellectual property law.141 Thereafter the Court
made a reference to Article 165(1) for the second time ever.142 Accordingly, it was
held permissible for the Member States to employ various means to protect sport-
ing events, including by virtue of protection of intellectual property rights, even if
they restrict free movement, as long as the restrictions are proportionate.
Thus the judgment made it clear that EU law has no basis to protect any form of
intellectual property of sporting events, but since sporting events are so specific in
their nature, Member States’ legislation may provide such protection. Article 165(1)
TFEU played a role in opening this avenue of protection by domestic legal systems.
It must be acknowledged that it has not been a decisive role as the Court already
held the sporting events to be of a unique and original character capable of forming a
subject of protection before making a reference to Article 165(1) TFEU. However,
constructing the subsequent reasoning around the Treaty-based obligation to take
into account specificity of sport and its social and educational functions certainly
strengthened the soundness of the argument and furnished it with a firm constitu-
tional support. Even before the coming into force of the Lisbon Treaty amendments
the Court would probably have reached the same conclusion based on the ‘specific
nature of sports’ alone, a concept entirely based on the state of affairs in the sporting
industry and their recognition in the Court’s jurisprudence. Objectives specific to the
sporting industry accepted as legitimate before the inclusion of Article 165(1) TFEU
were, for example, ensuring regularity of competitions,143 maintaining the balance

138 Ibid. paras 85–89.

139 Paragraph 94 of Joined Cases C–403/08 and C–429/08 Murphy.
140 Ibid. paras 96–99.
141 Ibid. para 100.
142 Ibid. para 101. The first time the Court mentioned Article 165(1) was in C-325/08 Bernard.
143 Case C-176/96 Lehtonen and Castors Braine [2000] ECR I-2681.
4.10 Joined Cases C–403/08 and C–429/08 Murphy [2011] 141

between clubs by preserving a certain degree of equality and uncertainty as to

results, encouraging the recruitment and training of young players144 and combating
doping in order for competitive sport to be conducted fairly including the need to
safeguard equal chances for athletes, athletes’ health, the integrity and objectivity of
competitive sport and ethical values in sport.145 After Murphy, the protection of
intellectual property rights of sporting events can be added to the list of aims
accepted as legitimate in the interpretation and enforcement of the EU law in the
area of sport. The difference between pre- and post-Article 165(1) TFEU methodol-
ogy in generating this list is the introduction of the constitutional nature of the obli-
gation to take into consideration the specificity of the sport, as opposed to a loose
obligation not delineated in clear and express terms in either the Treaty or the
Court’s jurisprudence that does not have a strict precedential value. This part of the
judgement has not yet affected the interpretation of intellectual property legislation
at EU level. However, by including sporting events in the derogation based on intel-
lectual property protection, it has slightly broadened the scope of that derogation
under the EU free movement law.
The Murphy case also illustrates that the restrictions do not necessarily have
to originate from sporting bodies to benefit from the legitimate aim recognised on
the basis of specificity of sport. An objective worthy of protection is to be taken
as such regardless of who adopts the restrictive measures as long as the infringing
party can be considered an addressee under the internal market provisions. This
particular justification, placed within the broader derogation of intellectual prop-
erty rights protection, is rooted in the specific nature of sporting events in general
(as opposed to being confined to particular sporting events) and the interpretation
of EU law in accordance with Article 165(1) TFEU, so as to allow for proportion-
ate national law to be consistent with the EU free movement provisions.
The proportionality of a measure taken at the national level to protect intellec-
tual property in sporting events was emphasised by the Court in para 105 of the
Murphy case. On the facts of the case, the restrictions in broadcasting agreements
were held to be disproportionate. The specific subject-matter of the intellectual
property did not guarantee the rights holders concerned the opportunity to demand
the highest possible remuneration. Protection of intellectual property rights which
included payment of a premium by broadcasters to obtain absolute territorial pro-
tection partitioned national markets and maintained artificial price differences, and
went beyond what is necessary for ‘appropriate remuneration’ to the right hold-
ers.146 Hence, a premium paid in exchange for territorial exclusivity in itself
would form a part of ‘appropriate remuneration’ and would be proportionate, but
only if that exclusivity is not accompanied by export prohibitions on decoding
devices granting absolute territorial protection. In other words, the system of sole
licensed broadcaster per territory which encrypts programme-carrying signal is

144 Case C-415/93 Bosman and Case C-325/08 Bernard.

145 Case 519/04 Meca-Medina.
146 Paragraphs 105–117.
142 4 EU Internal Market Law and Sport

allowed, but restricting trade in decoder devices on the top of such territorial
exclusivity is not. The possibility of provision of cross-border services to TV
viewers in other Member States should not be affected by exclusivity clauses in
broadcasting agreements. The Court followed the opinion of the Advocate General
in the case who considered that offsetting the price differences between Member
States by trade is a part of the idea behind the internal market and marketing the
broadcasting rights by the Premier League on this basis amounts to ‘profiting from
the elimination of the internal market’.147
There is no clearly recognisable pattern regarding the intensity of the propor-
tionality test carried out by the Court in different cases. Generally, the intensity
will vary depending on the restriction in question. From the Meca-Medina case148
it does not follow that the Court has given any special consideration to sport in this
regard. Kaburakis et al. correctly note that the proportionality test applied in
Murphy was stricter than the one carried out in Bernard,149 in which the Court for
the first time ever referred to Article 165(1) TFEU and it did so in the context of
the required standard of application of the proportionality test.150 This reference
was omitted at the proportionality stage of analysis in Murphy because there were
no specificities and social and educational functions of sport involved and the
issues considered were strictly commercial.

4.10.2.4 Objective Justification: Encouraging the Public

to Attend Matches

UEFA’s Regulations governing the implementation of Article 48 of the UEFA

Statutes allow, but do not require, national associations to set a two-and-a-half-
hour period on Saturdays or Sundays during which no live football matches can be
transmitted. The purpose of this so-called ‘closed period’ or ‘blocked hours’ rule is
to ensure that people are not deterred from going to the stadiums to watch local
matches, or participate in amateur or youth matches on the account of live trans-
mission.151 The Football Association in England designated this closed period for
Saturday afternoons. As required by the UEFA rules, this is the time correspond-
ing to the domestic fixture schedule when the majority of the games in the top
national leagues are played. The local broadcasters are required to respect this rule
by the terms of their license agreements. Also, national associations are required to
observe blocked hours in their agreements with broadcasters when selling in the
territory matches from other national associations that have designated their own
closed periods.

147 Paragraph 192 of her Opinion in Joined Cases C-403/08 and C-429/08 Murphy.
148 Case C-519/04 David Meca-Medina and Igor Majcen v. Commission [2006] ECR I-6991.
149 Kaburakis et al. 2012, p. 313.
150 See para 40 of Case C-325/08 Bernard. For discussion see Pijetlovic 2010, pp. 862–867.
151 Opinion of AG in Joined Cases C-403/08 and C-429/08 Murphy, para 206.
4.10 Joined Cases C–403/08 and C–429/08 Murphy [2011] 143

FAPL claimed that the importation of decoder cards would make it impossible
to enforce closed periods. But the Court rightfully dismissed this argument in para
123 saying that:
[…] even if the objective of encouraging such attendance of stadiums by the public were
capable of justifying a restriction on the fundamental freedoms suffice it to state that
compliance with the aforementioned rule can be ensured, in any event, by incorporating
a contractual limitation in the licence agreements between the right holders and the broad-
casters, under which the latter would be required not to broadcast those Premier League
matches during closed periods. It is indisputable that such a measure proves to have a
lesser adverse effect on the fundamental freedoms than application of the restriction at
issue in the main proceedings.

It is indeed far less restrictive, and yet as effective, to contractually oblige foreign
broadcasters to respect the sellers’ local rules on closed periods.
Regarding the precedential value of the justification put forth, the Court left us
without a clear indication on whether the goal of encouraging the public to attend
football stadiums and participate in matches was capable of justifying restrictions.
Its wording ‘even if the objective of encouraging such attendance of stadiums by the
public were capable of justifying a restriction’ would suggest that it is not. But the
Court then goes on to dismiss the proportionality of the measure (which is not neces-
sary for objectives not considered worthy of protection). The reason for this ambigu-
ity in analysis might be that the Court did not necessarily have to be more specific as
the restrictions themselves were easily proven disproportionate; the outcome of the
analysis would have been the same in either case. Unlike the Court, the Advocate
General seems to have accepted the attendance at stadiums and participation in
matches as capable of constituting a legitimate goal under EU internal market
law.152 It is important to note here that in assessing the value of the objective the
Advocate General relied on Article 165 TFEU but the Court did not. Siding with the
Court on this issue, it is submitted that encouraging attendance at stadiums and par-
ticipation in sporting activities should not be held in such high regard as worthy of
protection at the expense of free movement and partitioning of internal market.
Merely creating opportunities for the general public to engage in sports participation
and attendance at stadiums is sufficient. Once the opportunities exist, even the public
health argument would not justify a different conclusion. People usually like to de-
stress during weekends and the choice of how should be entirely up to them, as long
as choices exist. Some prefer staying at home and being far from football crowds
and socialising; who is to say that this might not be a more suitable personal health
choice for both mental and physical workers. Besides, attendance at stadiums, par-
ticipation in matches and watching a live transmission are three qualitatively differ-
ent activities that are poor substitutes for one another.153
Furthermore, under the contemporary model of financing employed by the
clubs in the Premier League, revenues from gate receipts are by far superseded by
revenues derived from the sales of media rights and are no longer crucial to the

152 This follows from paras 206–210 of her Opinion.

153 Ibid. (suggested in para 209).
144 4 EU Internal Market Law and Sport

financial survival of the clubs.154 But in lower football leagues, or in other sports,
gate receipts still represent a major part of the clubs’ budgets and the Court might
have been more receptive towards the justification put forth if the arguments were
repackaged and objective renamed as, for example, a solidarity mechanism,
enhancing competitive balance between leagues, or improving training conditions
for young talent (given that clubs in lower leagues are a breeding ground for
young talent). So, protecting gate receipts of the lower division clubs by closed
periods for reasons such as solidarity and competitive balance by means of
blocked hours is an objective likely to be accepted by the Court, but restricting
free movement and partitioning the internal market with the objective to encourage
public attendance at stadiums and participation in sport—which the public can
anyway do at will—should not be given the status of justification in EU law.
In either case, accepting the objective as legitimate does not mean that the con-
tested rule is in accordance with the Treaty provisions. The rule still has to be suita-
ble and proportionate. To demonstrate suitability in this particular case would be a
challenging task, to say the least, especially in the light of the intensity of the appli-
cation of the proportionality test as suggested by the Advocate General. She
assumed that the blocked hours rule might have been designed at least in part to
safeguard the economic interests of Premier League clubs by partitioning the inter-
nal market and considered that ‘a particularly strict test is therefore to be applied to
the demonstration of the need for closed periods’.155 Then she seems to have sug-
gested that using closed periods to attain any objective can hardly ever be suitable
because economic evidence and practice from other countries is heavily weighted
towards the conclusion that the attendance at stadiums and sport participation is not
affected by live transmission.156 Thus, even the public health, solidarity, competitive
balance and any other initially accepted legitimate objective, would all be predes-
tined to fail. As a matter of sound legal advice, the Advocate General ultimately left
the burden for FAPL to prove that different conditions prevailed in English football
which necessarily required protection by means of closed periods and which would
in turn justify a different conclusion on the point of suitability of the restricting rule.
The strictness of the application of proportionality makes any such burden particu-
larly onerous as the FAPL evidence would have to show that live transmissions have
‘substantial detrimental effects on attendance at matches and/or participation in foot-
ball matches in order for enforcement of the closed periods to be able to prevail over
the adverse effects on the internal market’.157

154 See Deloitte Annual Report of Football Finance (2011).

155 Paragraph 208 of her Opinion.
156 Ibid. para 209 reads: ‘[…] in an investigation of the closed periods under competition law

the Commission found that only 10 of 22 associations had actually adopted a closed period. No
closed periods were adopted in France, Germany, Italy and Spain, or in Northern Ireland, that
is to say, within the sphere of influence of English football. Furthermore, in Germany today all
Bundesliga matches are evidently transmitted live without attendance at matches in the top two
leagues suffering as a result’.
157 Paragraph 210 of her Opinion in Joined Cases C-403/08 and C-429/08 Murphy.
4.10 Joined Cases C–403/08 and C–429/08 Murphy [2011] 145

4.10.2.5 Competition Law Aspects

Unsurprisingly, the Court confirmed the result obtained under the free movement
provisions: clauses in the exclusive license agreements which include an obligation
on broadcasters not to supply decoding devices outside their exclusive territories
restrict competition by object and are prohibited by terms of Article 101(1)
TFEU.158 Even though the restraint to trade under both national legislation and the
broadcasting license agreements was identical and posed identical legal questions,
the national legislation was examined under free movement law, and clauses in
agreements under EU competition law, the latter set of provisions being addressed to
private undertakings and the former to the Member States. This was merely a techni-
cality enabled by the specific circumstances of the case. Had there not been any
national legislation on the subject, and the restrictions originated from a sporting
body, a single source, it would have been possible to bring those restrictions in pri-
vate agreements under the scope of internal market rules. The result would be the
same as for national legislation. In that case, the Court would refer to its findings
under free movement to say that there is no need to answer the competition law
questions, as it did in Bosman. But had the Court found no restriction under the
internal market law, it would have to examine the case under competition law.
The competition law aspects of Murphy are discussed in Sect. 5.5.4.4. As parts
of the case provide contribution to the convergence between the two sets of TFEU
economic provisions, Sect. 6.4 will look at the relevant paragraphs in the light of
the convergence theory.

4.10.2.6 Protecting Copyrights and Associated Works Under

the Copyright Directive

Having found that the EU internal market and competition law principles require that a
European citizen should be able to purchase a cheaper decoder card from another
Member State to gain access to foreign satellite transmissions, the Court answered a set
of questions regarding the use of the broadcast once they are received. Although the live
transmission was not subject to copyright, the associated works such as the opening
video sequence, the Premier League anthem, pre-recorded films showing highlights of
recent Premier League matches and various graphics were.159 The reproduction within
the memory of a satellite decoder and on a television screen to enable the broadcasts to
be transmitted and received constituted ‘reproduction’ within the meaning of Article
2(e) of the Copyright Directive, but since the reproduction fulfilled the exemption con-
ditions under Article 5(1) of that directive, (inter alia, it was temporary and transient
and had no independent economic significance) it did not require the authorisation of
the copyright holder.160 However, with regard to the works that are ‘communicated to

158 Joined Cases C-403/08 and C-429/08 Murphy, paras 134–146.

159 Ibid. para 149.
160 Ibid. para 182.
146 4 EU Internal Market Law and Sport

the public’ within the meaning of Article 3(1) of the Copyright Directive, the transmis-
sion of broadcast works to a new public (i.e. a public which was not taken into account
by the authors of the protected works when they authorised their use by the communica-
tion to the original public) constituted a new communication to the public.161 The Court
here assumes that when authors ‘authorise a broadcast of their works, they consider, in
principle, only the owners of television sets who, either personally or within their own
private or family circles, receive the signal and follow the broadcasts’.162 This might
indeed hold true in all other broadcasts but certain sports broadcasts in which the right
owners are well-aware of the fact that their copyrighted material is going to be used
widely in the public establishments, pubs in particular. The transmission of the copy-
righted works in pub settings was considered to have satisfied the formula of a new
‘communication to the public’ and thus required authorisation.163 So the Court distin-
guished between the authorisation requirement for use in private homes and the use
containing element of ‘communication to public’ which includes transmission of broad-
cast works in places where people gather such as cafés, restaurants, pubs, clubs, offices,
airplanes, etc. However, the key to the proper reading of the judgment should not be the
objective test related to the place where the works are shown, but the subjective test
related to the public ‘considered by the authors when they authorised the broadcasts of
their works’. The Court could not have been unaware of the fact that authors of the
works in casu, the FAPL, already take into account and know that exclusive broadcast-
ers will be serving both private homes and pubs. It is therefore submitted that pub-cli-
ents of the broadcasters should not need any additional authorisation from the authors of
works, whether they are domestic or foreign clients. Such authorisation is clearly given
to exclusive broadcasters for both types of clients when the rights are sold, and the pub-
lic in the public house should therefore constitute ‘original public’ when it comes to
broadcasting of Premier League. Recital 17 of the Satellite Broadcasting Directive
stands in support of this interpretation. It provides that ‘in arriving at the amount of the
payment to be made for the rights acquired, the parties should take account of all
aspects of the broadcast, such as the actual audience, the potential audience and the lan-
guage version’.164 Such aspects also include the copyrights associated with the
broadcast.

4.10.2.7 Final Remark

Ever since the Advocate General delivered her opinion, it was thought that liberal-
ising the service market for satellite transmission of sports, and as a necessary cor-
ollary, creating an internal market for trade in decoder cards, could result in

161 Ibid. para 197.

162 Ibid. para 198.
163 Ibid. paras 199 and 207.
164 Council Directive 93/83/EEC of 27 September 1993 on the coordination of certain rules con-

cerning copyright and rights related to copyright applicable to satellite broadcasting and cable
retransmission OJ L 248 ,06/10/1993 pp. 0015–0021.
4.10 Joined Cases C–403/08 and C–429/08 Murphy [2011] 147

reorganisation of the entire broadcasting sector in Europe,165 as without the pro-

tection by national segmentation, the rights holders would probably have to find a
new way to sell their rights to make up for the loss of profits resulting from paral-
lel trade in decoder cards. It was further thought that the judgement may ‘have
serious implications for European football […] which might lose a significant
share of their profits from the sale of broadcasting rights’.166 Looking at the stag-
gering figures in post-Murphy sale of broadcasting rights by the FAPL (for seasons
2013–2016),167 these concerns now appear unjustified. Restricting the commen-
tary included in broadcasting signal to different language versions might have cre-
ated ‘a sufficiently effective practical delimitation of the markets in order to
continue to serve the different national markets at different prices’.168

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Doukas D (2012) The sky is not the (only) limit—sports broadcasting without frontiers and the
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on circumvention, fraud and other misuses of community law. Eur Bus Law Rev 11:179–194
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United UFC, judgment of the Court of Justice (Grand Chamber) of 16 March 2010, not yet
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law/elj/eslj/issues/volume5/number2/miettinen_parrish
Parrish R (2003) Sports law and policy in the European Union. Manchester University Press,
Manchester

165 Ward and Amor 2012, pp. 86–90.

166 Doukas 2012, p. 626.
167 See Sect. 1.2.1.
168 Opinion of AG in Joined Cases C-403/08 and C-429/08 Murphy, para 202.
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Parrish R, Miettinen S (2008) Sporting exception in European Union law. T.M.C. Asser Press,
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Pijetlovic K (2010) Another classic of EU sports jurisprudence: legal implications of Olympique
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Chapter 5
EU Competition Law and Sport

Contents
5.1 Article 101 TFEU................................................................................................................. 150
5.1.1 Prohibition Provision: Article 101(1) TFEU.............................................................. 150
5.1.2 Exemption Provision: Article 101(3) TFEU.............................................................. 154
5.1.3 Nullity Provision: Article 101(2)............................................................................... 157
5.1.4 Commercialisation Agreements................................................................................. 157
5.2 Article 102 TFEU................................................................................................................. 158
5.2.1 Definition of Relevant Market................................................................................... 158
5.2.2 Establishing Dominance............................................................................................ 159
5.2.3 Abuse of Dominant Position...................................................................................... 160
5.2.4 Objective Justification and the Efficiency Defence................................................... 161
5.3 Oligopolistic Market Structures and the Concept of Collective Dominance....................... 162
5.3.1 The Oligopoly Problem.............................................................................................. 162
5.3.2 Collective Dominance................................................................................................ 163
5.4 Simultaneous Application of Articles 101 and 102 TFEU................................................... 167
5.5 Articles 101 and 102 TFEU in the Sporting Context........................................................... 168
5.5.1 Basic Elements........................................................................................................... 168
5.5.2 Relevant Market......................................................................................................... 170
5.5.3 Collective Dominance................................................................................................ 172
5.5.4 Analytical Framework for Commercial Rules in Sport............................................. 173
5.5.5 Analytical Framework for Regulatory Rules: C-519/04 Meca-Medina [2006]......... 179
5.6 Blocking Competing Organisations..................................................................................... 187
5.6.1 C-49/07 MOTOE [2008]............................................................................................ 187
5.6.2 Commission Investigation in FIA/Formula One Case............................................... 196
5.6.3 Case C-250/92 DLG [1994]....................................................................................... 199
5.7 Superdominance and Special Responsibility....................................................................... 202
5.7.1 The Concept of Superdominance............................................................................... 203
5.7.2 Special Responsibility of Dominant Undertakings: The Sliding Scale Approach..... 206
5.7.3 The Content of Special Responsibility of Superdominant Sports Undertakings....... 208
5.8 Conclusion........................................................................................................................... 211
References................................................................................................................................... 212

© t.m.c. asser press and the author 2015 149

K. Pijetlovic, EU Sports Law and Breakaway Leagues in Football,
ASSER International Sports Law Series, DOI 10.1007/978-94-6265-048-0_5
150 5 EU Competition Law and Sport

European Union competition provisions that apply to undertakings are set out in
the Title VII, Chap. 1, Sect. 1.1, Articles 101–106 of the Treaty. Article 101 is the
main instrument to control cartels between undertakings, Article 102 prohibits
the abuse of a dominant position by one or more dominant undertakings, while the
application of these two provisions (as well as other Treaty articles) to state meas-
ures in respect of public undertakings, undertakings granted special or exclusive
rights and undertakings entrusted with services of general economic interest are
regulated by Article 106 of the Treaty.
What follows in the sections below is a description of these articles, custom-
tailored to suit the purpose of this volume. They will set up the framework for
analysis of breakaway structures under Chap. 7, and focus on the application of
competition law in the sporting context.

5.1 Article 101 TFEU

For the purposes of application of competition law provisions contained in Articles

101 and 102 of the Treaty, any entity engaged in an economic activity,1 irrespec-
tive of its legal form and the way in which it is financed is categorised as an under-
taking.2 Together with Regulation 1/2003, Article 101 provides a principal tool to
control anti-competitive behaviour by cartels in the Union. The legal rules in this
article are divided into three functionally distinct paragraphs: the prohibition
­provision under para 1, the nullity provision under para 2, and the exemption
­provision under para 3 of the article.

5.1.1 Prohibition Provision: Article 101(1) TFEU

Article 101(1) prohibits agreements between undertakings, decisions by associations

of undertakings, or concerted practices, which are considered capable of affecting
trade between Member States and that have as their object (i.e., subjectively intend)

1 Any activity consisting in offering goods or services on a given market is an ‘economic

a­ ctivity’. See Case C-35/96 Commission v Italy [1998] ECR I-3851, para 36, and Joined Cases
C-180/98 to C-184/98 Pavlov and Others [2000] ECR I-6451, para 75. In addition, in Case
C-222/04 Cassa di Risparmio di Firenze and Others [2006] ECR I-289, paras 122 and 123, the
Court stated that the fact that the offer of goods or services is made without profit motive does
not prevent the entity which carries out those operations on the market from being considered an
undertaking, since that offer exists in competition with that of other operators which do seek to
make a profit.
2 Case C-41/90 Höfner and Elser [1991] ECR I-1979, para 21, and Joined Cases C-264/01,

C-306/01, C-354/01 and C-355/01 AOK Bundesverband and Others [2004] ECR I-2493, para 46.
See also Guidelines on the Application of Article 81(3) OJ C 101 27.4.2004, para 22.
5.1 Article 101 TFEU 151

or effect (i.e., objectively cause)3 the prevention, restriction, or distortion of compe-

tition within the common market. The term ‘agreement’ has a broad definition, and
is inclusive of agreements between independent undertakings that might distort
competition within the internal market, regardless of whether or not they constitute
contracts under national laws, whether or not they are intended to be legally binding,
whether they are in oral or in written form, and whether or not they provide sanc-
tions for the breach.4 Falling short of the ‘agreement’, mental consensus regarding
conduct on the market that substitutes cooperation for the risks of competition is
considered concerted practice,5 while all conduct which is meant to coordinate the
activities of the members of any association, in particular a trade association, will
amount to a decision by an association of undertakings.6 The object of the agree-
ment is discerned by examining ‘the aims pursued by the agreement […] in the light
of the economic context in which the agreement is to be applied’, rather than
­looking at common intention of the parties.7 Once the anti-competitive object of the
agreement is established, there is no need to demonstrate its adverse effects on com-
petition. The scope of this article is very broad since no actual and direct effect on
trade is required and prima facie any agreement made may be caught by this
­provision. However, there are a number of exceptions within the framework of this
provision, primarily for the agreements that restrict the competition by effect.
First, certain agreements are deemed harmless and never fall under Article
101(1) because they do not have an appreciable impact on trade between Member
States.8 This is known as the de minimis doctrine which automatically places
agreements of minor importance outside of the scope of Article 101(1).9

3 For the concept of ‘effects on trade’ see C-56/65 Societe Technique Miniere v. Maschinenbau
Ulm (STM) [1966] ECR 235, para 7; and Case 56/64 Consten and Grundig [1966] ECR 299,
para 27. See also Commission Notice—Guidelines on the effects on trade concept contained in
Articles 81 and 82 of the Treaty, OJ C 101, 27.04.2004, pp. 81–96.
4 See, in particular, Cases 56 and 58 Etablissements Consten SA and Grunding-Verkaufs-GmbH

v. Commission [1966] ECR 299, Case 41/69 ACF Chemiefarma NV. v. Commission (the Quinine
Cartel) [1970] ECR 661, Case C-227/87 Sandoz Prodotti Farmaceutici Spa. v. Commission
[1990] ECR I-45, and Case IV/30.804—Nuovo Cegam [1984] OJ L 99/29, [1984] 2 CMLR 484.
5 Case 48/69 ICI v. Commission [1972] ECR 619, para 64.
6 See, for example, Case 8/72 Vereeniging van Cementhandelaren v. Commission [1972] ERC 977.
7 Cases 29 and 30/83 Compagnie Royale Asturienne des Mines SA and Rheinzink GmbH v.

Commission [1984] ECR 1679, para 26; Case C-551/03 P General Motors BV v. Commission
[2006] ECR I-3173, para 77; and Joined Cases C-501/06 P, C-513/06 P, C-515/06 P and
C-519/06 P GlaxoSmithKline Services and Others v. Commission and Others [2009]
ECR I-9291, para 58.
8 Case 23/67 Brasserie de Haecht SA v. Wilkin [1967] ECR 407. For discussion on appreciable

impact of agreements see Case 5/69 Völk v Vervaecke [1969] ECR 295.
9 Under this principle, agreements are permissible between parties that do not ­ collectively
exceed 10 % of the relevant market, or 15 % in the case where the undertakings are not
­competitors, though certain agreements such as price fixing, output or sales limitations or m
­ arket
allocations are impermissible in all instances. See the Commission Notice on agreements of
minor importance which do not appreciably restrict competition under Article 81(1) of the Treaty
establishing the European Community (de minimis), OJ C 368/07, 22.12 2001.
152 5 EU Competition Law and Sport

Second, ancillary restraints, i.e., the restrictions on competition that are directly
related and objectively necessary for the implementation of the main, non-restrictive
transaction and are proportionate to it, fall outside of the ambit of the prohibition
provision.10 In STM the Court held that the term conferring exclusivity on a dis-
tributor may not infringe Article 101(1) if it seems ‘really necessary for the pene-
tration of a new area by an undertaking’.11 In Metro the restrictions in a selective
distribution scheme were held to fall outside of Article 101(1) where they satisfy
objective qualitative criteria and are applied in non-discriminatory manner.12 The
closest analogy to breakaway structures is supplied by the DLG case decided in
1994 in the context of agriculture.13 Therein, a cooperative purchasing association
was permitted to place a restriction on their members’ participation in alternative
agricultural cooperatives, on the basis that the restriction in fact benefited competi-
tion and was necessary to protect legitimate goals necessary for the functioning of
the cooperative. In the Court’s own words:
[a] provision in the statutes of a cooperative purchasing association, forbidding its mem-
bers to participate in other forms of organized cooperation which are in direct competition
with it, is not caught by the prohibition in Article [101(1)] of the Treaty, so long as the
abovementioned provision is restricted to what is necessary to ensure that the cooperative
functions properly and maintains its contractual power in relation to producers.14

The same test was carried out under Article 102 for the same restrictive provision
in the statutes of the cooperative and the same result was reached.15 Moreover,
proportionate restrictions in franchising agreements designed to protect intellec-
tual property rights of the franchisor, and to maintain the common identity of the
franchise system,16 as well as proportionate non-competition obligations on the
vendor where they are necessary to effect the transfer of undertaking,17 will not
breach the prohibition provision. Whish referred to the type of ancillary restrains
seen in these cases as ‘commercial ancillarity’ restraints because the restrictions
on competition were ancillary to a legitimate commercial purpose.18
Third, in Wouters the Court introduced an exception, characterised by Monti as
a ‘European-style rule of reason’19 and by Whish, perhaps more accurately, as a

10 See Guidelines on the Application of Article 81(3) OJ C 101 27.4.2004, paras 28–31; and

Case T-112/99 Métropole télévision (M6) and others [2001] ECR II-2459.
11 Case 56/65 Société La Technique Minière v. Maschinenbau Ulm GmbH [1966] ECR 234.
12 Case 26/76 Metro (I) [1977] ECR 1875.
13 Case C-250/92 Gøttrup-Klim e.a. Grovvareforeninger v Dansk Landbrugs Grovvareselskab

AmbA [1994] ECR I-5641.

14 Ibid. para 45.
15 Ibid. para 52.
16 Case 161/84 Pronuptia de Paris GmbH v Pronuptia de Paris Irmgard Schillgallis [1986] ECR

353.
17 Case 42/84 Remia BV and Others v. Commission [1985] ECR 2545.
18 Whish 2009, p. 126.
19 Monti 2002, pp. 1087–1088.
5.1 Article 101 TFEU 153

‘regulatory ancillarity’.20 The judgment does not really introduce the rule of
­reason in Article 101(1) because balancing of the pro- and anti-competitive effects
of restrictions involves economic arguments on both sides, whereas Wouters21
introduces the balancing of the Union’s competition law objectives against the
non-economic public interests that may or may not be a part of the Union’s objec-
tives in other areas. The Wouters test was confirmed in the sporting case of Meca-
Medina.22 Accordingly, certain types of agreements or decisions that restrict the
commercial behaviour of undertakings do not violate the prohibition in Article
101(1) TFEU, if, because of their context and objectives, the restrictions in those
agreements or decisions are inherent to, and proportionate for, the realisation of
non-competition objectives.23 From the scarce case law on regulatory ancillarity, it
appears that the exception is applicable only in cases of regulatory restrictions
imposed by collective private bodies in public interests, whether at national,
European or global level. So far, the Court has applied it only to rules having a
public law character deemed necessary for the proper organisation and (ethical)
conduct of a certain profession. The private bodies that laid those restrictive rules
down, the Bar of the Netherlands and the International Olympic Committee,
derived their powers from national law and public international law, respectively.
It is submitted that these facts do not imply that the framework developed under
that case law cannot be used to accommodate other kinds of non-competition
objectives, in particular those under policy-linking clauses of the Treaty, the
importance of which has been enhanced by the Lisbon amendments.24 To allow a
reliance on the public interest defence for agreements concluded by private parties
that do not derive their powers from public laws, especially private collective
­bodies such as the Fédération Internationale de Football Association (FIFA) and
Union des Associations Européennes de Football (UEFA), in an area where no
responsible public authority vested with powers to enforce the laws protecting
those public interests exists,25 is a necessary constitutional fine-tuning of the
Union’s competition law in view of the increase in private governance and self-
regulation of certain sectors and the corresponding decrease in the private/public
divide in EU law. It is noteworthy, however, that in the ENIC case concerning the
UEFA rule prohibiting multiple ownership of clubs the Commission applied the

20 Whish 2009, p. 126.

21 Case C-309/99 J.C.J Wouters, J.W. Savelbergh, Price Waterhouse Belastingadviseurs BV v.
Algemene Raad van de Nederlandse Orde van Advocaten [2002] ECR I-1577.
22 Case C-519/04 David Meca-Medina and Igor Majcen v. Commission [2006] ECR I-6991.
23 Paragraph 97 of Case C-309/99 Wouters, and para 42 of Case C-519/04 Meca-Medina.
24 The EU for the first time has a duty to mainstream the policy objectives under Article 7 of

the TFEU after Lisbon amendments: ‘[t]he Union shall ensure consistency between its policies
and activities, taking all of its objectives into account and in accordance with the principle of
­conferral of powers.’
25 However, the General Court held that where there is public authority with powers, for

­example, in relation to product safety, it is not for private undertakings to take the initiative to
eliminate the products which are not safe. See case T-30/89 Hilti, para 118.
154 5 EU Competition Law and Sport

Wouters test and thus recognised that necessity. It will be demonstrated in Chap. 6,
in the context of the sporting exception, that the foregoing considerations present
one of the reasons why the principle of convergence ought to be formally intro-
duced between competition and internal market provisions to the extent possible.26
The Court has anyhow made some competition decisions on the basis of single
market considerations, which then, due to misunderstandings and a lack of any
reference to convergence, attracted a lot of criticism.27
Finally, the approach presented is in line with the Court’s jurisprudence in the
Albany, Brentjens and Drijvende Bokken cases, where it was held that agreements
concluded in the context of collective bargaining between an employee and an
employer association that improve working and employment conditions fall out-
side the scope of Article 101(1).28 In addition, agreements between two or more
persons forming a single economic entity, full-function joint ventures, individual
employment agreements, and agreements between an agent and principal, will
normally also fall outside the scope of prohibition provision.29

5.1.2 Exemption Provision: Article 101(3) TFEU

Agreements, decisions or practices that are incompatible with Article 101(1) but
that satisfy the conditions under Article 101(3) of the Treaty, are valid and
enforceable, with no prior decision to that effect being required.30 The rationale
behind the provision is connected to the fact that certain agreements may have
both, pro-competitive and anti-competitive features. This recognition of the dual
nature of economic effects usually involves complex economic analysis weighting
the beneficial and harmful effects to determine whether the agreement qualifies for
the exemption. Accordingly, those agreements, decisions or practices that fulfil the
four conditions outlined in this provision will benefit from an exemption. Two pos-
itive conditions state that an agreement must improve the production or distribu-
tion of goods or promote technical or economic progress, and at the same time
allow consumers a fair share of the resulting benefits. Two negative conditions

26 See also Sect. 5.4.

27 See, for example, discussion on Case 56/64 Consten and Grundig in Jones and Sufrin 2011,
pp. 204–209.
28 Case C-67/96 Albany International BV v. Stichting Bedrijfspensioenfonds Textielindustrie

[1999] ECR I-5751, Cases C-115, 116 and 117/97 Brentjens’ Handelsonderneming BV v
Stichting Bedrijfspensioenfonds voor de Handel in Bouwmaterialen [1999] ECR I-6025 and Case
C-219/97 Drijvende Bokken [1999] ECR I-6121.
29 See Whish 2009, p. 146.
30 See Article 1(2) of the Council Regulation (EC) No 1/2003 of 16 December 2002 on the

implementation of the rules on competition laid down in Articles 81 and 82 of the Treaty OJ L 1,
04.01.2003, pp. 1–25.
5.1 Article 101 TFEU 155

state that an agreement cannot contain any restrictions that are not essential to the
attainment of the objectives under agreement (i.e., disproportionate restrictions)
and cannot lead to elimination of competition in substantial part of the product in
question. Balancing of anti-competitive and pro-competitive effects is conducted
exclusively within the framework laid down by Article 101(3),31 and there is no
scope in this provision for non-competition arguments that cannot be translated
into economic efficiencies.32 The Treaty, however, pursues a number of policy
objectives and some of them must be taken into consideration in the pursuit of
other policies. Under Article 101(3), public policy objectives may be taken into
account only if they can be subsumed under one of its four conditions,33 so as a
supplement to economic benefits that the agreement generates. Jones and Sufrin
argue that ‘a pursuit of a sole consumer welfare objective may produce a result
inconsistent with other Treaty policies […] and actions should take account of
certain policy-linking clauses, such as environmental protection, employment,
­
culture, health, consumer protection, industrial policy and/or elimination of
­
regional disparities.’34 However, instead of going so far as to contaminate the
exemption provision with the non-competition arguments, which could potentially
create more problems than solutions, it is submitted, first, that in the light of the
Court’s case law and the Commission practice so far, Article 101(1) offers a more
suitable analytical platform for policy integration. In fact, the framework estab-
lished by Wouters is ideal to accommodate any other policy objectives in accord-
ance with Article 7 TFEU and at the same time to stay faithful to the already
established and persistently defended paradigms that balancing of anti-competitive
and pro-competitive effects is conducted exclusively within the framework of

31 See Commission Guidelines on application of Article 81(3), para 11, and Commission

Guidelines on application of Article 101 on horizontal agreements para 20. See also Case
T-65/98 Van den Bergh Foods [2003] ECR II-4653, para 107; and Case T-112/99 Métropole
­télévision (M6) and others [2001] ECR II-2459, para 74, where the General Court held that it is
only in the framework of Article 101(3) that the pro- and anti-competitive aspects of a restriction
may be weighed.
32 See also Semmelmann 2008, p. 15. The Commission has accepted arguments on the basis

of environmental protection in Case IV/F 1/36/718—CECED [2000] OJ L 187/47. In Case

26/76 Metro (I) [1977] ECR 1875, the Court has accepted that ‘the establishment of supply
forecasts for a reasonable period constitutes a stabilising factor with regard to the provision of
­employment which, since it improves general conditions of production, […] comes within the
framework of the objectives to which reference may be had pursuant to Article [101(3)]’, para
43. The ­stabilising effect of an agreement on employment may translate into cost savings and
other ­efficiency gains.
33 Commission Guidelines on the application of Article 81(3), para 42. So far, the other policy

objectives have been considered under the first condition. See also Commission White Paper
on Modernisation of the rules implementing Articles 81 and 82 of the EC Treaty, Commission
Programme No 99/027 1999/OJ C 132/1, which states that Article 101(3) is meant to ‘provide a
legal framework for the economic assessment of restrictive practices and not to allow the applica-
tion of the competition rules to be set aside because of political considerations’, para 56.
34 Jones and Sufrin 2011, p. 245.
156 5 EU Competition Law and Sport

Article 101(3), and that only economic efficiencies are to be taken into account in
that provision, including public policy objectives that can be subsumed under one
of its four conditions. Namely, an agreement or decision that restricts competition
but genuinely pursues a public policy objective under some of the policy-linking
clauses35 or outside of it,36 that is not already protected by public regulation,37 and
that fulfils the Wouters criteria could thus escape the application of the prohibition
provision. Should the outcome of the Wouters test be different, the agreement or
decision will have to satisfy the four conditions of Article 101(3). If the public pol-
icy objective that it pursues can be translated into economic benefits, it should be
taken into account also in the framework of the exemption provision although it is
likely to fail the indispensability requirement in the cases where it already failed to
satisfy the proportionality under Wouters. This is the true face of the European-
style rule of reason and to interpret the exemption provision as suitable for purely
non-competition arguments would have the effect of completely blurring the dis-
tinction between the different paragraphs of Article 101. As a second point, it is
submitted that the consumer welfare standard includes the protection of goals in
the public interest, and that consumers are not just concerned with having cheap,
high-quality products and services. The European Union, correspondingly, has
‘not only an economic but also a social purpose’38 and this purpose ought to be
reflected in the interpretation of the law, especially in regard to the issues involv-
ing policy linking clauses.
Although the Commission and the Court take the view that hard core cartels
restricting competition by object are generally incapable of meeting the four con-
ditions of Article 101(3),39 this possibility nevertheless remains available.40
Alternatively, restrictions on competition can also be considered compatible with
Article 101 if they satisfy the criteria for application of one of the block exemption
regulations that grants exemptions to certain categories of agreements.

35 Such as, for example, clauses related to environmental protection in Article 11 TFEU,
c­ onsumer protection in Article 12 TFEU, achieving high level of employment in Article 147(2)
TFEU, respect for cultural diversities in Article 167(4) TFEU, health protection in Article
168(1) TFEU, competitiveness of the Union’s industry in Article 173(3) TFEU, and regional
­development under Article 175 TFEU.
36 See, for e.g., Case C-309/99 J.C.J Wouters, J.W. Savelbergh, Price Waterhouse

Belastingadviseurs BV v. Algemene Raad van de Nederlandse Orde van Advocaten [2002]

ECR I-1577; Case C-519/04 David Meca-Medina and Igor Majcen v. Commission [2006]
ECR I-6991; Case C-250/92 Gøttrup-Klim e.a. Grovvareforeninger v Dansk Landbrugs
Grovvareselskab AmbA [1994] ECR I-5641.
37 See Case T-30/89 Hilti v Commission [1991] ECR II-1439.
38 Case C-438/05 Viking Line [2007] ECR I-10779, para 79; Case C-341/05 Laval [2007] ECR

I-11767, para 105.

39 Cases C-403/04 P and 405/04 P Sumitomo Metal Industries Ltd. v. Commission, judgment of

25 January 2007, para 43.

40 See Commission Decision in COMP/29.373—Visa International—Multilateral Interchange

Fee [2000] OJ L 318/17, [2003] 4 CMLR 283.

5.1 Article 101 TFEU 157

5.1.3 Nullity Provision: Article 101(2)

Article 101(2) of the Treaty simply provides that agreements, which were caught
by Article 101(1) and have not qualified for exemption under Article 101(3), are
automatically void and unenforceable without the need for a prior decision to that
effect.41 This automatic nullity applies only to individual clauses in the agreement
affected by the prohibition.42

5.1.4 Commercialisation Agreements

Agreements restricting competition can be vertical and horizontal. Commercialisation

agreements43 are a common type of horizontal restraints. They involve co-operation
between competitors in the selling, distribution, or promotion of their interchangea-
ble products and cover a wide spectrum of agreement. ‘At one end of the spectrum
are joint selling agreements that may lead to a joint determination of all commercial
aspects related to the sale of the product, including price.’44 As a rule of thumb, these
agreements will almost always breach Article 101(1). At the other end of the spec-
trum, there are agreements that only address one specific commercialisation function,
such as distribution, after-sales service, or advertising.45 Some of the main competi-
tion concerns of commercialisation agreements include price fixing, output limitation
and market partitioning, all of which ultimately lead to a reduction in consumer wel-
fare. According to the Guidelines on horizontal cooperation agreements, price fixing
cannot be justified, unless it is indispensable for the integration of other marketing
functions, and this integration will generate substantial efficiencies.46 The question
of indispensability is therefore especially important for those agreements involving
hard-core cartels such as price fixing or market allocation, which can only, under
exceptional circumstances, be considered indispensable to achieve efficiency gains.47

41 See Article 1(1) of the Council Regulation (EC) No 1/2003 of 16 December 2002 OJ L 1,

04.01.2003, pp. 1–25.

42 See Case 56/65 Société La Technique Minière v. Maschinenbau Ulm GmbH [1966] ECR 234;

and Case 279/06 CEPSA Estaciones de Servicio SA v. LV Tobar e Hijos SL, judgement of 11
September, 2008, para 80.
43 See Communication from the Commission—Guidelines on the applicability of Article 101 of

the Treaty on the Functioning of the European Union to horizontal co-operation agreements OJ C
11, 14.1.2011, pp. 1–72, paras 225–256.
44 Ibid. para 225.
45 Ibid. para 225.
46 Ibid. para 246.
47 Ibid. para 249.
158 5 EU Competition Law and Sport

5.2 Article 102 TFEU

Article 102 prohibits abuse of market power by undertakings in a dominant

­position in one or more relevant markets. Dominance can be held by one ­undertaking
(single dominance) or more than one undertaking (collective dominance). The
thrust of this policy is not to prohibit the acquisition and existence of power per se,
but is directed at controlling the unilateral behaviour of a dominant firm(s) with
market power. In essence, three related enquiries must be conducted when deter-
mining the existence of an abuse of the dominant position.48

5.2.1 Definition of Relevant Market

First, the relevant market should be defined from its product, geographic and, if
applicable, temporal market.49 In defining the product market, cross-elasticity of
demand is analysed to determine the extent to which the goods or services offered
are interchangeable (substitutable) with other products or services from the point
of view of the consumer.50 The degree of interchangeability or substitutability is
based upon a hypothetical SSNIP51 test which asks whether the undertaking’s cus-
tomers would switch to readily available substitutes or suppliers in response to a
small but significant non-transitory increase in price (5–10 %) in the products or
services and areas being considered. If the degree of substitution resulted in loss of
sales and made the price increase unprofitable, additional substitutes and areas are
included in the relevant market until the set of products and geographic areas is
such that increases in relative prices would become profitable.52 In defining the
product market from the supply side, cross-elasticity is measured according to the
possibility for suppliers to switch production to the relevant product (in response
to its relative price increase) and market it in the short term without incurring sig-
nificant additional costs. The broader the definition of the relevant product market,
the less likely that the element of dominance will be found. The undertakings
under investigation will therefore always endeavour to include as many other

48 The Court has laid down the definition of the concept of dominant position in Case 27/76

United Brands v. Commission [1978] ERC 207, para 65.

49 See Commission Notice on the definition of relevant market for the purposes of Community

competition law, OJ C 372, 9.12.1997, pp. 5–13.

50 In order to answer this question, cross-elasticity of demand and supply are analysed. See

Case 27/76 United Brands which provides a good example of the application of product and
­geographic market test by the Court.
51 Small but significant non-transitory increase in price.
52 Commission Notice on the relevant market, para 17. The same rule was provided in, the now

obsolete, Form A/B for applications for negative clearance of agreements or practices which may
fall under Article 85(1) or 86 [now Articles 101(1) and 102 TFEU], Section 6.
5.2 Article 102 TFEU 159

suppliers and products into the definition as possible. In determining the geo-
graphic market, only the Member States in which the conditions of trade are suffi-
ciently homogenous for the market to be considered in its entirety are taken into
account,53 and conversely, those Member States markets where the dissimilar con-
ditions of competition exist are excluded from the definition.
The definition of relevant market is also important in the cases under Article
101(1) when considering whether an agreement has a restrictive or distortive effect
on competition.

5.2.2 Establishing Dominance

Second, the definition of the relevant market will be used to determine whether an
undertaking was dominant within that market. The concept of a dominant position
is defined as a position of economic strength enjoyed by an undertaking which
enables it to prevent effective competition being maintained on the relevant market
by giving it the power to behave to an appreciable extent independently of its com-
petitors, customers and ultimately of its consumers.54 Market power is assessed on
the basis of market share held by the undertaking,55 the existence of potential
competitors, barriers to entry, level of vertical integration, specificity of the prod-
uct in question, and other indicators of dominance.56 The existence of a dominant
position derives from a combination of several of these factors which, taken sepa-
rately, are not necessarily decisive.57 Undertakings in a dominant position have a
special responsibility not to allow their conduct to impair genuine and undistorted
competition.58

53 For details on approach and overview of the relevant case law see Commission Notice on the

definition of the relevant market.

54 See, in particular, the judgments in Case 27/76 United Brands v Commission [1978] ECR 207,

paras 65–66; and Case T-30/89 Hilti v Commission [1991] ECR II-1439, para 90.
55 In Case 27/76 United Brands a market share of 45 % in combination with other factors estab-

lished dominance, in Case 322/81 Michelin it was 57–65 %, in Case 62/86 AKZO the Court said
that where market share is 50 % there is a presumption of dominance; the lowest share at which
an undertaking was found to be dominant was 39.7 % in Case T-219/99 Virgin/British Airways
[2004] ECR II-5917.
56 Market share is therefore only an indicator of market power. See for e.g. Case 62/86 AKZO

v. Commission [1991] ECR I-3359, Case T-30/89 Hilti AG v. Commission [1991] ECR II-
1439, Case 85/76 Hoffmann-La Roche v. Commission [1979] ECR 461. See also paras 53–55
of Commission Notice on the definition of the relevant market for the purposes of Community
­competition law OJ C 372, 9.12.1997, pp. 5–13. See Jones and Sufrin 2011, pp. 324–355.
57 See, for example, Case 27/76 United Brands v Commission [1978] ECR 207, paras 65 and 66;

Case T-30/89 Hilti v Commission [1991] ECR II-1439, para 90; and Case C-250/92 Gøttrup-Klim
e.a. Grovvareforeninger v Dansk Landbrugs Grovvareselskab AmbA [1994] ECR I-5641, para 47.
58 Case 322/81 Michelin [1983] ECR 3461, paras 10 and 57. See also Sect. 5.7.2.
160 5 EU Competition Law and Sport

5.2.3 Abuse of Dominant Position

The third and final enquiry relates to the element of abuse of the dominant position
within the specified market. Instances of abuse are outlined in Article 102 TFEU
in a non-exhaustive list. They can be in the form of overpricing, predatory pricing,
refusal to supply, imposition of unfair trading conditions, discrimination between
trading partners, tying, exclusive dealing (single branding) contracts, or any other
form of abuse. Unlike purely unilateral abuses, such as predatory pricing, contrac-
tual abuses involve implied or express participation of another undertaking such as
in, for example, exclusive supply agreements. Much like under Article 101(1), the
element of effect on trade between Member States is required for abusive behav-
iour to be held incompatible with Article 102.59
Refusal to supply is a broad concept and covers many practices including vertical
and horizontal foreclosures, and refusal to deal with existing and new customers.60
More specifically, it covers practices such as, for example, refusal to supply in the
aftermarket (even where the offending undertaking is not dominant in the primary
product market but only in the market for its own spare parts),61 refusal to supply with
the purpose of excluding a competitor from an ancillary market,62 refusal to supply to
prevent parallel trade,63 or refusal to grant access to so-called essential facilities.64
The concept of essential facilities was defined as ‘a facility or infrastructure
­without access to which competitors cannot provide services to their customers’.65 It
can be anything from physical infrastructure such as ports, gas pipelines, or telecom-
munication wires, to property rights related to premium TV content or intellectual
property.66 An undertaking which refuses its competitors access to essential facilities
or grants access to competitors on discriminatory terms in relation to its own

59 The same test for effects on trade is applicable as in Article 101(1). See Commission Notice—
Guidelines on the effect on trade concept contained in Articles 81 and 82 of the Treaty OJ C 101,
27.4.2004, pp. 81–96.
60 For more on the concept of refusal to supply see Communication from the Commission—

Guidance on the Commission's enforcement priorities in applying Article 82 of the EC Treaty to

abusive exclusionary conduct by dominant undertakings, OJ C 45, 24.2.2009, paras 75–90.
61 Case 22/78 Hugin Kassaregister v. Commission [1979] ECR 1869.
62 Cases 6 and 7/73 Istituto Chemioterapico Italiano Spa and Commercial Solvents Corp. v.

Commission [1974] ECR 223.

63 Cases C-468-478/06 Sot. Lelos kai Sia and others EE v. GlaxoSmithKline AEVE

Farmakeftikon Proionton [2008] ECR I-7139.

64 See, for example, Cases C-241-242/91 P RTE & ITP v. Commission [1995] ECR I-743. See

Joined Cases T-374-5, 384 and 388/94 European Night Services v. Commission [1998] ECR II-
3141 for application of essential facilities doctrine in the context of Article 101 TFEU. See also
Anderman 2009, pp. 87–98.
65 See, for instance, Commission Decision in Case IV/34.174—Sealink/B&I Holyhead:

Interim Measures [1992] OJ 378/4, 5 CMLR 255, para 41, and Commission Decision in Case
IV/31.990—Port of Rødby [1994] OJ L 55/52, [1994] 5 CMLR 457, para 12.
66 See Whish 2009, pp. 697–699 for facilities to which the essential facilities doctrine has been

applied.
5.2 Article 102 TFEU 161

services, thereby placing it at a competitive disadvantage, infringes Article 102

TFEU.67 Mandatory dealing, however, interferes into contractual freedom of private
parties and acts as a disincentive for innovation for undertakings that have incurred
big expenses over a long period of time to develop their services. This is why the
­application of the essential facilities doctrine should be narrowly construed and the
obligation to contract based on Article 102 TFEU imposed only in very exceptional
circumstances.68 In order to find this type of abuse of dominant position, the Court
specified the following four criteria: the refusal must be likely to eliminate all
­competition in the downstream market, the access to essential facilities must be
indispensable (as opposed to merely desirable and convenient) for carrying on the
business, and there must be no potential substitute for the essential facility in
­question.69 In addition, an undertaking owning or controlling an essential facility will
not commit an abuse if it has an objective justification for the denial of access70 such
as, for example, issues with the creditworthiness of an undertaking seeking access,
capacity constraints, or the fact that other competing undertakings already having
access to the facilities maintain effective competition in the downstream market.

5.2.4 Objective Justification and the Efficiency Defence

Unlike Article 101 TFEU, Article 102 TFEU does not have an exemption provi-
sion. Nevertheless, in the practice of the Court and the Commission, the use of the
concept of objective justification coupled with the requirement of proportionality
provides the necessary flexibility to the otherwise overly formalistic approach in
the application of Article 102 TFEU.71 It would appear from the decisional prac-
tice of the Commission, as well as from the Commission Guidance,72 that objec-
tive justifications may include non-economic objectives and amount to an
equivalent of public policy justification under Article 101(1) TFEU. Furthermore,
in its 2005 Discussion Paper the Commission outlined the conditions under which
a dominant company may also rely on the efficiency defence in cases of abusive
exclusionary conduct. These conditions, which reproduce four cumulative criteria
of Article 101(3) TFEU, were later confirmed in the Commission Guidance,

67 Ibid.
68 Case C-7/97 Oscar Bronner GmbH & Co. KG v. Mediaprint Zeitungs [1998] ECR I-7791, para
26. In liberalised sectors where the facilities were built with public money it is easier to find an abuse.
69 Ibid. para 41.
70 Ibid. See also Commission Decision in Case IV/34.174—Sealink/B&I Holyhead: Interim

Measures [1992] OJ 378/4, 5 CMLR 255, para 41.

71 Case 27/76 United Brands, Case T-65/89 BPB, Case T-30/89 Hilti, Case 311/84 Centre Belge

d’Etudes du Marché-Télémarketing (CBEM) v. CLT SA [1985] ECR 3261.

72 Communication from the Commission—Guidance on the Commission's enforcement
­priorities in applying Article 82 of the EC Treaty to abusive exclusionary conduct by dominant

undertakings, OJ C 45, 24.2.2009, pp. 7–20.

162 5 EU Competition Law and Sport

reflecting the overall reform of the approach to Article 102 TFEU and shifting the
focus from the form-based towards a more effect-based analysis.73 The mirroring
of the cartel exemption provision makes the efficiency defence the functional and
analytical equivalent of Article 101(3) TFEU in the framework of Article 102
TFEU. Conversely, the objective justification defence under Article 102 TFEU is
more related to the specific framework developed by the Court in Wouters and
confirmed in the sporting case of Meca-Medina, because a dominant undertaking
that engages in an abusive but objectively justified and proportionate conduct will
be, as a matter of technicality, considered as not having committed an abuse in the
first place.74 A fortiori, it is submitted that the defence of objective justification
has been replaced by the Wouters test when applying Article 102 TFEU to the
­regulatory (organisational) acts of collective bodies that pursue a public policy
interest, as after Meca-Medina in the light of DLG, it is clear that the Wouters test
is applicable in the abuse of dominant position cases as well.

5.3 Oligopolistic Market Structures and the Concept

of Collective Dominance

5.3.1 The Oligopoly Problem

Undertakings operating in oligopolistic markets are sometimes able to coordinate

their behaviour and raise prices substantially above the competitive level or restrict
their output without entering into any explicit agreement or concerted practice.
Structural conditions prevailing in tight oligopolies predispose the market to a type
of conduct that resembles that of a concerted practice. Under Article 101 TFEU a
mere commercial parallelism is not caught by its prohibition provision and must
be distinguished from concerted practices which are so caught.75 Nevertheless, the

73 Ibid. para 30.

74 On the last point see the Opinion of Advocate General in Case C-53/03 Synetairismos
Farmakopoion Aitolias and Akarnanias (Syfait) and Others v. GlaxoSmithKline plc and
GlaxoSmithKline AEVE, formerly Glaxowellcome AEVE, delivered on 28 October 2004, para 72.
75 The Court said that ‘71.[…] it must be noted that parallel conduct cannot be regarded as fur-

nishing proof of concertation unless concertation constitutes the only plausible explanation for
such conduct. It is necessary to bear in mind that, although Article 85 of the Treaty prohibits
any form of collusion which distorts competition, it does not deprive economic operators of the
right to adapt themselves intelligently to the existing and anticipated conduct of their competi-
tors. 72. Accordingly, it is necessary in this case to ascertain whether the parallel conduct alleged
by the Commission cannot, taking account of the nature of the products, the size and the number
of the undertakings and the volume of the market in question, be explained otherwise than by
concertation.’ Joined Cases C-89, 104, 114, 116, 117, 125 to 129/85 Ahlström Osakeyhtiö and
others v Commission of the European Communities (Wood Pulp II) [1993] ECR I-1307. See also
Commission Decision in Case IV/30.350—Zink Producer Group [1984] OJ L 220/27, [1985]
2 CMLR 108, para 75 that reads: ‘[…] parallel pricing behaviour in an oligopoly producing
homogenous goods will not in itself be sufficient evidence of a concerted practice’.
5.3 Oligopolistic Market Structures and the Concept of Collective Dominance 163

effects that tacit coordination can produce on the market (coordinated effects) are
the same as would be produced by undertakings that entered into illegal cartels.76
However, not all oligopolies are uncompetitive. There are many highly competitive
markets with only few major sellers, and conversely, there exist polypolies with a
failure of competitive market mechanisms. Although a four-firm concentration
ratio is a quantitative description often utilised to describe oligopoly, the truth is
that they exist, as Whish puts it, ‘somewhere on the continuum that begins at
monopoly and ends at perfect competition.’77
Oligopolies present a regulatory problem for competition law. Both the Court
and the Commission have struggled to find a balanced approach to collective domi-
nance in their application of substantive rules on concentrations with the ‘Union
dimension’ and Article 102. On the one hand, it makes no sense to prohibit intel-
ligent adaptations by undertakings regarding transparency on the market and to
require them to conduct their business irrationally by not taking account of their
rivals’ behaviour. On the other hand, what is commercially rational for participants
in an oligopoly is not always good for consumers and competition. Hence, even the
non-collusive commercial parallelism can be quite detrimental to consumer welfare.

5.3.2 Collective Dominance

Collective dominance (also referred to as ‘coordinated effects’, ‘tacit collusion’,

‘tacit coordination’ and ‘joint dominance’) implies the absence of effective compe-
tition within an oligopoly and between an oligopoly and other firms on the rele-
vant market.78 With the case law raising more questions than it answers, a lot of
uncertainties surround this blurry concept in EU law and the subject is still overly
open to conjecture.
Article 102 refers to ‘abuse by one or more undertakings of a dominant position
within the common market’ [emphasis added]. This wording implies the possibility
for the independent undertakings to be found collectively dominant, a proposition
which was not accepted in early decisions. The Court was invited by the
Commission to adopt the theory of collective dominance in 1988 in the Alsatel
case on the basis of structural links between undertakings.79 However, the Court
did not comment on this point and its judgements prior to Alsatel appeared to have
rejected such a theory. For example, in Hoffmann-La Roche the Court suggested
that it was not appropriate to control tacit collusion by the Article 102 mechanism,

76 Non-coordinated effects (non-collusive oligopoly) occur when one of the undertakings in an

oligopoly, without being individually dominant, can derive benefits from their market power
without the coordinated response from the other undertakings in an oligopoly.
77 Whish 2009, p. 545.
78 O’Donoghue and Padilla 2006, p. 137.
79 Case 247/86 Société alsacienne et lorrainne de telecommunications et d’électronique v. SA

Novasam [1988] ERC 5987, paras 21–22.

164 5 EU Competition Law and Sport

presumably because oligopolistic conduct amounting to agreements or concerted

practices would be caught by Article 101,80 while in Continental Can81 it stated
that Article 102 covers a situation where dominance is held by undertakings that
belong to the same economic unit or corporate group. This narrow view on
­collective dominance was subsequently expanded and the issue raised in Alsatel
was finally addressed by the General Court in the Italian Flat Glass judgment:
There is nothing in principle to prevent two or more independent economic entities from
being, on a specific market, untied by such economic links that, by virtue of that fact,
together they hold a dominant position vis-à-vis the other operators on the same market.82

Italian Flat Glass represents the acceptance of the concept of collective

­dominance. This decision has also created the possibility for the conduct by the
oligopolists that is not caught by Article 101 to fall under Article 102, an approach
previously rejected by the Court in Hoffmann-La Roche.83 Although many questions
in relation to collective dominance still remain without answers, the subsequent
case law has clarified that: the concept of ‘economic links’ mentioned in Italian
Flat Glass can be structural (such as for example cross-shareholding or common
directorship),84 contractual,85 or provided by the structure of the market which
allows for the parallel behaviour between undertakings operating on an oligopolistic
market.86 Further, ‘the undertakings in the group must be linked in such a way that

80 Case 85/76 [1979] ECR 461, para 39 stated that: ‘A dominant position must also be ­distinguished

from parallel courses of conduct which are peculiar to oligopolies in that in an oligopoly the
courses of conduct interact, whilst in the case of undertaking occupying a dominant position the
conduct of an undertaking which derives profits from that position is to a great extent determined
unilaterally.’
81 Case 6/72 Europemballange Corporation and Continental Can Company Inc. v. Commission

[1973] ECR 215.

82 Cases T-68/89 etc. Società Italiano Vetro SpA v. Commission [1992] ECR II-1403, para 358,

(emphasis added).
83 Case 85/76 [1979] ECR 461, para 39 stated that: ‘A dominant position must also be distinguished

from parallel courses of conduct which are peculiar to oligopolies in that in an oligopoly the
courses of conduct interact, whilst in the case of undertaking occupying a dominant position the
conduct of an undertaking which derives profits from that position is to a great extent determined
unilaterally.’
84 Opinion of AG Fennelly in Joined Case C-395/96 P and C-396/96 P Compagnie Maritime

Belge Transports and Others v. Commission [2000] ECR I-1365.

85 Case T-191/98 Atlantic Container Line AB v Commission of the European Communities

[2003] ECR II-3275. Commission Decisions in Commission Decision in Case IV/31.990—Port

of Rødby [1994] OJ L 55/52, [1994] 5 CMLR 457; Case IV/30.373—P&I Clubs [1999] OJ L
125/12; or Opinion of Advocate General Lenz in Case C-415/93 Bosman and in Case C-66/86
Ahmed Saeed Flugreisen v Zentrale zur Bekampfung Unlauteren Wettbewerbs [1989] ECR 803.
86 See, for instance, Case T-102/96 Gencor Ltd. v. Commission [1999] ECR II-0753. In this

case the Commission relied on other elements to prove collective dominance including a high
degree of market concentration, the similarity of cost structures of the undertakings holding the
collective dominant position, market transparency, product homogeneity, moderate growth in
demand, price inelastic demand, high entry barriers, and a lack of negotiating power on the part
of purchasers.
5.3 Oligopolistic Market Structures and the Concept of Collective Dominance 165

they adopt the same conduct on the market’87 (i.e., engage in tacit collusion) and
‘links must be sufficiently strong for there to be a collective dominant position in a
substantial part of the common market’.88
In para 79 of the Notice on Access Agreements in the Telecommunication
Sector the Commission took the approach that:
[…] for two or more companies to be jointly dominant it is necessary, though not
­sufficient, for there to be no effective competition between the companies on the relevant
market. This lack of competition may in practice be due to the fact that the companies
have links such as agreements for cooperation or interconnection agreements. The
Commission does not, however, consider that either economic theory or [Union] law
implies that such links are legally necessary for a joint dominant position to exist. It is a
sufficient economic link if there is the kind of interdependence which often comes about
in oligopolistic situations. There does not seem to be any reason in law or in economic
theory to require any other economic link between jointly dominant companies […].89

In Compagnie Maritime Belge the Court confirmed the Commission’s approach,

introduced the notion of collective entity into the definition of collective dominance,
and reaffirmed the analytical framework under Article 102. It said that
[…] a dominant position may be held by two or more economic entities legally independent
of each other, provided that from an economic point of view they present themselves or
act together on a particular market as a collective entity. […F]or the purposes of analysis
under Article [102] of the Treaty, it is necessary to consider whether the undertakings con-
cerned together constitute a collective entity vis-à-vis their competitors, their trading part-
ners and consumers on a particular market. It is only where that question is answered in
the affirmative that it is appropriate to consider whether that collective entity actually
holds a dominant position and whether its conduct constitutes abuse.90

Whether or not independent undertakings will constitute a collective entity is

determined on the basis of ‘economic links or factors which give rise to a connec-
tion between the undertakings concerned’, and which ‘enable them to act together
independently of their competitors, their customers and consumers’.91 The Court
took the opportunity to spell out that agreements or other links in law are not a
pre-requisite to a finding of a collective dominant position; other connecting fac-
tors may be a basis for such finding, and economic assessment and the structure of
the relevant market can play the decisive role.92 ‘The analysis whether there exists
links sufficient to establish firms as a collective entity is therefore inextricably
bound to the question whether the firms individually occupy a dominant

87 Case C-393/92 Almelo v. NV Energiebedriff IJsselmij [1994] ECR I-1477, para 42.
88 Ibid. para 43.
89 Notice on the application of competition rules to access agreements in the telecommunications

sector OJ [1998] C 265/2, 5 CMLR 521.

90 C-396/96 P Compagnie Maritime Belge [2000] ECR I-1365, paras 38 and 39, (emphasis

added).
91 Ibid. paras 41 and 42, respectively.
92 Ibid. para 45.
166 5 EU Competition Law and Sport

position.’93 Compagnie Maritime Belge confirmed that the rule from Gencor
decided under the Merger Regulation94 that economic interdependence alone as
imposed by the market structure will suffice to find the undertakings concerned in
a collectively dominant position (or as Whish puts it, the ‘essence of collective
dominance is parallel behaviour within an oligopoly’95) is applicable in Article
102 cases as well.
In para 62 of the Airtours judgment, also belonging to the sphere of c­ oncentrations,
on the basis of the facts in which no structural or contractual links existed,
three cumulative conditions were deemed necessary for a finding of collective
dominance:
- first, each member of the dominant oligopoly must have the ability to know how the
other members are behaving in order to monitor whether or not they are adopting the
common policy. […]; - second, the situation of tacit coordination must be sustainable over
time, that is to say, there must be an incentive not to depart from the common policy on
the market. […]; - third, to prove the existence of a collective dominant position to the
requisite legal standard, the Commission must also establish that the foreseeable reaction
of current and future competitors, as well as of consumers, would not jeopardise the
results expected from the common policy.96

In Piau the General Court cited the Airtours criteria in the context of Article 102
assessments of joint dominance.97 Later in the year, the Commission outlined the
same criteria in the Discussion Paper on the application of Article 102 to exclu-
sionary abuses,98 but it is instructive that it has not done so in the subsequent
Guidelines adopted after public consultation on the Discussion Paper and focusing
only on single dominant undertakings. Some argue that a reference to Airtours in
Piau is misplaced because Piau dealt with the links in law (contractual links in
casu) and not tacit collusion,99 while others see the Airtours criteria as applicable
to any case of collective dominance, be it a case of tacit or explicit collusion,
because it would make no sense to have two distinct tests for reviewing cases of
collective dominance.100 The 2005 Discussion Paper makes a difference between
links in law and tacit collusion and appears to lend support to the former view.101
Regarding the final limb of the Article 102 analytical framework, the 2005
Discussion Paper states that ‘a finding of abuse of a collective dominant position is

93 Jephcott and Withers 2001, p. 301.

94 Case T-102/96 Gencor Ltd. V. Commission [1999] ECR II-0753.
95 Whish 2009, p. 564.
96 T-342/99 Airtours plc. v. Commission [2002] ECR II-2585, judgment of 6 June 2002, (­ emphasis

added).
97 Case T-193/02 Laurent Piau v. Commission, judgment of 26 January 2005, para 111.
98 European Commission DG Competition Discussion Paper on the application of Article 82 to

exclusionary abuses, Brussels (December 2005) paras 48–50.

99 Mezzanotte 2009, pp. 137–142.
100 O’Donoghue and Padilla 2006, p. 152.
101 Commission Discussion Paper on the application of Article 82 to exclusionary abuses,

paras 45–50.
5.3 Oligopolistic Market Structures and the Concept of Collective Dominance 167

typically based on showing that the collectively dominant undertakings have

­tacitly or expressly been following a common policy on the market, at least in
regard to the abusive conduct’.102 The General Court spelled out in Irish Sugar
that a collectively-held dominant position does not necessarily need to be abused
collectively, but that undertakings individually may commit an abuse which needs
only be a manifestation of, and undertaken from the position of, such collective
dominance.103 This case established vertical collective dominance and showed that
only a flimsy line separates a situation in which firms form a single economic unit
from the situation where two independent firms are united by economic links.104

5.4 Simultaneous Application of Articles 101 and 102

TFEU

Already in its early judgment of Continental Can the Court held that Articles 101
and 102 TFEU seek to attain the same aim of maintaining effective competition
within the common market.105 According to settled case law, the two competition
provisions can be applied simultaneously.106 In many cases, the strategy of the
dominant undertaking(s) turns on the reinforcement of their market power by
means of contractual clauses, such as tying, exclusivity, and other clauses. The
agreements between two or more undertakings containing such clauses might cre-
ate or reinforce a position of dominance which is, or may become, subject to
abuse. Such agreements may be incompatible with both, Articles 101 and 102
TFEU. If the case involves a tacit collusion in an oligopolistic market then only
Article 102 applies,107 and if the collusion is explicit than Article 101 will apply
simultaneously. The conduct resulting from the terms of restrictive agreements

102 Ibid. para 74.

103 Case T-228/97 Irish Sugar plc v. Commission judgment of 7 October 1999.
104 Mezzanotte 2009, pp. 137–142.
105 Case 6/72 Europemballage Corporation and Continental Can Company Inc. v. Commission

[1973] ECR 215, para 11. See also Case T-51/89 Tetra Pack Rausing SA v. Commission [1990]
ECR II-309.
106 See Case 85/76 Hoffmann-La Roche [1979] ECR 461, para 116; Case 66/86 Ahmed Saeed

Flugreisen and Silver Line Reisebüro GmbH v Zentrale zur Bekämpfung unlauteren Wettbewerbs
e.V. [1989] ECR 803; Joined Cases C-395/96 P and C-396/96 P Compagnie Maritime Belge
Transports SA, Compagnie Maritime Belge SA and Dafra-Lines A/S v Commission [2000] ECR
I-1365, para 33.
107 This conclusion follows from the case law discussed above. However, see para 4.125 of Faull

and Nikpay 2007, p. 343, for an argument that ‘it is very unlikely that a case could be taken
under Article [102] against oligopolists for engaging in tacit collusion per se. It is submitted that,
if the collusion is not such that it is capable of being addressed under Article [101], it would not
be appropriate to do so “through the back door:” under Article [102]’.
168 5 EU Competition Law and Sport

between the undertakings constituting the single economic entity is considered

unilateral and not collusive so Article 102 alone will be applicable, but only if the
undertakings concerned are dominant on the relevant market. Consistency requires
that Article 101(3) be interpreted as precluding any application of this exemption
to restrictive agreements that constitute an abuse of a dominant position. On the
other hand, a company holding a dominant position may benefit from an exemp-
tion under Article 101(3) of the Treaty when its conditions are fulfilled.108 In the
Piau case, decided in the sporting context, the General Court held that if the con-
duct of a dominant company satisfies all the conditions of Article 101(3) such con-
duct should not be classified as an abuse under Article 102 of the Treaty.109
Rousseva has convincingly argued that the element of dominance is the only dif-
ference between Articles 101 and 102 when it comes to vertical contractual
restraints involving a dominant undertaking.110 Therefore, as the current division
of labour between Articles 101 and 102 is difficult to sustain from a legal and eco-
nomic point of view, she suggests that discarding Article 102 and relying exclu-
sively on Article 101 would be a pragmatic solution which would bring many
advantages including carrying out a de facto modernisation of Article 102 without
entering into explicit conflict with existing precedents.111

5.5 Articles 101 and 102 TFEU in the Sporting Context

Provided that the sporting activity in question falls within the scope of the Treaty,
the rules which govern the conditions for engaging in that activity must satisfy the
requirements of Articles 101 and 102.112

5.5.1 Basic Elements

It has been recognized that national and international sporting associations, clubs
and independent athletes can constitute ‘undertakings’113; sporting federations

108 See also Commission Notice Guidelines on the application of Article 81(3) of the Treaty, OJ

C 101, 27.04.2004, pp. 97–118, para 106.

109 See Case T-193/02 Piau, para 119.
110 Rousseva 2005, p. 590.
111 Ibid. p. 637.
112 Case C-519/04 P Meca-Medina and Majcen v. Commission [2006] ECR I-6991, para 28, and

C-49/07 MOTOE, [2008] ECR I-4863.

113 For national and international sporting associations as undertakings see; Case T-193/02 Piau

paras 69–72; Commission Decision in COMP IV/37.806—ENIC/UEFA [2002] unpublished

decision of 27 June 2002, para 25; Opinion of Advocate General Lenz in Bosman points 255
5.5 Articles 101 and 102 TFEU in the Sporting Context 169

can, in addition, also constitute an ‘association of undertakings’114 or an ‘association

of associations of undertakings’115; their rules can amount to ‘agreements or deci-
sions,’116 distort the competition within the relevant markets and affect trade
between Member States within the meaning of Articles 101 and 102.117 Article
102 TFEU does not include the concept of ‘association of undertakings’ but
applies to unilateral conduct of dominant ‘undertakings’. The General Court has
held that even where a sports federation such as FIFA is not itself active on a given
market, it may be considered an ‘undertaking’ under Article 102 TFEU to the
extent that it represents the emanation of its members that are active on that mar-
ket.118 Furthermore, when they directly engage in economic activity, sporting fed-
erations usually acquire a status of an undertaking in a monopolistic position,119

Footnote 113 (continued)

et seq; Commission Decision in Case Cases 33.384 and 33.378—Distribution of package tours
during the1990 World Cup [1992] OJ L 326/31, paras 47 and 52–53. For individual athletes as
undertakings see Joined Cases C-51/96 and C-191/97 Christelle Deliège v. Ligue francophone
de judo etc. ECR 2000 I-2549, paras 56 and 57. According to AG Lenz in C-415/93 Bosman
para 263 football players employed by a football club do not constitute undertakings, as they
are workers and not providers of services. Commission Staff Working Document, The EU and
Sport: Background and Context, Accompanying Document to the White Paper on Sport, COM
(2007) 391 final, Annex I, para 2.1.3 clarifies that ‘even if athletes are employed by a sport club,
they may be considered undertakings insofar as they carry out economic activities independent
thereof, e.g., by entering into sponsoring agreements.’
114 See Case T-193/02 Laurent Piau v. Commission, judgment of 26 January 2005 where the

General Court held that ‘69. […] FIFA’s members are national associations, which are group-
ings of football clubs for which the practice of football is an economic activity. These football
clubs are therefore undertakings within the meaning of Article [101 TFEU] and the national
associations grouping them together are associations of undertakings within the meaning of that
provision. 70. The fact that the national associations are groupings of ‘amateur’ clubs, alongside
‘professional’ clubs, is not capable of calling that assessment into question.[…] 72. Since the
national associations constitute associations of undertakings and also, by virtue of the economic
activities that they pursue, undertakings, FIFA, an association grouping together national associa-
tions, also constitutes an association of undertakings within the meaning of Article [101 TFEU].’
See also Opinion of AG Lenz in C-415/93 Bosman paras 255–257, and the Commission Decision
of 23 July 2003 in Case COMP/C.2-37.398 Joint Selling of the Commercial Rights of the UEFA
Champions League.
115 Commission Decision Case COMP/C.2-37.398 UEFA Champions League, para 106.
116 Case T-193/02 Piau, para 75. Rules drawn up unilaterally by sporting associations consisting

of undertakings will usually constitute decisions by an association of undertakings (see, e.g.,

Commission decision in COMP IV/37.806—ENIC/UEFA, para 26, for a rule drawn up by the
UEFA Executive Committee, and C-519/04 P Meca-Medina, para 45 for a rule drawn up by the
International Olympic Committee and implemented by the International Swimming Federation).
117 For general guidance see ‘Guidelines on the effect of trade concept contained in Articles 81

and 82 of the Treaty’, OJ 2004 C 101/7.

118 Case T-193/02 Piau, paras 112 and 116.
119 Commission Staff Working Document, Annex I, para 2.1.4 recognises that: ‘sports associations

usually have practical monopolies in a given sport and may thus normally be considered dominant
in the market of the organisation of sport events under Article [102] EC.’
170 5 EU Competition Law and Sport

whereas clubs organised in a league may be held collectively dominant within the
meaning of Article 102, as interpreted by the relevant case law.120
Rules adopted by international sporting organisations will normally affect trade
between Member States due to their scope of application. Rules of national sports
associations usually affect only the territory of their respective country but in light
of the high level of internationalisation and mobility in professional sport, those
rules may also affect trade between Member States. The same can be said for the
agreements between clubs affiliated to national and international federations.

5.5.2 Relevant Market

An element that Articles 101 and 102 have in common is, inter alia, a need to
define the relevant market from both the geographic and the product market points
of view.
According to the generally–accepted Stix-Hackl and Egger classification, the
relevant product market for professional sport can be of three types.121 The first is
the exploitation market in which clubs and federations exploit their performances
and commercial rights, for example, through sales of broadcasting rights, ticket-
ing, and merchandising. Upstream of the exploitation market is the contest market
in which the final product, the sporting contest, is jointly produced by the clubs,
players being the most important factor of production.122 In order to effectively
stage a contest, sport governing bodies design the rules that regulate competition
between participants and rules limiting access to competitions. Since in European
football the leagues are open and they apply the system of promotion and relega-
tion, the market cannot be strictly demarcated according to leagues. The third is
the supply market which essentially comprises of the buying and selling of players
by the clubs. It is upstream of the contest market. Substitutability is generally
quite low in the first two types of markets but it is equally low when it comes to
the top players in the supply market.
In addition, some economists have made a useful description of the structure of
sporting competition which distinguishes between the product market, the labour
market, and the capital market.123 The product market in a sporting competition
incorporates structure of competition (playing rules for the contest and the organi-
sation of the competition), league structure (organisation and composition of the
league), and revenue (corresponds to the exploitation market according to the

120 For discussion on the concept of collective dominance in the sporting context see Case

T-193/02 Piau, paras 113–115; Opinion of AG Lenz in C-415/93 Bosman para 285. See also
Sect. 5.3.2.
121 Stix-Hackl and Egger 2002, pp. 81–91.
122 Other factors are, for example, trainers and physiotherapists.
123 See Borland 2009, p. 23.
5.5 Articles 101 and 102 TFEU in the Sporting Context 171

Stix-Hackl and Egger classification, plus allocation of the league revenue). The
structure of a labour market in a sporting competition incorporates: player assign-
ment to teams, player payment and wage determination, and size of the player list.
The capital market structure in a sporting competition deals with the types of own-
ership arrangements. One missing aspect in this classification is governance, i.e.,
the way that rules and policies are decided, and the degree of vertical
integration.124
In Piau, the rules of the FIFA Players’ Agents Regulations relating to agent
licensing requirements were challenged on the basis of Articles 101 and 102. The
relevant market was held to be ‘the market affected by the rules in question’ i.e., ‘a
market for the provision of services where the buyers are players and clubs and the
sellers are agents’.125
In ENIC,126 the Commission examined the rule that prohibited ownership of
multiple football clubs, according to which two or more clubs participating in the
same UEFA competition cannot be directly or indirectly controlled by the same
entity or managed by the same person. The English National Investment Company
(ENIC) owned stakes in six professional clubs. It argued that the relevant market is
the market for capital investment in football clubs in Europe that is ‘characterised
on the demand side by football clubs seeking capital and/or investment and on the
supply side by individuals or corporations interested in investing in a European
football club. Football clubs are competing in this market for access to capital.’127
Interestingly, the relevant market defined by the Court of Arbitration for Sport
(CAS) in this case128 was considered to be ‘the market for ownership interests in
football clubs capable of taking part in UEFA competitions’.129 What was seen as
the demand side of the market by ENIC was identified as the supply side by CAS
and vice versa. On the supply side of the relevant market, according to CAS, are
the potential sellers of ownership interests in football clubs. In point 135 of its
arbitral award, CAS considered this narrow market to be the relevant market since:
‘because of the peculiarities of the football sector, investment in football clubs
does not appear to be interchangeable with investments in other businesses, or
even in other leisure businesses’. In addition to the definition of the relevant mar-
ket, ENIC also considered the market for players, the sponsorship market, the
football merchandising market, the media rights market, and the market for gate
revenues as the ancillary markets.130

124 Ibid. pp. 23–24.

125 Case T-193/02 Laurent Piau v. Commission [2005] ECR II-0209, para 112.
126 Commission Decision in Case COMP IV/37.806—ENIC/UEFA.
127 Ibid. para 10.
128 CAS arbitral award of 20 August 1999 in Case CAS 98/200 AEK Athens and Slavia Prague

v. UEFA.
129 Ibid. para 133. See also Case COMP/37.806—ENIC/UEFA, para 10.
130 Case COMP/37.806 ENIC/UEFA, para 12.
172 5 EU Competition Law and Sport

In Mouscron,131 the UEFA ‘home and away’ rule according to which each club
must play its home matches at its own ground was challenged on the basis of
Article 102 by the French Communauté Urbaine de Lille after UEFA refused to
allow the Belgian club Excelsior Mouscron to play its home match against French
club Metz in Lille. The Commission considered that Lille was active in the market
for the renting of stadiums, but it left open the question on whether UEFA was
dominant in the market for organising European club competitions in football.132
In 1998 Football World Cup the Commission investigated the implementation
of discriminatory ticket sales arrangements by the local organising committee of
the 1998 Football World Cup in France towards non-French residents. The practi-
cal effect of such discrimination was to deny the overwhelming majority of con-
sumers outside France access to a significant proportion of entry tickets for finals
matches. The relevant product market was determined on the basis of a detailed
analysis under the SSNIP test, and it was held to comprise only the market for the
tickets for Football World Cup 1998 due to the very low cross–elasticity of
demand.133 The relevant geographic market was held to comprise ‘at least all
countries within the EEA’.134

5.5.3 Collective Dominance

In its judgment in Piau, the General Court addressed the issue of collective domi-
nance in the sporting sector. Citing the previous judgement in Compagnie
Maritime Belge135 it said that legally independent economic entities may be found
collectively dominant ‘provided that from an economic point of view they present
themselves or act together on a particular market as a collective entity’.136
Thereafter the Court restated the three cumulative conditions for a finding of col-
lective dominance as set out in para 62 of the Airtours decision.137 Implementation
by the clubs of a decision such as the FIFA Players’ Agents Regulations was seen
as potentially resulting in clubs being so linked as to their conduct on a particular
market that they present themselves on that market as a collective entity vis-à-vis

131 Case COMP/E3/36.85—Lille/UEFA (‘the Mouscron case’) [1999] unpublished decision

of 3 December 1999. Commission Press Release IP/99/965 ‘Limits to Application of Treaty

Competition Rules to Sport: Commission Gives Clear Signal’ 9 December 1999. See also
XXIXth Report on Competition Policy 1999, pp. 166–167.
132 Commission Staff Working Document, Annex I, para 2.2.1.2.
133 Case IV/36.888—1998 Football World Cup [2000] OJ 2000 L 5/55, paras 66–74.
134 Ibid. para 77.
135 C-396/96 P Compagnie Maritime Belge, para 36.
136 Case T-193/02 Laurent Piau v. Commission [2005] ECR II-0209, para 110.
137 Ibid. para 111.
5.5 Articles 101 and 102 TFEU in the Sporting Context 173

their competitors, their trading partners, and consumers.138 FIFA, national football
associations, and the clubs forming them were held collectively dominant on the
market for the provision players’ agents’ services:
Because the regulations are binding for national associations that are members of FIFA
and the clubs forming them, these bodies appear to be linked in the long term as to their
conduct by rules that they accept and that other actors (players and players’ agents) cannot
break on pain of sanctions that may lead to their exclusion from the market, in particular
in the case of players’ agents. […] such a situation therefore characterises a collective
dominant position for clubs on the market for the provision of players’ agents’ services,
since, through the rules to which they adhere, the clubs lay down the conditions under
which the services in question are provided.139

FIFA is included even though it is not active on the market for players’ agents’ ser-
vices; it is enough that it constitutes the emanation of the national associations and
the clubs, the actual economic operators on the relevant market. FIFA therefore
operates on the market through its members. The element of abuse of the collec-
tive dominant position was not subsequently found in this case.
This is not the first time that the issue of collective dominance was considered
in the sporting sector. In the Bosman case, Advocate General Lenz considered that
football clubs in a professional league could be ‘united by such economic links’ as
to be regarded as collectively dominant.140 However, the Court decided this case
under the internal market rules and therefore omitted to provide guidance on the
competition questions.141

5.5.4 Analytical Framework for Commercial Rules in Sport

It is clear from the General Court judgment in Piau that the rules enacted by
sporting organisations to regulate economic activity not connected to the specific
nature of sport, are to be assessed under the ordinary competition law framework
applicable to any other commercial rule. Therein it was held that FIFA regulations
governing
the activity of players’ agents, an economic activity involving the provision of services
which does not fall within the scope of the specific nature of sport as defined by the case

138 Ibid. para 113.

139 Ibid. para 114.
140 Opinion of AG Lenz in C-415/93 Bosman, para 285.
141 Case law and practice have assimilated the treatment of collective dominance under the

Council Regulation 139/2004 (Merger Regulation) and the Article 102 TFEU, and the Court has
used the cases decided in one area to solve the legal problems related to collective dominance
in another area. Having said this, it is important to nevertheless keep in mind the differences
in objectives between the two areas. EU merger control is concerned with preserving a market
structures and a ‘creation or strengthening of the dominant position’ whereas Article 102 TFEU
does not condemn the dominance as such.
174 5 EU Competition Law and Sport

law of the Court of Justice, constitutes a decision by an association of undertakings within

the meaning of Article [101(1)] EC, which must comply with the [Union] rules on
­competition where it has effects in the [Union].142

The activity of players’ agents was treated as being ancillary to sport, which was
not sufficient to merit a different treatment than any other profession. The same
treatment applies to Article 102 cases in as far as the sporting rules that govern
the economic activity which have nothing to do with the special nature of sport
have been unilaterally adopted by a dominant or collectively dominant undertaking.

5.5.4.1 Commercialisation Agreements and Sports Broadcasting

Market

The Nice Declaration acknowledges that the sale of television broadcasting rights
is one of the largest sources of income today for certain sports. Football is most
definitely one of those sports, in contrast to say, Formula 1 races, which generate
the main part their of revenues from sponsorship agreements. The position of the
European Council in the Nice Declaration was that ‘moves to encourage the mutu-
alisation of part of the revenue from such sales, at the appropriate levels, are bene-
ficial to the principle of solidarity between all levels and areas of sport.’143
The market for sports broadcasting used to be, and to a good extent still is,
organised in a monopoly/monopsony structure, i.e. it is characterised by the pres-
ence of a dominant seller and a dominant buyer. The buying side was de-
cartelised, but the selling side stayed highly centralised, which had implications
for the ability of sporting federations to affect the competition between
­broadcasters in the downstream market. What makes the definition of the relevant
market particularly difficult in the media sector is that the product and services are
not clearly separable, and due to technological or economic convergence they are
often marketed in a bundle.144
Sport events and films are the most popular pay-TV products.145 In TPS, the
Commission suggested that a separate market might exist for rights to broadcast
sports events.146 Today, not only is it universally accepted that sports broadcasting
rights indeed constitutes a separate market, but that the definition has become

142 Case T-193/02 Laurent Piau v. Commission [2005] ECR II-0209, para 5 summarising paras
73–75 of the judgment.
143 ‘Declaration on the Specific Characteristics of Sport and its Social Function in Europe, of

which Account Should be Taken in Implementing Common Policies’, Presidency Conclusions

following the Nice European Council Meeting of 7, 8 and 9 December 2000.
144 Organisation for Economic Co-operation and Development—Competition Committee,

Roundtable on Competition and Sports: Note by the European Union, DAF/COMP/WD(2010)56.

145 Commission Decision in Case No IV/36.237—TPS [1999] OJ L 90/6, para 34.
146 Ibid. See also Commission Decision in Case M.779—Bertelsmann/CLT [1996] OJ C 364/3,

para 19, where this was acknowledged for the first time.
5.5 Articles 101 and 102 TFEU in the Sporting Context 175

more sophisticated and narrower.147 Particular characteristics of sports

­programmes include their ability to generate high viewing figures and reach an
identifiable audience specially targeted by certain advertisers.148 In the examination
of the joint selling of commercial rights in UEFA Champions League, the
Commission considered the following markets relevant to an assessment of the
effects of such arrangements:
(a) the upstream markets for the sale and acquisition of free-TV, pay-TV and pay-per-view
rights; (b) the downstream markets on which TV broadcasters compete for advertising
revenue depending on audience rates, and for pay-TV/pay-per-view subscribers; (c) the
upstream markets for wireless/3G/UMTS rights, Internet rights and video-on-demand
rights, which are emerging new media markets at both the upstream and downstream lev-
els that parallel the development of the markets in the pay-TV sector; (d) the markets for
the other commercial rights namely sponsorship, suppliership and licensing.149

With regard to the geographic markets, both the downstream and upstream mar-
kets are usually of a national character.150 This is due to the national character of
distribution as a result of national regulatory regimes, linguistic differences and
cultural factors.151

5.5.4.2 Competition Concerns with Regard to Joint Selling

and Exclusivity Clauses

In most European sports, the condition for participation in a league is the transfer
of the commercial rights to a governing body by the clubs. Governing bodies then
create a single point of sale and bundle the rights for offer to broadcasters on an
exclusive basis. One broadcaster per country will win the bidding for the rights.
Such collective selling amounts to horizontal price fixing, a hard-core cartel spe-
cifically referred to in Article 101(1)(a). One of the justifications cited in support
of this arrangement is the need to maintain competitive balance between league
participants which is achieved by the subsequent distribution of profits acquired
by means of joint selling. In addition, exclusivity clauses in the broadcasting con-
tracts with national operators segment the market along national lines. This is,

147 Mangeat 2004 Sports Media Rights and Competition law: What are the Relevant Markets?—
Economics of the Sports Media Rights/Appraisal of the Relevant Markets with Regard to Their
Acquisition and Sale. Jusletter, (6 September).
148 Commission Decision in COMP/37.398 UEFA Champions League, OJ 2003 L291/25, para

60 (summarising the TPS case).

149 Ibid. para 56.
150 See, for example, Commission Decision in UEFA Champions League OJ 2003 L291/25, para

90, and Case M.993 Bertelsmnann/Kirch/Premiere, OJ 1999 L 53/1, para 22.

151 Commission Decision in UEFA Champions League OJ 2003 L291/25, para 88. For more on

product and geographic market see also Commission Staff Working Document, Annex I, para 3.1.
176 5 EU Competition Law and Sport

however, seen as the norm in the industry reflecting the predominantly national
set-up of the sports market that differs culturally and linguistically from one
Member State to another. Also, it protects the value of the rights for both buyers
and sellers, and encourages investments in innovative programming. Exclusivity
is not prohibited per se and will be examined in the light of the duration of com-
mitments in relation to the time needed for the broadcasters to recoup their invest-
ments as well as in the light of the foreclosure effect on potential new market
entrants. Availability and conditions of licensing will play a role in assessing the
nature of exclusivity. Apart from this restriction on competition in the downstream
market, two other effects of broadcasting agreements are of particular concern
to the competition enforcers: the impact it has on consumers in terms of choice
and price, and the restrictions on commercial undertakings (clubs) to exploit their
rights on an individual basis.

5.5.4.3 UEFA Champions League, Bundesliga, and the FAPL Cases

The Commission was dealing with the issue of collective sales of Champions
League rights on an exclusive basis by UEFA152; Bundesliga rights by the German
Football League153; and Premier League rights by the Football Association
Premier League.154 In all three cases, the joint selling arrangements were consid-
ered horizontal restrictions on competition contrary to Article 101(1) because they
hindered competition between the clubs in terms of prices and innovation, and cre-
ate the preconditions for offering to broadcasters the single (bundled) packages on
an exclusive basis. On the other side of the coin are the efficiencies identified by
the Commission under Article 101(3). They relate to the improvement of the
media product and its distribution with the resulting benefits for broadcasters,
viewers and the football clubs. Specifically, the creation of a single point of sale
for acquisition of a packaged league product provides efficiencies by reducing
transaction costs for football clubs and media operators, while the branding of the
output creates efficiencies as it establishes a recognisable homogenous product
that is more attractive for the viewers, more valuable for broadcasters, and leads to
more objectivity in media coverage than would be present with individual selling
by clubs. In UEFA Champions League the UEFA convincingly argued that
the creation of a single point of sale is a prerequisite for the existence of the UEFA
Champions League product. Since no individual club knows before the start of the season

152 The Champions League is one of the most watched events on television. Commission
Decision Relating to a Proceeding Pursuant to Article 81 of the EC Treaty and Article 53 of
the EEA Agreement (Comp/C.2-37.398 Joint Selling of the Commercial Rights of the UEFA
Champions League) 2003/778/EC, OJ 2003 L291/25.
153 Decision 2005/396 OJ 2005 L134/46.
154 Commission Decision in Case COMP/C-2/38.173—Joint Selling of Media Rights to the FA

Premier League [2006] C 2006/868 final.

5.5 Articles 101 and 102 TFEU in the Sporting Context 177

how far it will get in the tournament it could not sign a commercial agreement with a
broadcaster giving the broadcaster any certainty that the football clubs will make it to the
very end of the UEFA Champions League season. This provides an element of uncertainty
for broadcasters.155

In order to make the identified efficiencies count so as to outweigh the negative

effects the joint selling agreements have on competition, the Commission has
attached a number of commitments to its exemption decisions. The collectivity
and exclusivity were not condemned per se, but the unbundling of rights to make
them accessible to the wider range of operators, a shorter duration of exclusive
commitments, a transparent and non-discriminatory bidding procedure, selling of
some of the rights by the clubs, and reverting unsold rights back to the clubs were
all among the conditions for exemption depending on the specific circumstances of
each case. UEFA proposed a revised, unbundled selling policy based on segmenta-
tion of exploitation of TV rights, radio, internet, Universal Mobile
Telecommunications Systems and physical media such as DVD, VHS and
CD-ROM. Although the case finally ended in an exemption under Article 101(3),
in the Staff Working Document the Commission nevertheless identified the
remaining restraints after the commitments entered into have been put into prac-
tice. Namely, ‘the exclusive sale of live rights by UEFA still prevented individual
clubs from competing in the sale of those rights, a single price was fixed, broad-
casters only had one point of supply in respect of most live rights and the exploita-
tion of deferred rights was subject to limitations.’156 The Bundesliga had entered
into similar unbundling commitments and has limited the period of the duration of
the contracts with operators to 3 years maximum. Similarly, in the Premier
League, the commitments were shortened from 5 to 3 years and the league has
entered into a series of other undertakings including an increase in the number of
matches available for live TV transmission and the sale of rights in packages with
no buyer being able to acquire all of them. The end result was that British Sky
Broadcasting (BskyB), a broadcaster which used to hold all the exclusive rights,
acquired four out of the six packages available.157
Therefore, a common set of principles emerged from the three decisions allowing
collective selling as long as tendering of the media rights is open and transparent,
the duration of exclusive commitments is limited to 3 years, rights are unbundled
to be accessible on all media platforms and to a wider range of operators, and the
unsold rights are reverted back to the clubs. These were some of the ways in which

155 Commission Decision in Case COMP/37.398—Joint Selling of Commercial Rights (UEFA

Champions League) [2003] OJ L 291/25, para 140.

156 Commission Staff Working Document, Annex I, para 3.1.3.1.3.
157 For more on this topic see Rubenstein 2005 Unbundling of Sports Media Rights. Sports

Law: Administration and Practice 12(1), pp. 14–16; Editorial 2005 Sports Broadcasting: What
Next?. Sports Law: Administration and Practice 12(5), pp. 5–7; Thomas and Thomson 2004
Negotiation, Bundling and Competition Law—Current Issues Facing Those Involved in Sports
Broadcasting Rights. Sports Law: Administration and Practice 11(5), pp. 1–5.
178 5 EU Competition Law and Sport

the exclusivity of the media deals was made less exclusive. However, Hoehn and
Kastrianki identified case-specific differences between FAPL and Bundesliga
related to different circumstances that exist in the UK and Germany.158 In the UK,
the pay TV market was more mature than in Germany which justified the FAPL’s
commitments related to no-single-buyer rule, whereas Bundesliga’s commitments
related to substantially unbundling its media rights according to different
­platforms. In the UK, the auctioning of packages was platform-neutral. Today, all
of the big domestic European leagues have adopted, or plan to adopt, a system of
collective selling.159

5.5.4.4 Joined Cases C-403/08 and C-429/08 Murphy

The facts of Murphy,160 along with the parts of the judgement related to the
­internal market and intellectual property law were set out in Sect. 4.10. With
regard to competition law, the Court unsurprisingly reached the analogous conclu-
sions as under Article 56 TFEU. Whereas granting the exclusive right to broadcast
protected subject-matter by satellite to a sole licensee was essentially in accord-
ance with the Satellite Broadcasting Directive,161 accompanying such exclusivity
with the prohibition on provision of cross-border services (i.e. supply of decoding
devices outside exclusive territory) constituted restriction of competition by object
under Article 101 TFEU.162 Absolute territorial exclusivity in the area covered by
the licence eliminated all competition between broadcasters.163 This arrangement
could not be exempted by the terms of Article 101(3) because the Court found it
disproportionate earlier in the judgment in the context of the objective justification
framework under Article 56 TFEU.164
The Advocate General suggested the same outcome and considered that a con-
tractual obligation requiring the broadcaster to prevent its satellite decoder cards
which enable reception of the licensed programme content from being used out-
side the licensed territory has the same effect as an agreement to prevent parallel
exports.165 The exemption under Article 101(3) is theoretically possible, but
because the Advocate General indicated that it should be subject to similar consid-
erations as in the examination of whether a restriction of freedom to provide

158 Hoehn and Kastrianki 2012, p. 11.

159 Ibid. p. 12.
160 Joined Cases C-403/08 and C-429/08 FAPL and others v. QC Leisure and others; and Karen

Murphy v Media Protection Services Ltd., judgment of 4 October 2011.

161 Ibid. para 138. Article 1(2)(b) of the Directive 93/83/EEC of 27 September 1993 on the

­coordination of certain rules concerning copyright and rights related to copyright applicable to sat-
ellite broadcasting and cable retransmission (Satellite Broadcasting Directive) [1993] OJ L 248/15.
162 Ibid. paras 139–140.
163 Ibid. para 142.
164 Ibid. para 145.
165 Paragraph 248 of her Opinion in Joined Cases C-403/08 and C-429/08 Murphy.
5.5 Articles 101 and 102 TFEU in the Sporting Context 179

services is justified, it is very unlikely on the basis of her Opinion that the license
agreements in question would benefit from that exemption.166 We will come back
to this point below in Sects. 6.3 and 6.4 in the context of convergence between
internal market and competition law provisions of the Treaty.

5.5.5 Analytical Framework for Regulatory Rules: C-519/04

Meca-Medina [2006]

The first time that the Court directly addressed the application of competition
­provisions to regulatory rules in sport was in the Meca-Medina judgment167 of
2006. Hence, the case deserves special attention.

5.5.5.1 Factual Background

The case involved two professional swimmers who were found to have breached
the sport’s anti-doping rules adopted by the International Olympic Committee
(IOC). They tested positive for nandrolone and were suspended for a period of 4
years by the Doping Panel of the International Swimming Federation that
­implemented the rules for their discipline.168 Contesting the anti-doping rules, the
applicants asserted that they were in breach of Articles 101 and 102, and 56 on
freedom to provide services.
[…] First of all, the fixing of the limit at 2 ng/ml is a concerted practice between the IOC
and the 27 laboratories accredited by it. That limit is scientifically unfounded and can lead
to the exclusion of innocent or merely negligent athletes. In the applicants’ case, the
excesses could have been the result of the consumption of a meal containing boar meat.
Also, the IOC’s adoption of a mechanism of strict liability and the establishment of
­tribunals responsible for the settlement of sports disputes by arbitration (the CAS and the

166 Ibid. para 250.

167 Case C-519/04 David Meca-Medina and Igor Majcen v. Commission [2006] ECR I-6991.
Before this case the Court has had a number of opportunities to clarify the relation between com-
petition law and sports (notably in C-415/93 Bosman) but it has avoided this problem by deciding
the cases on the basis of internal market rules. In the absence of Union legislative competence, it
was only the Commission decisional practice that shed some light on the competition law issues
in sports.
168 The appeal against the suspension was first launched before the Court of Arbitration for

Sports which confirmed the decision of the doping panel but later, when scientific experiments
showed that nandrolone’s metabolites can be produced endogenously by the human body at a
level which may exceed the accepted limit when certain foods have been consumed, they reduced
the sanctions to 2 years. In 2001, however, the applicants launched the complaint with the
Commission whose decision they appealed to the General Court, and finally the decision of the
General Court was brought before the Court.
180 5 EU Competition Law and Sport

ICAS) which are insufficiently independent of the IOC strengthens the anti-competitive
nature of that limit. […].169

The athletes raised their claim under both the freedom to provide services and the
competition provisions of the Treaty.

5.5.5.2 Judgment of the Court

The Court started off by reiterating and confirming the rules developed in its previ-
ous case law. The orthodox rule that originated in Walrave170 provides that ‘sport
is subject to Community law only in so far as it constitutes an economic activity
[…]’.171 Rules of ‘purely sporting’ interest with nothing to do with economic
activity are excluded from the scope of the Treaty.172 The Court cited paras 14 and
15 of Donà and held that freedom of movement provisions ‘do not preclude rules
or practices justified on non-economic grounds which relate to the particular
nature and context of certain sporting events,’ and are limited to their proper objec-
tive.173 Such a restriction on the scope of the freedom of movement provisions
‘cannot be relied upon to exclude the whole of a sporting activity from the scope
of the Treaty’.174 The Court here states the obvious: that the sporting activity in
question (say, the activity of a football player) cannot altogether be excluded from
the scope of the Treaty in relation to all other sporting rules. The restriction on the
scope of the Treaty by the rule that fulfilled the requirements for exception ena-
bled by Walrave and Donà cannot be relied on to say that the sporting activity that
that rule governed therefore as a whole falls outside of the scope of the Treaty.
There is no such thing as a general exception for the sporting activity in question.
This interpretation of the judgement comes from the fact that when the Court in
para 76 of Bosman cited paras 14 and 15 from Donà adding to them the sentence
‘it cannot therefore be relied upon to exclude the whole of a sporting activity from
the scope of the Treaty’ it did so in response to the arguments raised by the
German Government that sport such as football is not an economic activity, that it
is akin to culture and should be treated as such. Also, it addressed UEFA argu-
ments which essentially called for exception due to the particular nature of sport.

169 C-519/04 Meca-Medina, paras 16–17.

170 Case 36/74 Walrave and Koch [1974] ECR 1405, para 4. This paragraph was subsequently
confirmed in Case 13/76 Donà [1976] ECR 1333, para 12; Case C-415/93 Bosman [1995]
ECR I-4921, para 73; Joined Cases C-51/96 and C-191/97 Deliège [2000] ECR I-2549, para 41;
and Case C-176/96 Lehtonen and Castors Braine [2000] ECR I-2681, para 32.
171 C-519/04 Meca-Medina, para 22.
172 Ibid. para 25 (citing Walrave para 8).
173 Ibid. para 26.
174 Ibid. para 26 (Citing Bosman, para 76, and Deliège, para 43). Emphasis added.
5.5 Articles 101 and 102 TFEU in the Sporting Context 181

The Court itself said it is addressing the arguments ‘on the question of application
of Article [45 TFEU] to rules laid down by sporting associations’.175
In the following paragraph, the Court used the new language that resulted in
giving the paragraph the false reputation of severely limiting the scope of sporting
exception that originated in paras 8 and 9 of Walrave. Having set out its position
from the previous case law, it said that
it is apparent that the mere fact that a rule is purely sporting in nature does not have the
effect of removing from the scope of the Treaty the person engaging in the activity
governed by that rule or the body which has laid it down.176

All the Court does here is re-state the obvious in the light of the above
­considerations: if a rule is motivated by purely sporting interests (which is what
the Court meant by ‘purely sporting in nature’) it is not the end of the story—a
person engaged in the economic activity governed by that rule and a body that laid
it down will fall under the scope of the Treaty, and the rule may be examined for
its compatibility with the Treaty provisions. In order to receive what is classified
below in Chap. 6 as a category II sporting exception, the rule will have to fulfil
the other requirements of paras 14 and 15 of Donà/paras 8 and 9 of Walrave. A
rule referred to in para 17 of Meca-Medina is any rule that produces an economic
effect. If it were a rule that has no effect of an economic nature the Court would
refer to para 4 in Walrave and that is where the story would begin and end.
The Court therefore implied that purely sporting motives of the rule are not suf-
ficient to escape scrutiny for the body that laid it down when it produces effects on
the economic activity. In either case, the fact that it uses the language of ‘it is appar-
ent’ would imply that it does not change anything in regard to the previous case law.
Thereafter the Court set aside the reasoning in the decision of the General
Court by finding an error in the interpretation of law. It held that:
even if those rules 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, that fact means neither that the sporting activity in question necessarily
falls outside the scope of Articles [101 TFEU] and [102 TFEU] nor that the rules do not
satisfy the specific requirements of those articles. However, in para 42 of the contested
judgment, the [General Court] held that the fact that purely sporting rules may have noth-
ing to do with economic activity, with the result that they do not fall within the scope of
Articles [45 TFEU] and [56 TFEU], means, also, that they have nothing to do with the
economic relationships of competition, with the result that they also do not fall within
the scope of Articles [101 TFEU] and [102 TFEU]. In holding that rules could thus be
excluded straightaway from the scope of those articles solely on the ground that they were
regarded as purely sporting with regard to the application of Articles [45 TFEU] and
[56 TFEU], without any need to determine first whether the rules fulfilled the specific
requirements of Articles [101 TFEU] and [102 TFEU], as set out in para 30 of the present
judgment, the [General Court] made an error of law.177

175 C-415/93 Bosman, para 69.

176 C-519/04 Meca-Medina para 27.
177 Ibid. paras 31–33, (emphasis added).
182 5 EU Competition Law and Sport

Therefore, the rules found to be purely sporting for the purpose of freedom of
movement provisions are not by the virtue of that fact also excluded from the
assessment under competition provisions. They have to satisfy the requirements of
both sets of the Treaty rules separately. A generous approach of the General Court
to the scope of sporting autonomy was quashed and tighter legal requirements for
compatibility of the rules of governing bodies with EU law were set by the Court.
Weatherill saw the setting aside of the General Court judgment not as a criticism
to the convergence thesis but as the Court first pointing out the inadequacy of the
General Court analysis and then putting the interpretation of Article 101 on
the right track setting the convergent course for other economic law provisions in
the Treaty that affect sport.178 Section 5.5.5.5 and Chap. 6 below develop a
detailed convergence theory.
Finally, the Court turned its attention to the application of Article 101(1).
Relying on its previous ruling in Wouters the Court emphasised the need for
­contextual approach:
Not every agreement between undertakings or every decision of an association of
undertakings which restricts the freedom of action of the parties or of one of them
­necessarily falls within the prohibition laid down in Article [101(1) TFEU]. For the
­purposes of application of that provision to a particular case, 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. It has then to be
considered whether the consequential effects restrictive of competition are inherent in
the pursuit of those objectives (Wouters and Others, para 97) and are proportionate to
them.179

The fact that the doping rule was intended to safeguard the objective of fair play
and ethics in sports did not remove it from the scope of competition rules; the
economic effects that it produced had to be considered in the light of the Wouters
inherency test and the requirement of proportionality. The rule was found to
restrict athletes’ freedom of action, but as the general objective was to provide a
level playing field and preserve integrity of sporting competition and the sanctions
were necessary to ensure compliance with the doping ban, the restrictions were
deemed inherent in the rule. The Court also found that athletes had not demon-
strated that the rule was disproportionate and upheld the previous finding of the
Commission on this point.
So the athletes lost. Of particular importance for understanding of the develop-
ment of law in this field is to remember that they did not lose because the rules
were of ‘purely sporting’ interest, but because these rules satisfied the test laid
down by the Court in para 42.180

178 Weatherill 2008b, p. 342.

179 C-519/04 Meca-Medina, para 42.
180 Weatherill 2007, p. 57.
5.5 Articles 101 and 102 TFEU in the Sporting Context 183

5.5.5.3 Comments

It follows from the test in para 97 of Wouters, as absorbed by para 42 of Meca-

Medina, that an organisational sporting rule or practice that is found to restrict the
freedom of action under Article 101(1) or 102 may not breach those provisions to
the extent that the rule in question pursues a legitimate objective, its restrictive
effects are inherent in the pursuit of that objective and are proportionate to it.181
Hence, the objective justification defence developed in the framework of Article
102, coupled with proportionality requirement, has been remodelled for the pur-
poses of its application to organisational rules of collective (sports) bodies that
pursue non-competition objectives, to the extent that the criterion of inherency has
been added to it. This seems to be a peculiar twist in the overall approach to the
application of EU law to sport which is known to be sensitive; it looks as if a regu-
latory sporting rule is held to a higher standard than a commercial rule or practice
adopted in an ordinary sector relying on the ordinary objective justification
defence which does not include the inherency requirement. Although on this level
of analysis the Court takes into consideration the specificity of sport, the effect of
which could be thought to bring back the necessary balance and stay faithful to the
overall approach via the adjusted intensity of the application of different parts of
the test, in particular the criterion of proportionality, the practice shows that in
Meca-Medina, just like in Wouters, the Court has applied a moderate intensity pro-
portionality test.182 Usually the intensity will vary depending on the restriction in
question. It does not follow from Meca-Medina that the Court has given any
­special consideration to sport in this regard.
Meca-Medina is not the first time that the Wouters test was applied in the
­sporting case, but it is the first time that the judgment hit so close to the core of
sporting autonomy and it was passed by the Court itself. Several years earlier, in
ENIC183 and in the unpublished Mouscron decision,184 the Commission directly
applied para 97 of Wouters in its positive assessment of the UEFA rule on multi-
club ownership and the ‘home and away rule’, respectively. Advocate General Lenz

181 Case C-519/04 David Meca-Medina and Igor Majcen v. Commission [2006] ECR I-6991.
See also Commission Staff Working Document, Annex I, para 2.1.2.
182 Lavrijssen 2010, pp. 636–659.
183 Commission Decision in Case COMP/37.806—ENIC/UEFA. See also Commission Press

Release IP/02/942 ‘Commission Closes Investigation into UEFA Rule on Multiple Ownership of
Football Clubs’ Brussels 27 June 2002.
184 Case COMP/E3/36.85—Lille/UEFA (‘the Mouscron case’) unpublished Commission

Decision of 3 December 1999. Commission Press Release IP/99/965 ‘Limits to Application of

Treaty Competition Rules to Sport: Commission Gives Clear Signal’ 9 December 1999. See also
XXIXth Report on Competition Policy 1999, pp. 166–167.
184 5 EU Competition Law and Sport

in Bosman,185 Advocate General Cosmas in Deliège,186 and Advocate General

Alber in Lehtonen187 explicitly referred to the DLG case, a precursor to Wouters.
The rule or practice which is found to satisfy the cumulative criteria of the test
is considered compatible with Articles 101 and 102. One the other hand, should
the rule or practice fail to meet any of the criteria, and it has a negative effect on
trade between Member States, it will breach Article 101(1) and will constitute an
abuse contrary to Article 102, which can be made valid only by satisfying the con-
ditions for exemption common to both articles (i.e., Article 101(3) and the effi-
ciency defence conditions). Here, it must be acknowledged that it is highly
unlikely that a rule of a sporting organisation pursuing a non-competition goal that
cannot be translated into economic efficiencies, or a rule that has failed the Meca-
Medina/Wouters test on the point of proportionality, would satisfy the requisite
economic conditions.188 That presents yet another raison d’être of the Wouters test
in the sporting context, for without it, the broad scope of Article 101(1) would
most likely render virtually any organisational rule of sport that restricts the free-
dom of action and relies on the non-competition justification incompatible with
the entire Article 101. Even without a test case, it can be assumed on the basis of
the case law so far, that neither the Court and the Commission are prepared to take
the specificity of sport into consideration at this level of analysis when it cannot be
translated into economic efficiency arguments, nor does the exemption provision
lends itself to non-economic assessments.

5.5.5.4 Reactions

The Meca-Medina judgment hit closer to the core of sporting autonomy than any
other sporting judgment prior to it. Needless to say, it was not welcomed by the
sporting bodies. In particular, the IOC and the two largest football governing bod-
ies (FIFA and UEFA) saw it as an attack on their authority and an unnecessary
intrusion into the scope of sporting autonomy they had thus far. Meca-Medina has
brought to an end the constitutionally based distinction in para 4 of Walrave and
Koch between economic and ‘purely sporting’ rules, leaving the sporting exception
applicable to only a small number of rules which, in all probability, no athlete or
club would even think to challenge.189 Weatherill thought that a possible

185 Opinion of AG Lenz in C-415/93 Bosman, paras 269–270.

186 Opinion of AG Cosmas in Joint cases C-51/96 and C-191/97 Deliège, para 112.
187 Opinion of AG Alber in C-176/96 Lehtonen, paras 107–108.
188 The Commission in Commission Staff Working Document, Annex I, para 2.1.6, says that

‘[s]uch a justification is most likely to apply where a rule is not inherent in the organisation or
proper conduct of sport so as to justify the application of Wouters but where the beneficial effects
of a rule outweigh its restrictive effects.’
189 Such as the rules of the game.
5.5 Articles 101 and 102 TFEU in the Sporting Context 185

i­nterpretation of the decision in Meca-Medina would hold that the so-called rule of
‘purely sporting interest’, originating in Walrave and Koch, has now been elimi-
nated as a basis for immunising sports rules which have an economic effect from
review under EU law.190 UEFA’s Director of Legal Affairs commented on the
judgment in Meca-Medina saying that it has opened up a possibility for almost
any sports sanction for any offence (e.g. doping, match-fixing, gambling, bad con-
duct, etc.) to be described as representing a condition ‘for engaging in’ sporting
activity and be challenged under EU competition law.191 Speaking for the
Financial Times, the IOC president Jacques Rogge also expressed his concern and
thought that proportionality of sentences has always been counted with and there
is no reason for the EU to interfere. He described bringing doping rules under EU
competition law as ‘frightening’192
On the other hand, the fact that the rule will be scrutinised under the competi-
tion provisions does not mean that it will be found in breach of those provisions.
But the concern of the sporting bodies seems to be there regardless of this fact.
The case has opened a door for the possibility to challenge most of the sporting
rules and there will be a consequential increase in the amount of litigation, regard-
less of their positive outcome for the governing bodies in sport. While it is not
hard to sympathise with some of the concerns raised, the fact is that none of the
criticisms of the judgment presented well-reasoned, convincing arguments on the
basis of EU law, not just amongst sport bodies and their representatives but also in
the relevant academic circles. UEFA’s Director of Legal Affairs further recalled
that in the General Court’s reasoning a sports rule that was ‘non-economic’ in
character and so outside free movement law, meant that it was also outside the
scope of competition law. He saw this reasoning as superior because the Treaty
applied only to economic activities, and if the rule is non-economic it should be
the end of the story, meaning that the Treaty does not apply altogether. Paragraph
31 of the decision of the CJEU in Meca-Medina was described as a ‘strange twist’
to this logic.193
While reflecting the opinion of most of the sporting world, this comment is
based on a flawed interpretation of the judgment because it alludes to the category
I sporting exception while it is clear that the Court was referring to the category II
sporting exception.194 The Court had merely reminded us that the two sets of pro-
visions protect different freedoms of action and include different elements and that
those differences deserve recognition. This is considered next as an answer to the
criticism of the Court’s decision in Meca-Medina.

190 Weatherill 2008b, p. 345.

191 Infantino 2006, pp. 3–4.
192 See ‘Olympic Chief Fears EU Grip on Doping’ by Roger Blitz, Financial Times, 17 October

2007.
193 Infantino 2006, pp. 3–4.
194 On this point, see Sect. 6.3.
186 5 EU Competition Law and Sport

5.5.5.5 Paragraph 31 of Meca-Medina Reversed

The constitutional limitations on the action of the Union institutions operate generally,
but their specific expression might be different in different substantive Treaty provi-
sions. With regard to the principle of subsidiarity in Article 5 of the Treaty on the
European Union (TEU), purely internal situations are outside of the scope of inter-
nal market rules and therefore outside of Union competence,195 but the competition
rules may, at least theoretically, apply even if the situation is purely internal, as long
as there is the required effect on competition. Similarly, the notion of appreciability
delimits the respective competences between Member States and the Union with
regard to competition provisions, but the notion has no counterpart in the internal
market area. Hence, the restriction on competition which does not produce an
appreciable effect on the trade between Member States is outside of the EU compe-
tence in respect to competition provisions, but it may fall to be examined by the EU
institutions under the free movement articles. To give a hypothetical example, it is
possible that regulatory rules restricting by effect the numbers of non-national play-
ers in, say, the third national league of a certain sport in a Member State could
escape review under Article 101(1) on the basis of their unappreciable effect on
trade between Member States. The competition provisions are not as concerned
with individual freedoms as much as with general market structures and preserva-
tion of viable, undistorted competition. However, because the doctrine of unappre-
ciable effect is virtually unknown in the freedom of movement provisions,196 the
same nationality restrictions might impede market access and fall afoul of Article
45 TFEU and Article 7 of Regulation 492/2011,197 unless objectively justified and
proportionate. A fortiori, a completely amateur, recreational sports league ran by
volunteers which has nationality quotas could be condemned on the basis of differ-
ential treatment in regard to social advantages for workers employed in the Member
State in another capacity (e.g., as construction workers), or on the basis of making
the move to that Member State less attractive for workers that practice the sport in

195 See, for example, Case 175/78 Regina v. Saunders [1979] ECR 1129 and Cases C-225-
227/95 Kapasakalis, Skiathis and Kougiagakas v. Greece [1998] ECR I-4329.
196 In the freedom of movement of goods that is not the subject of this convergence discus-

sion some rules can be seen as performing the same function: in C-267 and 268/91 Criminal
Proceedings against Keck and Mithouard [1993] ECR I-6097 rule on certain selling arrange-
ments; Cases C-69/88 Krantz v Ontvanger der Directe Belastingen [1990] ECR I-583 para 11,
and C-93/92 Motorradcenter v Pelin Baskiciogullari [1993] ECR I-5009, para 12 state that restric-
tive effects which it might have on the free movement of goods are too uncertain and indirect
for the obligation which it lays down to be regarded as being of a nature to hinder trade between
Member States. In Case C-190/98 Graf v Filzmozer Maschinebau GmbH [2000] ECR I-493, para
23, the Court stated that if a measure is non-discriminatory and it does not substantially hinder
access to market or its effect on free movement is too remote, it falls outside of Article 45 TFEU.
This has some functional resemblance to the de minimis and appreciability concepts, but it was
never formally recognised, it involves the non-discriminatory measures only and it is, in any case,
a far higher threshold to cross to have it produce the same effect as de minimis and appreciability.
197 Regulation (EU) No. 492/2011 of the European Parliament and of the Council of 5 April

2011 on the freedom of movement of workers in the Union OJ L 141, 27.5.2011, pp. 1–12.
5.5 Articles 101 and 102 TFEU in the Sporting Context 187

question. A worker that is a national of another Member State (or their family
­member) who does not have access to the sport they want to practice due to the
imposed quotas is de facto being discriminated against in terms of social advan-
tages and would have a right to bring a claim to the national court against the body
which laid the rule down. This situation is of no concern to competition law.
The illustration presented proves that para 31 of Meca-Medina also works in
reverse with regard to the constitutional limits. Rules of sports bodies would have
to satisfy the specific requirements of each of the articles of the Treaty separately
in order to be considered outside of the Union competence. So in the reverse
wording of the Court in para 31 of the judgment:
even if those rules do not constitute restrictions on competition because they do not ­produce
appreciable (economic) effect on trade between Member States and, as such, are not subject
of Union competence under competition provisions, that fact means neither that the (sport-
ing or other) activity in question necessarily falls outside the scope of the free movement
provisions nor that the rules do not satisfy the specific requirements of those articles.

Whatever the degree and type of convergence between competition and free move-
ment provisions, the reflection of the general constitutional principles may be dif-
ferent in the course of their enforcement, depending on the factual background of
each case. This is due to the fact that there is no, there cannot be a, total conver-
gence in the application of the two sets of rules, for they protect different economic
rights. The core constitutional provisions of the Union, such as the principle of
subsidiarity in Article 5 TEU, are therefore to be taken functionally from provision
to provision. This functional approach is dictated on the constitutional level by the
difference in the analytical elements, scope and content of prohibitions, exceptions
and protection in articles, but also by the demands of each article on a case-by-case
basis.198 The formalistic application in which the effect of the basic Union princi-
ples under one article could determine the outcome under another would deprive
those other Treaty articles of their proper function. Put simply, the competence to
act is generally not transplantable from competition to internal market articles and
vice versa. The article-specific exceptions and limitations, as well as general
­constitutionally–based limitations cannot produce a generic effect of removing the
case from the scope of all of the Treaty articles under which they fall.

5.6 Blocking Competing Organisations

5.6.1 C-49/07 MOTOE [2008]

5.6.1.1 Article 106(1)

Addressed to Member States, Article 106(1) applies to state measures of a

­regulatory nature which are directed at activities of an economic nature. It does

198 This comes through, for e.g., in paras 29 and 30 of Case C-519/04 Meca-Medina.
188 5 EU Competition Law and Sport

not have an independent application because it is a reference provision which can

be applied only in conjunction with other TFEU articles. The rationale behind
Article 106(1) is that in certain circumstances a Member State can be held liable
for the breaches of the Treaty by undertakings. It reflects in more specific terms
the principle of loyalty enshrined in Article 4(3) TEU according to which Member
States shall, inter alia, refrain from any measure that can jeopardise the attainment
of the Union’s objectives. Article 106(1) TFEU reads:
In the case of public undertakings and undertakings to which Member States grant special
or exclusive rights, Member States shall neither enact nor maintain in force any measure
contrary to the rules contained in the Treaties, in particular to those rules provided for in
Articles 18 and 101–109.

5.6.1.2 Facts

MOTOE199 is the second sports case decided under the TFEU competition
­provisions concerned Articles 102 and 106 in the context of the organisation and
regulation of motorcycling in Greece. Article 49 of the Greek Road Traffic Code
provides that a license to organise motorcycling events would be issued to the
organisers by the Minister for Public Order, or the authorities empowered by him,
only after the organiser secures the consent from the official representative in
Greece of the Fédération Internationale de Motocyclisme (the International
Motorcycling Federation). Accordingly, the power to grant consent for the organi-
sation of motorcycling events was given to ELPA (Elliniki Leskhi Aftokinitou kai
Periigiseon—Automobile and Touring Club of Greece), a legal person and a non-
profit association who was itself organising the same kinds of events in Greece.
MOTOE (Greek Motorcycling Federation) planned to organise a motorcycling
competition in Greece but was refused the consent from ELPA for no apparent
reason and therefore failed to obtain authorisation from the competent ministry.
After being refused an authorisation, MOTOE claimed pecuniary damages from
the government in the Greek national court relying on Articles 102 and 106(1)
TFEU. Article 49 of the Greeks Road Traffic Code conferred on ELPA a position
of monopoly power over the organisation of motorcycle events in Greece which in
itself does not breach Article 102 of the Treaty to the extent that the power is not
abused. MOTOE claimed that ELPA had abused its monopolistic position because
it refused to grant the consent needed for authorisation of its planned event.

5.6.1.3 Judgment and Comments

The Courts first held that ELPA constitutes an undertaking regardless of the fact
that it has been formally classified as non-profit organisation under Greek law, and

199 Case C-49/07 Motosykletistiki Omospondia Ellados NPID (MOTOE) v Elliniko Dimosio
[2008] ECR I-4863.
5.6 Blocking Competing Organisations 189

that it has been vested with public powers in regard to its special right to grant
consent. For the remainder of its activities, the organisation and marketing of
sporting events, it was an undertaking, and this conclusion cannot be changed
because the offer of goods or services is made without a profit motive since that
offer is in competition with other undertakings that do seek to make profit.200 The
fact that MOTOE was itself classified as a non-profit organisation could not
change this conclusion either, as ‘non-profit-making associations which offer
goods or services on a given market may find themselves in competition with one
another’ and their economic survival ultimately depends on imposing their
­services on the relevant market to the detriment of those offered by the other
­operators.201 This is not a novelty in the Court’s jurisprudence.202 Furthermore,
the product market was defined as consisting of ‘first, the organisation of
­motorcycling events and, second, in their commercial exploitation by means of
sponsorship, advertising and insurance contracts. Those two types of activities are
not interchangeable but are rather functionally complementary.’203 Confirming the
well-established case law, the Court then went on to say that a geographic market
which is confined to a single Member State does not imply that trade between
Member States is not affected; the effect of the conduct in a single Member State
may be the partitioning of markets on a national basis and preventing economic
interpenetration.204
There was no doubt that ELPA was dominant on the relevant market as defined
by the Court. Granting special or exclusive rights to an undertaking to control
whether and under which conditions other undertakings can gain access and
engage in activities on the relevant market entails such conclusion. ELPA’s
monopoly to grant the necessary consent was statutory and therefore the
­examination of Article 106 TFEU was needed. The classification of ELPA as an
undertaking entrusted with the operation of ‘services of general economic inter-
ests’ for the purposes of application of exception in Article 106(2) TFEU was dis-
missed on the following ground: the undertaking’s economic activities related to
the organisation and commercial exploitation of motorcycling events were not
conferred by an act of entrustment by the public authority, an element needed for
the application of this provision. The power to grant consents to applications for
authorisation to organise motorcycling events, although stemming from an act of
public authority, namely Article 49 of the Greek Road Traffic Code, could not be
classified as an economic activity and consequently Article 106(2) TFEU was held
inapplicable also to this part of ELPA’s activities.205

200 Paragraphs 25 and 27 of C-49/07 MOTOE.

201 Ibid. para 28.
202 See, for example, Case 96/82 IAZ International Belgium v. Commission [1983] ECR 3369.
203 Paragraph 33 of C-49/07 MOTOE.
204 Ibid. para 42.
205 Paragraphs 44–47 of C-49/07 MOTOE.
190 5 EU Competition Law and Sport

The Court then turned its attention to Article 106(1) TFEU in conjunction
with Article 102 TFEU. The mere creation or reinforcement of a dominant posi-
tion through the grant of special or exclusive rights within the meaning of Article
106(1) TFEU was not in itself considered incompatible with Article 102 TFEU.
However,
a Member State will be in breach of the prohibitions laid down by those two provisions if
the undertaking in question, merely by exercising the special or exclusive rights conferred
upon it, is led to abuse its dominant position or where such rights are liable to create a sit-
uation in which that undertaking is led to commit such abuses (Höfner and Elser, cited
above, para 29; ERT, cited above, para 37; Case C-179/90 Merci convenzionali porto di
Genova [1991] ECR I-5889, paras 16 and 17; and Case C-323/93 Centre d’insémination
de la Crespelle [1994] ECR I-5077, para 18). In this respect, it is not necessary that any
abuse should actually occur (see, to that effect, Case C-55/96 Job Centre [1997] ECR
I-7119, para 36). In any event, Articles [102 TFEU and 106(1) TFEU] are infringed where
a measure imputable to a Member State, and in particular a measure by which a Member
State confers special or exclusive rights within the meaning of Article [106(1) TFEU],
gives rise to a risk of an abuse of a dominant position (see, to that effect, ERT, cited
above, para 37; Merci convenzionali porto di Genova, cited above, para 17; and Case
C-380/05 Centro Europa 7 [2008] ECR I-0000, para 60).206

As emphasized by the Court in numerous judgments, including MOTOE, Article

102 is not breached by the mere existence or reinforcement of a dominant posi-
tion, even if the position is attained through the grant of special or exclusive rights
within the meaning of Article 106(1), but by the circumstances in which the under-
taking is led to abuse that position is created. The key question is the discretion
that a Member State leaves for the regulatory bodies to abuse the conferred pow-
ers. Should an undertaking be under an obligation to engage in abusive practices,
the Member State is responsible for the abuses that take place, and conversely, if
an undertaking has discretion not to abuse its special powers the Member State
will not be held responsible for the committed abuses.207 The judgment in
MOTOE, paras 49 and 50, clearly indicate that the Court will consider Article
106(1), in conjunction with Article 102, breached where the dominant position
creates the mere possibility which can lead the undertaking to commit an abuse.
The concept of abuse is interpreted expansively to include creating ‘a risk of an
abuse of a dominant position’. This is more reminiscent of the approach to oli-
gopolistic markets, and even to substantive assessment of concentrations, than it is
to the well-established approach to Article 102 TFEU alone under which abuse has
to take place in order to find violation. On the facts of the case, ELPA was itself
organizing and commercially exploiting motorcycling events, and in addition was
in charge of giving consent to other undertakings to organise and commercially
exploit motorcycling events. These different powers placed ELPA in apparent

206 Ibid. paras 49 and 50.

207 For analytical comment on MOTOE that details this point see Miettinen 2009, pp. 137–149.
5.6 Blocking Competing Organisations 191

advantage over its competitors whereby it could restrict access to the relevant
­market for the other operators.208
Weatherill has posed the question if the MOTOE judgment therefore implies
that sporting federations must ruthlessly separate their regulatory functions from
any whiff of commercial advantage in order to avoid condemnation under Article
102 and that the State too must withdraw special rights granted to such sporting
bodies in order to escape condemnation under Article 106? He said that ‘it
­certainly pushes in that direction.’209 The conflict of interests between regulatory
and commercial functions has been held to per se violate a combination of Articles
106(1) and 102 also in Corbeau,210 whereas in cases such as ERT and La
Crespelle211 the mere risk of abuse was not sufficient to find Member State liabil-
ity. The final word of the Court was that:
[…] a rule, which gives a legal person such as ELPA the power to give consent to applications
for authorisation to organise motorcycling events without that power being made subject
by that rule to restrictions, obligations and review, could lead the legal person entrusted
with giving that consent to distort competition by favouring events which it organises or
those in whose organisation it participates. In the light of the foregoing, the answer to the
questions referred must be that a legal person whose activities consist not only in taking
part in administrative decisions authorising the organisation of motorcycling events, but
also in organising such events itself and in entering, in that connection, into sponsorship,
advertising and insurance contracts, falls within the scope of Articles [102 EC and 106
EC]. Those articles preclude a national rule which confers on a legal person, which organ-
ises motorcycling events and enters, in that connection, into sponsorship, advertising and
insurance contracts, the power to give consent to applications for authorisation to organise
such competitions, without that power being made subject to restrictions, obligations and
review. [emphasis added].212

This wording provides a lifeline for the sporting bodies: although paras 49 and 50
considered the mere existence of a conflict of interest in breach of Article 106(1),
in conjunction with 102, this breach could have been avoided if the power granted
to ELPA were subject to an appropriate standard of control. On the facts of this
case there was no such control placed upon ELPA and the Greece lost the case.

208 Paragraph 51 of the C-49/07 MOTOE. In Case C-41/90 Höfner and Elser v. Macrotron
[1991] ERC I-1979 it was held that the state measure within the meaning of Article 106(1) will
be unlawful where by exercising exclusive rights conferred on it an undertaking cannot avoid
abusing dominant position. In Case C-203/96 Dusseldorp [1998] ECR I-4075 the Court held that
Article 106(1) in conjunction with Article 102 will be breached where the Member State ‘adopts
any law, regulation or administrative provision which enables an undertaking on which it has
conferred rights to abuse its dominant position.’
209 Weatherill 2008a, p. 6.
210 Case C-320/91 Corbeau [1993] ERC I-2533, where the Court appears to have implied that

the monopoly not justifiable under Article 106(2) would amount to measure contrary to Article
106(1).
211 Case C-260/89 ERT [1991] ECR I-2925, and Case C-323/93 Centre d’Insémination de la

Crespelle v. Coopérative de la Mayenne [1994] ECR I-5077.

212 C-49/07 MOTOE, paras 51 and 52.
192 5 EU Competition Law and Sport

Fig. 5.1  Checklist under C-49/07 MOTOE judgment

Nevertheless, as a matter of the rule supplied by the MOTOE judgment, justification

for the inevitable abuse is possible. Miettinen concludes that, ‘as a consequence of
MOTOE, it could be argued that since all undertakings that are endowed with reg-
ulatory powers are placed in a dominant position, regardless of whether they abuse
that position they must be subject to “restrictions, obligations and review.”’213 (see
Fig. 5.1)
What kind of supervisory control on the exercise of special powers is required
has not been explained by the Court. Reflecting part of the Opinion of Advocate
General Kokott, Weatherill suggests that the correct interpretation of the judgment
is that giving exclusive rights which lead to conflict of interests is not a problem in
itself, as long as sporting federations thus endowed have ‘transparent, objectively

213 Miettinen 2009, p. 147.

5.6 Blocking Competing Organisations 193

justified, and non-discriminatory procedures and criteria for selection which are
followed faithfully and openly’.214 Moreover, the applicant promoter should be
afforded a right to a hearing and be given reasons for decisions taken, which
should be reviewable by an independent body.215

5.6.1.4 Applying Article 106(2) to Sport is Undesirable

and Superfluous

In addition to the exceptions under internal market provisions, and Articles 101
and 102 TFEU, 106(2) TFEU provides a further exception from the application of
the rules contained in the Treaty which applies only to cases involving provision
of services of general economic interest. It reads:
Undertakings entrusted with the operation of services of general economic i­nterest or
having the character of a revenue-producing monopoly shall be subject to the rules
­
­contained in the Treaties, in particular to the rules on competition, in so far as the
­application of such rules does not obstruct the performance, in law or in fact, of the
­particular tasks assigned to them. The development of trade must not be affected to such
an extent as would be contrary to the interests of the Union.

Article 106(2) thus excludes from the application of the Treaty certain categories
of agreements, decisions and certain types of conduct by undertakings in as far as
they do not significantly affect trade contrary to the Union interests. The Article
106(2) exception is of a dual nature in as far as it is capable of being invoked by
both, undertakings entrusted with the operation of a public service to justify
breaches of, for example, Articles 101 and 102, and by Member States to justify
the adoption of certain measures which are deemed necessary to guarantee the
functioning of the public services, the operation of which was entrusted to certain
undertakings. In order to qualify for the Article 106(2) TFEU exception, four
cumulative criteria must be fulfilled. Firstly, there must be an act of entrustment,
whereby the State confers responsibility for the execution of a certain task to an
undertaking.216 Secondly, the entrustment must relate to a service of general

214 Weatherill 2008a, p. 8.

215 Ibid.
216 Entrustment requires an official act(s) by the Member State, no particular form being pre-

scribed. It can be for example, a legislative measure or follow from the terms and conditions
of a concession agreement (see Case 30/87 Corinne Bodson v. Pompes Funèbres [1988] ECR
2497, [1989] 4 CMLR 984). Commission Decision 2005/842/EC on the application of Article
86(2) of the EC Treaty to State aid in the form of public service compensation granted to cer-
tain undertakings entrusted with the operation of services of general economic interest, OJ L
312/67, 29/11/2005, Article 4(a), requires the state entrusting an undertaking for the execution
of a certain task to specify the nature and duration of the public service obligation; Article 4(b)
the undertaking and territory concerned; Article 4(c) the nature of any special or exclusive right
assigned to undertaking; Article 4(d) parameters for calculating, controlling and reviewing the
compensation, and; 4(d) the arrangements for avoiding and repaying any overcompensation.
194 5 EU Competition Law and Sport

e­ conomic interest.217 Thirdly, the exception has to be necessary for the perfor-
mance of the tasks assigned and proportional to that end. If the market is in a state
of healthy competition, providing a product or a service to the consumers is not
considered necessary.218 Finally, the development of trade must not be affected to
such an extent as would be contrary to the interests of the Union.219 If these
requirements are satisfied, the Member State measure or conduct of undertaking(s)
will be deemed compatible with the Treaty.
The proposals in the Arnaut Report aimed at European institutions included the
adoption of the ‘Guidelines to the application of competition law to sport’ according
to which it should be assumed that sport organisations fulfil a task of general eco-
nomic interest in the sense of Article 106(2).220 However, any such ‘assumptions’
would constitute a double breach of the EU law. First, Union law is clear that
without the official act of entrustment by the state in the exercise of its functions
as a public authority there can be no performance of the task of general economic
interest within the meaning of Article 106(2) by any undertaking and therefore no
exception granted on that basis.221 Second, it could also be construed as an intru-
sion into Member States’ authority and a breach of the principle of subsidiarity to
imply any such entrustment in relation to the undertakings that have not been so
entrusted by the Member States themselves.
It is debatable whether sport would qualify as a ‘general service’ or a ‘service
of general economic interest’. Although Member States are in principle free to
choose which services they want to guarantee for its citizens, their discretion is
subject to principles of necessity and proportionality. The concept of ‘services of
general economic interests’ is a Union concept which sets a maximum standard.
Therefore, the Court and the Commission could refuse to accept that the public

217 Commodities that states are obliged to provide to their citizens due to their essential character.
The functioning of the general economic interest can be provided through state aid measures only
if a normal market economy cannot provide for it without state intervention. Also, the measure
must be so essential to the consumers that it is considered to be a necessity in their everyday
life, must benefit the citizens of the state in general and not be aimed at giving an advantage to
an industry or generally boost the economy of the state. Whereas the provision only applies to
general interests of economic nature, the aim cannot be economic but it must be of social, cultural,
or other non-economic nature. For the specific requirements to qualify as service of g­eneral
economic interest see, for example, Faull and Nikpay 2007, pp. 626–646, or Whish 2009,
pp. 234–335.
218 The industry that does not need state regulation to allow it to function in a manner that will

guarantee the consumer constant access to the product at a competitive price is not a good candi-
date for this exception.
219 Case law in C-56/65 STM [1966] ECR 235 has demonstrated that there is no need to show the

measures actually produce effect in distorting the trade between Member States, it is sufficient to
show that there is potential threat.
220 Paragraph 6.27 of the Arnaut Report.
221 Opinion of Advocate General Jacobs in Case C-203/96 Chemische Afvalstoffen Dusseldorp

and others v. Minister van Volkshuisvesting, Ruimtelijke Ordening en Milieubeheer [1998] ECR
I-4075, para 103.
5.6 Blocking Competing Organisations 195

service guaranteed by a Member State was a ‘service of general economic interest’

within the meaning of Article 106(2). Any other approach would send an invitation to
Member States to use the Article 106(2) as a protectionist mechanism to exclude
the entire sectors of economy from the application of the Treaty rules.
In the opinion of the Arnaut Report authors, there is no doubt that sport organi-
sations perform services of general economic interest within certain geographic
areas. They cite access to sport, bringing people together, social inclusion,
­measures to combat doping, social significance, fight against xenophobia etc., in
support of that suggestion.222
Due to the multiplicity of tasks and the stark difference between ­stakeholders’
interests that one sport federation ought to protect in accordance with the
­principles of good governance, and whereas the Article 106(2) implies the States
pursuing the goals of, inter alia, social policy, and whereas the social policy goals
might indeed qualify as ‘general services’, it is difficult to reconcile this social
role with the role of the sporting organization in regulating the highly commercial
professional sport. Partial entrustment could therefore be thought to be the way to
go. But the practical difficulties prevent this approach: there is no clear distinc-
tion between sports bodies’ regulation of professional and amateur sports. They
are interconnected on many levels, and so the rules passed by the bodies often
have implications for both. Taking into account the current sporting structures in
Europe there is no space for this exception.
The ultimate question is if the sport bodies would even (a) want to be
entrusted, or (b) need to be entrusted with the task of providing a service of
general ­
­ economic interest. In relation to the ‘need to be entrusted’, national
sport o­ rganisations already have the same objectives enshrined in their f­unctions.
Promoting sport at all levels and making it generally and widely accessible within
their respective geographic areas is a part of what they already (ought to) do.
They have a monopoly over such activities so there is no need to protect them
from ­competition. In addition, they comply with the rules of international govern-
ing bodies that already fight against xenophobia and racism, doping, protection of
minors, etc. Hence, an act of entrustment would be unnecessary. More importantly,
there is no reason to go through Article 106(2) to achieve the effect of excluding
the rules of the sport organisations from the scope of application of the Treaty. The
EU institutions have already designed a system of enforcement in which the rules
for performance of tasks in the general public interest by sporting bodies are suf-
ficiently protected. To push for the status of undertakings entrusted with operation
of services of general economic interest would therefore be unnecessary.
In relation to the ‘want to be entrusted’, it has already been observed by some
authors that sporting bodies themselves have not promoted the arguments put forth
by the Arnaut Report, and it is indicative that the White Paper on Sports does not
mention sport in this context.223 Every sporting body seeks the maximum level of

222 Paragraphs 6.53 and 6.54 of the Arnaut Report.

223 Parrish and Miettinen 2008, pp. 133–134.
196 5 EU Competition Law and Sport

autonomy and self-governance without interference from any other regulators.

With the act of entrustment, a Member State would impose a legal obligation on
the sporting organisations to perform the specific service of general interest (which
they already perform), and this would in turn require state supervision of the per-
formance and accountability for financial compensation. This is not what the sport
organisations want. Also, Member States are not very keen on promoting this
exception in sporting context for it brings extra expenses and administrative bur-
den. For instance, in the MOTOE judgment the Greek Government did not even try
to claim that ELPA has been entrusted with the exercise of their activities through
an act of public authority.

5.6.2 Commission Investigation in FIA/Formula One Case

In sport involving motor races, unlike in football, it is hard to see any socio-­
educational function. The FIA/Formula One case224 is therefore significant for the
management and governance of motor sports, in which there is no element of
specificity of sport, but also for sports in general when the issue under investigation
is purely commercial.
The access to financial resources at all levels of the sport is a prerequisite for
participation, and it has been said that Formula One is first business and then
sport.225 Unlike in football where financing is heavily reliant on broadcasting
rights, in motor sport events such as Formula One, organisers, promoters and
teams mostly depend on sponsorship for finance. Television coverage is vital to the
success of a motor sport event mostly because the level of sponsorship generated
depends to a large extent on the television coverage a promoter or organiser can
guarantee.

5.6.2.1 Restrictive/Abusive Conduct

A case concerning the conflict of interest between the regulatory and commercial
functions of a sport association involved the Fédération Internationale
d’Automobile (FIA), the international association for motor sport. FIA was the
organiser and promoter of motor sport championships, including Formula One. It
issued licences to any party wishing to take part in international motor sport events
authorised by FIA, including track owners, vehicle manufacturers, organisers of
motor sport events and drivers. License holders were allowed to organise or enter

224 Notice published pursuant to Article 19(3) of Council Regulation No 17 concerning Cases

COMP/35.163—Notification of FIA Regulations, COMP/36.638—Notification by FIA/FOA of

agreements relating to the FIA Formula One World Championship, COMP/36.776—GTR/FIA
and others (2001/C 169/03).
225 Cygan 2007, p. 76.
5.6 Blocking Competing Organisations 197

only those events authorised by FIA. Entering or organising events not authorised
by FIA would mean the loss of their license and the virtual end of any commercial
activity in motor sport. This way, FIA was able to control everyone and everything
needed stage a rival championship that could compete with FIA’s events. The
Commission found evidence that the competing GTR Organisation was forced out
of the market by these rules, and its GTR series was replaced by the FIA GT
Championship. Further, FIA claimed the television rights to all events incorporating
the FIA name into their title, which were then transferred to International
Sportsworld Communicators (ISC). It also forced the Formula One teams by the
terms of tripartite Concorde Agreement to assign to it all broadcasting rights in
the Formula One championship, which it then transferred to Formula One
Administration Ltd (FOA), a commercial rights holder. The same agreement also
prevented Formula One teams from racing in any other series comparable to
Formula One for a very long period of time. The promoters’ rights were taken
directly by FOA which has been given the power by the FIA to determine who can
and cannot be a promoter of a grand prix. Interesting to note here is that a vice-
president of FIA, Bernie Ecclestone, was controlling both FOA and ISC. An
agreement between FOA and the various broadcasters and promoters which are
involved in the Formula One championship was reinforcing already substantial
difficulties for those who wished to stage a series competing with Formula One.
The promoters’ contracts prevented circuits used for Formula One races from
being used for races which could compete with Formula One, while the agree-
ments with broadcasters placed a massive financial penalty, ranging from between
33 and 50 % of the price paid, if they televised anything deemed by FOA to be a
competitive threat to Formula One.226

5.6.2.2 Statement of Objections and Settlement

In 1999, the Commission issued a Statement of Objections. It came to the preliminary

conclusion that the rules described were contrary to Articles 101(1) and 102 TFEU
as they gave FIA the control to block the organisation of races which competed
with the events FIA promoted or organised, in particular Formula One from which
it derived the biggest commercial benefit. The Commission also objected to certain
terms of the contracts between the FOA and broadcasters because they made it
­possible to block the organisation of motor sport events that would compete with
Formula One races. Finally, the Commission objected to FIA rules according to
which FIA automatically acquired TV rights to all the motor sport events it authorises
even if these were promoted by a different promoter. The core of all of the

226 Commission Press Release IP/99/434 ‘Commission opens formal proceedings into Formula

One and other international motor racing series’ Brussels 30 June, 1999.
198 5 EU Competition Law and Sport

objections is the conflict between the FIA’s legitimate role as the regulator of
­international motor sport and its interests in the commercial side of motor sport.227
In 2001 the Commission closed the case after reaching a settlement with FIA’s
president Max Mosley, and CEO of FOA, Bernie Ecclestone. The settlement
­provided that FIA would
limit its role to that of a sport regulator without influence over the commercial exploitation
of the sport and thus removing any conflict of interest (through the appointment by FIA of
a ‘commercial rights holder’ for 100 years in exchange for a one-off fee); guarantee
access to motor sport to any racing organisation and to no longer prevent teams to partici-
pate in and circuit owners to organize other races provided the requisite safety standards
are met; waive its TV rights or transfer them to the promoters concerned; and remove the
anticompetitive clauses from the agreements between FOA and broadcasters.228

Later in 2001, after consultation with all the interested parties, the Commission
closed its investigation in the FIA/Formula One case, satisfied that the agreed
amendments will remove the competition concerns.229 In 2003 it ended the
­monitoring of compliance with the 2001 settlement.230

5.6.2.3 Comparison with MOTOE

Much like MOTOE, FIA/Formula One was a case of sporting ‘conflict of interest’
examined under the TFEU competition rules. In both cases the core issue was con-
flation of regulatory and commercial functions in one body, which ultimately led
to blocking of competing organisations and preventing market access. Both cases
involved sporting bodies protecting private interests, rather than acting on behalf
of public interests in general. Neither of the cases involved specificity of sport in
any form. Unlike in MOTOE, in FIA/Formula One there was no element of State
involvement, as the powers which enabled it to control the relevant markets were
not endowed by an act of public authority but by its own rules and web of private
agreements. Whereas in MOTOE the requirement on the Member State was to cre-
ate a system of safeguards against abuse (by ELPA’s refusal to grant the consent
necessary for the issuance of license) of the dominant position it enabled, in FIA/
Formula One the mere fact that the body was issuing licenses was not a problem.
Rather, it was the restrictions on competition that those licenses entailed under the

227 Commission Press Release IP/01/120 ‘Commission welcomes progress towards resolving the

long-running FIA/Formula One case’ Brussels, 26 January 2001.

228 Commission Staff Working Document, Annex I, para 2.2.2.1.
229 Commission Press Release IP/01/1523 ‘Commission closes its investigation into Formula

One and other four-wheel motor sports’, Brussels, 30 October 2001.

230 Commission Press Release IP/03/1491 ‘Commission ends monitoring of FIA/Formula One

compliance with 2001 settlement’, Brussels, 31 October 2003.

5.6 Blocking Competing Organisations 199

disputed rules.231 The safeguard against unjustified refusal of licenses in the FIA/
Formula One case was the obligation to insert a new clause ensuring that legal
challenge against FIA decisions would be available not only within their structure
but also before national courts.

5.6.3 Case C-250/92 DLG [1994]

5.6.3.1 Facts

A Danish cooperative association, DLG, which distributed farm supplies,

­provided its members with farm supplies at the lowest prices and negotiated the
best prices for its members’ produce. DLG’s members were divided into four
­categories from A to D. B members were local associations or other cooperatives
whose ­objective was trading in and/or producing goods appearing in the range of
­products offered by DLG. They were entitled to some extent to take part in DLG’s
management. The plaintiffs, 37 local associations specialising in distribution of
farm s­ upplies that were B members of DLG, were also members of the National
Union of c­ ooperative associations (LAG) formed in 1975 by the B members of
DLG. During the 1980s, some B members, dissatisfied with the prices charged by
DLG on the sale of fertilizers and plant protection products, took the initiative and
began to import those products themselves. As a result, they started to cooperate
amongst themselves within LAG.
DLG reacted by amending its statutes as regards B members because of
increasing competition from LAG. According to the amended statutes, B mem-
bers were prohibited from membership in any other cooperative organisations or
participation in any other forms of organised membership in competition with
this association on the wholesale market, with regard to the purchase and sale of
fertilizers and plant protection products. The B members were still free to make
wholesale purchases of farm supplies through suppliers other than DLG, as long
as those substitute purchases were not made through any organised membership
of or participation in other associations. Members who were participating in any
such association, society or cooperative were required to cease that member-
ship or resign from DLG. Some of the B members refused to comply with the

231 This is evident from the Statement of Objections and from the Sect. 5.6 of the Notice

(Notice published pursuant to Article 19(3) of Council Regulation No 17 concerning Cases

COMP/35.163—Notification of FIA Regulations, COMP/36.638—Notification by FIA/FOA of
agreements relating to the FIA Formula One World Championship, COMP/36.776—GTR/FIA
and others (2001/C 169/03)), which says that ‘[t]he notified agreements as amended will remove
those barriers which had prevented in the past the use of FIA licensed products and circuits or
the participation of FIA licensees in different disciplines or in competing events in the same
­discipline. The proposed changes to the notified agreements will, for example, result in the
availability of racetracks in Europe for rival series to use, even if these circuits already host FIA
Formula One championship events.’
200 5 EU Competition Law and Sport

amendments to the statutes, with the result that 37 local associations which were
B members were excluded from DLG.

5.6.3.2 Judgment

The compatibility of the statutes of a cooperative purchasing association, a voluntary

association of persons established in order to pursue common commercial objec-
tives, with EU competition law cannot be assessed in the abstract but will depend
on the particular clauses in the statutes and the economic conditions prevailing on
the markets concerned.232 In a market where product prices vary according to the
volume of orders, the activities of cooperative purchasing associations may, rela-
tive to the size of their membership, constitute a significant counterweight to the
contractual power of large producers and bring about more effective competition
in some markets.233 A dual membership in competing cooperatives would jeopard-
ize both the proper functioning of the cooperative and its contractual power in
relation to producers making each association less capable to pursue its objectives.
In this sense, prohibition of dual membership does not necessarily constitute a
restriction of competition and may even have beneficial effects on competition.234
On the other hand, the amendments also have adverse effects on competition
because they restrict the opportunity for members to join other types of competing
cooperatives and thus discourage them from obtaining supplies elsewhere.235
The Court held that the statutes of a cooperative purchasing association, forbid-
ding its members to participate in other forms of organised cooperation which are
in direct competition with it, are not caught by the prohibition in Article 101(1)
TFEU and do not amount to abuse of a dominant position under Article 102
TFEU, so long as they are restricted to what is necessary to ensure the achieve-
ment of the legitimate commercial objectives (in casu, the proper functioning of
the cooperative and ensuring its contractual power in relation to producers).236
On the facts of the case it did not appear that amendments went beyond what
was necessary to ensure that the said objectives are met. First, the restrictions cov-
ered only the farm supplies in respect of which there existed a direct relationship
between sales volume and price.237 Second, non-members of DLG, including the
plaintiffs, were free to make any purchases from it on the same commercial terms
and at the same prices as members, except that ‘non-members’ were not entitled to

232 Case C-250/92 Gøttrup-Klim e.a. Grovvareforeninger v Dansk Landbrugs Grovvareselskab

AmbA [1994] ECR I-5641, para 31.
233 Ibid. para 32.
234 Ibid. paras 33–34.
235 Ibid. para 35.
236 Ibid. paras 35, 45 and 52.
237 Ibid. para 37.
5.6 Blocking Competing Organisations 201

annual discount on the amount of the transactions carried out.238 Finally, DLG’s
statutes authorize its members to buy fertilizers and plant protection products
without using DLG as an intermediary, provided that such transactions are carried
out otherwise than through an organised consortium.239

5.6.3.3 Comment and Comparison with Wouters and Meca-Medina:

The Shared Test

In DLG, much like in the subsequent Wouters and Meca-Medina judgments, the
Court made it clear that a restriction on commercial freedom is not the same as
a restriction on commercial freedom that restricts competition. The aims of EU
competition law and policy are centred on the preservation of free competition and
do not contain guarantees on unfettered commercial conduct of the all the parties.
In fact, the success of many pro-competitive agreements depends on the ability to
restrict conduct of some of the parties.
The judgment in DLG is often referred to as a precursor to Wouters, but some
important differences should be recognised. First, DLG was probably not a dom-
inant undertaking having only 36 % of the market share and it was established
as voluntary association of persons to pursue common commercial objectives.
In contrast, the Bar of the Netherlands in Wouters and the IOC in Meca-Medina
were both regulatory monopolies with delegated public functions. Second, DLG
acted in the interest of its members, whereas the two regulatory monopolies laid
down rules that were in public interests. Third, the objectives of the rules in DLG
statutes were strictly commercial while the rules in Wouters and Meca-Medina
had a deontological purpose. Fourth, the plaintiffs in DLG were its members but
also competitors, while the parties whose conduct was restricted as a result of
the rules of Bar of the Netherlands and IOC were not either actual or potential
competitors of those bodies. Finally, it is clear that the Wouters and Meca-Medina
cases involved weighing of the public interest (i.e., non-competition) objectives
against the TFEU competition objectives, but it is equally clear that the DLG
case involved weighing pro and anti-competitive effects of the statutes within the
framework of Article 101(1). The last-mentioned matter applies regardless of the
formal rejection by the Court and the Commission of the rule of reason analysis in
this provision. Thus, whereas it is easy to explain why the Court would design the
test in regard to the cases involving public policy non-economic interests that are
ill-suited for the exclusively economic analysis in Article 101(3), it is hard to see
why it would do so for the DLG-type of cases that could in any case benefit from
the Article 101(3) as they are well-suited for the economic analysis and exception
criteria contained therein.

238 Ibid. para 38.

239 Ibid. para 39.
202 5 EU Competition Law and Sport

The significance that the outlined differences hold is prone to conjecture, but
before getting caught in any such discussion it must be recognised that the test
supplied by these cases is essentially the same. The difference is that the Court
had not been careful in DLG to neatly separate the different parts of the test it
later spelled out in Wouters. Nevertheless, it implicitly recognised the objec-
tives that DLG was carrying out as legitimate and it considered as necessary (i.e.,
inherent) the restrictions on the conduct of its B members. The recognition that
something is ‘limited to what is necessary’ for the attainment of its objectives is
an automatic acceptance of those objectives as legitimate by the Court, and auto-
matic recognition that they are ‘necessary’ or ‘inherent’. In the judgment the
Court did deal with the question of inherency in paras 32–34 without specifically
mentioning it.
Furthermore, paras 35, 45 and 52 of DLG illustrate that the test applicable to
Article 101(1) TFEU along with its outcome, also applies to Article 102 TFEU.
The same is, of course, valid for the Wouters and Meca-Medina test. It would
make no sense to hold the proportionate rules adopted in the public interest that
outweigh the restrictions on free competition under Article 101(1) in breach of
Article 102. The two provisions protect the same undistorted competitive process
and consumer welfare and once the case falls under both provisions the applica-
tion of the same test ought to produce a uniform result. In Meca-Medina, the Court
itself did not mention Article 102 TFEU, one of the articles relied on by the plain-
tiffs, once it decided the case under Article 101 TFEU. The Commission Staff
Working Document confirms that the Meca-Medina (and therefore Wouters) test is
applicable to both competition provisions equally.240

5.7 Superdominance and Special Responsibility

Even by the most permissive definition, sports governing bodies tend to constitute
dominant undertakings when they engage in economic activity; the decisive ques-
tion then is whether their acts amount to abuse.241 This fact can be seen as point-
ing towards the more specific concept of superdominance. In accordance with the
established case law of the Court, ‘the actual scope of the special responsibility
imposed on a dominant undertaking must be considered in the light of the specific
circumstances of each case.’242

240 See Annex I to the Commission Staff Working Document, para 2.1.2.
241 Parrish and Miettinen 2008, p. 126. Case T-193/02 Piau has shown that the engagement in
economic activity can be indirect, when federations operate on the relevant market through their
members.
242 See, for example, Case C-333/94 P Tetra Pak International SA v. Commission [1996] ECR

I-5951, para 24.

5.7 Superdominance and Special Responsibility 203

5.7.1 The Concept of Superdominance

In Michelin243 the Court has formulated the concept of special responsibility of

dominant undertakings which has been confirmed in the subsequent case law in
the same terms:
whilst the finding that a dominant position exists does not in itself imply any reproach to
the undertaking concerned, it has a special responsibility, irrespective of the causes of that
position, not to allow its conduct to impair genuine undistorted competition on the com-
mon market (Michelin, para 57, and Irish Sugar, para 112).244

The special responsibility of dominant undertakings is particularly onerous in

cases of superdominance where the degree of market power reaches a status of
quasi-monopoly.245 This status might have repercussions for the finding of abuse,
which in few cases seemed to be correlated with the degree of market power
enjoyed by the undertaking(s).246 In GVL, the Court acknowledged the wide scope
of a monopolist’s special responsibility in relation to discriminatory conduct on
grounds of nationality or residence.247
O’Donoghue and Padilla saw several practical, legal, and economic problems
with the concept of superdominance. First, Article 102 itself does not make any
reference to the degree of dominance and a corresponding level of responsibility.
Second, economics does not have a basis for specifying a point at which an under-
taking could be said to acquire a position of superdominance. Third, by applying
the concept, significant uncertainty would be added to the law and the notion of

243 Case 322/81 Michelin [1983] ECR 3461, paras 10 and 57.
244 Case T-219/99 British Airways plc v. Commission judgment of 17 December 2003, para 242.
245 The concept of superdominance was first time referred to in the Opinion of Advocate General

Fennelly delivered on 29 October 1998 in Joined Cases C-395/96 P and C-396/96 P Compagnie
Maritime Belge Transport SA, Compagnie Maritime Belge and Dafra-Lines A/S v. Commission,
para 137: ‘To my mind, Article [106] cannot be interpreted as permitting monopolists or quasi-
monopolists to exploit the very significant market power which their superdominance confers so
as to preclude the emergence either of a new or additional competitor. Where an undertaking, or
group of undertakings whose conduct must be assessed collectively, enjoys a position of such
overwhelming dominance verging on monopoly, comparable to that which existed in the present
case at the moment when G and C entered the relevant market, it would not be consonant with
the particularly onerous special obligation affecting such a dominant undertaking not to impair
further the structure of the feeble existing competition for them to react, even to aggressive price
competition from a new entrant, with a policy of targeted, selective price cuts designed to elimi-
nate that competitor. […]’ In Case C-333/94 P Tetra Pak International SA v. Commission [1996]
ECR I-5951, paras 28–31, the Court referred to the quasi-monopolistic position enjoyed by the
undertakings.
246 See Case T-228/97 Irish Sugar plc v. Commission, judgment of 7 October 1999, para 185.

See also Commission Decision in Case IV/36.888—1998 Football World Cup [2000] OJ L 5/55,
para 86, where the Commission considered that the scope of the parties’ responsibility must be
considered in relation to the degree of dominance held by the parties.
247 Case 7/82 GVL [1983] ECR 483, para 56.
204 5 EU Competition Law and Sport

abuse would require re-defining. Finally, the concept might lead to unnecessary
intervention in as far as it is related to the high market share, which does not imply
the ability to persist or the protection of market power by high entry barriers.248
It is submitted that that none of these points is very convincing. First, it is well-
known that the Court uses teleological interpretation. Given the countless number
of occasions in which the Court construed the provision as necessary to give it full
effect in the light of its objectives and context, it would not be too much to con-
clude that imputing into an article what it does not expressly provide for, consti-
tutes a rule rather than exception in the interpretation of the Treaty. Here, the
Court would not even have to go against the express wording of the article, a path
not unfamiliar to its judgments. The fact that Article 102 does not distinguish
between varying degrees of dominance is therefore completely irrelevant. In addi-
tion, the mere fact that an undertaking occupies the superdominant position does
not mean that it breaches Article 102 as some other authors have implied.249 It
merely means that the effects of that undertaking’s behaviour on the market are
more profound, which merits more rigorous standard of application of the compe-
tition rules including amplified concept of special responsibility.250 Second, super-
dominance was referred to by the Court as a quasi-monopoly—a term familiar to
economists for a long time.251 Relying on both Whish252 and Advocate General
Fennelly’s Opinion in Compagnie Maritime Belge, Crocioni and Veljanovski, both
economists, defined superdominance, using this very term, as ‘(a position
approaching monopoly) which requires a market share of 80 % or more.’253 More
importantly, there is no need to specify the precise point when dominance turns
into superdominance in any quantitative terms. In this respect O’Donoughe and
Padilla correctly note that market power exists along a continuum and that

248 O’Donoghue and Padilla 2006, pp. 167–168.

249 Appeldoorn 2005, pp. 653–658.
250 See C-52/09 Konkurrensverket v TeliaSonera Sverige AB [2011] ECR I-000 paras 78–82.
251 See, for example, Taussig 1915, p. 119, where he said that ‘if not complete monopoly,

a quasi-monopoly, enduring for a considerable time, is likely to appear wherever industry is

­conducted on a very large scale’.
252 Whish 2001, pp. 635–637.
253 Crocioni and Veljanovski 2003, p. 39. In the practice of the Court and the Commission so far, the

market share of the superdominant undertakings has been 90 % or more. See for e.g., Commission
Decision in Case COMP/C-3/37.792 Microsoft [2005] 4 CMLR 965, IP/03/1025, and Cases
T-24/93, T-25/93, T-26/93 and T-28/93 Compagnie Maritime Belge v Commission [1996] ECR II-
1201. In Commission Decision in Case COMP D3/38.044—NDC Health/IMS Health: Interim
measures [2002] OJ L 59/18, the undertaking was held to be in ‘quasi-monopoly situation ’accord-
ing to the Commission, however, the market shares have been deleted as a business secret. This case
has withdrawn by the Commission—see Commission Press Release IP/03/1159 ‘Commission inter-
vention no longer necessary to enable NDC Health to compete with IMS Health’ 13 August 2003.
Paragraph 92 of the Commission’s 2005 Discussion Paper which provided that ‘a dominant com-
pany is in general considered to have a market position approaching that of a monopoly if its market
share exceeds 75 %’ has not been subsequently adopted in the subsequent Guidelines. This is an
indication that 75 % might be too low a market share for finding of superdominance.
5.7 Superdominance and Special Responsibility 205

‘concerns regarding dominance are at their most acute where a firm’s strength
approaches a position of near-monopoly’.254 From the economic point of view
there indeed exists a palpable difference in effects between a situation of domi-
nance where an undertaking with, say 45 % of the market share is found dominant,
and a dominance that results from an undertaking holding, for example, 90 % of
the market share. In the former case, the next largest competitor might be an
undertaking holding 20 % that could in the future acquire the ability to exercise
competitive pressure on the dominant undertaking individually or via a concentra-
tion with a firm that holds, say 12 % of the relevant market, possibly rendering the
dominant undertaking no longer dominant. But in the latter case of an undertaking
with 90 % of the market share, especially if accompanied by high barriers to entry,
there exists no realistic possibility for viable competition to emerge. This sizeable
difference in the economic power and effects on the market between the dominant
and superdominant undertakings should be matched by corresponding legal regu-
lation, and always according to the individual merits of each case. Third, any call
for re-definition of the concept of abuse in order to specify when exactly the con-
duct of a superdominant undertaking falls foul of Article 102, is a call for the re-
introduction of the form-based approach to this provision, or an equivalent of strict
liability. The case-by-case approach and treating each case on its own merits is in
accordance with the modernisation and effect-based approach. In case of any
uncertainty that might result from this approach, the undertakings thought to be in
a superdominant position always have the option to seek informal guidance from
the Commission on the compatibility of their conduct with the competition law.255
In response to the final point, suffice it to say that even though the Court takes
very high market shares in themselves as evidence of the existence of dominant
position, it has nevertheless repeatedly emphasised that ‘exceptional circum-
stances’ might merit a different conclusion. For example, in Compagnie Maritime
Belge the General Court said that ‘in the absence of exceptional circumstances,
extremely large market shares are in themselves evidence of the existence of a
dominant position.’256 In its Guidance on the exclusionary conduct, the
Commission indicated that in assessing the dominance it takes into account the
competitive structure of the market, and in particular the constraints from competi-
tors, constraints imposed by the countervailing buyer power and the credible threat
of future expansion by actual competitors or entry by potential competitors.257 The
fact of the matter is that the Court and the Commission do take into consideration
other factors than market shares in their appraisal of superdominance, as do the

254 O’Donoghue and Padilla 2006, p. 166.

255 Paragraph 38 of the preamble of the Regulation 1/2003.
256 Cases T-24/93, T-25/93, T-26/93 and T-28/93 Compagnie Maritime Belge v Commission

[1996] ECR II-1201, para 76. See also Case 85/76 Hoffmann-La Roche [1979] ECR 461, para 41
[emphasis added].
257 Communication from the Commission—Guidance on the Commission’s enforcement

­priorities in applying Article 82 of the EC Treaty to abusive exclusionary conduct by dominant

undertakings, OJ C 45, 24.2.2009, pp. 7–20, para 12.
206 5 EU Competition Law and Sport

relevant authorities of EU Member States. In Napp case the UK Competition

Appeals Tribunal cited and applied AG Fennelly’s Opinion in Compagnie
Maritime Belge and a number of the Court’s judgments. It accepted that the
­special responsibility of a dominant undertaking is particularly onerous where the
quasi-monopolists enjoy ‘dominance approaching monopoly’, ‘superdominance’
or ‘overwhelming dominance verging on monopoly’.258 Having moved on to the
next stage of analysis the Court will take into consideration the specific circum-
stances of each case to analyse the existence of the abuse259 and its effect on the
market, which is surely more profound in cases of undertakings with very large
market shares. The case-sensitive approach should in principle act as a safety net
and provide guarantee against unreasonable outcomes. Indeed, the emergence of
the concept of superdominance does little more but emphasise the need to judge
each case on the basis of its own facts.260
The concept of superdominance, although never referred to by this name by the
Court and the Commission,261 has found its doctrinal space within Article 102
TFEU. For the purposes of that provision, it introduced a new layer in the
­distinction between undertakings on the basis of degree of their market power:
non-dominant, dominant, superdominant (quasi-monopolistic) and monopolistic.
Some national authorities have transplanted this concept following developments
in the EU competition law and this is indicative of the wider acceptance and that
the concept is there to stay.

5.7.2 Special Responsibility of Dominant Undertakings:

The Sliding Scale Approach

In order to establish a market-distorting foreclosure effect, the DG Competition

Discussion Paper suggested the sliding scale approach. Accordingly, the degree of

258 In Napp case the UK Competition Appeal Tribunal said: ‘In our view, Napp’s high and

p­ ersistent market shares put Napp into the category of “dominance approaching monopoly”—i.e.
superdominance—and the issue of abuse in this case has to be addressed in that specific context’
[emphasis added]. Paragraph 219 of the judgement in Case No 1001/1/1/01 Napp Pharmaceutical
Holdings Ltd v. Director General of Fair Trading [2002] CAT 1, [2002] CompAR 13.
259 In general, finding the exsistence of abuse is not affected by the market share of undertakings as

indicated in C-52/09 Konkurrensverket v TeliaSonera Sverige AB [2011] ECR I-000 paras 78–82.
In para 81 the Court said that ‘the degree of market strength is, as a general rule, s­ ignificant in
relation to the extent of the effects of the conduct of the undertaking concerned rather than in
relation to the question of whether the abuse as such exists.’
260 This was implied by the Court in para 24 of Case C-333/94 P Tetra Pack II ECR I-5951 when

it said that each case is to be decided on its own merits. See also Cases T-24/93, T-25/93, T-26/93
and T-28/93 Compagnie Maritime Belge v Commission [1996] ECR II-1201, para 114.
261 Instead, it has been called an: ‘overwhelmingly dominant position’, ‘quasi-monopoly

­situation’, ‘virtual monopoly’, ‘a position of dominance approaching monopoly’ and ‘a position

of dominance exhibiting extraordinary features’.
5.7 Superdominance and Special Responsibility 207

dominance will be a relevant factor to such an assessment and ‘the higher the
capability of conduct to foreclose and the wider its application and the stronger
the dominant position, the higher the likelihood that an anticompetitive foreclo-
sure effect results’.262 In General Electric the Court held that ‘the greater the
dominance of an undertaking, the greater is its special responsibility to refrain
from any conduct liable to weaken further, a fortiori to eliminate, competition
which still exists on the market’.263 Citing GVL and Tetra Pack II, in 1998
Football World Cup the Commission said that the actual scope of ‘special respon-
sibility must be considered in the light of the specific circumstances of the case,
reflecting a weakened competitive situation.’264 It then went on to assert that the
scope of special responsibility should therefore be assessed ‘in relation to
the degree of dominance held by the parties and to any special characteristics of
the market which might affect the competitive situation.’265 The Commission
emphasised the interrelation between the scope of the special responsibility and
the degree of dominance in its Guidelines on exclusionary abuses according to
which the scope of special responsibility must be considered in the light of the
specific circumstances of each case.266 It is well-established that a special respon-
sibility may deprive a dominant undertaking of the right to adopt a course of con-
duct that would be unobjectionable if adopted by a non-dominant undertaking.267
According to this, and in combination with the sliding scale approach, a special
responsibility imposed upon a superdominant undertaking may deprive it of the
right to adopt a course of conduct that would be unobjectionable if adopted by a
dominant undertaking.
This can be contrasted with the approach of the courts in the US who repeatedly
held that a monopolist has no special duties under section 2 of the Sherman Act
with respect to other market participants, nor should it have to co-operate with its
rivals, exercise any special restraint or be held to a standard of behaviour which
differs from that of other competitors, as Judge Posner made clear in Olympia
Equipment.268 In Trinko, the Supreme Court concluded that insufficient assistance
in the provision of service to rivals was not a recognized antitrust claim under
the Court’s refusal to deal precedents as there is no duty to aid competitors.269 The

262 Paragraph 56 of the Discussion Paper.

263 Case T-210/01 General Electric v. Commission judgment of 14 December 2005, para 550.
264 Case IV/36.888, 1998 Football World Cup, OJ 2000 L 5/55, para 85.
265 Ibid. para 86.
266 Paragraph 9 of Commission Guidelines on exclusionary abuses.
267 Case T-111/96 ITT Promedia v Commission [1998] ECR II-2937, para 139.
268 Olympia Equipment Leasing v Western Union Telegraph 797 F 2d 370 (7th Cir 1986), at 375.

For more details see Mcmahon 2009.

269 Verizon Communications Inc v Law Offices of Curtis V. Trinko 540 US 398 (2004), 124 S.Ct

872, at 411. Discussed in Mcmahon 2007, pp. 123–172.

208 5 EU Competition Law and Sport

source of this attitude can be traced back to the Chicago school of thought and the
theory on self-correcting market mechanisms.

5.7.3 The Content of Special Responsibility

of Superdominant Sports Undertakings

It is not clear whether the content of special responsibility of dominant undertakings

refers to any other obligations but the preservation of undistorted competition.
Case law thus far seems to indicate only the concern with this specific obligation.
But to interpret the concept this way would imply a redundant approach to the
responsibilities upon the dominant undertakings that are nevertheless binding upon
them by the terms of Articles 101 and 102 TFEU. The emphasis on special respon-
sibility, therefore, seems completely unnecessary, and as noted by Whish, it is ‘a
statement of the obvious’.270 In order to make this concept count, its content has to
be expanded beyond the requirements imposed by the mere wording of those
articles.
For this purpose it first of all needs to be acknowledged that while the
­undertakings in the highly fragmented markets already participate in effective
competition which delivers all the benefits of competition to the final consumers
and customers alike, and in which participating undertakings are relatively easily
substitutable from the point of view of demand and supply, the dominant or
collectively d­ominant undertakings operating in the highly concentrated
­
­oligopolistic markets possess a degree of independence from the competition and
other external pressures.271 They are not easily substitutable, and in the case of
regulatory monopolies, not at all substitutable. It means that their conduct is capa-
ble of having a detrimental impact on all interested parties and that they are
responsible not just for the undistorted competitive process in downstream and
upstream markets, but for the interests of all other stakeholders as well. In relation
to stakeholders that have economic interests, the responsibilities of the superdomi-
nant undertakings are prescribed and protected by the Treaty. The manifestation of
responsibilities that are not legally binding is sometimes effected by the firms
through their voluntary investment into various social causes as a part of positive
social responsibility.
Corporate social responsibility (CSR) is a concept whereby undertakings
­consider interests of the society by taking responsibility for the effect of their

270 Whish 2009, p. 184.

271 This is actually already included in their definition as dominant undertakings. See, for
instance, Case 27/76 United Brands [1978] ECR 207, para 65.
5.7 Superdominance and Special Responsibility 209

decisions and conduct on a voluntary basis.272 The new instruments on corporate

governance in Europe all include policy proposals relating to CSR. For instance,
the new corporate governance principles published by the European Corporate
Governance Service (ECGS) brought together best practice standards for large
companies and took the view that CSR and corporate governance are intercon-
nected and that social and environmental reporting, as well as the transparency
with regard to the management of stakeholder relationships, are all aspects of good
corporate governance. ECGS recognizes that a ‘one size fits all’ approach is inap-
propriate but that institutional investors support common international standards.
The enquiry here is not related directly to CSR as such but rather to the question
of whether such ethical business codes can be translated into positive legal obliga-
tions when relied on as legitimate aims to seek an exemption from the application
of the law by the superdominant private regulatory bodies that, due to their man-
date, restrict competition in the public interests.
Only some of the most profound impacts of the activities of corporations are
regulated by law and social responsibilities are imposed on them as a matter of
statutory obligation. Such is the obligation on environmental reporting under the
Environmental Impact Assessment Directive of 1985, as amended.273 However,
these legal obligations are enforced in relation to non-dominant firms on the mar-
ket as well, and in this regard they cannot be counted on as that extra responsibility
borne as a matter of law only by the dominant undertakings. The enquiry should
focus on those responsibilities which can be made legally-binding upon superdom-
inant undertakings through the expanded concept of special responsibility. One
­conceivable option in law is to include into the concept of special responsibility the
content of legitimate aims relied on to secure the exemption from the enforcement of
the otherwise applicable provisions of competition law.

272 Communication from the Commission to the European Parliament, the Council and the

European Economic and Social Committee—Implementing the partnership for growth and
jobs: making Europe a pole of excellence on corporate social responsibility, Brussels 22.3.2006,
COM(2006) 136 final, defined CSR as ‘[…] a concept whereby companies integrate social and
environmental concerns in their business operations and in their interaction with their stakeholders
on a voluntary basis. It is about enterprises deciding to go beyond minimum legal requirements and
obligations stemming from collective agreements in order to address societal needs. Through CSR,
enterprises of all sizes, in cooperation with their stakeholders, can help to reconcile economic,
social and environmental ambitions. As such, CSR has become an increasingly important concept
both globally and within the EU, and is part of the debate about globalisation, competitiveness and
sustainability. In Europe, the promotion of CSR reflects the need to defend common values and
increase the sense of solidarity and cohesion.’ Directorate General in charge of Employment, Social
Affairs and Inclusion at the European Commission defines the concept in the following terms: ‘cor-
porate social responsibility is companies acting voluntarily and beyond the law to achieve social
and environmental objectives during the course of their daily business activities.’
273 Council Directive 85/337/EEC of 27 June 1985 on the assessment of the effects of certain

public and private projects on the environment, OJ L 175, as amended.

210 5 EU Competition Law and Sport

To illustrate this point with the sporting example, the Nice Declaration states
that
sports federations have a central role in ensuring the essential solidarity between the vari-
ous levels of sporting practice, from recreational to top-level sport, which co-exist there;
they provide the possibility of access to sports for the public at large, human and financial
support for amateur sports, promotion of equal access to every level of sporting activity
for men and women alike, youth training, health protection and measures to combat dop-
ing, acts of violence and racist or xenophobic occurrences. These social functions entail
special responsibilities for federations and provide the basis for the recognition of their
competence in organising competitions.274

It also declared that the Union must ‘in its action under the various Treaty provi-
sions, take account of the social, educational and cultural functions inherent in
sport and making it special, in order that the code of ethics and the solidarity
essential to the preservation of its social role may be respected and nurtured.’ The
working group on the follow-up to the Nice Declaration recognised the central
role of the federations in organising sport in Europe, while at the same time point-
ing out that the federations also have duties with regard to transparency, solidarity,
democracy and development of a sport with a social and educational vocation.275
Due to the fact that sports governing bodies rely heavily on public interest justi-
fications that are part of their mandate, such as those related to their social func-
tions, the content of their legitimate aims should be made legally binding on sport
bodies every time they rely on them to provide an exemption from EU laws. For
instance, the legitimate aim of ensuring competitive balance in European football
is something that UEFA can successfully invoke before the EU Courts. The part of
the principle of proportionality that should ensure the suitability of the means used
to attain ends is most often based on purely hypothetical assessments producing
faulty conclusions, as it is seldom evidence-based. False positive results in the test
of suitability will secure the exemption, if the rule is otherwise proportionate. But
in practice there is no competitive balance in European football, and some of the
rules that can be justified by reference to that legitimate aim, in practice produce
the opposite result. To make the content of a legitimate aim invoked legally bind-
ing when relied on to ensure an exemption, would ensure that competitive balance
(i.e., the reason for exception) is actually attained in practice by the restrictive rule
(or at least that restrictive effect is in balance with its alleged benefits). This is
the only way to effectively protect competition—otherwise, any rule that can be
merely hypothetically defended by reference to public interest and proportionality
will be found to be compatible with competition articles. The Commission

274 ‘Declaration on the Specific Characteristics of Sport and its Social Function in Europe, of

which Account Should be Taken in Implementing Common Policies’, Presidency Conclusions

following the Nice European Council Meeting of 7, 8 and 9 December 2000.
275 Xth European Sports Forum, Conclusions of the working group on the follow up to the Nice

Declaration, Brussels 17–18 October 2001.

5.7 Superdominance and Special Responsibility 211

decisions in cases of breaches of Article 101 TFEU or abuse of a superdominant

position or monopoly by a sport governing body that relies on the legitimate aim
could be taken by decisions similar to those under Article 9 of the Regulation
1/2003 which provides for commitment decisions.276 In cases of undertakings in
superdominant or collective superdominant position that rely on a public interest
justification to secure an exemption under competition law for otherwise restric-
tive rules or practices, the decision to exempt that rule or practice could be made
conditional upon fulfilment of the content of objective justification. Hence, it
could be a conditional decision accompanied by temporal limitation—the time
frame of the effect of such decision could be the time in which the superdominant
undertaking will be asked to supply the evidence on the real practical effects of the
justification.

5.8 Conclusion

The concept of special responsibility of dominant undertakings was developed

and recognised under Article 102 TFEU. Nevertheless, if the theory on expansion
of the concept of special responsibility for superdominant sport governing bod-
ies is to be accepted, the upshot in the light of the Meca-Medina/Wouters test and
the convergence theory set out in Chap. 6 is the expanded legal scope of special
responsibility, i.e., this concept would incidentally apply also under Article 101
TFEU and the free movement provisions analysis. This would, however, add noth-
ing to the obligation upon undertakings resulting from the expanded content of the
concept under Article 102 TFEU. Simply put, if the entity that is in superdominant
position is allowed to justify its rules or conduct that have restrictive effect on the
market, then the claimed benefits to the public interest should be proven genuine
and not merely hypothetical. So the standard of proof should increase from logical
construction of argument to practical effects demonstrable by sufficiently convinc-
ing evidence.

276 Under Article 9 of the Regulation 1/2003, in the cases in which it intends to order the t­ermination
of infringement, the Commission may instead adopt decisions accepting commitments by under-
takings. These commitments are binding on the addressee, subject to the time limits, and may be
invoked by the third parties before national courts. Article 9(2) provides that: ‘Commission may,
upon request or on its own initiative, reopen the proceedings: (a) where there has been a material
change in any of the facts on which the decision was based; (b) where the undertakings concerned
act contrary to their commitments; or (c) where the decision was based on incomplete, incorrect or
misleading information provided by the parties.’ The corresponding penalty provision is introduced
by Article 22(2)(c) for failure to comply with the commitments. According to Article 27(4) of the
Regulation 1/2003, the Commission publishes its commitment decisions and all interested parties
can submit observations within the period no shorter than 1 month. Safeguards ensuring compliance
with commitment decisions are fines provided in Article 23(2)(c) and periodic ­penalty payments in­
Article 24 of the Regulation 1/2003.
212 5 EU Competition Law and Sport

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Chapter 6
A Quest for Convergence in the Application
of EU Internal Market and Competition
Law to Sport

Contents
6.1 Introduction.......................................................................................................................... 215
6.2 Addressees............................................................................................................................ 216
6.3 Prohibition Level Convergence—Categories I, II and III of Sporting Exception................ 217
6.3.1 Sporting Rules That Do not Produce Any Economic Effect....................................... 218
6.3.2 ‘Purely Sporting’ Rules............................................................................................... 218
6.3.3 Inherent Rules............................................................................................................. 224
6.4 Justification Level Convergence—Category IV Sporting Exception................................... 228
6.5 Burden of Proof.................................................................................................................... 233
References................................................................................................................................... 235

6.1 Introduction

The degree and type of convergence between competition and internal market
rules is an obscure, yet important matter. A fundamental tension underlying both
fields of law in their application to regulatory rules in sport concerns striking the
proper balance between the pro-market regime and the public interests exceptions
as reflected in the concept of sporting exception and Article 165(1) TFEU. The
issues regarding relationship between the two types of rules, as regards their
addressees, prohibitions and exceptions, are the most pronounced in sports cases.1
Questions that would need judicial and/or legislative clarification regarding con-
vergence and divergence between internal market and competition rules are many,
but for the purposes of this volume, the discussion will focus on the relationship in
the area of sport between the elements of the analytical framework under Articles

1 For detailed treatment of other areas, such as social security, see Sauter and Schepel 2007,
available at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1010075.

© t.m.c. asser press and the author 2015 215

K. Pijetlovic, EU Sports Law and Breakaway Leagues in Football,
ASSER International Sports Law Series, DOI 10.1007/978-94-6265-048-0_6
216 6 A Quest for Convergence in the Application of EU Internal …

45, 49 and 56 TFEU, with the elements in the Meca-Medina/Wouters analytical

framework, and with emphasis on the proper place for the sporting exceptions in
the convergence thesis. It is submitted that, for the sake of legal certainty and
­clarity, simplification of the legal tests, and development of a logical analytical
framework, the Court and the Commission should seek to promote convergence
wherever possible. It should be taken that if ‘in law, the only things which are
comparable are those which fulfil the same function’,2 it follows a fortiori that the
only things transposable are those which fulfil the same function.
The ideas outlined in this chapter are split into discrete categories for the pur-
poses of clarity. But it is to be kept in mind that there is a good degree of overlap
between the different categories of the sporting exception, which will be indicated
throughout the text.

6.2 Addressees

The initial dichotomy in the application of the two sets of norms is among their
respective circle of addressees. Typically, Articles 101 and 102 TFEU apply to pri-
vate undertakings, whereas free movement provisions apply to state and quasi-
state defendants. Baquero Cruz considered that the heart of the relationship
between the provisions on competition and free movement lies in the eventual
application of the free movement rules in the private sphere and of the competition
rules to state action.3 The Court has applied competition rules to a government
(employment) agency engaged in the business of employment procurement
because such activity ‘has not always been, and is not necessarily, carried out by
public entities’,4 while refusing to apply those rules to private undertakings exer-
cising powers that typically belong to public authorities.5 Moreover, the Court has
given a full effect to free movement provisions in cases against private entities,6

2 Zweigert and Kotz 1987, p. 31.

3 Baquero Cruz 2002, p. 85.
4 Case C-41/90 Höfner and Elsner v Macroton [1991] ECR I-1979, para 22.
5 Case C-343/95 Diego Calì & Figli v SEPG [1996] ECR I-1547.
6 Free movement of goods is a notable exception and become applicable only when a private action

is attributable to state. See, for example, Case C-470/03 A.G.M.—COS.MET Srl v Suomen
Valtio, Tarmo Lahtinen [2007] ECR I-2749 and Case C-265/95 Commission v France (Spanish
Strawberries) [1997] ECR I-6959. For horizontal application of free movement of work-
ers in non-sporting context see, for example, Case C-281/98 Angonese [2000] ECR I-4139;
for freedom to provide (and receive) services see C-341/05 Laval un Partneri Ltd v Svenska
Byggnadsarberareförbundet [2007] ECR I-11767; and for freedom of establishment see Case
C-438/05 Viking Line [2007] ECR I-10779.
6.2 Addressees 217

and at the same time preserved an appropriate sphere for public authority
­exceptions under Articles 45(4) and 51 TFEU.7
In regard to sporting organisations, however, the public/private distinction is not
very pronounced, if at all. As we have seen in cases like Walrave, Bosman,
Deliège, Lehtonen, Piau and Meca-Medina, sports federations may be subject to
both set of norms without anyone seriously questioning their applicability on the
basis on improperness of addressee. It is debatable whether the effect that free
movement provisions have when applied to the rules of sport governing bodies
constitutes ‘an extended form of vertical direct effect’8 due to the scope of regula-
tory latitude possessed by these bodies and effect of their decisions, or a restrictive
form of horizontal direct effect which encompasses only those private bodies that
collectively regulate the entire profession. It is, however, clear that the aspect of
convergence pertaining to addressees of competition and internal market provi-
sions is facilitated by the direct effect of both set of norms in regard to their appli-
cation in the sport sector, the Court’s teleological interpretation of Treaty rules and
its functional approach to classification of entities.

6.3 Prohibition Level Convergence—Categories I, II

and III of Sporting Exception

The nature and scope of the sporting exception in EU law has been thoroughly
researched by Parrish and Miettinen.9 The sporting exception in EU law describes
‘both the removal of rules from the scope of the Treaty and the sensitive applica-
tion of [EU] law to the sports sector’.10 In this sense, the sporting exception is a
misnomer in the latter case, as it does not imply an exception as such. Four catego-
ries of rules that will qualify for the sporting exception in its broad meaning can
be identified in the examination of the Court’s jurisprudence.11 The first two
­categories of sporting exceptions have a limited use in practice, but are valid
­nevertheless. What follows is an explanation of each category in the light of
­convergence between free movement of persons and competition law in their
application to sport.

7 This sphere was defined in Case 149/79 Commission v Belgium [1982] ECR 1845 that
c­ oncerned public service exception under Article 45(4) TFEU, and Case 2/74 Reyners v Belgian
State [1974] ECR 631 that involved official authority exception under Article 52 TFEU. The
scope of these exceptions is narrowly construed.
8 As argued by Barnard 2010, p. 234.
9 Parrish and Miettinen 2008.
10 Ibid. p. 73.
11 For more detailed treatment of the subject, see Parrish and Miettinen 2008, Chap. 4, in

particular pp. 100–101.

218 6 A Quest for Convergence in the Application of EU Internal …

6.3.1 Sporting Rules That Do not Produce Any Economic

Effect

The Category I exception applies when sport constitutes a non-economic activity

within the meaning of Walrave, para 4. Both the sporting rule and its effects must
be non-economic to merit this exception. The exception applies to a very small
group of rules, such as rules of the game (e.g. offside in football, the dimensions
of a tennis court) which are unlikely to be challenged before the courts.12 This is
the only category of sporting rules that will not be examined for its compatibility
with the Treaty. Although it was developed in the free movement area, this excep-
tion can also apply in challenges under competition law to render the rules ab ini-
tio outside the scope of the Treaty as it sets a generally applicable constitutional
limitation on the conferred powers of EU institutions.
Many authors confuse this exception with the notion of ‘purely sporting’ rules,
implying that ‘purely sporting’ rules produce no economic effect.13 However, as
will be illustrated in the section below, the ‘purely sporting’ rule exception
involves sporting rules that do produce an economic effect, but because they meet
specific requirements, they are nevertheless considered ‘purely sporting’. Without
economic effects, the sporting rule would fall under para 4 of Walrave, as opposed
to paras 8 and 9 of Walrave and 14 and 15 of Donà, and would not require fulfil-
ment of any additional requirements. The lack of economic effect is the sole fact
that is sufficient in itself to take the rule outside of the scope of the Treaty and
­outside of Union competence.

6.3.2 ‘Purely Sporting’ Rules

The Category II exception encompasses sporting rules that (1) produce an

­economic effect, but (2) that can be justified due to their non-economic (‘purely

12 This is not to say that a few scenarios could not be envisaged where the rules of the game are
challenged, especially if the long-standing rules of the game were to be changed so as to produce
specific disadvantages for an identifiable group of undertaking (clubs or individual participants),
in which case they might be held to have an effect on economic activity and would not benefit
from this particular exception.
13 For example, it has been argued that ‘[r]ules governing the composition of national sports

teams or the conduct of anti-doping controls may plausibly define the nature of sporting com-
petition, in the sense that the very existence of sporting endeavour is undermined without such
rules. They are sporting rules. But they are not purely sporting rules. They visibly have economic
repercussions (for players most of all)’. He also states that ‘[a]ll that can be intended by the
‘purely sporting rule’ is a reference to the small category of rules which govern sport but which
are devoid of economic effect—such as the offside rule and fixing the height of goalposts. In the
unlikely event that such rules were to provoke litigation, they would be found to lie outside the
scope of the [TFEU]’. See Weatherill 2009, pp. 78–100.
6.3 Prohibition Level Convergence—Categories I, II and III … 219

sporting’) motives, (3) that relate to the particular nature and context of certain
sporting events and (4) that are limited to their proper objectives. This exception
originated in paras 8 and 9 of Walrave and it was reformulated in paras 14 and 15
of Donà and repeated in subsequent case law. In Walrave, the Court held that the
prohibition on nationality discrimination in Articles 18, 45 and 56
8. […] does not affect the composition of sport teams, in particular national teams, the
formation of which is a question of purely sporting interest and as such has nothing to do
with economic activity. 9. This restriction on the scope of the provisions in question must
however remain limited to its proper objective.

In paras 14 and 15 of Donà it confirmed, but somewhat reformulated, the excep-

tion and held that those provisions of the Treaty do not prevent
14. […] the adoption of rules or of a practice excluding foreign players from participation in
certain matches for the reasons which are not of an economic nature, which relate to the par-
ticular nature and context of such matches and are thus of sporting interest only, such as, for
example, the matches between national teams from different countries. 15. This restriction on
the scope of the provisions in question must however remain limited to its proper objective.

From these paragraphs, it is apparent that it is the motives for the rules, and not
the rules themselves, that do not produce an economic effect and have noth-
ing to do with economic activity. The effect of the rules is undeniably economic.
Furthermore, ‘purely sporting’ interest and ‘purely sporting’ rules are two different
things. ‘Purely sporting’ rules necessarily have ‘purely sporting’ interests which
is one of the requirements for this exception, but the ‘purely sporting’ interests of
the rule do not imply that the rule will necessarily be considered ‘purely sporting’.
It still has to fulfil the other two requirements for the exception, i.e. be related to
the particular nature and context of certain sporting events, and be limited to its
proper objectives (the proportionality requirement).
It was argued that the ‘purely sporting’ rules exception ‘does not apply to sports
teams, or to general rules on team composition, but only to nationality rules in
national team sports’.14 However, although it originated in that specific factual
context, since Walrave, the Court has always repeated the rule, mentioning the
national team sports and nationality rules only as an example, or completely leav-
ing that example out. It is hard to see the logic in doing so, unless there is a pur-
pose behind it. In para 25 of Meca-Medina the Court cited para 8 of Walrave: ‘[…]
the prohibitions enacted by those provisions of the Treaty do not affect rules con-
cerning questions which are of purely sporting interest and, as such, have nothing
to do with economic activity’. It does not say that the exception applies only in
relation to prohibitions on nationality discrimination, but to ‘prohibitions enacted
by Articles 45 and 56’. Such prohibitions include both direct and indirect national-
ity discrimination as well as non-discriminatory obstacles. Clearly, the Court left
open the possibility for the other kind of discriminatory and non-discriminatory
rules to qualify as ‘purely sporting’ rules. Unlike in Walrave and Donà, the factual
context in Meca-Medina did not involve nationality discrimination and thus the

14 Parrish and Miettinen 2008, p. 100.

220 6 A Quest for Convergence in the Application of EU Internal …

Court left out the reference to ‘foreign players’ or ‘nationality discrimination’ from
its formula on what constitutes a ‘purely sporting’ rule. Repeating para 76 of
Bosman word for word, it then said in para 26 of Meca-Medina that
With regard to the difficulty of severing the economic aspects from the sporting aspects of
a sport, the Court has held (in Donà, paras 14 and 15) that the provisions of [Union] law
concerning freedom of movement for persons and freedom to provide services do not pre-
clude rules or practices justified on non-economic grounds which relate to the particular
nature and context of certain sporting events. It has stressed, however, that such a restric-
tion on the scope of the provisions in question must remain limited to its proper objective.
It cannot, therefore, be relied upon to exclude the whole of a sporting activity from the
scope of the Treaty […].

The Court first recognises that almost every aspect of sport has something to do
with economic activity,15 but that proportionate rules grounded on purely sporting
motives ‘which relate to the particular nature and context of certain sporting
events’ are outside the scope of the Treaty even when they are both sporting and
economic. It does not mention national team sports even as an example.
Paragraphs 76 and 127 of Bosman make a reference to paras 14 and 15 of
Donà. Paragraph 127 of Bosman restates para 76 of Bosman in full, but adds as a
specific example of non-economic interests the exclusion of foreign players from
certain matches, such as ‘matches between national teams from different coun-
tries’. Unlike para 76 of Bosman, which cited Donà in the context of non-discrim-
inatory transfer rules, in which participation in matches was not an issue, the para
127 reference to Donà was made in the context of the directly discriminatory 3+2
rule which related to participation in matches. It could be read from this that the
Court indeed takes national team matches only as an example, when related to
the issue considered, and when not related, the example is left out as irrelevant.
The Donà rule as clarified and broadened by para 76 of Bosman stands regardless
of whether the issue involves nationality discrimination in national team sports.
The rest of the case law supports this interpretation. In Lehtonen, where the partic-
ipation of a player in team matches was an issue, the Court mentioned an example
of excluding players from certain matches, and matches between national teams
from different countries. The same goes for Deliège, where the selection rules pre-
venting athletes from participation in certain competitions were disputed. Bernard
did not even mention the notion of ‘purely sporting’ rules from Walrave and Donà
because the rules were not related to the context and nature of certain matches, nor
were they preventing participation of a player in any matches. Advocate General
Cosmas in Deliège, after citing relevant paragraphs from Walrave, Dona and
Bosman, said that the following conclusions can be drawn from that line of cases:
First, certain rules or practices relating to sport do not fall within the scope of Article [56] of
the Treaty. Secondly, in order for that exception to apply, the rules or practices in question

15 It has been argued in the light of Meca-Medina, that, to continue assessing the sporting rules

on the basis of their fiscal nature is ‘intrinsically flawed since modern sport dictates that financial
considerations now impact on almost every aspect of sport’. See Callery 2011, p. 48.
6.3 Prohibition Level Convergence—Categories I, II and III … 221

must be justified by specific, non-economic reasons which relate purely to sport; the
­organisation of matches between national teams is a prime example of such a reason. […].16

Advocate General Alber in Lehtonen also referred to the organisation of matches

between national teams as a ‘prime example’ of purely sporting motives.17 All of
this implies that there may be something more to the exception than just directly
discriminatory rules in matches between national teams from different countries. If
the Court intended the exception to produce only such a limited effect, why would
it bother mentioning it only in the role of a prototype, and why would that role be
left out in cases in which there is no question of the particular nature and context
of certain matches, such as transfer rules in Bosman, training compensation fees in
Bernard, or doping sanctions in Meca-Medina?
Further, it may be thought that this interpretation would result in an overbroad
exclusion of all sporting rules with economic effects from the scope of the Treaty.
But it appears that the requirement that the rules be motivated by ‘purely sporting’
considerations, be related to the nature and context of certain sporting events, and
be proportionate, is a very high threshold, which has in practice so far been met
only by directly discriminatory rules in national team sports. This single instance
of the application of the exception does not mean that it may not be met by other
types of rules not involving national teams or issues of direct discrimination.18
Stripped of the requirement for nationality discrimination in national team
sport, the exception may well be applicable in competition law instances,
although, admittedly, the Court has thus far cited it in relation to free movement
of persons only. This neither implies that other Treaty articles are excluded, nor
would there be a logical explanation for reserving this type of exception only for
free movement cases. In Meca-Medina, the reference in para 26 to free move-
ment provisions was specifically directed to overruling the decision by the General
Court, while in all other cases the Court dealt only with free movement and
ignored the preliminary reference questions about the applicability of competition
law. There was no chance to clarify its take on this issue.
In para 31 of Meca-Medina,19 the Court seems to have rejected any parallels
between free movement and competition law in the application of this exception.

16 Paragraph 69.
17 Paragraph 69 of his Opinion.
18 For example, compulsory uncompensated player release for representative matches of national

teams might be a candidate rule for this exception. It produces economic effects, is related to the
particular nature and context of certain matches, and there is no doubt that it has been motivated
by purely sporting considerations. Its proportionality in the light of its objectives, especially con-
sidering solidarity and the need for competitive balance between the teams, as well as solidarity
with poorer national associations, might not be at issue either. See Sect. 3.3.6.1.
19 This paragraph reads: ‘even if those rules 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, that fact means neither that the sporting activity in question necessarily falls out-
side the scope of Articles [101 TFEU] and [102 TFEU] nor that the rules do not satisfy the specific
requirements of those articles’. See Sect. 5.5.5.5 above for detailed analysis of this paragraph.
222 6 A Quest for Convergence in the Application of EU Internal …

But this rejection is only on one level of the analysis of the exception.20 Weatherill
points out that paras 31–33 in Meca-Medina should not be read as a general rejection
of the convergence thesis because the Court is not ‘doing anything more remarkable
than drawing attention to the thinness of the [General Court] analysis’ that did not
even touch on possible differences between the norms.21 He also says that para 31
of Meca-Medina is probably best taken on its own limited terms.22 This is an
excellent point for departure of the illustration that follows.
In the arguments presented above,23 there is indeed no convergence in regard to
EU constitutional competence due to some very individual features of each set of
norms, such as internal situations, or the requirement of appreciability. There is
also no convergence as regards other required elements for the presumption of
restriction, such as the concept of undertaking, agreement or decision, restrictive
effects, etc. I will refer to all these features and conditions as ‘required economic
effects’ for moving on to the exception analysis.
The application of the ‘purely sporting’ rule exception is triggered by the pre-
sumption of the restriction of the specific provision. It also implies that the required
economic effect was found to exist. The specific scope of the different articles (constitu-
tional competence and certain individual elements giving rise to the required economic
effect) and the presumption of restriction are the areas in the analytical process in which
convergence does not exist. However, the conditions for exception (e.g. purely sport-
ing motive, participation in certain matches and proportionality) are exactly the same,
and concerning them, there exists full convergence. Once the rule satisfies the required
economic effect test for application of both sets of provisions, it reaches the common
ground for assessment of the applicability of conditions for exemption. In that case
there is no need to carry out the exemption test separately. One more element has to be
added to complete and clarify these conclusions: presumptions under Article 101(1).
The language in para 31 of Meca-Medina, which implies that the rule that already
satisfied the requirements for exception under the free movement provisions cannot
be taken to automatically satisfy those requirements under competition provisions,
can be explained by the difference in presumptions. Namely, in regard to cases that
involve the specificity of sport, the internal market does not have the equivalent of the
hard-core restrictions in Article 101(1). In sports cases, both directly discriminatory
and merely restrictive rules are treated within the same analytical framework.
However, under Article 101(1), if a rule constitutes a ‘per se’ or hard-core restriction
by object, it is not open to the parties to argue that it in fact does not amount to a
restriction and the presumption of a breach of that provision is conclusive, as opposed

20 Level of ‘required economic effect’. See Fig. 6.1.

21 Weatherill 2008, p. 342.
22 Ibid. p. 341. See also paras 104–105 of Advocate General Alber’s Opinion in Lehtonen who, in

the context of Article 101(1), argued that it must be possible ‘to find that trade is affected in a case
in which the exercise of fundamental freedoms is obstructed. […] Since the development of eco-
nomic activities by the clubs, that is, by undertakings, is obstructed by these transfer rules, there is
probably also a restriction of competition within the meaning of Article [101(1)] of the EC Treaty’.
23 See Sect. 5.5.5.5
6.3 Prohibition Level Convergence—Categories I, II and III … 223

Fig. 6.1  Flowchart for analysis of category I sporting exception and ‘purely sporting’ rules

to rebuttable. In that case, a rule that has satisfied all the requirements for the category
II exception under the free movement provisions cannot benefit from the attempt at
that exception under Article 101(1) to which it would otherwise be entitled but for the
hard-core restrictions and conclusive presumptions of the breach. A party may rely on
Article 101(3) but not on any of the judicially-developed exceptions available on the
level of the restriction. Conversely, if there is no conclusive presumption under the
competition provisions, and the rule has already been regarded under internal market
articles as ‘purely sporting’ and having nothing to do with economic activity, that
result is transplantable to competition law, with no further analysis being required.
The para 31 in Meca-Medina should be read in this light. Once there is a rebuttable
(non-conclusive) presumption on the level of ‘required economic effect’ established
under both sets of provisions, the rest of the conditions for exception are the same.24

24 On convergence of burden of proof see Sect. 6.5

224 6 A Quest for Convergence in the Application of EU Internal …

Most recently, this approach to convergence is confirmed in general terms by

the Advocate General in Murphy, who used her conclusion in regards to freedom
of movement law to support her conclusion in competition law. She said that ‘[…]
conflicting assessments of the fundamental freedoms and competition law are to
be avoided in principle’.25
Finally, it must be added that if rules were not confined to their proper
­objectives (and thus failed the proportionality criterion for the category II excep-
tion) it is very unlikely that they will be exempted in further analyses, which also
involve the proportionality requirement under both sets of provisions. When it is
determined that the case falls under both areas of law, yet the category II exception
did not apply under either set of the articles for a failure to meet the criterion other
than proportionality (which is the most likely outcome in sports cases), the results
of the analyses that follow should, in principle, be transposable. This is what the
discussion turns to next.

6.3.3 Inherent Rules

The Category III sporting exception includes rules that, based on their legitimate
objectives,26 do not constitute restrictions because they derive from the need, and
their restrictive effects are, inherent in the organisation of sport, and are
­proportionate.27 In the Commission practice and the case law of the Court, ­including
the opinions of the Advocate Generals, ‘inherent’ is a synonym for ‘indispensable’,
‘necessary’ or ‘essential’. Inherency can also be seen as one part of a full proportion-
ality test, which includes an assessment of suitability (a measure is suitable, if it is
capable of achieving the goal both legally and factually), inherency or necessity
(a measure is inherent/necessary if, without taking these measures, the legitimate
objective cannot be achieved), and proportionality (a measure is proportionate if
does not go beyond what is necessary, and there are no less restrictive rules that are
capable of achieving the same objective).
The application of the ‘inherent sporting rules’ concept is not identical under free
movement and competition law.28 In free movement law, only non-discriminatory
rules that are not related to market access can satisfy the inherent rule test. The same
test under competition law articles is not sensitive to the difference between the dis-
criminatory and non-discriminatory rules, and between market access and exercise
of economic activity rules. Its scope is therefore broader and more flexible.

25 Opinion of AG Kokott in Cases C-403/08 and C-429/08 Murphy v. Premier League [2011],

para 249.
26 This criterion is specifically mentioned only in relation to competition provisions (in Meca-

Medina case) but, as submitted below, it applies in free movement as well.

27 Ibid.
28 For more on this discussion see paper by Miettinen S and Parrish R, ‘Inherent Rules in EC

Sports Law’, presented at the Conference on Law and Popular Culture, Onati, Spain (June 2008).
6.3 Prohibition Level Convergence—Categories I, II and III … 225

In the context of free movement, in Deliège, the Court first dismissed the
­applicability of the categories I and II sporting exception and then went on to say that
in contrast to the rules applicable to the Bosman case, the selection rules at issue in the
main proceedings do not determine the conditions governing access to the labour market
by professional sportsmen and do not contain nationality clauses limiting the number of
nationals of other Member States who may participate in a competition.29

The Court thus considered the selection rules as non-discriminatory rules affecting
the exercise of economic activity, rather than as discriminatory market access
rules.30 Only then it proceeded to specify that although the selection rules at issue
…inevitably have the effect of limiting the number of participants in a tournament, such a
limitation is inherent in the conduct of an international high-level sports event, which
­necessarily involves certain selection rules or criteria being adopted. Such rules may not
therefore in themselves be regarded as constituting a restriction on the freedom to provide
services prohibited by Article [56] of the Treaty.31

Although the Court did not specifically mention that the inherent rules should
be proportionate, it is hard to accept that disproportionate rules could satisfy
the requirements of the free movement norms, even if they raise issues affect-
ing the exercise of economic activity as opposed to market access. The following
­paragraph requires the inherent rule to be proportionate:
…the adoption, for the purposes of an international sports tournament, of one system for
selecting participants rather than another must be based on a large number of considerations
unconnected with the personal situation of any athlete, such as the nature, the organisation
and the financing of the sport concerned.32

Accordingly, the discriminatory rule would be considered disproportionate and the

inherency test failed. The Commission in its Communication did not differentiate
between competition and internal market law when it explained that in order to
assess the compatibility of sporting rules with any EU law, it considers the legiti-
macy of the objectives pursued by the rules, whether any restrictive effects of
those rules are inherent in the pursuit of the objectives, and whether they are
­proportionate to them.33 So these are the common requirements under the inher-

29 Joined Cases C-51/96 and C-191/97, para 61.

30 Under the ‘Säger formula’ this would have been enough to find a breach. Paragraph 12 of
Case C-76/90 Säger [1991] ECR I-4221 provides that Article 56 required: ‘not only the elimina-
tion of all discrimination against a person providing services on the ground of his nationality but
also the abolition of any restriction, even if it applies without distinction to national providers of
services and to those of other Member States, when it is liable to prohibit or otherwise impede
the activities of provider of services established in another Member State where he lawfully pro-
vides similar services’. See on this point Miettinen S and Parrish R, ‘Inherent Rules in EC Sports
Law’, presented at the Conference on Law and Popular Culture, Onati, Spain (June 2008).
31 Joined Cases C-51/96 and C-191/97 Deliège, para 64.
32 Ibid. para 65 (emphasis added).
33 Communication from the Commission to the European Parliament, the Council, the European

Economic and Social Committee, and the Committee of the Regions ‘Developing the European
Dimension in Sport’ COM(2011) 12 final, 18. 1. 2011, para 4.2.
226 6 A Quest for Convergence in the Application of EU Internal …

ency test for both sets of provisions, whether or not explicitly stated. In Deliège,
the adoption of one system over another is left to sporting bodies and organisers,34
as long as the selection is made on the basis of objective factors unconnected with
the athletes’ personal situation. The proportionality of such a system is not ques-
tioned by the Court. But this does not imply that the system need not fulfil the
requirement of proportionality. It is deemed proportionate by default. Thus, the
system adopted in Deliège was deemed proportionate because it was neither based
on the athlete’s personal situation (it was not discriminatory) nor did it create
obstacles to market access. The athletes not selected on the basis of their national-
ity have no chance to ever be selected (unless they change their citizenship or
move back to their Member State), but when criteria unrelated to their personal
situation is used, all athletes have an equal opportunity to be selected. Only non-
discriminatory rules that do not relate to market access can satisfy the inherency
test under free movement provisions. Hence, the reason that the Court did not
­specifically mention the proportionality requirement is because it is built into the
concept of inherency under free movement. Parrish and Miettinen argued that
[a]lthough inherent rules do not constitute restrictions within the meaning of free move-
ment law, the process of analysis involves an examination of proportionality of the rule
and the relationship between fundamental rights and the rule purported to be inherent. As a
consequence, the distinction between objective justification and the process of determining
whether a rule is inherent is limited to the Court’s treatment of proportionality of inherent
rules: the Court appears less inclined to examine the proportionality of inherent rules and
more inclined to require that applicants demonstrate its disproportionality, whereas in the
context of objective justification the party purporting to objectively justify the rule is
required to demonstrate that no less restrictive means will achieve the same, justified
ends.35

A discriminatory rule would not be inherent, but would be subject to the objective
justification framework as was the case in Lehtonen, and is unlikely to satisfy the
proportionality test unless objective reasons concerning only sport as such can
­justify differential treatment.36 Another possibility for a discriminatory sporting
rule to satisfy free movement provisions is to fall under the Category II sporting
exception. Rules preventing market access, even if non-discriminatory rules such
as the transfer rules in Bosman, or training compensation fees in Bernard, ‘affect
the players’ opportunities for finding employment and the terms under which such
employment is offered’37 and therefore ‘directly affect players’ access to the
employment market in other Member States’.38 As such they cannot be considered
inherent and must be put through the objective justification framework.
In the field of competition law, the Court set out the inherent rule test in para
42 of Meca-Medina which included three analytical points: the existence of a

34 Joined Cases C-51/96 and C-191/97 Deliège, paras 67 and 68.

35 Parrish and Miettinen 2008, p. 101.
36 See C-176/96 Lehtonen, paras 47–51.
37 C-415/93 Bosman, para 75.
38 Ibid. para 103.
6.3 Prohibition Level Convergence—Categories I, II and III … 227

legitimate aim, inherency and proportionality. The apparent difference with the
inherency test in Deliège is that the requirement for proportionality of the rules,
and the existence of a legitimate aim, are both specifically set out. Prima facie, it
could be thought that the effect of this difference is that a rule that does not qualify
as inherent for the purposes of competition might so qualify for the purposes of
free movement law. However, given that proportionality is also a built-in require-
ment in an inherent rule under free movement law, and given that every inherent
rule does in fact pursue a legitimate aim, it is submitted that the result of the tests
under both set of provisions should be identical. There is one qualification to this:
if the rule satisfies the competition law inherency test, the result can be trans-
planted to the free movement inherency test only if the rule is non-discriminatory
and related to exercise of economic activity rather than to market access—other-
wise, the result will be transplanted under the internal market objective justifica-
tion framework. Substantial equivalence between these tests should in principle
produce the same results.
The rules that have been, or are likely to be, considered inherent under compe-
tition law provisions are: non-discriminatory transfer windows, non-discriminatory
criteria for selection of athletes for competitions, proportionate sanctions for
breach of anti-doping rules, proportionate home-and-away rules and proportionate
rules preventing multiple ownership of clubs.39 In the Commission Staff Working
Document, Annex I, the ‘rules of the game’ (category I)40 and ‘purely sporting’
rules (category II) are also contained in the notion of inherent rules under competi-
tion provisions, which apply to a much broader category of organisational sporting
rules.41 All those rules have ‘purely sporting’ interests (or motives) in common.
The Commission considered that the ‘purely sporting’ rule from Walrave would
likely meet the inherency test under Meca-Medina.42 The inherent rule notion
under competition law, therefore, inevitably encompasses both the non-economic
rules of the game and the ‘purely sporting’ rules. It will be argued in Sect. 6.4
below that it is also apt to encompass the rules objectively justified under free
movement articles.
In this sense, at the risk of going too far, the argument could be stretched to
claim that the scope of a ‘purely sporting’ rule was de facto broadened by the
notion of inherent rules but only in relation to competition law: it necessarily
fits into the inherent rule test, and in addition, there are many other rules that
are not ‘purely sporting’ that satisfy the same inherency test. The benefit that
both categories of sporting exception afford to a sporting rule is essentially the
same (it affirms their compliance with the law) and on the same level of analy-
sis in both sets of provisions (that of restriction), however with a different de jure

39 Commission Staff Working Document, The EU and Sport: Background and Context,

Accompanying Document to the White Paper on Sport, COM (2007) 391 final, Annex I, para 2.4.
40 Ibid. para 2.1.5.
41 Ibid. paras 2.2.1.4 and 2.4.
42 Ibid. para 2.2.1.4.
228 6 A Quest for Convergence in the Application of EU Internal …

result: ‘purely sporting’ rules do not fall under the scope of the article in ques-
tion whereas inherent rules do not constitute restrictions even though they restrict
freedom of action. For the parties involved in a dispute, this technical difference
means nothing. Even though a ‘purely sporting’ rule is technically outside the
scope of the article in question, substantively, it will have to go through a similar
analytical process as the inherent rule under competition law to enable that conclu-
sion. At the end of the day, the inherent rule and ‘purely sporting’ rule tests are
nothing more than an application of specific forms of the rule of reason or ancil-
lary restraints doctrine (see Fig. 6.2 in Sect. 6.4).
The test for ‘purely sporting’ rules as outlined above in Sect. 6.3.2 is capable of
incidentally satisfying the inherent rules test in the free movement area. Unlike in
competition law, it will not always happen. ‘Purely sporting’ rules that are discrimi-
natory or that relate to market access will not be capable of satisfying the inherency
test in free movement law, unless in the future the Court indicates that the inherency
test has replaced the purely sporting rule test in the free movement area. In Meca-
Medina, the Court reiterated paras 14 and 15 of Donà with the p­ urpose of showing
that there is no full convergence between competition law and free movement of
persons. Nevertheless, it indicated that the ‘purely sporting’ rule is still alive and
well in free movement law, regardless of the fact that its practical use might be lim-
ited to those rare rules fulfilling the conditions of the Category II exception.
Discriminatory rules and rules restricting market access that have satisfied the
competition law inherency test will be subject to the objective justification frame-
work under free movement (or, in very rare instances, the ‘purely sporting’ rules
test). The submission in the section that follows is that there is a full convergence
between the free movement objective justification framework and the competition
law Meca-Medina/Wouters inherency test. This in turns means that the rules found
compatible with Article 101(1) under the inherency test will, in any case, be com-
patible with free movement provisions (and vice versa, barring the existence of
hard-core restrictions).

6.4 Justification Level Convergence—Category IV

Sporting Exception

The Category IV exception is not an exception, strictly speaking. It applies to rules

that, unlike the other three categories, constitute restrictions. It involves a sensitive
application of the law to sport,43 or rather, the recognition of the specificity of the
sports industry. In para 40 of the Bernard case, the Court set out the standard of
application of the proportionality principle in the objective justification frame-
work, according to which, account must be taken of the specific characteristics of
sport and of its social and educational function. The same standard, it is submitted,
applies in the interpretation and application of EU competition law to sport.

43 Parrish and Miettinen 2008, p. 73.

6.4 Justification Level Convergence—Category IV Sporting Exception 229

Fig. 6.2  Convergence between inherent rules and objective justification framework

Here it must be emphasised that the category IV exception does not exist sepa-
rately in application of competition law to sport, but it is contained in the Meca-
Medina/Wouters test. It is in this way that the convergence occurs between the
internal market objective justification framework and competition law. Otherwise,
once the sporting rules are found restrictive under Article 101(1), there is no indi-
cation in law that they will benefit from any special treatment under Article
101(3), or the efficiency defence under Article 102 in cases where they are found
to constitute an abuse of a dominant position. These competition law justifications
stand alone and have no counterpart in free movement law that could be taken into
account for the purposes of convergence theory, unless the legitimate aim in public
interest can be translated into economic benefits in which case there would exist at
least a possibility for this type of convergence. The sporting rules that failed the
requirement of inherency but are proportionate, and can translate their legitimate
public interest goals into economic benefits, are apt for the convergent outcome
between the Article 101(3) exemption and Article 102 economic efficiency
defences on the one hand, and the objective justification test in free movement
provisions on the other. The two requirements specific to Article 101(3) regarding
affording a fair share of the resulting benefits to consumers and the non-elimina-
tion of competition in respect of a substantial part of the product in question are
more likely to be satisfied than not, once the requirements of economic efficiency
and proportionality are met under that provision.44

44 See Guidelines on the Application of Article 81(3) OJ C 101 27.4.2004.

230 6 A Quest for Convergence in the Application of EU Internal …

The application of the free movement Gebhard-type objective justification

framework is seen, for example, in Lehtonen, Bosman and Bernard, but the Court
in sport cases uses it for both directly and indirectly discriminatory rules.45 The
objective justification involves essentially the same analytical points as the inher-
ency test under competition provisions. Although the Court has so far avoided
making any direct statements about convergence in general, including this type of
convergence, the Commission and the Advocates General have been less cautious.
In the Commission Staff Working Document, Annex I, the Commission considered
that ‘the regulation of transfer periods are likely to constitute sporting rules that do
not infringe Articles [101(1) and 102 TFEU] under Meca-Medina (provided they
do not go beyond what is necessary, e.g. do not differentiate as regards the origin
of a player or set transfer periods that are too short).’46 The transfer periods in
Lehtonen, assessed under internal market provisions, were considered under mar-
ket access rules relating to the ‘essential purpose of professional player’s activity’
and as such were not inherent; they fell to be examined under the objective justifi-
cation framework. They were found to be disproportionate. The instruction from
the Annex I of the Commission Staff Working Document is that, had the transfer
periods in Lehtonen been proportionate, they would have been justified not only
under free movement law, but also under Article 101(1) and the judicially devel-
oped objective justification under Article 102. Objectively justified sporting rules
under internal market law satisfy the inherency test under competition law and
vice versa.
In the preliminary opinion on the notified Union des Associations Européennes
de Football (UEFA) rule prohibiting ownership of more than one team participating
in the same UEFA club competition, the Commission has drawn the analogy from
the area of freedom of movement and automatically applied the objective justifica-
tion from the Bosman case to Article 101(1):
Taking into account what the Court of Justice has recognised in the Bosman Case as
­legitimate objectives in the view of the considerable social importance of football in the
[Union], the Commission considers that the restrictions imposed by the rule may escape to
the prohibition laid down in Article [101(1)] of the Treaty. In order to establish whether this
preliminary conclusion can be upheld or not, the Commission has to know if such restric-
tions are limited to what is necessary to preserve the integrity of the UEFA club competi-
tions and to ensure the uncertainty as to results. In other words, the Commission must
confirm whether there are or not less restrictive means to achieve the same objective.47

45 Case C-55/94 Gebhard [1995] ECR I-4165 para 37 and Case C-19/92 Kraus [1993] ECR

I-1663 para 32 are normally reserved for non-discriminatory measures only. Discriminatory
measures normally can only benefit from the exhaustive list of Treaty-based exceptions such as
public policy, public health and public security, but not from an open list of justifications available
to non-discriminatory measures. Sport is an exception to this rule.
46 Paragraph 2.2.1.6.
47 Communication made pursuant to Article 19(3) of Council Regulation No 17 concerning

request for negative clearance or for exemption pursuant to Article 81(3) of the EC Treaty Case
No 37.632—UEFA rule on integrity of the UEFA club competitions: independence of clubs
1999/C 363/02.
6.4 Justification Level Convergence—Category IV Sporting Exception 231

This represents the transposition of the objective justification framework to Article

101(1) reminiscent of the Meca-Medina/Wouters inherency test.
Conversely, in the EPO case decided under Article 101, the General Court dis-
missed the applicant’s arguments that the professional codes of conduct pursue an
aim in the general interest according to Van Binsbergen, Thieffry and Gebhard,48
cases decided under the freedoms provisions, and that it was therefore necessary to
accept, by application of the rule of reason, that they are indispensable and cannot
therefore fall within the scope of Article 101(1) TFEU. The ban on comparative
advertising, according to the applicant, was necessary in the context of a regulated
activity which is a matter of public policy and does not adversely affect
competition.
The General Court replied that:
…the case-law which the applicant cites in support of its argument is irrelevant. The judg-
ments in question relate to the principles of freedom of establishment and freedom to pro-
vide services. It follows that rules of professional conduct in force in one Member State
which pursue an aim in the general interest apply to professionals who come to practise
on the territory of that State without infringing those principles. However, no conclusion
can be drawn from that case law as concerns the applicability of Article [101 TFEU] in
the present case.49

Mortelmans considered that it does not constitute a refusal of the convergence

approach by the General Court because the goal of the general interest was invoked
as an exception after finding a restriction, while under Article 101 it was invoked as
an argument, packed up as a rule of reason, in support of non-applicability of the
rule, i.e. at the gate of Article 101, in its prohibition paragraph.50 However, it
would seem to be the case that convergence can be properly invoked only in the
context of the first paragraph of Article 101(1), because justifications in free move-
ment law are non-economic. Under Article 101(3), the rule faces four cumulative
criteria that are specific to economic arguments and in general do not provide space
for public policy grounds as exceptions. Any convergence between the two areas of
EU law has to involve the possibility of ‘diagonal convergence’ and this is espe-
cially necessary in the area of sport where grounds of justification are non-eco-
nomic. It makes more sense and is more in line with the Court’s overall approach
to draw the analogies with regard to their substantive, functional role in the process
of analysis. Treating issues formalistically is not known to be the Court’s style.
Whish suggested that the Court in Wouters was perhaps deliberately trying to
reach the convergent outcome to that which would have been attained under
Article 56, had it been the Dutch Government and not the Bar that adopted the

48 Case 33/74 Van Binsbergen v. Bestuur van de Bedrijfsvereniging voor de Metaalnijverheid

[1974] ECR 1299; Case 71/76 Thieffry [1977] ECR 765; and Case C-55/94 Gebhard [1995] ECR
I-4165.
49 T-144/99 Institute of Professional Representatives before the European Patent Office v.

Commission [2001] ECR II-1087 para 66. This paragraph makes the decision of the General
Court in Meca-Medina taken a few years later even more surprising.
50 Mortelmans 2001, p. 629.
232 6 A Quest for Convergence in the Application of EU Internal …

restrictive rule in question in Wouters.51 It is to be remembered that the early case

law of Van Binsbergen allows Member States to take measures restricting the free-
dom to provide services to the extent they are necessary to safeguard professional
rules of conduct.52
Regarding Article 101(3), Advocate General Lenz in Bosman mentioned that
…it would admittedly appear theoretically conceivable that the Commission might grant
those rules, which are in breach of Article [45], an exemption from the prohibition in
Article [101(1)]. Since such an exemption would, however, make no difference to the
breach of Article [45], it would make sense for the Commission to take that factor into
account in the exemption procedure. A uniform result ought to be aimed at in any case.
That would mean that an exemption under Article [101(3)] would also have to be ruled
out.53

Most recently, in the Murphy case, the Advocate General pointed out that
…conflicting assessments of the fundamental freedoms and competition law are to be
avoided in principle. […]an anti-competitive agreement within the meaning of
Article 101(1) TFEU can be justified pursuant to Article 101(3) TFEU. However, a person
who relies on that provision must demonstrate, by means of convincing arguments and
evidence, that the conditions for obtaining an exemption are satisfied. In this connection,
it would appear that similar considerations should apply as in the examination of whether
a restriction of freedom to provide services is justified.54

The Advocate General was apparently of the opinion that convergence ought to
exist on the level of justification, but also in general, including on the level of
prohibition.55
However, the utility of establishing the principle of convergence between the
free movement ordinary objective justification framework and Article 101(3)
TFEU would be relatively limited, and in sporting disputes virtually unusable. If a
measure survives the objective justification test and Meca-Medina/Wouters test
then, of course, there is no reason to look into it further under Article 101(3)
TFEU. If a measure fails their shared test, it means that it failed to establish its
legality under EU free movement law and as such it does not qualify for the excep-
tion. Even if such measure produced economic efficiencies, which outweigh the
negative effects of restraints under Article 101(3) TFEU, that fact still does not
legalise the measure under the freedom of movement provisions. The measure will
be illegal and will have to be abandoned or modified to comply with the

51 Whish 2009, pp. 127–128.

52 Case 33/74 Van Binsbergen [1974] ECR 1299.
53 Opinion of AG Lenz in C-415/93 Bosman, para 278.
54 Opinion of AG Kokott in Cases C-403/08 and C-429/08 Murphy v. Premier League [2011],

paras 249–250.
55 In C-222/07 Presidente del Consiglio dei Ministri v Regione Sardegna [2009] ECR I-1404 she

similarly considered that when the same questions arise under the law of State aid as with regard
to the fundamental freedoms, the reply to the latter should not differ from the reply to the former
and the same criteria must be applied in both cases to avoid conflicting assessments. See paras
134 and 135 of her Opinion in that case.
6.4 Justification Level Convergence—Category IV Sporting Exception 233

requirements of free movement rules. In other words, once the internal market
rules apply alongside the competition law, Article 101(3) TFEU becomes obsolete
in practical terms and any convergence in regard to the aims translatable into eco-
nomic efficiencies and proportionality becomes relevant only in theory.56
This was confirmed by the Court in Murphy when it only referred to its findings
on (dis)proportionality of the measure under internal market law to hold that the
exemption in Article 101(3) TFEU does not apply in the case. Had the avenue of
the Meca-Medina/Wouters test been available to the rule under competition law
provisions, all of the objective justification findings would have been fully trans-
plantable and the Court would have referred not just to the part of the judgement
dealing with the proportionality of the measure, but also to the rest of the consid-
erations under the objective justification framework.57

6.5 Burden of Proof

The outstanding question concerns the party that should bear the burden of proof
under Article 101(1) in the framework of the Meca-Medina/Wouters test. Normally
under Article 101 TFEU, in the first paragraph the burden is on the party alleging
infringement, and in the third paragraph the burden is borne by the defendant.58
However, in Michelin II the General Court was unequivocal that the burden of proof
for elements of the objective justification defence in Article 102 TFEU was on the
dominant undertaking.59 The Discussion Paper addressed this issue and said that
[e]xclusionary conduct may escape the prohibition of Article [102] in case the dominant
undertaking can provide an objective justification for its behaviour or it can demonstrate
that its conduct produces efficiencies which outweigh the negative effect on competition.
The burden of proof for such an objective justification or efficiency defence will be on the
dominant company. It should be for the company invoking the benefit of a defence against
a finding of an infringement to demonstrate to the required legal standard of proof that the
conditions for applying such defence are satisfied.

56 See also Sect. 7.8

57 Paragraph 145. The Court’s selected reference to paras 105–124 also confirms the point made
above in Sect. 4.10.2.4, that encouraging public to attend and participate in matches is probably
not accepted as objective worthy of protection under EU law, and that the Court was only dealing
with the point of proportionality.
58 Article 2 of the Council Regulation 1/2003 of 16 December 2002 states that: ‘In any national

or [Union] proceedings for the application of Articles [101] and [102] of the Treaty, the burden
of proving an infringement of Article [101(1)] or of Article [102] of the Treaty shall rest on the
party or the authority alleging the infringement. The undertaking or association of undertakings
claiming the benefit of Article [101(3)] of the Treaty shall bear the burden of proving that the
conditions of that paragraph are fulfilled’.
59 See Case T-203/01 Manufacture française des pneumatiques Michelin v Commission

(Michelin II) [2003] ECR II-4071, paras 107–109.

234 6 A Quest for Convergence in the Application of EU Internal …

The burden of proof therefore shifts to the dominant undertaking when relying on
the efficiency defence in Article 102 TFEU, equivalent to Article 101(3) TFEU, or
the objective justification defence in Article 102 TFEU, equivalent to the DLG and
Meca-Medina/Wouters style of exceptions under Article 101(1) TFEU. For the
sake of convergence between the two competition law provisions, which is abso-
lutely necessary to preserve the uniform application of the Meca-Medina/Wouters
test applicable equally to both competition provisions, the structure of Article 101
TFEU should not be allowed to impede the functional equivalence between the
elements and analysis common to them. Such equivalence would bring a number of
conceptual problems should the burden of proof under the M ­ eca-Medina/Wouters
test remain with the party alleging the infringement. Prima facie, this interpretation
seems to go against Article 2 of Regulation 1/2003,60 but on a more careful exami-
nation, Recital 5 of that regulation explains that in the effective enforcement of EU
competition law, which respects the ‘fundamental rights of defence’, the burden of
proof under Articles 101(1) and 102 TFEU should be on the authority alleging
infringement, but then it goes on to say without specifying the legal provisions
involved that the burden of proof ‘should be for the undertaking or association of
undertakings invoking the benefit of a defence against a finding of an infringement
to demonstrate to the required legal standard that the conditions for applying such
defence are satisfied’. In other words, it does not matter under which paragraph of
Article 101 TFEU the defence takes place, the burden of proof should be on the
party seeking to rely on the justification, as a matter of the fundamental right of
defence. This interpretation would, moreover, coincide and align the approach
with that under the free movement provisions. For these reasons, in the light of the
blurring divide between addressees and the pressing need to specify the parame-
ters of convergence, it is submitted that the Court should re-examine para 55 of
Meca-Medina in which it implied that the burden is on appellants to establish that
rules were disproportionate.61 Examination of the regulatory and organisational
sporting rules does not follow the orthodox analytical approach under Articles
101(1) and 102 TFEU, whereas Article 2 of the Regulation 1/2003 was drafted
with that approach in mind. When dealing with private regulatory bodies such as
sporting organisations where it is clear that both internal market and competition
law apply to the same cases, this should not be allowed to create additional confu-
sion. Burden of proof is suitable for convergence in the application of the two sets
of provisions.

60 Council Regulation (EC) No 1/2003 of 16 December 2002 OJ L 1, 04.01.2003, pp. 1–25.

Article 2 reads: ‘in any national or Community proceedings for the application of Articles 81 and
82 of the Treaty, the burden of proving an infringement of Article 81(1) or of Article 82 of the
Treaty shall rest on the party or the authority alleging the infringement. The undertaking or asso-
ciation of undertakings claiming the benefit of Article 81(3) of the Treaty shall bear the burden of
proving that the conditions of that paragraph are fulfilled’.
61 In para 55 of C-519/04 Meca-Medina, the Court held: ‘Since the appellants have, moreover,

not pleaded that the penalties which were applicable and were imposed in the present case are
excessive, it has not been established that the anti-doping rules at issue are disproportionate’.
References 235

References

Barnard C (2010) The substantive law of the EU, 3rd edn. Oxford University Press, Oxford
Baquero Cruz J (2002) Between competition and free movement: the economic constitutional
law of the European community. Hart Publishing, Oxford
Callery C (2011) Should the European Union embrace or exorcise Leegin’s rule of reason
European competition law. Review 32:42–50
Mortelmans K (2001) Towards convergence in the application of the rules on free movement and
on competition? Common Market Law Rev 38:613–649
Parrish R, Miettinen S (2008) Sporting exception in European Union law. T.M.C Asser Press,
The Hague
Sauter W, Schepel H (2007) State and market in the competition and free movement case law
of the EU courts. TILEC discussion paper 2007-024, Tilburg University. http://ssrn.com/
abstract=1010075
Weatherill S (2008) Anti-doping revisited—the demise of the rule of ‘purely sporting interest?
In: Weatherill S (ed) European Union sports law: collected papers. T.M.C. Asser Press, The
Hague
Weatherill S (2009) The influence of EU law on sports governance. In: Gardiner S, Parrish R,
Siekmann CR (eds) EU, sport, law and policy: regulation, re-regulation and representation.
T.M.C Asser Press, The Hague, pp 79–100
Whish R (2009) Competition law, 6th edn. Oxford University Press, Oxford
Zweigert K, Kötz H (1987) An introduction to comparative law, 2nd edn. Clarendon Press,
Oxford
Chapter 7
Treatment of UEFA Restrictions
on Breakaway Leagues in Football
Under EU Law

Contents
7.1 Introduction.......................................................................................................................... 237
7.2 The Conflict......................................................................................................................... 239
7.3 Defining the Relevant Market.............................................................................................. 240
7.3.1 The Market for Organisational Services for Transnational Club Football
in Europe.................................................................................................................. 241
7.3.2 Connected Downstream Market: Exploitation Market............................................ 244
7.3.3 Connected Upstream Market: The Market for Clubs’ Services............................... 246
7.3.4 Relevant Geographic Market................................................................................... 247
7.4 Classification of the Parties and the Restraints.................................................................... 248
7.4.1 Undertaking or Association of Undertakings/Agreement or Decision?.................. 248
7.4.2 Market Power of UEFA on the Relevant Market..................................................... 253
7.4.3 Article 49 of the UEFA Statutes: Restrictive Effects............................................... 259
7.5 Applicable Justification Framework..................................................................................... 267
7.6 The Existence of Elements of Justification.......................................................................... 268
7.6.1 The Overall Context: Legitimate Aims in Public Interest........................................ 269
7.6.2 Suitability of the Article 49 Rule: Effectiveness Test.............................................. 272
7.6.3 Inherency Requirement............................................................................................ 278
7.6.4 Proportionality......................................................................................................... 281
7.7 Effect on Intra-Union Trade................................................................................................. 301
7.8 The Conditions of Article 101(3) TEFU.............................................................................. 302
7.9 Collective Dominance and Collusion by Elite Clubs........................................................... 303
7.10 Concluding Remarks.......................................................................................................... 308
References................................................................................................................................... 309

7.1 Introduction

The questions of breakaway leagues and the legality of the clauses in Article 49(1)
and (3) of the Union des Associations Européennes de Football (UEFA) Statutes
have never been addressed by the Court of Justice of the European Union (‘CJEU’
or ‘the Court’). But as we saw in Chaps. 4 and 5, a compass to navigate through this

© t.m.c. asser press and the author 2015 237

K. Pijetlovic, EU Sports Law and Breakaway Leagues in Football,
ASSER International Sports Law Series, DOI 10.1007/978-94-6265-048-0_7
238 7 Treatment of UEFA Restrictions on Breakaway Leagues …

legal issue is supplied to us by the Court’s jurisprudence and the Commission’s

practice in the area of sport and beyond. In DLG, the Court held that the statutes of a
cooperative purchasing association forbidding its members to participate in other
forms of organised cooperation was compatible with Articles 101(1) and 102 TFEU
because it was restricted to what was necessary to ensure the achievement of the
legitimate (commercial) objectives. In its policy documents, the Commission sup-
ported the preservation of pyramid structures and open competitions, however, not
at the expense of surrendering the breadth of economic freedoms any more than
necessary to attain legitimate aims.1 According to the Commission Communication
on Developing the European Dimension in Sport, Article 165 TFEU supports the
preservation of European sporting structures as a part of the concept of specificity of
sport.2 Elsewhere in this volume, it has been submitted that Article 165 TFEU has
given additional weight to the sporting arguments.3 This certainly plays into the
hands of UEFA as a party that heavily relies on the concept of specificity of sport in
the context of breakaway structures. On the other hand, the Court is known to rule
in favour of economic considerations every time that rules pursuing legitimate sport-
ing goals have been found disproportionate. It had little hesitation in holding that
rules regarding transfer windows in Lehtonen or training compensation in Bernard
went further than necessary in realisation of their legitimate aims. Similarly, the
Court liberalised the market for satellite transmission decoders in Murphy and the
labour market in Bosman. It is for the clubs determined to form an alternative league
to exploit the logic of the legal arguments in this line of jurisprudence.
According to the Commission, the methodological approach to assessing
whether a rule adopted by a sports association relating to the organisation of sport
infringes Articles 101 and/or 102 involves a four-step test:
Step 1: Is the sports association that adopted the rule to be considered an ‘undertaking’ or
an ‘association of undertakings’? […] Step 2: Does the rule in question restrict competi-
tion within the meaning of Article [101(1) TFEU] or constitute an abuse of a dominant
position under Article [102 TFEU]? This will depend, in application of the principles
established in the Wouters[/Meca-Medina]judgment, on the following factors: a. the over-
all context in which the rule was adopted or produces its effects and its objectives; b.
whether the restrictions caused by the rule are inherent in the pursuit of the objectives;
and c. whether the rule is proportionate in light of the objective pursued. […] Step 3: Is
trade between Member States affected? Step 4: Does the rule fulfil the conditions of
Article [101(3) TEFU]?4

Striking the balance between commercial freedoms for the clubs on the one hand and
the specificity of sport on the other is at the heart of the conflict that culminates in the
application of the proportionality test. On the basis of established legal parameters,
this chapter will evaluate the status under EU law of clauses in the UEFA Statutes

1 See Sect. 3.2.1 for policy statements on the pyramid structure.

2 Paragraph 4.2 of the Communication, COM (2011) 12 final, 18. 1. 2011.
3 See Sect. 4.8.
4 Commission Staff Working Document, The EU and Sport: Background and Context,

Accompanying Document to the White Paper on Sport, COM (2007) 391 final, Annex I, para 2.1.2.
7.1 Introduction 239

prohibiting the unauthorised establishment of alternative cross-border ­competition in

football. It will also briefly touch upon the question of whether the practices in the
current governance model as described in Chap. 3 amount to an abuse of a collective
dominant position by elite European football clubs.

7.2 The Conflict

The source of potential conflict between elite clubs in a pan-European breakaway

league and UEFA arises from the clauses in Article 49(1) and (3) of the UEFA
Statutes (hereinafter ‘Article 49 rule’) that read:
UEFA shall have the sole jurisdiction to organize or abolish international competitions in
Europe in which Member Associations and/or their clubs participate. […] International
matches, competitions or tournaments which are not organized by the UEFA but are
played on UEFA territory shall require the prior approval of FIFA and/or UEFA and/or the
relevant Member Associations in accordance with the FIFA Regulations Governing
International Matches and any additional implementing rules adopted by the UEFA
Executive Committee.5

Committing to any form of participation in international club competitions not

organised or not approved by the concerned governing bodies will entail disciplinary
measures as specified in the codes implementing the Fédération Internationale de
Football Association (FIFA) Regulations Governing International Matches and disci-
plinary codes of national associations; Article 19 of the FIFA Regulations Governing
International Matches (2012) and Article 12 of the FIFA Disciplinary Code (2011);
and Article 53 of the UEFA Statutes (2012) and Article 6 of the UEFA Disciplinary
Regulations (2013). The sanctions that may be imposed by UEFA provide that any
club in breach of the UEFA Statutes may become subject to a withdrawal of their
license, full or partial stadium closure, disqualification from competitions in pro-
gress and/or exclusion from future competitions, and fines in an amount of no more
than €1 million.6 The European Club Association (ECA) expressly agreed to this
rule via Memorandum of Understanding 2012 that governs the relationship between
the clubs and UEFA. According to paras D.1, D.3 and D.4, ECA undertakes ‘to rec-
ognise UEFA as the governing body of football at European level in accordance with
its Statutes […]; to ensure that none of its member clubs participate in any competi-
tion that is not organised or recognised by UEFA/FIFA’ and ‘to ensure that its mem-
ber clubs are not members of any other association or grouping involving clubs from
more than one country […]’.
In recent years, the UEFA’s general attitude to the idea of cross-border leagues
became more moderate. After the meeting of the UEFA Management with UEFA
Member Association General Secretaries, which was held on 26–27 October 2005

5 UEFA Statutes, edition 2012.

6 Similarly, the most severe sanction under Article 12 of the FIFA Disciplinary Code involves
expulsion from competitions and a fine of no more than CHF 1 million.
240 7 Treatment of UEFA Restrictions on Breakaway Leagues …

in Nyon, UEFA considers that a cross-border competition is conceivable, but only

if the proposal for such a project a priori satisfies 13 conditions which are set out
and analysed below in Sect. 7.6.4.3. The conditions are particularly onerous: they
do not allow a direct access to the exploitation market, the proposed league has to
be confined to a specific geographical area, compulsory solidarity contributions are
required, regulatory competence remains mostly with UEFA including club licens-
ing and uniform match calendar, clubs presumably have to remain as participants
in their national championships, and the approval of national associations, UEFA
and FIFA is required. UEFA perceives these rules as a natural and legitimate part
of its mandate and a necessary means of the proper organisation and financing of
football. Conversely, clubs may claim that the Article 49 rule presents a restriction
upon their commercial freedom in breach of TFEU rules on competition and the
free movement of services. The Article 49 rule in the UEFA Statutes is not likely
to be challenged in the abstract by the clubs, but only when the conflict material-
ises, i.e. only if the authorisation by the relevant governing body or bodies has not
been obtained and/or the clause is used as a basis to impose sanctions on the clubs
and/or players participating in an unsanctioned breakaway league.
The first part of the text that follows in this chapter will consider preliminary
issues such as the relevant market, classification of parties and their position on
the relevant market, classification of restraints under the EU law and the applica-
ble justification framework. Thereafter, the elements in the justification framework
will be analysed.

7.3 Defining the Relevant Market

The relevant product market in question is the market for provision of organisa-
tional services for transnational club football in Europe. Entry to this market in iso-
lation would however not be the per se goal for the clubs involved in an alternative
league and for private promoters. The UEFA rules are designed to control access to
this market, but their ultimate aim is to prevent the emergence of a rival league in
several connected markets, most importantly, in the downstream market for com-
mercial exploitation and the upstream market for services of clubs. In the DLG
case, the Court considered the commercial activities within the organisation (distri-
bution of fertilisers and plant protection products, in casu), rather than the access
to mere organised membership in the rival establishment, as the relevant market.7
In MOTOE, the Court defined the relevant market as consisting in ‘first, the organi-
sation of motorcycling events and, second, in their commercial exploitation’.8

7 Case C-250/92 Gøttrup-Klim e.a. Grovvareforeninger v Dansk Landbrugs Grovvareselskab

AmbA (DLG) [1994] ECR I-5641, paras 19 and 48.
8 Case C-49/07 Motosykletistiki Omospondia Ellados NPID (MOTOE) v Elliniko Dimosio

[2008] ECR I-4863, para 33.

7.3 Defining the Relevant Market 241

Those two types of activities were seen as functionally complementary.9

Nevertheless, the definition of the relevant market in our case should rather focus
on the market for the organisation of football competitions alone. The reason for
this difference in approach is that in MOTOE and DLG, the rival entity already
existed and was active on the market for organisation and exploitation. In MOTOE,
the prior authorisation was exercised by ELPA in relation to MOTOE, a rival
already established on the market and an entity already performing organising
functions. In DLG, the B members had already organised their participation in a
rival entity and competed with DLG when DLG decided to change its rules and
prohibit dual membership. So the question was less about restricting the access to
market for organisation in general and more about restricting the exercise of spe-
cific activities that also entailed an element of discrimination between economic
operators that were already active on the organisational market. In our case, there
is no actual rival organisation and the question is focused more on access to the
organisational market itself that will, in either case, bring about access to the
exploitation market. The distinction is similar to the distinction between access
(take-up of an activity or entry into market) and exercise (pursuit of an activity or
operation in a market) in internal market law.

7.3.1 The Market for Organisational Services

for Transnational Club Football in Europe

7.3.1.1 Production Processes of Professional Football Contests

There are two stages in the production process of professional football contests.
The first stage takes place at the level of individual clubs: owners invest into devel-
oping the playing strength of their respective teams.10 They buy players and hire
coaches, buy, build or rent stadia, and provide everything that is necessary for
building as successful a team as possible. Under the European model of sport, and
taking into consideration the system of revenue distribution, we can assume that
club owners focus on win-maximising strategies and not profit-maximising strate-
gies—this is because the two are interconnected and focusing on the club’s on-the-
pitch success inevitably implies economic success. However, a single club is not
capable of producing a marketable product and needs at least one opponent to
achieve that. There is significantly less demand in the exploitation market for indi-
vidual games, such as exhibitions, than games played as a part of an organised

9 Ibid.
10 Dietl et al. 2011, Organisational Differences between U.S. Major Leagues and European
Leagues: Implications for Salary Cap. International Association of Sports Economists, Working
Paper Series, Paper No 11-05, p. 2. Available at http://college.holycross.edu/RePEc/spe/Dietletal
_OrganizationalDifferences.pdf.
242 7 Treatment of UEFA Restrictions on Breakaway Leagues …

competition.11 In order to markedly raise the economic value of such a game, the
game needs to be integrated into an organised championship race. Clubs are there-
fore the producers of inputs (individual games) which, when integrated, deliver the
final meta-product—the championship.12
The second stage of the production process occurs at the level of the league.13
For example UEFA has the organisational and administrative responsibility for the
UEFA Champions League and Europa League. It conducts the draw procedure;
approves the participants; and appoints referees, match delegates, and referee
observers, and covers their expenses. It also acts as a disciplinary body supervising
and enforcing all aspects of the competition. UEFA selects and appoints a wide
range of third-party service providers to provide services that are required in con-
nection with a match, such as product development, sales, after-sales services and
client relations with broadcasters, sponsors, suppliers, licensees and participating
clubs, media services (booking of commercial spots and broadcast sponsorship
throughout the world), legal services, television production services, auditing and
monitoring of UEFA Champions League television programmes throughout the
world, research services, operational implementation of the commercial concepts,
hospitality services, financial and administrative services, and statistical and infor-
mation services.14 All of these services are indispensable for creating the best pos-
sible value in any professional team sport and for the professional marketing of a
final meta-product before it starts producing revenue. UEFA thus performs organ-
ising functions in the production process of professional football competitions at a
pan-European level.
The market for organisational services for transnational club football in Europe
is integrated into the contest production process, and the clubs participate together
with UEFA in this process. It is the access to the organisational market that is the
subject of the authorisation under the Article 49 rule. Imposing prior authorisa-
tion on clubs entering the second stage of production is at the heart of the legal
problem and a key to the correct definition of the relevant market in the context.
Without such authorisation, it is not possible to produce a marketable product
independently of UEFA. Lack of direct control by clubs over the second stage
presents a barrier for clubs to become market operators independent of UEFA in
the production process of professional football contests. The entry into that stage
directly ties with, and provides access to, the exploitation market.

11 Noll 2003, fn. 1.

12 Dietl et al. 2011, p. 3.
13 Ibid. p. 2.
14 Commission Decision in Case COMP/37.398—Joint Selling of Commercial Rights (UEFA

Champions League) [2003] OJ L 291/25, para 13.

7.3 Defining the Relevant Market 243

7.3.1.2 Cross-Elasticity of Supply and Demand

The relevant market is the market for organisational services for transnational club
football in Europe. In this market, clubs are on the demand side and UEFA is on
the supply side. Stage one of the production process is identical for both the pro-
duction of national and European professional club football contests. In stage two
of the national championship production process, national leagues or associations,
as the case may be, provide the organisational services and perform functions
similar to those of UEFA. Service providers for national club football do not have
the mandate, aspiration, or realistic chance to provide their services to organise
transnational competitions. They will not supply the transnational market in either
the short or long term and are not a potential substitute for UEFA, a transnational
regulatory and organisational body. The competitive constraint on the supply side
might come from independent private entities such as big media firms, the for-
mation of a rival entity by the clubs or the combination of the two. Nevertheless,
these parties cannot be said to present an immediate competitive threat as supply
substitutes, but they will definitely play a role as potential competitors—it is more
appropriate to take potential competition into account in the assessment of UEFA’s
market power than in the assessment of relevant market.
In a market with no immediate alternative suppliers, the use of the SSNIP test
might not be an ideal measurement for demand substitution as there is no viable
option to easily switch to. But due to the existence of potential competitors it is
possible to, at the very least, run the test. There is a general consensus among
economists and competition law academics that the use of this test provides many
advantages. For example Faull and Nikpay argue that ‘it is useful to think of the
market definition questions in terms of SSNIP. […] [It] provides for a framework
within which to consider the question of economic substitution’.15
The way that UEFA ‘charges’ for its services is to apportion a part of the reve-
nues from the exploitation market to cover its organisational costs. It takes no profit
for performing this function. In the circumstances where there are no immediate
alternative suppliers, the SSNIP test for the cross-elasticity of demand comes down
to one question: would the clubs break away (and organise in a joint venture or
assign organising functions to an independent entity) shortly after the cost of organ-
isational services rose by 5–10 %? The answer would probably be ‘no’. The UEFA
organisational costs for all the competitions in the past four seasons represented
12 % of the overall profits, so the total price increase would roughly be in the range
of 0.6–1.2 % of the overall profits. On the basis of this test alone, the conclusion is
that it would not make such a significant impact on the important commercial deci-
sions of the clubs. Also, the rise in the cost of services would probably not affect
the returns to the clubs, but some other item on the financial report’s expenditure
sheet. In the past 3 years, the amounts paid to the clubs as well as solidarity pay-
ments have been rising due to the rise in the broadcasting revenues.

15 Faull and Nikpay 2007, p. 44.

244 7 Treatment of UEFA Restrictions on Breakaway Leagues …

From the qualitative perspective, input by clubs produced in stage one of the
contest production process is compatible with the organisational functions of any
entity that has the necessary level of know-how. Should it become evident to a suf-
ficiently big majority of the top clubs that the commercial and legal risks involved
in changing the status quo are the more rational economic choice than continu-
ing to cooperate with UEFA in their role as organisers, the clubs will break away
and create a rival competition that could have the effect of commercially killing
off any remaining pan-European competition. As seen throughout the discussion in
Chap. 3, regulatory and governance issues affecting the commercial interests of the
clubs outside this market may also have repercussions for any breakaway decision.

7.3.2 Connected Downstream Market: Exploitation Market

On the supply side of the exploitation market is UEFA’s licensing of the commer-
cial rights to pan-European football club competitions that are played throughout
the year, and sales of the related merchandise. The commercial rights include
product licensing, broadcasting and new media, sponsorship, suppliership and
other intellectual property rights. One of the products that UEFA markets (in part-
nership with Television Event and Media Marketing AG) is supreme: the
Champions League features the highest quality football on the planet and it is the
most popular club competition in the world, even ahead of the American National
Football League’s Super Bowl.16 The newly rebranded Europa League is, in sheer
number of matches, the biggest football competition, with 205 matches per season,
but it is considerably less valuable and in the few years of its existence has not
managed to break-even financially.17 However, the quality of football played
between the top teams in the Europa League is generally comparable to the quality
achieved by the clubs in the Champions League, so there is at least a potential to
build up the marketing image. The system of promotion and relegation keeps the
membership in the two pan-European leagues fluid, and it is also instructive for
the market definition that the Media Partners proposal included most of the clubs
from both of those leagues. Since UEFA holds the exclusive right to organise and
commercially exploit the two championships, at this stage of product market anal-
ysis it appears that there are no actual competitive constraints on the supply side of
the market. Potential competition in the exploitation market may come only from
clubs organising a pan-European rival league.
On the demand side are the suppliers, sponsors, producers of different goods,
broadcasters with a downstream market for their subscribers and advertisers, and
football supporters. The demand side is a market for the acquisition and resale of
commercial rights to football competitions, typically organised in a tendering con-
test. There is a close and interdependent vertical relationship between the parties

16 ‘Champions League Final Tops Super Bowl for TV Market’, BBC news, 31 January 2010.
17 UEFA Financial Report 2010/2011, p. 23.
7.3 Defining the Relevant Market 245

in the demand market: broadcasting companies are willing to invest generously

into obtaining exclusive rights to top sporting events as they are considered the
most valuable TV content. Broadcasting these events attracts a big number of
advertisers and subscribers. The events are followed live by a cumulative audience
of hundreds of millions of fans on different kinds of media devices, which makes
the events especially interesting for sponsors and advertisers aiming to reach large
targeted audiences. The bigger the anticipated audience and the more popular the
sporting event, the more lucrative the sponsorship deals for UEFA and the higher
the value of advertising space for broadcasters.18
The entire demand side of the exploitation market is driven by the appeal a par-
ticular sporting event has on the masses as represented by final consumers in this
vertical chain of supply. Hence, it is ultimately the substitutability from the per-
spective of the final consumers that determines the substitutability of demand in the
exploitation market.19 In this context, it was held that viewing sport is not inter-
changeable with viewing other forms of entertainment20 and football broadcasts
are not interchangeable with other sports broadcasts.21 The Commission further
subdivided the football broadcasting market into regular events and those played
intermittently.22 This was confirmed in the examination of joint selling arrange-
ments in UEFA Champions League, where the Commission held that football
events in Europe that are played throughout the year constitute a separate relevant
product market.23 Such events included UEFA Champions League, Europa League
and national first division leagues and cups. They regularly attract high audience
numbers, a specific audience, and provide a certain brand image for the broadcaster
which cannot be achieved by means of any other content.24 Even though UEFA’s
EURO is the third and FIFA’s World Cup is the most-watched sporting event in the
world, they were viewed as too infrequent and too short to be considered as pre-
senting an alternative to support the viewing habits of subscribers or to add a tem-
poral dimension to the product market as defined by the Commission. The
application of the standard SSNIP test to football broadcasts of regular events
would likely reveal zero cross-price elasticity of demand as a competitive

18 This was recognised by the Commission in Case COMP IV/37.806—ENIC/UEFA [2002]

unpublished decision of 27 June 2002, para 41 that said: ‘the preferences of viewers determine
the value of a programme to advertisers and pay TV broadcasters’.
19 Analogous to finding in Commission Decision in Case IV/36.539—British Interactive

Broadcasting/Open [1999] OJ L 312/1, p. 1.

20 Commission Decision in Case No IV/36.237—TPS [1999] OJ L 90/6, p. 6.
21 Commission Decision in COMP/M.2483—Group Canal+/RTL/GJCD/JV [2001] OJ L 2985,

para 19.
22 Ibid. para 21.
23 Commission Decision in COMP/37.398—Joint Selling of Commercial Rights (UEFA

Champions League) [2003] OJ L 291/25, para 59.

24 Ibid. para 58.
246 7 Treatment of UEFA Restrictions on Breakaway Leagues …

constraint from other kind of sporting events.25 In relation to a part of final con-
sumers, this position is reinforced by the fans’ loyalty to one club, analogous (and
perhaps more strongly) to the concept of consumer loyalty to a particular brand
mentioned by the General Court in cases such as BaByliss26 or Kaysersberg.27

7.3.3 Connected Upstream Market: The Market for Clubs’

Services

The upstream market to the organisation of European transnational football club

competitions is the market for clubs’ services. This market is the mirror image of
the relevant organisational market discussed above. Here UEFA is on the demand
side and is currently the sole buyer of the services of clubs on a European level.28
This in turn enables the exclusivity of commercial exploitation of pan-European
club competitions. It is a peculiarity of professional sport production that champi-
onships must possess a monopoly status to achieve consistent ranking and increase
their value for consumers.29 Being a sole buyer of the clubs’ services functions as
a means to achieve such consistency and to produce a single champion per market
area, per sport discipline.
UEFA regulates the European labour market, club licensing and other factors
of production. National associations regulate the production of their competitions
within the confines of their respective mandates. Operating in this regulatory envi-
ronment, clubs invest into team building and participate in competitions organised
by UEFA and by national associations. By participating in those competitions,
clubs supply input services for the production of championship leagues without
which UEFA’s organisational functions in transnational club competitions, and
national associations’ organisational functions in national club competitions, would
become obsolete. It should be remembered that clubs cannot individually produce
a marketable product and that individual games that are not a part of scheduled
contest are not in demand. Hence, clubs need an entity performing the organising
functions, be it sporting association such as UEFA, or a private promoter.
It may be difficult to define a market in a situation where both levels of the verti-
cal chain of supply, which are represented by parties having a quid pro quo arrange-
ment instead of a classic wholesale price (for example cost covering for UEFA
organisational services is not a classic charge for services as it has no profit mar-
gins). But we need not look far, as the service is unique and not interchangeable: the

25 This follows from findings by Dietl et al. 2011, p. 10. In either case, it is not irrelevant that the

UEFA EURO and the FIFA World Cup, which similarly attract large viewership, are scheduled to
avoid overlap with the Champions League, European League or national leagues.
26 Case T-114/02 BaByliss SA v. Commission, judgment of 3 April 2003.
27 Case T-290/94 Kaysersberg SA v. Commission, judgment of 27 November 1997.
28 But see the discussion below in the subsection on the UEFA market power.
29 Dietl et al. 2011, p. 3.
7.3 Defining the Relevant Market 247

relevant market is the market for top football clubs’ ‘input services’. Since, for
UEFA, and any potential pan-European rival organiser, there are no economically
viable substitutes for the quality and value of individual games between clubs in the
Champions League and the Europa League, only those clubs’ services are to be
included in the definition of the connected upstream market. Only the input from
those clubs is compatible with UEFA’s relevant organisational functions (i.e. another
part of the final meta-product), because it is capable of being turned into economi-
cally valuable product that can be used for the purposes of maintaining crucial soli-
darity mechanisms. The market at the European level is therefore further subdivided
into services for clubs playing top-quality football as represented in European
leagues and the rest of the clubs. National associations however might have a differ-
ent perspective on the interchangeability of the elite clubs’ services as only a few of
such teams from their top flight league participate in European competitions. For
most of them, all the clubs in their first (and in the big football nations, also second)
division are capable of creating commercial value at the national level, the only
level they can exploit. The input services from both the top clubs and from all others
playing in their competitions are compatible with their organisational functions.
Hence, the national associations and UEFA can be said to ‘compete’ only for the
services of those clubs playing in the European leagues. However, as the 13 condi-
tions set by UEFA for the approval of alternative cross-border competitions30 are
directed towards geographically delimited leagues (as opposed to pan-European
leagues which would not be approved), all the clubs that are capable of producing
the commercial value for the national governing bodies belong to the connected
upstream market for clubs’ services.

7.3.4 Relevant Geographic Market

The relevant geographic market is the European continent. This is the area in which
UEFA organisational services are provided and in which sufficiently homogenous
conditions of competition exist. Unlike the broadcasting market which is still, even
after Murphy, national in character, the organisational service market for transna-
tional club competitions is not characterised by linguistic, cultural and legal-regula-
tory differences or other factors segmenting markets along national lines.
Organisational services are provided at a European level and have no connection to
any particular country. The upstream market as defined above mirrors this geographic
scope. Clubs provide their services and play the matches all over Europe under the
unified set of rules. Commercial rights other than broadcasting (such as sponsorship,
product licensing and suppliership) are also Europe-wide rather than national as these
undertakings associate themselves with the league and not with particular teams.31

30 See Sect. 7.6.4.3.

31 Ibid. para 89.
248 7 Treatment of UEFA Restrictions on Breakaway Leagues …

7.4 Classification of the Parties and the Restraints

The difficulties involved in applying the traditional competition law concepts to

the area of sport are illustrated by the classification of the parties and the restraints
under Articles 101 and 102 TFEU. For the purpose of application of those provi-
sions, individually or simultaneously, the preliminary question must be: is UEFA
is an undertaking or association of undertakings on the relevant market, and does
the Article 49 rule constitute an agreement between undertakings or a decision by
an association of undertakings? Article 101 applies to different forms of collusion
between two or more undertakings, including collusions made through the
medium of association, whereas Article 102 TFEU does not include the concept of
an association of undertakings, but if the association represents an emanation of its
members that are active on the relevant market, it may be considered an undertak-
ing for the purposes of that article.32 Also, if the association is active itself on the
relevant market it will amount to an undertaking.

7.4.1 Undertaking or Association of Undertakings/

Agreement or Decision?

Formally, UEFA is a private body that is engaged in economic activities on the rel-
evant market and in both of the connected markets. But even if it could be argued,
in order to take its purchasing functions outside the definition of economic activ-
ity, that functionally UEFA is a public body because it discharges social functions
in public interest, it would nevertheless be considered as engaged in economic
activity because the services of the clubs that it obtains are subsequently used as
an input for an economic activity.33
On the basis of the considerations in Sects. 5.1 and 5.5.1, it is clear that UEFA
can be classified as an ‘association of associations of undertakings’, an ‘associa-
tion of undertakings’ or an ‘undertaking’ for the purposes of the application of
competition law provisions. The precise classification depends on the definition of
the relevant market under examination. The Commission decision in para 25 of
ENIC states that although UEFA is an association of associations of undertakings,
it can qualify as an undertaking for the purposes of organisation of European club
competitions.34 An undertaking alone cannot adopt ‘decisions by associations of
undertakings’ or collide with itself by entering into agreements or concerted prac-
tices within the meaning of that article. That action requires involvement of at

32 T-193/02 Piau, paras 112 and 116.

33 In accordance with Case T-319/99 Federación Nacional de Empresas de Instrumentación
Cientifica, Médica, Técnica y Dental (FENIN) v. Commission ECR II-351 paras 36–37 as upheld
by the Court in Case C-205/03 [2006] ECR I-6295, paras 25–27.
34 Commission Decision in Case COMP IV/37.806—ENIC/UEFA, para 25.
7.4 Classification of the Parties and the Restraints 249

least two undertakings. Alternatively, it requires an agreement between an associa-

tion of undertakings and at least one other undertaking. The General Court has
held that the wording of Article 101(1) TFEU encompasses agreements between
associations of undertakings and other undertakings, including its member under-
takings, as long as the association engaged in conduct is separate from that of
undertakings in regard to one and the same infringement.35
Citing the General Court on this point, the Commission held in para 26 of ENIC
that ‘the UEFA rule on “Integrity of the UEFA club competitions: independence of
clubs” is a decision taken by an association of associations of undertakings within
the meaning of Article 101(1) of the Treaty, as it was drawn up by UEFA Executive
Committee.’36 Does this imply that any rule drawn up by the UEFA Executive
Committee is a decision by the association? If it does, then the decision in ENIC
appears to be in conflict with itself because in para 25 the Commission suggested
that UEFA ‘can be qualified as an undertaking for certain activities such as the
organisation of European club competitions’. If UEFA constitutes an undertaking
on that market, and the Article 49 rule was drawn up by the UEFA Executive
Committee, how could that rule be a decision by the association? Specifically,
what is the status under Article 101 TFEU of a rule drawn up by the UEFA
Executive Committee that regulates the activities regarding organisation of club
competitions? This question is valid in our case even though the Article 49 rule
was drawn up by a different organ at UEFA: the Congress, the supreme controlling
organ of the UEFA consisting of all its Member Associations. Taking into consid-
eration its composition, the Congress is not qualitatively different to the UEFA
Executive Committee under para 26 of ENIC and so the questions still remain.
Reconciliation between paras 25 and 26 of ENIC is offered by acknowledging
that para 25 is merely a suggestion to be used whenever the circumstances so
require—the words ‘can be qualified’ do not imply that UEFA necessarily ought to
be classified as such for every case involving organisation of European competitions.
Similarly, in regard to para 26 of ENIC, Annex I of the Commission Staff Working
Document confirms that rules drawn up unilaterally by sporting associations consist-
ing of undertakings will usually (i.e. not always) constitute decisions by an associa-
tion of undertakings.37 Therefore, the classification of an entity and its rules will be
decided on the basis of the case-by-case approach emphasised on numerous occa-
sions by the Commission, most notably, in the White Paper on Sport. There is no a
priori uniform answer but some guidance on the issue is provided by the case law.
In Meca-Medina,38 the Court did not waste its time in classifying the IOC rule
enforced by FINA as either a decision of an association or as an agreement between
undertakings. In para 45, it simply said that ‘even if the anti-doping rules at issue

35 Cases T-25/95 etc. Cimenteries CBR SA v. Commission [2000] ECR II-491, para 1325.
36 Paragraph 26 [emphasis added].
37 See Annex I, endnote nr. 27 [emphasis added].
38 Case T-313/02 David Meca-Medina and Igor Majcen v Commission [2004] ECR II-3291 and

Case C-519/04 David Meca-Medina and Igor Majcen v Commission [2006] ECR I-6991.
250 7 Treatment of UEFA Restrictions on Breakaway Leagues …

are to be regarded as a decision of an association of undertakings limiting the

appellants’ freedom of action, they do not […] necessarily constitute a restriction of
competition incompatible with the common market’. The White Paper assumes that
this means that the IOC rule was considered a decision by an association.39
In DLG, the restriction on membership in a rival cooperative was examined
under both Articles 101 and 102 TFEU without specific reference to the status
of an entity as an undertaking or an association of undertakings, and the statutes
of the cooperative as an agreement or decision. The Court did, however, say that
DLG was a ‘voluntary association of persons established in order to pursue com-
mon commercial objectives’ and treated the rules in the statutes simply as restric-
tions under both competition articles of the Treaty.
In Wouters, the Court held the General Council of the Bar of the Netherlands to
be an association of undertakings and the regulation prohibiting multidisciplinary
partnership of the members of the Bar and the accountants it adopted, to be a deci-
sion within the meaning of Article 101 TFEU.40 The Court did not consider it to
be an undertaking for the purpose of the application of Article 102 TFEU since the
Bar did not carry out any economic activities, and the Court did not consider it to
be a group of undertakings, because the members of the Bar were not sufficiently
linked to adopt common conduct on the market.
However, in Piau, like in DLG, the rule was examinable under both articles. In
the context of Article 102 TFEU, FIFA was regarded as an emanation of the clubs
acting on their behalf as a second-level association of undertakings formed by the
clubs that are so linked on the relevant market that they present themselves as a
collective entity.41 The FIFA rule regulating access to the profession of players’
agents was considered to be a decision by an association of undertakings under
Article 101 TFEU.42
FIFA and the Italian football association were considered as undertakings by
the Commission in FIFA World Cup 1990.43 FIFA conferred on the commercial
company exclusive rights for the supply of match tickets for the purpose of putting
together package tours. The agreement between FIFA and that company was con-
sidered as agreement within the meaning of Article 101 TFEU.44
The pattern that transpires from the case law is that regulatory rules applica-
ble to the market in which the association is not economically active will con-
stitute decisions of an association of undertakings, whereas the cases in which
those associations are economically active on the relevant market will contribute
towards the finding of an undertaking.

39 See Annex I, endnote nr. 27 of the White Paper.

40 Case C-309/99 Wouters [2002], para 64.
41 T-193/02 Piau, paras 112 and 116.
42 T-193/02 Piau, para 75.
43 Commission Decision in Case Cases 33.384 and 33.378—Distribution of package tours dur-

ing the 1990 World Cup [1992] OJ L 326/31.

44 Ibid. para 75.
7.4 Classification of the Parties and the Restraints 251

There is much support for the claim that the UEFA Statutes were adopted by
UEFA of its own authority and that the Article 49 rule is a unilaterally drawn rule
and UEFA its sole author. The cooperation of other entities is not necessarily
required for its enforcement on the relevant market, although the enforcement may
be substantially aided by concerted efforts with national associations. The Article
49 rule endows the UEFA Executive Committee with the power to decide on any
cases of formation of cross-border leagues. The Executive Committee consists of a
president and 15 members who each hold an active office (usually the office of the
president) within a different Member Association. They are elected by the
Congress, a UEFA body composed of all Member Associations. It was this body
that adopted the first UEFA Statutes in 1997, including the Article 49 rule, and
made all of the subsequent amendments to it.45 Thus, it could be argued that the
Article 49 rule merely reflects the concurrent will of the Member Associations,
and that UEFA is acting as an emanation of its members who, through the mem-
bership and powers within the bodies of UEFA, represent their own interests. It is
indeed in their direct interest to have a rule such as Article 49 included in the
Statutes: national associations are the beneficiaries of the solidarity payments
resulting from UEFA’s collective sales of commercial rights for European compe-
titions organised by it.46 None of them in isolation can claim the dominion over
the organisation of pan-European competitions. This is collectively achieved by
using their powers in UEFA organs and via UEFA rules. An emergence of a
European rival would terminate UEFA’s exclusive organising functions at the
European level and would affect, if not completely cease, the financial contribu-
tions to Member Associations. The rule was voted in and maintained by all
Member Associations via the UEFA Congress, and if needed, will be enforced
under Article 49 of the Statutes by the decision of representatives of 15 Member
Associations qua UEFA Executive Committee. Article 101 TFEU encompasses
decisions by associations of undertakings. The idea is to enable those applying
Article 101 TFEU ‘to hold associations liable for the anti-competitive behaviour
of their members’.47 On the basis of these considerations, the Article 49 rule may
be argued to constitute a decision by an association of undertakings.
However, the Member Associations are neither active nor do they constitute
undertakings on the relevant market. UEFA on the other hand engages in a wide
range of purchasing functions and it clearly can constitute an undertaking. ENIC
does not help in resolving the puzzle. Paragraph 25 of the case instructs us to
conclude that UEFA is an undertaking because it is active on the relevant market
for the organisation of European club competitions, but para 26 suggests that the
Article 49 rule is likely to be a decision of an association of undertakings because

45 UEFA Statutes, edition 2012, Article 70.

46 The solidarity payment is made available to Member Associations to develop infrastructure,
co-finance some of their statutory tasks, as incentives for good governance, for the clubs licens-
ing project, etc. See UEFA Financial Report 2009/2010, p. 13.
47 The constitution and rules of trade associations may constitute decisions. Commission

Decision in Case IV/27.958—National Sulphuric Acid [1980] OJ L 260/24, para 30.

252 7 Treatment of UEFA Restrictions on Breakaway Leagues …

the rule was drawn by the UEFA Congress. The reference to the activities on the
relevant market produces a result different than the reference to the Article 49 rule
alone. It is submitted that in this situation, it is the conclusion made by the refer-
ence to the relevant market that should prevail because it is the substance and the
effects rather than the form that should matter. UEFA could therefore be consid-
ered an undertaking and as such outside the scope of Article 101. But this conclu-
sion could also be challenged.
National associations themselves may constitute undertakings to the extent that
they carry out economic activities.48 The General Court ruled in AC-Treuhand AG
that it is not necessary for an undertaking to itself operate on the market where the
restriction takes place to offend against Article 101 TFEU.49 The General Court
rejected the applicant’s argument that its firm could not be regarded as a co-perpe-
trator of an infringement because it did not carry out an economic activity on the
relevant market affected by the restriction of competition and because its contribu-
tion to the cartel was merely subordinate. The purpose of its conduct, as coordi-
nated with that of other undertakings, was to restrict competition on a specific
relevant market. The requisite legal standard to prove participation in a cartel and
label an undertaking as a perpetrator is to prove that the undertaking attended
meetings at which anti-competitive agreements were concluded without manifest-
ing its opposition to such meetings.
National associations are obliged by Article 59 of the UEFA Statutes to include
in their statutes ‘a provision whereby it, its leagues, clubs, players and officials
agree to respect at all times the Statutes, regulations and decisions of UEFA’.
Article 59 of the UEFA Statutes reinforces obligations under the Article 49 rule
upon the clubs. Article 7bis(2) of UEFA Statutes provides that
[l]eagues or any other groups of clubs at Member Association level shall only be per-
mitted with the Association’s express consent and shall be subordinate to it. The
Association’s statutes shall define the powers apportioned to any such group, as well as its
rights and obligations. The statutes and regulations of any such group shall be subject to
the approval of the Association.

This is the national level equivalent of the Article 49 rule, applicable on the level
of national associations whose organisational functions are confined to their
respective territories. Together with Article 49 rule it helps build the pyramidal
structure with UEFA at the apex. Without some structure and hierarchy at each
national level, it would be difficult to secure the best clubs for the European com-
petitions, as the existence of an unsanctioned league could result in some inferior
clubs qualifying for the Champions League, which would in turn dilute its com-
mercial value. If there were many unsanctioned competitions in many different
European countries, they would not be a subject of national association or UEFA

48 Commission Decision in Cases 33.384 and 33.378—Distribution of package tours during the

1990 World Cup, OJ 1992 L326/31, paras 52 and 53. See also the references in Commission
Decision COMP/37.398—Joint Selling of Commercial Rights (UEFA Champions League)
[2003] OJ L 291/25, para 106.
49 T-99/04 AC-Treuhand AG v Commission [2008] ECR II-1501.
7.4 Classification of the Parties and the Restraints 253

rule books and they could therefore avoid the application of the Article 49 rule
should they decide to organise on a transnational level. The organisational func-
tions of national associations at the national level, therefore can be seen as com-
plementary and facilitating/enabling those of UEFA on transnational level, and
their rules implementing Articles 59 and 7bis(2) of UEFA Statutes can be seen
as reinforcing the Article 49 rule. In this sense, national associations can consti-
tute undertakings for our purposes even though they are not active on the relevant
market but carry out only a subordinate role. Hence, it can be asserted that they
are using UEFA as a vehicle to coordinate their conduct to restrict competition
on the relevant market, which would make UEFA an association of undertakings
rather than an undertaking. The Article 49 rule would then be a decision merely
reflecting the will of national associations. Alternatively, UEFA could constitute an
undertaking which is engaged in concerted practice with its members.
Having gone through the different options, one must remember that the classifi-
cation of UEFA as an undertaking or an association of undertakings is important
in order to determine which competition article of the Treaty will become applica-
ble to the restrictions emanating from the Article 49 rule. Nevertheless, as the legal
test for restrictions is equivalent under both articles, the result will be the same
regardless of the precise status of the parties as an association of undertakings or
undertakings and the restrictive rules as agreements or decisions. What matters for
the applicability of these articles is the existence of an entity engaged in economic
activity whose agreements or decisions restrict competition on the relevant market,
and in the case of Article 102 TFEU, the existence of a dominant undertaking or a
group of undertakings. This is the standpoint that can be traced back to the Court’s
DLG judgment and to the Opinion of Advocate General Lenz in Bosman.50

7.4.2 Market Power of UEFA on the Relevant Market

Dominance is defined as a position of economic strength which enables an under-

taking to prevent effective competition on the relevant market by giving it the
power to behave to an appreciable extent independently of its competitors, cus-
tomers and ultimately its consumers.51 In addition, the existence of such a domi-
nant position ‘derives from a combination of several factors which, taken
separately, are not necessarily determinative’.52 The main feature of a dominant
position is the ability of undertaking to act without having to take account of exist-
ing or potential competition in its market strategy. Thus, the concept of independ-
ence, which has to exist to ‘an appreciable extent’, is the key factor in finding the
existence of a dominant market position.

50 See his Opinion in C-415/93 Bosman, paras 254–259.

51 Case 27/76 United Brands v. Commission [1978] ERC 207, para 65.
52 Ibid. paras 65–66.
254 7 Treatment of UEFA Restrictions on Breakaway Leagues …

7.4.2.1 Market Shares

On the basis of the market shares indicator, it would be counterintuitive and unre-
alistic to claim that UEFA is not dominant on the relevant market. Even for a cas-
ual observer it does not require much evidence to prove that the UEFA is not just
dominant, but holds a monopoly on the market for the provision of organising ser-
vices for the European club competitions. The Commission Staff Working
Document backs up this conclusion in stating that ‘sports associations usually
have practical monopolies in a given sport and may thus normally be considered
dominant in the market of the organisation of sport events under Article [102
TFEU].’53 UEFA is the only entity active on the relevant market while the Article
49 rule and organisational structure of European football support that exclusivity.
According to the Court in Hoffmann-La Roche ‘although the importance of the
market shares may vary from one market to another the view may be taken that
very large market shares are in themselves, and save in exceptional circumstances,
evidence of the existence of dominant position’.54 The size of the UEFA market
share raises the presumption that UEFA is the dominant undertaking on the rele-
vant market. This presumption will stand in the absence of ‘exceptional circum-
stances’ indicating that the large market shares are deceptive and that, for example
a new competitor may easily emerge to disrupt the dominance affects the behav-
iour of a dominant undertaking. Market shares supply a quantitative value and do
not tell us why the undertaking has high market shares, what are its potential com-
petitors, and whether there are any other significant constraints on its behaviour
such as countervailing buyer power. According to the Commission ‘[e]ven firms
with very high market shares may not be in a position […] to significantly impede
effective competition, in particular by acting to an appreciable extent indepen-
dently of their customers, if the latter possess countervailing buyer power’.55

7.4.2.2 Countervailing Buyer Power

The first indicator of countervailing buyer power is the buyer’s market share on the
purchase market as it reflects the importance of its demand for possible suppliers.56
In this context, it is submitted that the elite clubs are collectively dominant under-
takings on the connected upstream market for clubs’ services and providers of
essential input that cannot be duplicated by any other (group of) entities on the rele-
vant market. Links between the elite clubs that support the conclusion on tacit coor-
dination are many. Tightly knit relationships that exist among them due to the nature
of their business and the common course of conduct on the relevant market are

53 Annex I, para 2.1.4.

54 Case 85/76 Hoffmann-La Roche [1979] ECR 461, para 41.
55 Guidelines on the assessment of horizontal mergers under the Council Regulation on the con-

trol of concentrations between undertakings 2004/C 31/03, para 64.

56 Commission Notice—Guidance on Vertical Restraints, Brussels SEC (2010) 411, para 116.
7.4 Classification of the Parties and the Restraints 255

evidenced by: complete dependence on each other to produce a marketable product;

similar cost structures; common marketing and sales of broadcasting rights on the
relevant market through UEFA; homogenous product; symmetric growth prospects;
no incentive to force other firms out of the market; the interaction of firms in multi-
ple markets; stable demand; transparent or known prices (the media contributes to
this); the fact that clubs can effectively impose their agreements on their customers
(UEFA on the market for clubs’ services); difficulty of defection from the agreed
course of action is difficult; use of each other’s infrastructure (football stadiums) to
play the games; and in general, the structure of the market and nature of the industry
being conductive to tacit collusion.57 From the point of view of UEFA and ultimate
consumers, these clubs come as a package deal. Commonality of their interests is
predetermined by the high level of interdependency between the clubs to produce a
quality product, i.e. the games integrated in championship race. Clubs negotiate
terms and conditions of their engagement on the market together and if they were to
leave the European football structures, they would do it together. As such, the strate-
gic goals of the clubs as undertakings are sufficiently aligned to give rise to a collec-
tively dominant position, whereas the market provides the perfect conditions for
tacit collusion to sustain over long period of time. Therefore, the criteria for a find-
ing of collective dominance under para 62 of Airtours58 as confirmed by Piau59 are
easily met, and the required links within the meaning of para 45 of Compagnie
Maritime Belge case60 as elaborated in cases such as Italian Flat Glass, Gencor and
Almelo,61 are easily established. This is the type of collective dominance that is
superimposed on undertakings by the nature and structure of the market in question.
A fortiori, it fits the concept of ‘superdominance’ as elaborated by Advocate
General Fennelly in Compagnie Maritime Belge.62
Further to the analysis of countervailing buyer power, the collectively dominant
elite clubs are responsible for stage one of the professional football contest produc-
tion process and UEFA for stage two.63 Without the clubs, UEFA’s function of
organising European club competitions would become obsolete and its role as a
regulator able to rely on solidarity payments to fulfil its mandate would be signifi-
cantly reduced.64 On the other hand, the clubs would be able to exchange UEFA for
another entity capable of performing the league functions, or they could establish a

57 For more on the list of factors that support a finding of collective dominance see O’Donoghue
and Padilla 2006, pp. 137–161.
58 T-342/99 Airtours plc. v. Commission [2002] ECR II-2585, judgment of 6 June 2002.
59 Case T-193/02 Laurent Piau v. Commission, judgment of 26 January 2005, para 111.
60 C-396/96 P Compagnie Maritime Belge Transports and Others v. Commission [2000] ECR

I-1365.
61 Cases T-68/89 etc. Società Italiano Vetro SpA v. Commission [1992] ECR II-1403; Case

T-102/96 Gencor Ltd. V. Commission [1999] ECR II-0753; and Case C-393/92 Almelo v. NV
Energiebedriff Ijsselmij [1994] ECR I-1477.
62 See Opinion of Advocate General in C-396/96 P Compagnie Maritime Belge, para 137.
63 See Sect. 7.3.1.1.
64 See Sect. 7.3.3.
256 7 Treatment of UEFA Restrictions on Breakaway Leagues …

jointly owned undertaking entrusted with performing organising functions.65 The

complete dependence on the potential competitor, a sole buyer of organising ser-
vices who is also the provider of essential input into production of the professional
football contest, puts into doubt the presumption of dominance that emerges from
the monopolistic market shares. The existence of a monopsony held by the clubs on
the demand side in the relevant market, which is not exposed to any present or
future challenges, is a powerful counterbalance to any degree of dominance, and
may amount to ‘exceptional circumstances’ under para 41 of Hoffmann-La Roche.
Countervailing buyer power implies the bargaining strength which a buyer enjoys
in relation to its suppliers by virtue of its size, commercial significance to the seller,
and its ability to switch to alternative suppliers.66 According to the Commission ‘[i]
n some circumstances buyer power may prevent the parties from exercising market
power and thereby solve a competition problem that would otherwise have existed.
This is particularly so when strong customers have the capacity and incentive to
bring new sources of supply on to the market […].’67 The first sentence of this
quote means that, for the conclusion on dominance of an undertaking, the mere
possession of market power does not count for much without the possibility to
exercise that power in a corresponding manner by adopting conduct on the market
that is characteristic of a dominant undertaking. In regard to the second sentence of
the quote, we shall now look at potential competition on the relevant market.

7.4.2.3 Potential Competition: Entry and Expansion

One source of countervailing buyer power is the possibility for the buyer to switch
to other suppliers within a reasonable time frame and ‘credibly threaten to verti-
cally integrate into the upstream market or to sponsor upstream expansion or entry
for instance by persuading a potential entrant to enter by committing to placing
large orders with this company’.68 The existence of this possibility is precisely
what made UEFA accommodate the interests of the clubs (to the detriment of other
stakeholders including non-elite clubs) when they were set to form a breakaway
league, so the credibility of the threat is apparent from the response of the supplier.
For a new entry or expansion to be considered as presenting sufficient competitive
constraint it has to be likely (sufficiently profitable taking into account the price
effects of injecting additional output into the market and the potential responses of
the incumbents, and not exposed to very high risks or high barriers to entry), timely
(normally considered as a time frame of 2 years, but the characteristics and
­dynamics of the market may affect this time frame) and sufficient (it cannot be

65 Ibid.
66 Guidelines on the assessment of horizontal mergers under the Council Regulation on the con-
trol of concentrations between undertakings 2004/C 31/03, para 64.
67 Commission Notice—Guidance on Vertical Restraints Brussels SEC (2010) 411, para 116.
68 Guidelines on the assessment of horizontal mergers under the Council Regulation on the con-

trol of concentrations between undertakings 2004/C 31/03, para 65.

7.4 Classification of the Parties and the Restraints 257

small scale entry but must be of such magnitude as to constrain the behaviour by
the putatively dominant undertaking, for example by deterring price increases).69
Elements of likelihood, timeliness and sufficiency are all present for a new pro-
vider of organising services for elite club competition at the European level.70 The
account of the history of breakaway threats in Chap. 3 and concessions made by
UEFA backs up this conclusion. On the other hand, it can also act as a proof of
UEFA’s ability to fend off the competition by adopting appropriate strategic behav-
iour in response to the potential new entry to the market which is the feature char-
acteristic of a dominant undertaking. In the case of the 1998 Media Partners
proposal such response involved the expansion of the Champions League (which
can be taken as analogous to increasing output), whereas in the case of the Oulmers
affair/release of players rule it meant the creation of a compensation pool (which
can be taken as analogous to a decrease in price). In the relevant market as defined
above, the fact that these strategic decisions were successful so far does not provide
much comfort for UEFA that it will be equally successful in the future under the
specific circumstances surrounding an aspiring future entrant. Therefore, the pres-
sure of expansion and entry appears to exist to a sufficient degree to be taken as
presenting a competitive constraint on UEFA’s behaviour in the relevant market.

7.4.2.4 Industry Specific Aspects of Decision-Making

‘Exceptional circumstances’ under para 41 of Hoffmann-La Roche are presented

also by the nature of the industry. UEFA, as a European regulatory body, is neither
a typical private undertaking nor a typical private regulatory entity, as it takes its
decisions in consultation with various stakeholders, some of which happen to be
both potential competitors who have the ability to eliminate it from the market for
organisation of European club competitions, and powerful customers on the organ-
ising market. It has been demonstrated in Chap. 3 that UEFA is therefore taking
utmost care of the commercial interests of the elite clubs, as demonstrated by the
following matters: (1) their entrenchment on the Executive Board of ECA, their
presence at the UEFA Professional Football Strategy Council, and their right to
elect five out of nine ordinary members and two out of three vice-chairman at the
UEFA Club Competitions Committee, and (2) breakaway threats which they use
as a trump card if all else fails. These matters give them the possibility to exercise
decisive influence on the strategic decisions of UEFA in its capacity as a regulator
of European football and as a provider of organising services. Should the clubs
become dissatisfied with the terms and conditions that UEFA offers in its capacity
of a provider of organising services, they would likely exert pressure culminating

69 Ibid. paras 68–75.

70 The prospect of formation of some other regional alternative league (such as the Balkan
league) might not satisfy the requirement of sufficiency, but an elite breakaway on a pan-Euro-
pean level is different in its scope and in the fact that the clubs supply an input that cannot be
duplicated in terms of its value for UEFA.
258 7 Treatment of UEFA Restrictions on Breakaway Leagues …

in a threat to break away and cause UEFA to change its envisaged course of
action, as has already occurred several times in the past. The market shares alone,
even though they point towards a status of monopoly, cannot be taken as an evi-
dence of a dominant position in this case. Far from being independent in making
its strategic decisions pertaining to the relevant market, UEFA in fact appears to be
highly dependent on the clubs. Thus, any reference to UEFA as having superior
market power on the relevant market is highly inappropriate in the light of power
struggles and the current governance model. Along with analysis on competitive
constraints it becomes apparent that it should not be as easy to establish the domi-
nance of UEFA as had been presumed each time the relevant market under investi-
gation has been mentioned in rare academic writing,71 by practitioners,72 and the
Commission,73 all of whom confined their assessment to one sentence merely stat-
ing in a matter-of-fact fashion that such dominance exists.

7.4.2.5 Conclusion

The presence of a powerful buyer on the market, the expansion and entry possibili-
ties that UEFA has to account for, and the idiosyncrasies of governance and deci-
sion-making, are all factors heavily suggesting that dominance (i.e. appreciable
independence) on the market for organisation of European clubs competitions is far
from easy to prove. In fact, it might not exist. This is undeniably a surprising result
of the UEFA dominance analysis brought about by a closer qualitative examination
of the requirements of independence, which revealed a different state of affairs as
compared to the overwhelming market shares-based prima facie impression that
UEFA holds a monopoly on the relevant market. This result is based on a substantive
assessment of the concept of independence that is not unlike the concept of ‘control’
in certain other areas of EU law. For example acquisition of control of an undertak-
ing is a key to establishing the existence of a concentration under Article 3(1)(b) of
the Merger Regulation.74 ‘Control’, whether joint or sole control, is a qualitative
concept defined as ‘the possibility of exercising decisive influence’ (as opposed to
actually exercising or intending to exercise such decisive influence) on an undertak-
ing and it may be established on the basis of rights, contracts, or ‘any other means’

71 Hornsby 2001, and; Halgreen 2004, p. 155.

72 Jonathan Taylor and Adam Lewis ’Governing Body Restraint on Breakaways’ paper presented
at ‘Sport and The Law’ conference, London, 31 March 2011 and Stephen Hornsby ‘Governing
Body Restraints on Breakaways. Do They Really Need to Rely on Them or is Dominance
Enough?’ paper presented at ‘Sport and The Law’ conference, London, 31 March 2011.
73 White Paper on Sport (2007), para 2.1.4, and; Professional Sport in the Internal Market, pro-

ject No. IP/A/IMCO/ST/2005-004, Commissioned by the Committee on the Internal Market and
Consumer Protection of the European Parliament (September 2005), para 4.2.6.
74 Council Regulation (EC) No 139/2004 of 20 January 2004 on the control of concentrations

between undertakings. OJ L 24, 29/1/2004, pp. 1–22.

7.4 Classification of the Parties and the Restraints 259

of control.75 Blocking rights are, for instance, considered as one of the means dimin-
ishing the possibility of decisive influence and conferring negative control.76 In our
case, a proven strategy (such as a breakaway threat as well as the institutionalised
means of exerting pressure over UEFA in its role of organiser of European club
competitions) may amount to such negative control.
Taking the described approach to the assessment of the United Brands inde-
pendence criteria in certain sporting issues may result in practical benefits by
presenting a powerful incentive for the sport associations to establish a model of
governance which will include the genuine input of all the stakeholders in their
decision-making. A governing body should not be held to be dominant on a cer-
tain relevant market if its strategic decisions represent a reflection of the will of
relevant stakeholders. The restrictions that emerge from this kind of decision-
making are likely to constitute agreements between different stakeholders under
Article 101, rather than unilateral conduct capable of being reviewed under Article
102 TFEU (though there could be a case for a finding of collective dominance in
specific cases). If clubs, players, leagues and others concerned all participate in
the adoption (and/or implementation) of a certain rule, and/or in the decisions that
pertain to the market which the rule governs, the likelihood of ‘internal’ challenges
within a sport’s structure would be brought to a minimum and the autonomy of
sport to govern itself would be far more likely to be supported by the European
institutions in cases of ‘external’ legal challenges under Article 101 TFEU by third
parties. In this sense, genuine adherence to the principles of good governance is
the ultimate course of action for sport governing bodies to make sure their rules
are given the maximum chance of surviving legal challenges under EU law.

7.4.3 Article 49 of the UEFA Statutes: Restrictive Effects

Under the Article 49 rule the participation of clubs in alternative cross-border

competitions was made subject to prior approval and not to outright prohibition.
It is not uncommon for regulatory bodies to take on a function of sanctioning
competitions, issuing licenses, and generally making access to a certain market
subject to prior authorisation. The issues remain of how the rule is implemented
in practice and whether there are clear guidelines based on objective criteria that
govern access to the market. In assessing the restrictiveness of the Article 49 rule,
therefore distinctions have to be made between the mere existence of prior authori-
sation as a precondition for access to the market (which in itself is not objection-
able), the conditions set for the issuance of approval (which might offend against
principle of proportionality), and the actual exercise of the prior authorisation
upon application for access to the market.

75 Commission Consolidated Jurisdictional Notice under Council Regulation (EC) No. 139/2004

on the control of concentrations between undertakings (2008/C 95/01), paras 16–21.

76 Ibid. para 56.
260 7 Treatment of UEFA Restrictions on Breakaway Leagues …

The Commission in its Staff Working Document considered that rules shielding
sports associations from competition, such as in FIA/Formula One case,77 are likely
to infringe competition provisions.78 This concurs with the popular view that the
Article 49 rule has a restrictive effect on competition, which is not completely free
from being challenged in regard to European elite clubs. The lack of other provid-
ers on the market for organising services for elite clubs’ competitions on the pan-
European level might not be attributable to the Article 49 rule but to the fact that
those clubs did not want to leave the UEFA structure so far. As Hornsby noted,
UEFA enjoys ‘enormous “first mover” advantage’.79 Apart from the nature of pro-
viding the service in question as a high investment operation requiring special
know-how and taking of commercial risks while navigating through a demanding
legal environment, the lack of will on the part of clubs is probably the biggest rea-
son why there are no large media companies or private investors competing to make
the best offer to the European elite clubs to resign from the UEFA and national
competitions and form an alternative league. As the Chief Executive of Liverpool
FC said, an alternative league did not materialise thus far because the Champions
League was so successful and the clubs were broadly happy with it.80 Nevertheless,
he added that a trend of increase in foreign ownership may provoke a change of
heart.81 This is illustrative of the degree to which this Premier League club and one
of the founding members of G14 considers the Article 49 rule a restriction on its
possible plans to break away. Also, the history of UEFA (and FIFA) concessions in
response to breakaway threats by the European elite clubs82 demonstrates that the
rule is not capable of preserving the status quo should the clubs be genuinely deter-
mined in their intent to separate. From the EU law perspective, it is not objectiona-
ble in itself for clubs to resign from traditional structures and form an alternative
cross-border league.83 Therefore, the causal link between the Article 49 rule and the
alleged restrictive effect in providing pan-European organising services for the elite
competition might not be that strong. The Article 49 rule can be thought to have a
restrictive effect for the wealthiest clubs in conjunction with disciplinary measures
and fines imposed post facto. Namely, if the clubs form an unsanctioned pan-Euro-
pean elite league, they could be collectively boycotted by UEFA and national

77 See Sect. 5.6.2 for case analysis. Notice published pursuant to Article 19(3) of Council

Regulation No. 17 concerning Cases COMP/35.163—Notification of FIA Regulations,

COMP/36.638—Notification by FIA/FOA of agreements relating to the FIA Formula One World
Championship, COMP/36.776—GTR/FIA and others (2001/C 169/03).
78 Commission Staff Working Document, Annex I, para 2.2.2.1.
79 Stephen Hornsby ‘Governing Body Restraints on Breakaways. Do They Really Need to Rely

on Them or is Dominance Enough?’ paper presented at ‘Sport and The Law’ conference, London,
31 March 2011.
80 An interview with Rick Parry, Chief Executive of Liverpool Football Club 1998–2007 and a

former head of the Premier League, 2 June 2011.

81 Ibid.
82 See Sect. 3.3.
83 Parrish and Miettinen 2008, p. 213.
7.4 Classification of the Parties and the Restraints 261

associations by, for example cutting all ties with the participating clubs and/or their
players. There is not much that can be done to prevent or restrict the elite clubs
from forming the alternative pan-European structure in the first place, especially in
regard to an alternative structure that would comply with EU law requirements. It is
only the possibility of sanctions and legal challenges that may create operational
problems for the newly established league. But collective boycotts would likely
amount to a breach of the competition provisions, unless they could be justified by
the protection of legitimate goals in the public interest.84
The view presented here does not apply to the case of smaller regional leagues
that cannot afford to disregard the lack of approval by the governing bodies and that
cannot use the breakaway threat to their advantage. Whereas a pan-European break-
away would present an alternative to the UEFA Champions League (i.e. the golden
goose for the financing of European football) and would commercially destroy it,
merely forming a geographically delimited league amongst small market clubs
would have a different impact on UEFA’s financial goals and the solidarity mecha-
nism, but would nevertheless be perceived as pernicious due to its potential to cause
a snowball effect and trigger the erosion of the pyramid structure bringing into
question the uniform organisation of sport. The clubs from smaller markets have no
ambition to fully break away on their own and their desire so far was only to exploit
the benefits that lie outside the structure and outside of the set match calendars. For
those clubs, the sanctions based on the Article 49 rule do have a priori restrictive
effect, which means that without the necessary approvals from the national govern-
ing bodies and UEFA they would not go ahead and form a private league.
There is no doubt that the Article 49 rule would be considered prima facie
restrictive of the clubs’ economic freedoms under the TFEU competition provi-
sions by the Court and the Commission, and this would trigger the application of
the Meca-Medina/Wouters test. If the Article 49 rule passes the requirements of
that test, it would be considered as not having breached the competition provisions
in the first place. At the same time, under internal market provisions, the rule
would be considered as having infringed the free movement of services, but it
could be justified under Gebhard objective justification framework85 which coin-
cides with Meca-Medina/Wouters test.
The focus under this limb of analytical framework in our case is to specify
which economic freedoms are restricted and what is the nature and designation of
restrictions under the EU law. The Court does not take into account the specificity
of sport at this level of analysis, as apparent from the case law.86

84 Treatment of the players participating in clubs forming breakaway league by the national associ-

ations and UEFA is important in this regard due to EU free movement rules. Also, leagues that have
no ties with national associations would themselves likely breach competition law because they
would, as such, amount to closed leagues. See on this point Parrish and Miettinen 2008, p. 213.
85 Case C-55/94 Gebhard [1995] ECR I-4165 para 37.
86 For example Case C-325/08 Olympique Lyonnais SASP v. Olivier Bernard and Newcastle

United FC judgment of grand Chamber of the Court delivered on 16 March 2010. See Sect. 4.8
for detailed analysis.
262 7 Treatment of UEFA Restrictions on Breakaway Leagues …

7.4.3.1 Restrictions Under Article 101 TFEU

On an orthodox application of Article 101 TFEU, any agreement or practice

between undertakings or by association of undertakings that has as its object or
effect the prevention, restriction or distortion of competition will automatically
breach Article 101 TFEU, unless a respondent can prove that it satisfies the Article
101(3) TFEU criteria. The question on whether the characterisation of the rule as an
‘object rule’ may be justified under Meca-Medina/Wouters framework, in addition
to Article 101(3) TFEU, has not been addressed in either the Court jurisprudence or
Commission decision-making and legislative practice. With reference to para 31
Meca-Medina, it was submitted in Sect. 6.3.2 that an object rule can survive the
Article 101 TFEU scrutiny only by means of exemption under Article 101(3) TFEU
and should not be tested under Meca-Medina/Wouters as it carries a conclusive pre-
sumption that Article 101(1) TFEU has been breached. In determining whether an
agreement or a practice may be labelled as restrictive by object, ‘close regard must
be paid in particular to the objectives which it is intended to attain’,87 ‘to its eco-
nomic and legal context’,88 and to the wording of the contested provision.89
Evidence of subjective intent to restrict competition is ‘a relevant factor but not a
necessary condition’.90 The requirement that the agreement be assessed in its eco-
nomic and legal context is reminiscent of the Meca-Medina/Wouters contextual
approach with particular emphasis on the objective of the rule in ascertaining the
existence of justification for restriction.91 Even when the restraint on competition
was subjectively intended and not just objectively achieved, should there exist a
reasonable support for the view that the restriction was not an end objective but
only a means to attain a genuinely pursued legitimate goal, it should be classified as
an effect rule to align with the more economic and less form-based approach being
promoted by the Commission. This goes in particular for entities such as sport gov-
erning bodies in Europe whose commercial and regulatory functions are often so
symbiotic that it might be easy to obtain a ‘false positive’ result on an ‘object test’
unless the relevant context is taken into account. Typical ‘object’ agreements would
involve one of the hard-core restraints, such as, for example horizontal agreements
on price fixing, market sharing, limiting outputs or sales, collective exclusive deal-
ing, and vertical agreements fixing minimum resale price or imposing export bans.
Typical restrictions by object are those which prima facie do not have any signifi-
cant beneficial effects but ‘have such high potential of negative effects on

87 Case C-8/08 T-Mobile Netherlands BV and Others v. Raad van bestuur van de Nederlandse

Mededingingsautoriteit, judgment of 4 June 2009, para 27.

88 Ibid.
89 Case C-209/07 Competition Authority v. Beef Industry Development Society Ltd and Barry

Brothers (Carrigmore) Meals Ltd [2008] ECR I-8637, para 21.

90 Communication from the Commission—Notice—Guidelines on the application of Article

81(3) of the Treaty OJ C 101/97, 27.4.2004, para 22.

91 The relationship between the two different references to context and objective has not been

addressed anywhere, but it can be assumed that there is a great degree of overlap between them.
7.4 Classification of the Parties and the Restraints 263

competition that it is unnecessary for the purposes of applying Article [101(1)] to

demonstrate any actual effects on the market’.92
On the basis of these legal guidelines, UEFA’s Article 49 rule may be catego-
rised as an ‘effect’ rather than as an ‘object’ rule.93 It would be hard to argue that
its objective aim in the context in which it applies was to prevent, restrict or distort
competition on the relevant market. That might be the side effect of the rule
intended to perform certain public interest objectives,94 as ascertainable from a
prima facie analysis.
According to Société La Technique Minière if an agreement does not have the
object of restricting competition
the consequences of the agreement should then be considered and for it to be caught by
the prohibition it is then necessary to find that those factors are present which show that
competition has in fact been prevented or restricted or distorted to an appreciable extent.
The competition in question must be understood within the actual context in which it
would occur in the absence of the agreement in dispute.95

The Court in Société La Technique Minière sets out the necessity to establish a
counterfactual by conducting a hypothetical analysis of the market but for the
agreement in questions. Its negative effects on competition must be ‘appreciable’.
It is hard to predict what the relevant market would look like but for the Article
49 rule. UEFA was formed in 1950s and it established a market for pan-European
club football. Since then, top national associations’ clubs have been competing in
various UEFA organised competitions. How would the market for transnational
organising services look like today, had the Article 49 rule been non-existent?
According to the basic economic theory of competitions
[the] peculiarity of professional sports production is that, by definition, any championship
must possess monopoly status. The validity of a championship rests primarily on such
monopoly status. If there are several championships per market area per sport, no consist-
ent ranking of all performers is achieved and, hence, the championship will lose a signifi-
cant part of its value for consumers.96

We can conclude from this that without the Article 49 rule, the most economically via-
ble option for the top clubs would be to organise a single pan-European championship
with regulatory and/or organising services correspondingly entrusted to a single entity,
be it UEFA or a private promoter. Also, we can assume that some regional competitions
would be organised by the clubs that do not perform that well on the pan-European

92 Guidelines on the application of Article 81(3) of the Treaty, para 21.

93 For the opposite view which argues that the rule is an object rule, see Hellenthal 2000,
Zulässigkeit einer supranationalen Fussball Europaliga nach den Bestimmungen des europäis-
chen Wettbewerbsrechts, Frankfurt am Main, cited in Professional Sport in the Internal Market,
project no. IP/A/IMCO/ST/2005-004, Commissioned by the Committee on the Internal Market
and Consumer Protection of the European Parliament (September 2005).
94 For public interest objectives see Sect. 7.6.
95 Case 56/65 Société La Technique Minière v. Maschinenbau Ulm GmbH [1966] ECR 235, at

249–250.
96 Dietl et al. 2011, p. 3.
264 7 Treatment of UEFA Restrictions on Breakaway Leagues …

level, and by the clubs that do not qualify for the competitions at the pan-European
level. Preventing, restricting or distorting formation of such regional cross-border
championships can be taken as appreciably restricting the competition within the inter-
nal market. Similarly, preventing, restricting or distorting the elite clubs to switch the
pan-European organiser restricts competition within the meaning of Article 101(1)
TFEU and fulfils the notion of appreciability. It limits the commercial freedoms of the
clubs and therefore influences the entry to market of the potential alternative organisers.
As such, the Article 49 rule presents a barrier to entry with the effect of limiting pro-
duction, markets and investment, to use the language of Article 101(1)(b) TFEU.
Putting some familiar labels on the type of restraint in question, it can further
be said that via the Article 49 rule (expressly accepted by the ECA in the
Memorandum of Understanding) UEFA ties the clubs to their organising services
leaving not much room for competitors, comparable to the exclusivity and mini-
mum quantity clauses in vertical agreements which leave the purchaser no spare
capacity to stock the competing goods. In the context of single branding agree-
ments (also referred to as exclusive purchasing agreements), the Commission rec-
ognised that powerful buyers cannot be easily cut off from the supply of the
competing services.97 It was submitted in Sect. 7.4.2 above that UEFA might not
qualitatively qualify as a dominant undertaking on the relevant market due to the
existence of, inter alia, countervailing buyer power. The role of countervailing
buyer power under the dominance test is different than in the context of restraint
analysis. The fact that elite clubs may exercise decisive influence on UEFA strate-
gic decisions on the relevant market, thus removing the key element of independ-
ence which has to exist to ‘an appreciable extent’, does not in any way imply that
rules which brought about the creation, and subsequently consolidation of UEFA’s
position on the relevant market, are not liable to restrict competition on that mar-
ket. More generally, the Commission said that a service supplier may have to com-
pensate its customers for the loss in competition resulting from exclusivity, and
where such compensation is given, ‘it may be in the individual interest of a cus-
tomer to enter into a single branding obligation with the supplier’.98 However, no
automatic conclusions should be drawn from this ‘that all single branding obliga-
tions, taken together, are overall beneficial for customers in that market and for the
final consumers’.99 This is because of cumulative network effects that many equiv-
alent exclusive purchase agreements may produce on the market. There is no need
in our case to take the cumulative net effect of all the similar agreements in the
market as there are no other such agreements in European transnational football
but for the Article 49 rule, and there is no need to analyse the contribution of the
Article 49 rule to the foreclosure effect as the Court did in, for example the
Delimitis case,100 because UEFA quantitatively holds 100 % of the market share.

97 Commission Notice—Guidance on Vertical Restraints, Brussels SEC (2010) 411, para 137.
98 Ibid.
99 Ibid.
100 Case C-234/89 Stergios Delimitis v Henninger Bräu AG [1991] ECR I-935.
7.4 Classification of the Parties and the Restraints 265

Exclusive arrangements between all the clubs as customers on the relevant market
and UEFA as supplier clearly result in foreclosure of the market for potential sup-
pliers of the organising services.

7.4.3.2 Abuse of a Dominant Market Position Under Article 102 TFEU

Rousseva considered the element of dominance as the only difference between

Articles 101 and 102 TFEU when it comes to vertical contractual restraints involv-
ing a dominant undertaking.101 In her view, that makes the current division of
labour between Articles 101 and 102 TFEU difficult to sustain from a legal and
economic point of view, and suggests discarding Article 102 TFEU and relying
exclusively on Article 101 TFEU as a pragmatic solution which would bring many
advantages including carrying out a de facto modernisation of Article 102 TFEU
without entering into explicit conflict with existing precedents.102 This approach
will be adopted in the current section which proceeds with the assumption that
dominant market power does exist.
It must be restated that the existence of a dominant market power is not in itself
condemned under Article 102 TFEU, only the abuse of that power. Addressing the
concept of abuse of a dominant position, the Court in DLG said that ‘neither the
creation nor the strengthening of a dominant position is in itself contrary to Article
[102] of the Treaty’.103 It is the manner in which a non-dominant undertaking
becomes dominant and in which a dominant undertaking behaves that may be
deemed abusive. In Hoffmann-La Roche, the Court defined exclusionary abuses as
an objective concept that pertains to the behaviour of a dominant undertaking
which influences the structure of the market so as to hinder the maintenance or
growth of competition.104 As a general designation, the Article 49 rule belongs to
the category of exclusionary, non-pricing, abuse. More specifically, it could be
seen as an exclusive purchasing arrangement. In its guidance on exclusionary
abuses, the Commission reiterated the same approach to these types of restrains as
discussed in Sect. 7.4.3.1 above.105 In the Commission’s approach to both vertical
restraints and exclusionary abuses, the type of restraint on competition in question
was considered as capable of amounting to a restriction under Article 101(1)
TFEU and an abuse under Article 102 TFEU, respectively. An organisational rule
that restricts competition under Article 101(1) TFEU and that may be attributed to
a dominant undertaking, also amounts to abuse under Article 102 TFEU.

101 Rousseva 2005, p. 590.

102 Ibid. p. 637.
103 Case C-250/92 Gøttrup-Klim e.a. Grovvareforeninger v Dansk Landbrugs Grovvareselskab

AmbA [1994] ECR I-5641, para 49.

104 Case 85/76 Hoffmann-La Roche v. Commission [1979] ECR 461, para 91.
105 Communication from the Commission—Guidance on the Commission’s enforcement priori-

ties in applying Article 82 of the EC Treaty to abusive exclusionary conduct by dominant under-
takings (2009/C 45/02), para 34.
266 7 Treatment of UEFA Restrictions on Breakaway Leagues …

Depending on the precise facts of the case, post facto sanctions by collective
boycott of the clubs on the part of UEFA and national association could possibly
amount to a refusal to deal with a long-standing client as a punishment for switch-
ing suppliers, which is another type of abuse of dominant position. Objective justi-
fication would be possible in accordance with the Meca-Medina/Wouters test. The
exclusion of the players that are affiliated to the clubs participating in the breaka-
way league from any competitions at national association and UEFA level has pri-
mary repercussions for the free movement of workers, but can also amount to an
abuse of dominant position in as far as it controls and limits the availability of the
factors of production for the non-participating clubs.

7.4.3.3 Market Access Issues Under Article 56 TFEU

Advocate General Kokott in Murphy acknowledged that conflicting assessments of

the fundamental freedoms and competition law are in principle to be avoided.106 A
finding of restrictive effect under competition law presents cogent and convincing
evidence that the breach of the applicable internal market provisions also occurred.
Outside the very limited circumstances as explained in Sects. 5.5.5.5 and 6.3.2
above, it is virtually impossible for the measure to escape the designation of
restriction also under Article 56 TFEU on freedom to provide services.
For the purposes of the application of the internal market rules, suffice it to say
that Article 56 TFEU has horizontal direct effect by virtue of the Court decisions
in Walrave and Koch and Laval, so even though UEFA is not a public authority it
could breach that article. It suffices that it is an association exercising exclusive
regulatory powers over the provision of services. Furthermore, in Murphy the
Court reminded us that ‘Article 56 TFEU requires the abolition of all restrictions
on the freedom to provide services, even if those restrictions apply without distinc-
tion[…], when they are liable to prohibit, impede or render less advantageous the
activities of a service provider[…]’. This means that not only directly and indi-
rectly discriminatory arrangements but also genuinely non-discriminatory restric-
tions to provision of services will breach Article 56 TFEU. Advocate General
Fennelly argued in Graf that ‘[t]he imposition of conditions regarding entry to the
market or the taking up of economic activity is itself sufficient to establish the
existence of a restriction, even if the condition can be relatively easily satisfied’.
The Article 49 rule is non-discriminatory in its form but it is intrinsically liable to
restrict the freedom to provide services. It could however be argued that it is
applied in a discriminatory manner. Namely, in September 2012 UEFA approved a
cross-border league between the highest ranked Belgian and Dutch women’s foot-
ball teams, the so-called BeNe league.107 As discrimination involves treating equal
cases unequally but also treating unequal cases equally, a counterargument could

106Paragraph 249.
107‘Cross-Border Women’s Soccer League May Lead to Men’s Competition’ by Tariq Panja,
Bloomberg, 4 September 2012.
7.4 Classification of the Parties and the Restraints 267

be made that women’s football is not equal to men’s football, has no effect on
overall financing of the sport, and deserve a more permissive treatment. It is a fact
that women’s and men’s football fall into two distinct markets. In sporting cases so
far, all rules, whether discriminatory or not, benefited from the wide range of judi-
cially developed justifications, not just express Treaty-based derogations. So
whether classified as discriminatory or non-discriminatory restriction to market
access, it will not make a difference for the range of justifications available.

7.5 Applicable Justification Framework

It is clear that the Article 49 rule does not belong to the category I or category II
sporting exceptions as classified in Chap. 6. Regarding the category III sporting
exception, it must be remembered that the application of ‘inherent sporting rules’
concept is not identical under free movement and competition law.108 In free
movement law, only non-discriminatory rules that are not related to market access
can satisfy the inherent rule test. The same test under competition law articles is
not sensitive to the difference between the discriminatory and non-discriminatory
rules, and between market access and exercise of economic activity rules. Its scope
is therefore broader and more flexible. As the non-discriminatory Article 49 rule
relates to market access, the Gebhard objective justification framework will apply
to it under free movement law. In accordance with the theory on convergence set
out in Chap. 6 and portrayed in illustration 6.2, the Gebhard framework is trans-
posable and functionally equivalent to the Meca-Medina/Wouters test applicable
under Articles 101(1) and 102 TFEU.
Furthermore, we are not dealing with the object rule for the conclusive pre-
sumption of breach of Article 101(1) TFEU to remove the possibility of conver-
gence on the level of justification and make way for the application of para 31
of Meca-Medina as argued at the end of Sect. 6.3.2. None of the initial constitu-
tionally based differences between the articles as discussed above in Sect. 5.5.5.5
applies in our case. Hence, we have the path set for application of a single justifi-
cation test based on full convergence between its analytical points that will pro-
duce a uniform result under competition and internal market provisions.
The discussion that follows belongs to the restriction analysis under competi-
tion law. If the Meca-Medina/Wouters test is passed the competition articles are
considered as not having been infringed in the first place. In other words, no pre-
vention, restriction or distortion of competition under Article 101(1) TFEU or the
abuse of a dominant position under Article 102 TFEU was found. On the other
hand, in free movement law, the infringement of Articles 49 and 56 TFEU has
already been established, but such infringement can be justified if the rule passes
scrutiny under the Gebhard objective justification framework. Even though the

108 For more on this discussion see paper by Miettinen S and Parrish R, ‘Inherent Rules in EC

Sports Law’, presented at the Conference on Law and Popular Culture, Onati, Spain (June 2008).
268 7 Treatment of UEFA Restrictions on Breakaway Leagues …

equivalent test can therefore be located in different overall analytical fractions, the
end result of the legal analysis is the same. As Parrish and Miettinen put it, ‘it is
difficult to envisage organisational rules governing access to competitions or
breakaway leagues that the Court would accept in the context of only competition
law or free movement, but not both’.109

7.6 The Existence of Elements of Justification

The considerations in this section rely on factual support more than legal support
in assessing the legality of the Article 49 rule. The implicit aspect underpinning the
ultimate decision on the fulfilment or non-fulfilment of the justification test per-
tains to the standard of proof, the ‘elusive concept’ in the jurisprudence of the EU
Courts, which are not bound by any evidentiary thresholds.110 A closely related
aspect concerns the varying proportionality formulas that are chosen by the Court
according to the circumstances of each case, as well as varying degrees of intensity
in application of the proportionality test ranging from deferential to highly inten-
sive. Some general principles can nevertheless be discerned from the Court’s case
law. For example there is a perceptible difference between the application of the
proportionality test formula to financial burdens and penalties (which is essentially
confined to a relatively uncontroversial examination of excessiveness), and the
application of the proportionality test to the exercise of discretionary powers
(which varies from the rarely applied full proportionality test—suitability, neces-
sity and proportionality—to various combinations of its three subtests depending
on specific circumstances of the case). Sometimes the Court uses a completely dif-
ferent formulation and employs a general test of arbitrariness or reasonableness.111
In Meca-Medina, Wouters, and DLG, the Court has applied a moderate inten-
sity proportionality test.112 In Bernard the Court referred to Article 165(1) TFEU
in the context of the required standard of application of the proportionality test.113
This reference was omitted at the proportionality stage of analysis in Murphy
because there were no specificities and social functions of sport involved and the
issues considered were strictly commercial. The application of the proportionality
test in Murphy was therefore markedly stricter than in Bernard.114 In our case, a
highly intense review of proportionality can be ruled out, due to (a) the fact that
structural and organisational matters are discretionary choices that result from the

109 Parrish and Miettinen 2008, p. 216.

110 As referred to by Gippini-Fournier 2010.
111 For more on principle of proportionality see Harbo 2010.
112 Lavrijssen 2010, pp. 636–659.
113 See para 40 of Case C-325/08 Bernard. For discussion see Pijetlovic 2010, pp. 862–867, and

Sect. 4.8.
114 See Pijetlovic and Nyman-Metcalf 2013, pp. 88–89, and Sect. 4.10.2.3. See also Kaburakis

et al. 2012, p. 313.

7.6 The Existence of Elements of Justification 269

autonomy of sport regulatory bodies, as recognised by the EU institutions, (b) the

nature of the restriction, objectives of which lie in the social function and specific-
ity of sport and (c) the nature of the affected interests, which are strictly commer-
cial as opposed to interests involving considerations of fundamental rights. On the
other hand, the fact that autonomy (i.e. the discretion) is limited by, and condi-
tioned upon, respect for EU law rules out a deferential review of the proportional-
ity of the Article 49 rule. It is therefore submitted that the Article 49 rule would
likely be subject to a moderate intensity proportionality review by the Court.
Finally, due to the necessity to facilitate convergence between Articles 101 and
102 TFEU as well as between competition law and internal market law, the burden
of proof, as argued in Sect. 6.5, should be on the party seeking to justify its restric-
tive measures. It was submitted that the Court should re-examine para 55 of Meca-
Medina in which it implied that the burden to establish that rules were
disproportionate under Article 101 TFEU was on appellants.115

7.6.1 The Overall Context: Legitimate Aims in Public

Interest

The contextual approach to sporting rules and their restrictive effects makes it pos-
sible to assess the intended function of those rules with reference to their legiti-
mate objectives. The Commission Staff Working Document specifies that the
legitimate objectives of sporting rules will normally relate to the ‘organisation and
proper conduct of competitive sport’.116 In a UEFA press release that was pub-
lished after the Media Partners proposal threat was averted, as discussed in the
Sects. 3.3.2 and 3.3.3, UEFA was opposed to ‘any concept susceptible of having a
negative influence on the existing domestic and European competitions and of
endangering the future of national teams’.117 Justifications put forth in defence of
the Article 49 rule include (1) solidarity mechanisms which enable fulfilment of
the socio-cultural functions of football and which work to preserve a certain finan-
cial and sporting balance between clubs, and (2) effective and proper organisation
of sport. These public interest objectives that are contained in a UEFA Statement
on club football (2000)118 have already been accepted as legitimate. At the time of
its formation in 1954, UEFA stated that its initial aim was ‘to foster and develop

115 In para 55 of C-519/04 Meca-Medina the Court held: ‘[s]ince the appellants have, moreover,
not pleaded that the penalties which were applicable and were imposed in the present case are
excessive, it has not been established that the anti-doping rules at issue are disproportionate’.
116 Commission Staff Working Paper, Annex I, para 2.1.5.
117 UEFA news item ‘European Club Football—National Associations, their leagues and clubs

want UEFA to remain in charge’ 30 July 1998.

118 UEFA Statement on club football, 15 December 2000. Available at http://kassiesa.

home.xs4all.nl/bert/uefa/news/001215.html.
270 7 Treatment of UEFA Restrictions on Breakaway Leagues …

unity and solidarity among the European football community’ and to organise
competitions at a European level.119
Article 165(1) states that the Union shall take account of the specific nature of
sport, its structures based on voluntary activity and its social and educational func-
tion in implementation of other Treaty articles. Football performs social functions to
the extent that is unmatched by any other sport in Europe, due to its popularity and
the sheer number of people involved in football in all capacities.120 The preservation
of essential social benefits of sport is maintained through ‘arrangements which pro-
vide for a redistribution of financial resources from professional to amateur levels of
sport (principle of solidarity)’.121 In its notification of its joint selling arrangements
to the Commission, UEFA advanced as a justification for exemption under Article
101(3) TFEU the issue of financial solidarity. It argued that its financial solidarity
model supports the development of European football by ensuring a fairer distribu-
tion of revenue. The Commission accepted this argument. Citing the cases Metro,
Remia and Consten and Grundig,122 it said that a solidarity model improves produc-
tion and stimulates the development of the sport and emphasised that it is in favour
of the financial solidarity principle.123 The Court has accepted solidarity as the
grounds for non-application of EU laws or exception from those laws in different
contexts, and in Sodemare v. Regione Lombardia Advocate General Fennelly defined
solidarity as ‘an inherently uncommercial act of involuntary subsidisation of one
social group by another’.124 When assessing the status as undertakings of entities
involved in social protection, the Court made a distinction between cases where such
protection is provided in the market context, and in the context of solidarity. For
example in Poucet the Court held that regional social security offices administering
sickness and maternity insurance schemes for self-employed persons are not acting
as undertakings within the meaning of EU competition law as they are intended to
provide equal benefits for all the persons to whom they apply.125 The compulsory
nature of the system of contribution from active workers to retired workers, and the
manner in which the funds were distributed granted a safe harbour for the entity in
question. Furthermore, the Court in Bosman accepted as legitimate the aim of

119 Ducrey et al. 2003, UEFA and Football Governance: A New Model. Adoptions for the

Challenges of Modern Football. Centre International D’Etude Du Sport, p. 35. Available at

http://www.academia.edu/173028/UEFA_and_Football_Governance_A_New_Model.
120 For example, there are 23 million registered male and female players, with many more millions

playing informally. See the Independent European Sport Review (2006) often referred to as the
‘Arnaut Report’. As a matter of comparison, access to motor sport at all levels requires substantial
finances and, unlike football, it is not a ‘sport for all’—it is first business and then sporting activity.
See Cygan 2007, pp. 74 et seq. Other team sports in Europe draw in significantly less people.
121 Paragraph 3.4.
122 Case 26/76 Metro v. Commission [1977] ECR 1975, Case 42/84; Remia v. Commission [1985]

ECR 2545 and; Cases 56 and 58/64 Consten and Grundig v. Commission [1966] ECR 299.
123 Paragraphs 164 and 165.
124 Case C-70/95 [1997] ECR I-3395, para 29.
125 Paragraph 9.
7.6 The Existence of Elements of Justification 271

‘maintaining a balance between clubs by preserving a certain degree of equality and

uncertainty as to results’ and it did so ‘in view of the considerable social importance
of sporting activities and in particular football in the [Union]’.126 The argument sup-
porting the acceptance and continuance of horizontal solidarity between clubs is
enhanced by the fact that the wealthiest clubs amount to collectively dominant under-
takings that have influence in European football governance equivalent to that of
UEFA. Much as UEFA and national associations are unavoidable trading partners for
the clubs, so are the elite clubs indispensable for UEFA and national associations in
fulfilling the terms of their mandate. Thus, the elite clubs have special responsibility
under Article 102 TFEU as collectively dominant undertakings, but also, like UEFA,
have a social responsibility towards the rest of the football pyramid, the fulfilment of
which UEFA ensures by means of the Article 49 rule in conjunction with the central
marketing of commercial rights. Due to profound changes in governance, some of
the responsibility for the state of affairs in European football would appear to have
been shifted onto the elite clubs, not by virtue of their mandate, but by the virtue of
their de facto powers in governance and their collective dominant position on the
market in which many small clubs are on the verge of bankruptcy. Eliminating a cer-
tain number of potential competitors on the market for provision of football clubs’
services is not the same as when it happens in ordinary markets (where elimination
of some of the competition is tolerated as long as it is not affecting a substantial part
of the market in question127) due to the social and physical connection that clubs
have with their locality and the lack of substitutes. The elite clubs’ financial contribu-
tions can be seen in this light, while UEFA carries the mandated responsibility to
make those financial contributions happen. The Nice Declaration recognised the cen-
tral role of sports federations in ‘ensuring the essential solidarity between the various
levels of sporting practice’.128 It listed numerous social functions which are said to
‘entail special responsibilities for federations and provide the basis for the recogni-
tion of their competence in organising competitions’.129 The Nice Declaration also
emphasised that ‘even though not having any direct powers in this area, the [Union]
must, in its action […] take account of the social, educational and cultural functions
inherent in sport and making it special, in order that […] the solidarity essential to
the preservation of its social role may be respected and nurtured’.130

126 Case C-415/93 Union Royale Belge Sociétés de Football Association and others v. Bosman
and others [1995] ECR I-4921, para 106.
127 This is the final requirement of the Article 101(3). See Commission Notice Guidelines on the

application of Article 81(3) of the Treaty, OJ C 101, 27.04.2004, pp. 97–118, paras 105–116 and
Communication from the Commission—Guidance on the Commission's enforcement priorities in
applying Article 82 of the EC Treaty to abusive exclusionary conduct by dominant undertakings,
OJ C 45, 24.2.2009, pp. 7–20, para 30. See also Sect. 5.2.4.
128 ‘Declaration on the Specific Characteristics of Sport and its Social Function in Europe, of

which Account Should be Taken in Implementing Common Policies’, Presidency Conclusions

following the Nice European Council Meeting of 7, 8 and 9 December 2000, para 8.
129 Ibid. para 9.
130 Ibid. para 1.
272 7 Treatment of UEFA Restrictions on Breakaway Leagues …

The effective functioning of an agricultural cooperative was the objective justi-

fication used in DLG131 to defend restrictions on the participation of its members
in alternative cooperative structures. Ensuring proper functioning and proper
organisation of competitions was accepted in Lehtonen and Deliège, respec-
tively.132 According to the Communication on Sport, the legal concept of specific
nature of sport established by the Court and recognised by Article 165 TFEU
encompasses characteristics such as the pyramid structure of open competi-
tions.133 This means that the EU institutions must take such characteristics into
account in implementation of other Treaty provisions.
Even though the Article 49 rule pursues legitimate aims, it still needs to satisfy
the twin requirements of the proportionality test related to suitability and necessity.

7.6.2 Suitability of the Article 49 Rule: Effectiveness Test

The enquiry in this subsection concerns the suitability of the restrictive Article 49
rule, i.e. its capability to achieve the said objectives. To be suitable, a measure
must also contribute to and be targeted at the attainment of those objectives. The
Court has not developed any criteria to test the effectiveness of the restrictive
rules. From certain cases it can be extracted that the Court does not require com-
plete effectiveness, and instead, a partial contribution to the attainment of legiti-
mate aims will generally be sufficient.134 However, there exists no specific
threshold to indicate the requisite level of effectiveness the rules ought to attain in
absolute terms, or in terms of their relative contribution vis-à-vis other measures
targeted at pursuing the same objective.

7.6.2.1 Vertical and Horizontal Solidarity

At the outset it is important to look briefly into the operation of the financial solidarity
mechanism in European football and set out the figures that make up this concept.
According to the UEFA Financial Report, UEFA’s total revenue for 2011/12 stands at
€2.79 billion (including €1.39 billion from EURO 2012). Solidarity payments

131 C-250/92 Gøttrup-Klim e.a. Grovvareforeninger v Dansk Landbrugs Grovvareselskab AmbA

[1994] ECR I-5641.
132 Case C-176/96 Jyri Lehtonen and Castors Canada Dry Namur-Braine ASBL v. Fédération roy-

ale belge des sociétés de basket-ball ASBL (FRBSB) [2000] ECR I-2681, and Joined Cases C-51/96
and C-191/97 Christelle Deliège v. Ligue francophone de judo et disciplines associées ASBL, Ligue
belge de judo ASBL, Union européenne de judo and François Pacquée [2000] ECR I-2549.
133 Communication from the Commission to the European Parliament, the Council, the

European Economic and Social Committee, and the Committee of the Regions ‘Developing the
European Dimension in Sport’ COM(2011) 12 final, 18. 1. 2011, para 4.2.
134 Case C-434/04 Ahokainen and Leppik [2006] ECR I-9171, para 39.
7.6 The Existence of Elements of Justification 273

represent 22.7 % of overall contributions of this amount, or €642 million.135

Solidarity contributions are paid out to: national associations to develop infrastructure,
to cofinance some of their statutory tasks; and as incentives (participation in other
competitions, and for good governance, including club licensing); clubs eliminated in
the preliminary stages of the UEFA Champions League and UEFA Europa League;
other top-division clubs that do not qualify for UEFA’s main competitions, with pay-
ments distributed by the leagues or associations for youth development, and; clubs
participating in the success of national team football in general and the UEFA EURO
in particular through the participation of some of their players.136 The 2011/2012 is,
however, not the most representative year in terms of figures, because 2012 was the
year of staging the quadrennial UEFA EURO. In the preceding season UEFA’s total
income from club competitions was €1.45 billion, over 1 billion of which was distrib-
uted back to the participating teams and €238 million (or 16 %) of which covered soli-
darity payments.137 Broadcasting rights from central marketing represented 75 %,
while other commercial rights represented 19 % of the total income in 2010/2011.138
The total UEFA Champions League revenue amounted to €1,147.8 million (79 %) of
total income, and the UEFA Europa League accounted for €210.4 million (14.5 %).139
The solidarity payment distribution procedure is delegated from UEFA to the national
associations which further transfer the money to their top leagues.140 The leagues then
apportion the revenues among their member clubs that run youth development pro-
grammes, according the UEFA-approved national club licensing systems. Clubs that
do not run youth academies are not eligible for solidarity payments. National leagues
are the entities responsible for determining the criteria and for distributing solidarity
payments (except for the Netherlands, where association itself is in charge of specify-
ing the criteria for distribution).141 There are no uniform criteria for distribution and
some leagues distribute the money according to sporting merit, whilst others divide it
equally among some or all their affiliated clubs and even sometimes share it with
lower divisions. Each UEFA territory is organised differently in this regard, but what
they all have in common is that the clubs participating in the Champions League
group stages onwards are not eligible to receive solidarity funds.142
The figures and system of allocation of solidarity funds presented here are sup-
ported by the income that national leagues or associations derive from their
domestic competitions. It is indisputable that the redistribution of finances in

135 UEFA Financial Report 2011/12, p. 2.

136 Ibid. p. 11.
137 UEFA Financial Report 2010/11, p. 9.
138 Ibid. p. 6.
139 Ibid. p. 7.
140 European Professional Football Leagues, ‘Financial Solidarity at Leagues and European

Level’ (July 2010) p. 18.

141 Ibid.
142 Ibid. pp. 19–21.
274 7 Treatment of UEFA Restrictions on Breakaway Leagues …

European football pursues the goals of solidarity—it is intrinsic in its very nature.
The European Council considers that moves to encourage the mutualisation of part
of the revenue from sales of broadcasting rights, at the appropriate levels, are ben-
eficial to the principle of solidarity between all levels and areas of sport.143
Mutualisation is a generally acceptable and applied principle but it does not tell us
much about the details of this arrangement. The question to ask and answer under
the effectiveness test relates to the current figures of solidarity contributions, i.e.
€642 million (22.7 % of the total revenue) and €238 million (16 % of the total
income) in 2011/2012 and 2010/2011, respectively. Are these figures capable of
fulfilling the goals related to social functions of sport and to which extent? In order
to answer this question with certainty, a fully blown study in each UEFA mem-
ber’s territory would be required. In the absence of any such study, there are few
viewpoints to consider.
Andreff and Bourg examined the 1998 and 1999 market share of the four top
football clubs in England and France in terms of turnover, which stood at 39.4 and
42.3 %, respectively, and which was much bigger than the same concentration
ratio for television rights. Because the ratio between the highest and the lowest
turnover was significantly higher than the ratio between the highest and the lowest
television rights, they considered that ‘even though the solidarity mechanism at
work through the television rights redistribution does actually narrow the range of
television rights revenues across the clubs, it is not enough to compensate for the
uneven distribution of clubs’ turnover due to other sources of finance’.144
In this sense, the next question to ask under the effectiveness test is if there is a
need to create a completely levelled economic playing field in order to consider
solidarity mechanisms effective? Is giving a fair sporting chance to clubs the level
of effectiveness that is required? The bar can, however, be located even lower than
that. In Bosman, UEFA argued that the intention of the rules aimed at maintenance
of financial and sporting equilibrium is to ensure the financing, and ultimately the
survival, of small- and medium-sized clubs.145 If so, the objective should be
renamed and endeavours of maintaining equilibrium substituted with a goal
depicting a more realistic intention. Preserving the social functions of football in
general, and ensuring the financial survival of smaller clubs in particular (rather
than referring to ‘balance between clubs’), is a more appropriate wording in this
regard. It is extremely unlikely that this renamed objective would not be accepted
as legitimate by the Court. As Advocate General Lenz pointed out in Bosman
many people in [the EU] are interested in football. The number of spectators in stadiums
and in front of television screens emphatically confirms that. In some towns, the local
football team is one of the big attractions which contribute decisively to the fame of the

143 Declaration on the Specific Characteristics of Sport and its Social Function in Europe, of

which Account Should be Taken in Implementing Common Policies’, Presidency Conclusions

following the Nice European Council Meeting of 7, 8 and 9 December 2000, para 15.
144 Andreff and Bourg, p. 51.
145 Case C-415/93 Union Royale Belge Sociétés de Football Association and others v. Bosman

and others [1995] ECR I-4921, para 52.

7.6 The Existence of Elements of Justification 275

place. Thus, in Germany, there are probably only a few interested contemporaries who do
not associate the town of Mönchengladbach with football. The big clubs have in addition
long since become an important economic factor. It would thus be possible, in my opin-
ion, to regard even the maintenance of a viable professional league as a reason in the gen-
eral interest which might justify restrictions on freedom of movement.146

In the UEFA Champions League, the Commission fully endorsed the European
Council’s Nice Declaration of 2000, where a redistribution of part of the revenue
from the sales of TV rights at the appropriate levels was seen as beneficial to the
principle of solidarity between all levels and areas of sport.147 If a number of
small and medium-sized clubs were to become bankrupt, it would deprive many
people of supporting their local teams on the stadium, watching them play on TV,
and practicing football in local clubs. There would be no football academies in
smaller localities and a big number of young people would be deprived of playing
youth football. For example in Estonia, Lithuania, Wales and Cyprus, the solidar-
ity system is funding 50–100 % of the youth development budget of the recipient
clubs.148 Vertical and horizontal financial solidarity is therefore a suitable means
of preserving the social functions of sport and ensuring the survival and valuable
participation in competitions of small- and medium-sized clubs.
On the other side of the argument are the grassroots members who claim that
the solidarity system providing them with money earned by the federation does not
work properly.149 The authors of the Arnaut Report recognised that more redistri-
bution modelled upon EURO is needed to finance the grassroots, in particular in
the Champions League. Does this imply that the contributions need to be signifi-
cantly increased to fulfil the suitability criteria? Such an increase should certainly
put to rest all doubts as to the suitability of the rule, but it would trigger dissatisfac-
tion and breakaway threats of the wealthy clubs, concessions by UEFA and very
likely lead to the withdrawal of any plans to increase solidarity contributions. The
Helsinki Report expressed concern at the effects of commercialisation such as the
increase in the number of lucrative sporting events, which may undermine sporting
principles and the social function of sport and lead big clubs to leave the federation
in order to derive maximum profits for themselves alone. This was seen as a threat
to financial solidarity and the system of promotion and relegation. The European
Council, European Parliament and the Committee of Regions agree on the need to
preserve the social function of sport, and therefore to preserve the current struc-
tures of the organisation of sport in Europe by a uniform and coordinated approach

146 Opinion of AG Lenz in Case C-415/93 Bosman, para 219.

147 Commission Decision Relating to a Proceeding Pursuant to Article 81 of the EC Treaty and
Article 53 of the EEA Agreement (Comp/C.2-37.398 Joint Selling of the Commercial Rights of
the UEFA Champions League) 2003/778/EC, OJ 2003 L291/25, para 131.
148 Independent European Sport Review (2006), Annex III, p. 148.
149 Paragraph 3.1.2 of the European Model of Sport.
276 7 Treatment of UEFA Restrictions on Breakaway Leagues …

of the Member States, sporting movement, and the EU.150 This coordinated and
convergent effort would aim at preserving the traditional values of sport, and
ensure that organisational aspects of sport assimilate the new economic order.151
The Arnaut report further identifies three threats to solidarity: ambush market-
ing, internet piracy and news access.152 The effectiveness of solidarity depends on
income and there is some validity in seeing ambush marketing and internet piracy
as threats to profits, although no specific evidence has been provided. The substi-
tutability of full-length matches with photographs or less-than-a-minute news
reports is highly doubtful and, in this sense, the demand market is far less flexible
than assumed in the Arnaut Report. What is more important for the effectiveness
of solidarity than the threats identified is how the redistribution system is organ-
ised from the revenues actually generated. The Arnaut Report pointed out that
there is a significant decline in competitive balance in a number of European top-
flight football leagues, as supported by statistical analysis, and noted a growing
concentration of wealth both within leagues, as only a few teams are capable of
winning the national league, and between leagues, as only teams from a few
leagues are likely to succeed in international competition.153 It concluded that
concentration of wealth and success ‘can only be detrimental to long term interests
of football’.154 This statement is supported by the arguments supplied in Chap. 3
of this volume. However, in the context of suitability of the measures and testing
the effectiveness of solidarity as a means of ensuring the preservation of the social
functions of sport, including the survival of clubs from small localities, the threats
to solidarity of the kind identified by the Arnaut Report are irrelevant because they
are external threats that are covered by the relevant Member States’ legislation and
would pose an equal threat to any alternative financial solidarity measure.
In addition, there are other subcategories of the socio-cultural function of football
such as social integration, promotion of health, education and culture that, at least
indirectly, benefit from mechanisms of financial redistribution.155 Unfortunately,
some of them suffer from the problem of differing in their intentions and in their
reality. For instance, the Nice Declaration describes sport as a ‘factor making for
integration, involvement in social life, tolerance, acceptance of differences […]’. But
the reality is often disturbingly different.156

150 Report from the Commission to the European Council with a view to safeguarding the cur-

rent sports structures and maintaining the social function of sport within the Community frame-
work (‘The Helsinki Report on Sport’) COM(1999) 644 final, para 4.2; Resolution of the European
Parliament on the role of the European Union in the field of sport, OJ C 200, 30.6.1997, and;
Opinion of the Committee of the Regions on “The European model of sport”, CdR 37/99, 15.9.99.
151 Ibid.
152 Ibid., Annex 3.
153 Paragraph 3.67 of the Report.
154 Ibid.
155 These social functions are usually directly supported by the local governments.
156 A famous example involved Eric Cantona, a French player in Leeds United in 1993. See

Gardiner 1998, pp. 249–64.

7.6 The Existence of Elements of Justification 277

Social encounters through sport most certainly occur and sport has an important social
meaning, one has to be aware that social exclusion is also a problem of sport itself (for
instance in the form of sexism, racism and homophobia). It should not be forgotten that
sport also incites competition, hierarchy, subordination, distinction and rivalry. […] That
is also the reason why sport does not automatically lead to social inclusion, social integra-
tion and social cohesion. It might be a tool for fighting any kind of social exclusion and
social discrimination, but can also be a field where differences, or even social exclusion
and social discrimination are produced or enforced, with respect to gender, social class,
race/ethnicity, nationality, physical ability and/or sexual orientation.157

This excerpt addresses the issue of the ‘internal paradox’ of sport, which is accord-
ing to the French sociologist Gasparini constituted by the fact that sport can easily
be seen as integrating, but also as excluding through the existing forms of chauvin-
ism, elitism, nationalism and racism.158 Health can also be looked at through the
same lens of internal paradox: drug abuse sometimes starts because of sports and
career-ending injuries occur frequently. Education can also be viewed in a similar
way: a glance at the American model of sport159 should make it clear that
European model has not much to do with education and many young people in
Europe quit their high schools to dedicate their life to their sporting discipline.

7.6.2.2 Effective and Proper Organisation of Sport

There does not seem to be much controversy surrounding the role of the Article 49
rule in the effective organisation of football. It is generally accepted that the pyra-
mid structure is the supreme way to organise a sport in terms of uniformity of the
rules and regulations, institutional hierarchy and clarity of responsibilities. In the
European Model of Sport under the ‘competition law’ heading, the Commission
explicitly stated that it does not call the monopolistic role of the federations into
question and considers the monopolistic institutional structure as the most efficient
way of organising sport and ensuring essential solidarity.160 The Helsinki Report
expressed concern that ‘the existence of several federations in one discipline
would risk causing major conflicts’,161 while the Commission in its Staff Working
Document considered that ‘the organisation of national championships and the
selection of national athletes and national teams for international competitions
often require the existence of one umbrella federation’.162

157 Consultation Conference with the European Sport Movement on the Social Function of Sport,

Volunteering in Sport and Fight Against Doping, ‘The EU and Sport: Matching Expectations’,
Brussels 14–15 June, 2005.
158 ‘Sport both integrates and excludes’, EurActiv, 18 June 2008.
159 See Sect. 2.2.2.
160 Paragraph 3.2 of the European Model of Sport.
161 Paragraph 4.2.3 of the Helsinki Report.
162 Commission Staff Working Document, para 3.4.
278 7 Treatment of UEFA Restrictions on Breakaway Leagues …

7.6.3 Inherency Requirement

The Article 49 rule will not offend against the economic provisions of the Treaty if
it can be demonstrated that its restrictive effects do not go beyond what is inherent
in the pursuit of its objectives. Under Article 101(1) TFEU, an inherent rule that is
proportionate will amount to ‘regulatory ancillarity’ or a public policy justification
necessary to facilitate the achievement of the legitimate objectives. The process of
ascertaining the existence of such justification largely corresponds to the objective
justification under Article 102 TFEU as discussed in Sect. 5.2.4, and matches the
analysis required under the objective justification framework supplied by the
Gebhard case163 under free movement provisions (see Fig. 6.2 in Chap. 6).
The inherency criteria alone demands that, based on their legitimate objectives,
the challenged measures derive from the need for, and their restrictive effects are
inherent in, the organisation and proper conduct of competitive sport. Without tak-
ing these measures, the legitimate objective cannot be achieved. In Wouters, a case
that involved regulatory ancillarity, the Court left it up to the national court to
assess the rules in question against the Wouters test.164 It did not insist on any par-
ticular result of its preliminary ruling in the original proceedings, but instead
talked of a measure that could ‘reasonably be considered to be necessary in order
to ensure proper practice of the legal profession, as it is organised in the Member
State concerned’.165 The Court did not require the respondent to comply with a
high evidential threshold. According to Whish, this position should be contrasted
with Article 101(3) TFEU, where convincing evidence of economic efficiencies is
required from the respondent.166 The Court, furthermore, did not require an abso-
lute necessity for the challenged rules, and it left untouched a choice of the organi-
sational set-up. In Meca-Medina the Court extracted a conclusion on inherency on
the basis of an assessment that, in terms of its (lack of) depth, can be compared to
a prima facie assessment.167 In Deliège, the Court limited its analysis of inherency
to a statement that the rules were inherent in the organisation of competition
because it ‘naturally falls’ on the sporting federations to select athletes eligible to
participate in competitions.168 From these cases it appears that inherency is a crite-
rion that is not going to be particularly intensely scrutinised by the Court.
The question important for our analysis is whether the effects of the Article 49
rule and the conditions that restrict the formation of alternative leagues in football

163 Case C-55/94 R. Gebhard v. Consiglio dell'Ordine degli Avvocati e Procuratori di Milano
[1995] ECR I-4165.
164 Case C-309/99 J.C.J Wouters, J.W. Savelbergh, Price Waterhouse Belastingadviseurs BV v.

Algemene Raad van de Nederlandse Orde van Advocaten [2002] ECR I-1577, paras 97 and 108.
165 Ibid. para 107.
166 Whish 2009, p. 127.
167 Case C-519/04 David Meca-Medina and Igor Majcen v Commission [2006] ECR I-6991,

para 44.
168 Joined Cases C-51/96 and C-191/97 Deliège [2000] ECR I-2549, para 64.
7.6 The Existence of Elements of Justification 279

are inherent in pursuit of the goals related to solidarity and effective organisation
of football. It is essentially this question that relates to the necessity of the pyra-
mid as the structural model for the attainment of those goals by UEFA. It is
instructive that the Court of Arbitration for Sport (CAS) takes the structure of
European football and the mandate of national federations as a rather natural
occurrence.169 CAS also noted that in some countries the mandate of the national
federations as promoters and organisers of football at all levels, and as guardians
of the interests of all their members, is entrusted upon them by national legislation
in the form of delegated governmental powers.170
EU institutions, the Court included, will not insist on imposing any particular
organisational structure on the sport because selecting the appropriate institutional
set-up is in the realm of regulatory autonomy of the sporting bodies. In the Nice
Declaration the European Council stressed its support for the ‘independence of
sports organisations and their right to organise themselves through appropriate asso-
ciative structures’, and noted that ‘sports federations have a central role in ensuring
the essential solidarity’.171 Other European policy documents also explicitly sup-
port the right to self-govern for sporting organisations, but at the same time condi-
tion this support upon respect for certain principles related to good governance in
decision-making (such as transparency, democracy, accountability and representa-
tion of concerned stakeholders). For instance, the Commission Communication on
Developing the European Dimension in Sport states that ‘good governance in sport
is a condition for the autonomy and self-regulation of sport organisations’.172 In its
White Paper on Sport, the Commission acknowledged the autonomy of sporting
organisations and representative structures and considered that ‘most challenges can
be addressed through self-regulation respectful of good governance principles, pro-
vided that EU law is respected’.173
Hence, although the Court will not interfere with the choice of organisational
structure of a sport, it is the particular arrangements that exist within the structure
that will be scrutinised for their compatibility with EU law. In case of the Article
49 rule, however, the very issue to be scrutinised intrinsically relates to the organi-
sational structure. This would make it more difficult for the Court to find that the
restrictive effects on the market are not inherent in the pursuit of solidarity goals
and the effective organisation of sport, in particular due to the remarkable
improvements in the standards of governance in European football. Weatherill

169 Court of Arbitration for Sport, 17 July 1998, CAS 98/200.

170 Ibid. Specifically, CAS cited French Law no. 84-610 of 16 July 1984 as an example.
171 Declaration on the specific characteristics of sport and its social function in Europe, of which

account should be taken in implementing common policies 13948/00, Annex to the Presidency
Conclusions, Nice (‘Nice Declaration’).
172 Communication from the Commission to the European Parliament, the Council, the

European Economic and Social Committee, and the Committee of the Regions ‘Developing the
European Dimension in Sport’ COM(2011) 12 final, 18. 1. 2011, para 4.1.
173 White Paper on Sport, para 4.
280 7 Treatment of UEFA Restrictions on Breakaway Leagues …

considered that the pyramid represents an exaggerated view of what is necessary

for proper organisation of football in Europe.174 But his objection to the pyramid
structure was related to the ‘exclusion of the major football clubs from formal par-
ticipation in taking of decisions that directly affect their commercial interests
[…]’.175 This no longer holds true. As explained in Sects. 3.4 and 7.4.2 the gov-
ernance of football in Europe has undergone radical changes in the recent past.
The strategic commercial decisions that affect the clubs are no longer made cen-
trally by UEFA, and clubs have a means of control over such decisions.
It is therefore submitted that the restrictive effects of the Article 49 rule are
inherent in this particular organisational structure, which, due to the improve-
ments in governance, are not in themselves objectionable from the point of view of
EU law and policy. In such a structure, UEFA is the body mandated with promot-
ing, protecting and developing European football at every level of the game, pro-
moting the principles of unity and solidarity, and dealing with all questions
relating to European football.176 It is responsible for
organisation of competitions for professional, youth, women’s and amateur football;
increase in access and participation; supporting growth in the grassroots of the game;
achieving commercial success and sound finances without distorting the sporting qualities
of our competitions; using UEFA’s revenues to support reinvestment and redistribution in
the game in accordance with the principle of solidarity between all levels and areas of
sport; targeting specific aid and assistance to help member associations with the greatest
need; promoting positive sporting values (such as fair play, anti-racism and safe and
secure match environment); running an anti-doping programme aiming at preserving the
ethics of sport, safeguarding the players’ health and ensuring equal chances for all com-
petitors; and ensuring that the needs of the different stakeholders are properly reflected in
UEFA’s thinking.177

Restrictions on the formation of an alternative league are merely inherent in pur-

suing this broad agenda that stems from the need for the proper organisation of
sport in a pyramidal structure of European football. Properly organising football
in this structure means keeping every segment of the pyramid alive and function-
ing through the mechanisms of financial solidarity enabled by the restrictions on
alternative leagues and collective sale of broadcasting rights. Without the Article
49 rule and the conditions imposed on formation of cross-border leagues, the legit-
imate objectives relied on could not be achieved in such structure, while the organ-
isation of sport would lose on its effectiveness.
The Opinion of the Advocate General in Deliège may be used in support of this
reasoning. Chiming with the policy statements cited above, he argued that
[EU] law does not require sport to develop in a particular direction, in the sense that it does
not demand that individual sports become fully commercialised or fully professional. On
the contrary, in principle, it respects the choices made by the governing bodies of each

174 Weatherill 2007, p. 265.

175 Ibid. See also Weatherill 2009, p. 100.
176 UEFA Mission Statement.
177 UEFA Vision Europe 2005, p. 7.
7.6 The Existence of Elements of Justification 281

sport, who are also the legitimate representatives of its practitioners, its fans and anyone
with an interest in it generally. The [EU] legal order merely prohibits the commercialisation
or professionalisation of sport in breach of the rules of the Treaty. I take the view, in other
words, that the right of self-regulation which sport enjoys and to which I referred above is
protected by [EU] law. It ensures that sporting institutions have the power to promote a
sport in a manner which they consider to be most consistent with their objectives, provided
that their choices do not give rise to discrimination or conceal the pursuit of economic
interests. Accordingly, any decision by sporting institutions which has as its exclusive aim
or objective the promotion of the social dimension of sport, over and above any intention of
an economic nature, is in principle justified, even where it entails a restriction on [EU] free-
doms. This is dictated by the need to guarantee sport’s right of self-regulation.178

In regard to concealing the pursuit of economic interests that this Opinion refers to
and that could be thought to constitute a counterargument to the inherency of the
Article 49 rule, suffice it to say that the fact that the rule genuinely pursuing the
legitimate regulatory objectives in a proportionate manner also serves economic
purposes, will be irrelevant to the inherency assessment. For instance, the argument
of the applicants in Meca-Medina that the International Olympic Committee, apart
from protecting legitimate objectives, also had in mind protecting its economic
interests was, according to the General Court, not sufficient to alter the purely
sporting nature of those rules.179 The General Court judgment was overruled, but
this particular point survived in a different form that made no reference to ‘purely
sporting nature’ of rules. Namely, on appeal to the Court, the applicants’ argument
intended to challenge the inherency of the anti-doping rule failed, as the rule was
considered proportionate for safeguarding integrity and ethical values in sport.180
What follows next is an examination of proportionality, the key point for the
outcome of an analysis on the legality of the UEFA Article 49 rule.

7.6.4 Proportionality

White Paper on Sport specifies that ‘the sporting rule must also be proportionate in
relation to its objective in order for it not to infringe Articles [101(1) and 102
TFEU] and must be applied in a transparent, objective and non-discriminatory
manner’.181 This is also a valid framework for the examination of sporting rules
under internal market provisions. The question at this stage of the analysis is
whether there are any other, less restrictive, measures that are capable of achieving
the same objectives. Any proposed alternative measure must therefore comply with
the twin principles of suitability and proportionality, and in that sense, it must rep-
resent a viable less restrictive option, as opposed to merely a possible substitute, in

178 Opinion of Advocate General in Joined Cases C-51/96 and C-191/97 Deliège [2000] ECR
I-2549, para 87.
179 Case T-313/02 David Meca-Medina and Igor Majcen v Commission [2004] ECR II-3291,

paras 56–57.
180 Case C-519/04 Meca-Medina [2006] ECR I-6991, paras 46–56.
181 Commission Staff Working Document, Annex I, para 2.1.5.
282 7 Treatment of UEFA Restrictions on Breakaway Leagues …

order for the Article 49 rule to be considered disproportionate in EU law. For the
challenged measure to be upheld via an objective justification the Court requires
‘an actual showing of fit and proportionality’.182 This analysis is conducted in an
environment where the actual situation on the market is readily available for
assessment. On the other hand, a counterfactual analysis of the situation on the
market but for the restrictive measure, as well as the analysis of the suitability of
alternative measures, is purely hypothetical because the effects of certain regula-
tory changes can be very difficult to predict with any certainty. Proposed alterna-
tives have to go through essentially the same proportionality test as the challenged
measures, but due to the speculative nature of conclusions as to their effects, it is
submitted that they should shoulder a de facto higher standard of proof.
The Article 49 rule and possible substitute arrangements, such as the 1998
Media Partners proposal, that are capable of attaining the same goals in a less
restrictive manner will be analysed against the requirements of EU law in the final
sections of this chapter. First, however, various theories on alternative structures
in European football followed by a description of existing alternative leagues in
domestic football and in other sports will be set out.

7.6.4.1 Alternative Structures in Theory

Several theories were put forth as regards the possible alternative structures for
European football. Parrish and Miettinen merely suggested that the future might
bring a deregulated product market based on many supranational, as opposed to
national leagues, or a mixed model of a supranational league operating in conjunc-
tion with the national leagues, both falling under UEFA regulatory competence.183
Hoehn and Szymanski developed a framework to analyse the consequences of
the structure of competition in Europe and US, in particular the effects of partici-
pation of teams in both domestic and international club competitions as opposed to
participation in one hermetic league only.184 Starting from the premise that the cur-
rent UEFA Champions League has several major flaws in terms of competitive bal-
ance, they argued in favour of creation of a European Superleague detached from
domestic competitions. Such a league would be based around four regional confer-
ences of 15 teams, each playing 28 matches against teams from their own league
and six matches against teams from each of the other conferences. A play-off sys-
tem with two top teams at the end of the regular season from each regional league
would determine the European champion in club football.185 However, Hoehn and
Szymanski did recognise that the proposed structure would imply clear benefits
only for incumbent teams to the detriment of excluded outsiders, consumers and

182 McDermott 2010, p. 280.

183 Parrish and Miettinen 2008, p. 215.
184 Hoehn and Szymanski 1999.
185 Ibid. pp. 230–232.
7.6 The Existence of Elements of Justification 283

smaller nations and regions.186 Potential benefits to domestic leagues stripped of

the top clubs as participants were portrayed in highly speculative general terms
unsupported by any evidence. The article also does not consider the likely possibil-
ity of bankruptcies among smaller clubs in the domestic leagues should a truly
independent Superleague be established. It was submitted in Sect. 7.6.2.1 above
that the legitimate objectives referring to ‘balance between clubs’ should be refor-
mulated to reflect more realistic goals focusing on preserving the social functions
of football in general, and ensuring financial survival of smaller clubs in particular.
Furthermore, the authors identified access, redistributive measures, and the scope
of inter-league competition and the role of UEFA, as the most prominent policy
issues in endorsing a shift towards a hermetic Superleague.187 Regarding access,
they suggested that the fact that some nations and regions will never qualify to par-
ticipate in the Superleague, even if the league remains open to promotion and rele-
gation, should not present a problem as the weaker clubs do not enjoy much
success in the top European competitions even today and there is nothing to be
gained by preserving unbalanced competition. They see redistribution within the
clubs in a league as a way of softening competition, reducing incentive to compete,
and worsening competitive balance, and acknowledge that the American mecha-
nisms of competitive balance (such as the rookie draft and salary caps) are possible
to implement only in a closed league. The greater potential, according to Hoehn
and Szymanski, lies in redistribution among leagues, as the big clubs buy and use
smaller clubs as farm teams, which can also be successfully implemented only in a
closed league system. UEFA is portrayed as facing unsustainable conflict of inter-
ests as a regulator of both domestic competitions and a Superleague on the one
hand, and as a promoter of a Superleague on the other, which would oblige it to
choose between one of these two roles.188 The standpoint of these authors, both
economists, is entirely based on a pro-market approach while not giving much
weight to social values, European traditions, consumer welfare, and regional policy
issues in their conclusions. EU sports law and policy is specially designed to take
all of these aspects into account in the assessment of the compatibility of any
sporting rules with the internal market requirements. Access to competitions would
certainly become a sensitive issue under EU competition law.
Weatherill proposed not to demolish the pyramid as an organisational paradigm
for football but to confine the scope of the pyramid to strictly regulatory matters or
give clubs more input into decisions that directly and substantially affect their
commercial interests.189 Given that substantial changes in the governance of
European football have already taken place190 since Weatherill’s article on pyra-
mid structure, and that today clubs have a means of control over the decisions that

186 Ibid. pp. 225–227.

187 Ibid. pp. 228–230.
188 Ibid.
189 Weatherill 2005, para 7.
190 See Sects. 3.4 and 7.4.2.
284 7 Treatment of UEFA Restrictions on Breakaway Leagues …

affect their commercial interests, it is likely that this author would view the gov-
ernance in the pyramid as it stands today as being more in line with the require-
ments of EU law and policy.
Speaking at the Sport&EU 2013 conference in Istanbul, a senior adviser to the
UEFA President, William Gaillard, was frank about the fact that cross-border
leagues are a taboo in UEFA even though a number of leagues and federations
have been talking to one another regarding alternate possibilities, the most visible
project at the moment being Russia–Ukraine.191 He confirmed the rumours of a
new Atlantic league and said they reflect the fact that some national leagues are no
longer sustainable due to the inability of clubs to pay salaries to their players.
Dangers associated with this include match-fixing and corruption, so the lack of
sustainability becomes a danger also for the rest of European football.192 He then
suggested, in relatively broad terms, that some leagues have to be set up to allow
them to build critical mass and restore the status of those clubs that have no chance
to compete in European competitions because of extremely low national TV reve-
nues. In his opinion, UEFA will have to allow some of the alternative leagues to
help restore the competitiveness of the leagues and clubs. He further said that it
was difficult to get UEFA to agree on a woman’s cross-border competition in the
Netherlands and Belgium (BeNe League)193 and that there will be pressure for this
model to spread. UEFA will try to resist but eventually will have to let it happen as
it is a matter of life and death for all but the top six leagues. Finally, he concluded
that European professional football can be made more sustainable by taking some
lessons from across Atlantic. What can be read between the lines from the speech
of William Gaillard is that UEFA will allow, however reluctantly, the formation of
cross-border leagues where it is a matter of survival or restoring competitiveness
of the leagues and clubs, but that sanctioning a private league consisting of top
European clubs would be a different issue as far as UEFA is concerned.
A study entitled Professional Sport in the Internal Market correctly considered
that the European Super League project is essentially a matter of finding common
ground in the conflict between the competing interests of top clubs as self-inter-
ested entities concerned with financial planning, and of the national umbrella
organisations and UEFA motivated by a desire to represent the interest of football
as a whole.194 Views of that study on the Europe-wide cross-border league can be
summarised as follows: It is far from clear in which form a European Super
League may be expected to be formed. Such a league would not only encounter
difficulties in gaining acceptance in different cultures and in facing UEFA

191 William Gaillard, a personal advisor to the President of UEFA ‘Football and the EU in a
Wider Historical Perspective’ in a speech delivered at Sport&EU annual conference in Istanbul
28 June, 2013.
192 Ibid.
193 UEFA news item ‘Best of Belgian and Dutch Unite in the BeNe League’ 23 January 2013.
194 Professional Sport in the Internal Market, Project No IP/A/IMCO/ST/2005-004, Commissioned

by the Committee on the Internal Market and Consumer Protection of the European Parliament
(September 2005), p. 62.
7.6 The Existence of Elements of Justification 285

opposition, but the closed circle model would not be permissible under EU compe-
tition law. From the legal point of view, an open circle based on the European rele-
gation system that meets the needs of different stakeholders involved in it is
therefore a way to go. In practice, however, the open European Super League pro-
ject might come across issues in regard to its implementation, such as the neces-
sity to be incorporated in the hierarchical league system—the infrastructure exists
only in the form of national and international associations occupying monopolistic
positions, so the European Super League would have to cooperate with national
associations or UEFA—a hard-to-predict process which may take time. The study
concludes that the demands of Europe’s top clubs and the forces of commercialisa-
tion will eventually take over and there will be several interim models before the
cross-border league based on an open circle model finally emerges.195
These were some thoughts by academics, economists, and practitioners on the
topic of European breakaway league. However, the only detailed alternative plan
remains the Media Partners proposal from 1998 set out in Sect. 3.3.2.

7.6.4.2 Proportionality Requirement and Nature of Protected Interests

in Case Law on Rival Competitions

Apart from the Court’s decision in the DLG case,196 there is not much clarity on
the application of the proportionality test to the rules and regulations of associa-
tions designed to restrict rival competitions in the EU. Carrying out the propor-
tionality test requires a case-by-case approach, and while there are many examples
from general EU case law, it would be helpful to have a sample model illustrating
what exactly is expected from sport governing bodies in connection with rules
restricting rival competitions.
In Fédération Internationale d’Automobile (FIA)197 the Commission required
FIA to stick to its regulatory role, so as to prevent any conflict of interests by con-
flating commercial and regulatory functions.198 Weatherill saw ‘the frequently
endemic’ conflict of interest as a feature in governance that should be avoided, so
that regulatory power is not used to promote commercial advantage of the govern-
ing body.199 The Commission position was that the FIA rules might not be used to
restrict new competitions unless justified on grounds related to the safe, fair or
orderly conduct of motor sport, in which case the justifications would relate to

195 Ibid. pp. 61–62.

196 Case C-250/92 Gøttrup-Klim e.a. Grovvareforeninger v Dansk Landbrugs Grovvareselskab
AmbA (DLG) [1994] ECR I-5641.
197 Notice published pursuant to Article 19(3) of Council Regulation No 17 concerning Cases

COMP/35.163—Notification of FIA Regulations, COMP/36.638—Notification by FIA/FOA of

agreements relating to the FIA Formula One World Championship, COMP/36.776—GTR/FIA
and others (2001/C 169/03).
198 For details and analysis of the case see Sect. 5.6.2.
199 Weatherill 2008, p. 11.
286 7 Treatment of UEFA Restrictions on Breakaway Leagues …

protecting public interests.200 When it comes to the issue of restricting breakaway

leagues in European football, the justifications relate to solidarity goals and the
effective and proper organisation of sport. Importantly, UEFA does not have only a
commercial/regulatory role in that its mandate includes the promotion of football
at all levels of sport, developing participation in sport, and maximising its health
and socio-cultural benefits, among other things.201 This goes beyond the mere reg-
ulation of sport and entails certain other social responsibilities. In order to fulfil
this all-encompassing mandate some restrictive rules on participation in rival com-
petitions are deemed necessary by the governing body. Whether acting in its regu-
latory or commercial capacity, public interests are at the heart of the UEFA
mandate as well as its Article 49 rule. FIA by contrast used its regulatory role for
the sole purpose of protecting its private interests and solidifying its commercial
dominance in a sport that does not have a social and educational dimension, and
could not therefore rely on considerations given to sport in EU law that have sub-
sequently been set out in Article 165(1) TFEU. The clauses in agreements with
broadcasters according to which severe penalties would be imposed by FIA if
broadcasters showed anything deemed as a competitive threat to Formula One, as
well as automatic acquisition of television rights for all motor sport events it
authorised (even when organised by a different promoter), clearly suggested goals
related to private commercial interests, enabled by FIA’s dual functionality of reg-
ulator and commercial actor. The mere fact that FIA used its dual functionality in
the described manner amounted to abuse of a dominant position which could not
be justified by reference to any of the sporting (or other) objective justifications, so
there was no discussion of proportionality in this case. The Meca-Medina/Wouters
analytical framework did not apply as this was not a case of regulatory ancillarity,
and it was also not the case of commercial ancillarity as the restrictions were not
proportionate restrictions on competition that were directly related and objectively
necessary for the implementation of the main, non-restrictive transaction. The rule
about separating commercial and regulatory functions set out by the Commission
in the FIA/Formula One case is therefore not appropriate for application to the
issue of breakaway leagues in football.
Similarly, in MOTOE202 the issue related to the conflation of regulatory and
commercial functions in one body, which ultimately led to blocking of competing
organisations.203 Just like the FIA/Formula One case, such conflict of interest was
assumedly used to restrict competition for the purpose of protecting private com-
mercial interests of the sporting body. In such cases (providing that there is no
statutory monopoly and Article 106 TFEU involved as in MOTOE), it is only the

200 Commission Press Release IP/01/1523 ‘Commission closes its investigation into Formula

One and other four-wheel motor sports’, Brussels, 30 October 2001.

201 See Sect. 3.4.2 for details on UEFA mandate.
202 Case C-49/07 Motosykletistiki Omospondia Ellados NPID (MOTOE) v Elliniko Dimosio

[2008] ECR I-4863.

203 For details and analysis of the case see Sect. 5.6.1.
7.6 The Existence of Elements of Justification 287

efficiency defence under Article 102 TFEU and/or Article 101(3) TFEU and the
proportionality requirement in those frameworks that could be used, although the
exemption is highly unlikely to be granted.
In DLG,204 the interests that the agricultural organisation was safeguarding (by
introducing clauses prohibiting membership in any other cooperative organisations or
participation in any other forms of organised membership in competition with DLG on
the wholesale market) were also of a commercial nature, but DLG acted in the interest
of its members, was not a dominant undertaking and the factual analysis revealed that
it confined the scope of restrictions only to what was necessary for the attainment of
its legitimate objectives. The Court found that the actions of DLG complied with the
principle of proportionality because the amendment of DLG’s statutes was restricted
so as to cover only those farm supplies in respect of which a direct relationship existed
between sales volume and price205; the option to buy from DLG the whole range of
products which it sold on the same terms and at the same prices as members remained
open to non-members of the association, including the plaintiffs, except that non-
members were not entitled to receive a yearly discount on the amount of the transac-
tions carried out206; DLG’s statutes authorised its members to buy fertilisers and plant
protection products without using DLG as an intermediary, provided that such transac-
tions were carried out otherwise than through an organised consortium207; the penal-
ties imposed for infringing DLG’s rules did not appear to the Court to be
disproportionate, since DLG treated the non-members as if they were members exer-
cising their right to withdraw208; the membership period had been reduced from 10 to
5 years, which did not seem unreasonable209; and the Court also noted as significant
that after their exclusion from DLG the non-members succeeded in creating vigorous
competition with DLG through a different organisation and obtained market share
similar to DLG.210 Therefore, its restrictive clauses were held legal and enforceable.
These three cases suggest that the position of the Court and the Commission
towards clauses restricting rival competitions was almost exclusively influenced by
the nature of the interests being safeguarded (as it was easier for associations to
defend restrictions undertaken for the sake of public interests or interests of their
members, as opposed to purely commercial private interests) and the proportional-
ity of the restrictions.211 The Meca-Medina analytical framework does not apply

204 C-250/92 DLG.

205 Paragraph 37 of C-49/07 MOTOE.
206 Ibid. para 38.
207 Ibid. para 39.
208 Ibid. para 41.
209 Ibid. para 42.
210 Ibid. para 43.
211 In Wouters and Meca-Medina, both involving regulatory ancillarity, the issue did not relate to

preventing breakaway structures but to ethical standards of profession and the Court upheld the
legality of the restrictions. Thus, proportionality usually ends up being the main issue in regards
to restrictive rules of associations that are designed to protect public interest, ethical standards, or
commercial interest that benefit the members.
288 7 Treatment of UEFA Restrictions on Breakaway Leagues …

to the rules of associations adopted for the protection of their private commercial
interests, and the exemption would have to be sought under Article 101(3) TFEU
and the efficiency defence under Article 102 TFEU.
The treatment in other jurisdictions of the issue of proportionality and restrictions
on alternative structures provides a better illustration. In a groundbreaking case
before the High Court of Justice of England and Wales (the High Court), Greig v.
Insole,212 the International Cricket Council (ICC) governed test cricket and had the
exclusive power to regulate the qualification rules for cricketers to play in test
matches. At the same time, a private promoter (Kerry Packer’s Television
Corporation) set up World Series Cricket and engaged 34 of the world’s leading test
cricketers to play in an autumn and winter series in Australia. The ICC reacted by
changing the rules on qualification for test cricketers so that any player who played
in a match disapproved of by the ICC was ineligible to play test cricket and was
banned indefinitely. The ICC then passed a resolution disapproving of matches
organised by the private promoter, and asked its member federations to follow suit in
respect of their domestic competitions. The body that regulated county cricket in
England complied and proposed to disqualify players who played in World Series
Cricket. The private promoter and the players sued these two bodies in the English
High Court and relied on the restraint of trade doctrine. The promoter also sued the
defendants for unlawful inducement to breach of contract. In Greig v. Insole it was
held that the public interest required that the game should be properly organised and
administered, but that measures taken to this effect must be no more that is reasona-
bly necessary.213 The High Court recognised that ICC and TCCB had to take meas-
ures to protect their objectives as governing bodies and custodians of the public
interest because they financed the rest of the game, including the grassroots where
future test match players were trained and developed. Breakaway organisers were
seen as ‘parasitic’ because they were creaming off and commercially exploiting the
star players from traditional cricket in whose training and preparation for stardom it
they had not invested.214 The High Court considered whether, on the facts of the
case, the restraints were reasonably necessary for this public interest objective to be
met. Anything that is likely to prejudice the attraction or profitability of the competi-
tion that brings finances into the game, according to the judgment, must be of con-
cern to the governing bodies.215 But the threat posed by World Series Cricket to test
match finances was seen as very limited, and presented an immediate threat only to
the finances of Australian cricket, because about 20 of its players were under con-
tract with World Series Cricket and the event was going to be staged on its soil.216 In
this respect, indefinite retrospective bans on player participation in breakaway league
were seen as disproportionate because players had not breached any rules at that

212 Greig v. Insole [1978] 1 WLR 302 (Ch D 1977).

213 Ibid. paras 347–348.
214 Ibid. para 349.
215 Ibid. para 310.
216 Ibid. para 351.
7.6 The Existence of Elements of Justification 289

point and because the effect of such a ban would be to deprive the public of watching
those players in test matches, thus reducing test match revenues. Prospective bans on
such participation would likely not be disproportionate and would have been possi-
ble to justify as the seriousness of the threat posed to the game by the emergence of
the private promoter could change in the long term. The High Court identified three
ways that this could happen: 1. other players might join World Series Cricket; 2. the
breakaway series could extend its programme beyond the planned 3 years, and; 3.
other promoters might join the market and start signing up the players from test
cricket. Identified threats could have been adequately averted by ‘merely imposing a
prospective disqualification from test cricket on all players who should thereafter
contract with or play for World Series Cricket or other unapproved private promot-
ers’.217 Had the threat to the sport as a whole been more serious and immediate, it is
not inconceivable that the retrospective bans would have been seen as proportionate
under the circumstances. The High Court held that (i) the contracts between the pro-
moter and the claimants were to be treated as valid and enforceable and (ii) although
the defendants had acted in good faith they had committed a tortious act inducing a
breach of contract, and had done so having full knowledge of the contracts.218
Given the clarity of the High Court treatment of the proportionality requirement
in Greig v. Insole, its judgment in Hendry v. WPBSA219 is disappointing. In a very
similar factual situation, the High Court acknowledged that the governing body for
snooker had a legitimate interest to protect by an already existing rule which pro-
vided that players could not participate in events not organised or sanctioned by the
governing body, and that the decisive question related to proportionality. The only
attempt to differentiate the two cases was the High Court’s recognition that
WPBSA, unlike cricket authorities, does not have a major investment to protect in
the training of players. Nevertheless, protecting its broadcasting and sponsorship
agreements was seen as protecting collective benefits of the sport and its players.220
The judgment followed the reasoning from Greig v. Insole, but then the High Court
took an unexpected turn and without much explanation decided that the WPBSA
refusal to sanction events that clashed with the Main Tour events went further than
was necessary to protect the legitimate objectives.221 Earlier in the judgment, in
para 53, the High Court mentioned a meeting that took place between the private
promoter and the BBC intended to persuade the BBC to withdraw from a contract
with WPBSA making the Main Tour not viable due to the withdrawal of sponsor-
ship that would be certain to follow in that situation. Some commentators on the
case asked the right questions and enquired if this sort of behaviour by the private
promoter was allowed, why was WPBSA not allowed to defend itself against such
behaviour by requiring players to commit to events it organised so as to secure the

217 Ibid. para 352.

218 Ibid. para 365.
219 Hendry and others v. WPBSA [2001] All ER (D) 71.
220 Ibid. paras 114–115.
221 Ibid. para 116.
290 7 Treatment of UEFA Restrictions on Breakaway Leagues …

revenues that pay their prize money? Similarly, they asked ‘if it is legitimate for a
governing body to take steps to protect the commercial revenues generated by its
events in order to reinvest in all levels of sport, and to prevent outside organisers
free-riding on its developmental efforts, how is it supposed to do that if not by
requiring players to commit themselves to participate in sanctioned events only?’222
These questions were not answered anywhere in Hendry v. WPBSA. The propor-
tionality requirement was not fulfilled and no reasoned explanation for this conclu-
sion was provided, but this is not to say that the explanation was not available. For
example, WPBSA initially agreed to sanction the proposed events as long as they
did not clash with the Main Tour that WPBSA organised and their broadcasting
schedule did not clash with the BBC’s live coverage of the Main Tour events. The
decision on proportionality might have been influenced by the fact that the Main
Tour events occupied all the dates in the broadcasting calendar that were of interest
to broadcasters. Also, the High Court could have referred to the fact that profes-
sional snooker lacks many features that sports like cricket and football have, such
as the need to establish competitive balance, invest in training and development of
young players, the governing body does not need major investments to stage com-
petitions, and there is no strong social and educational element, etc. When the
objective justification, as accepted by the High Court in Hendry v. WPBSA, is not
that forceful and persuasive, then the scrutiny of proportionality of the restrictive
rule should be particularly strict and the reasoning set out in more detail.

7.6.4.3 Proportionality Analysis of UEFA Requirements for Setting Up

a Cross-Border Competition

According to the proportionality test, the positive effects of the prohibition laid
down by the Article 49 rule ought to outweigh the negative effects caused by
the restraint placed on clubs and private promoters on entering the market for
organisational services in transnational football in Europe. Before analysing the
proportionality of UEFA conditions for approval of cross-border competitions,
several notes should be made. First, there is a Memorandum of Understanding that
governs the relationship between the ECA and UEFA according to which ECA
expressly agreed to
recognise UEFA as the governing body of football at European level in accordance with
its Statutes […]; to ensure that none of its member clubs participate in any competition
that is not organised or recognised by UEFA/FIFA’ and ‘to ensure that its member clubs
are not members of any other association or grouping involving clubs from more than one
country […].223

222 Jonathan Taylor and Adam Lewis ’Governing Body Restraint on Breakaways’ paper pre-

sented at ’Sport and The Law’ conference, London, 31 March 2011.

223 Memorandum of Understanding between UEFA and ECA (2012), paras D.1, D.3 and D.4.
7.6 The Existence of Elements of Justification 291

Second, some of the principles elaborated in MOTOE224 may apply to Article 102
TFEU alone even if the power of the association does stem from an act of public
authority. Hence, the criteria and procedures for access to market must be based on
transparent, objectively justified and non-discriminatory conditions for selection
which are followed faithfully and openly.225 Third, the proportionality of the rules
specified in the 13 UEFA conditions is not a subject of this analysis. The question to
ask here is whether the imposition of such rules on alternative competitions goes
beyond what is necessary to achieve the legitimate objectives set out in Sect. 7.6.1.
Fourth, the conditions are aimed at smaller cross-border competitions, not at organi-
sationally independent leagues, and implicitly exclude the possibility of pan-Euro-
pean structures. However, the analysis will consider the applicability of the
conditions of approval to both regionally delimited leagues and pan-European
leagues. Finally, both UEFA and (elite) clubs have legitimate but conflicting interests
to protect. A conflict involving cross-border leagues is essentially a conflict between
private and public interests that culminates in the assessment of proportionality.
In order for a cross-border competition to be approved by UEFA it needs to ful-
fil 13 conditions before putting into effect any alternative league plans. They read
as follows:
1. The cross-border competition must be approved by the respective UEFA member asso-
ciations; 2. The cross-border competition must be organised by the respective UEFA
member associations; 3. All clubs planning to participate in the cross-border competition
must be affiliated to a UEFA member association (or to a league/regional football associa-
tion subordinated to such association); 4. Geographical aspects should be taken into con-
sideration when a cross-border competition is being assessed; 5. All clubs planning to
participate in the cross-border competition must recognise, as a condition of participation,
that the ownership of the competition and its core commercial rights belong centrally to
the competition organiser—in this case the associations (not the league, clubs, etc.)—not
to the individual clubs (same model as the UEFA Champions League); 6. Minimum stand-
ards should be fixed with regards to the levels of solidarity distributions from the commer-
cial rights revenues (core commercial rights commercialised centrally) for example: i.
Minimum 10 % of commercial rights revenues must be distributed to amateur football in
the countries concerned, via the associations involved; ii. Minimum 10 % of commercial
rights revenues must be distributed to professional football clubs of the associations con-
cerned but only clubs who are not participating in the cross-border competition concerned
(providing that they fulfil, as a minimum, the sporting criteria of the UEFA Club
Licensing System); iii. Of the remaining revenues divided amongst the participating clubs,
a minimum of 25 % (ideally a minimum of 50 %) must be distributed equally, with the
remainder based on on-field performance. 7. The competition regulations must be in com-
pliance with the UEFA statutes/regulations and need to be approved by UEFA; 8.
Participating clubs must be licensed in accordance with the UEFA Club Licensing
System; 9. The competition regulations must include, among other things, provisions con-
cerning, for example: i. Refereeing; ii. Disciplinary matters; iii. Independence of clubs
(integrity of competition); iv. Anti-doping. 10. The cross-border competition must not
conflict with the international match calendar; 11. The matches of the cross-border com-
petition may not be played on the same day as UEFA club competitions; 12. The

224 Case C-49/07 MOTOE [2008] ECR I-4863.

225 Weatherill 2008, p. 8.
292 7 Treatment of UEFA Restrictions on Breakaway Leagues …

cross-border competition must not replace the national championships and must be
arranged around the calendar of the national championship; 13. Approval of FIFA.226

Conditions 1 and 13 refer to approvals that are required for the cross-border league
by both UEFA member associations and FIFA. There are no indications as to what
are the conditions for approval by national associations and FIFA, and if these
bodies can, without explanation, refuse to sanction competitions that fulfil all of
the other conditions. This criterion should be further clarified. Presumably, if the
clubs fulfil the rest of the conditions they should be able to obtain such approval
automatically, and subsequently automatic approval by UEFA. Even though the
power of UEFA does not stem from an act of entrustment by a public authority or
statutory duty, it is theoretically possible to test the UEFA approval policy against
the stricter requirements laid down by the Court for the exercise of such regulatory
functions. In accordance with the principles in MOTOE, and elsewhere in the simi-
lar case law of the Court,227 undertakings such as UEFA and national associations
possessing both regulatory and commercial powers, must be made subject to
restrictions, obligations and review. The fact that a market entry was made subject
to prior authorisation is not a problem per se. In freedom of movement cases, the
Court has held systems subjecting the marketing of goods and services to a prior
authorisation procedure as justified only if they pursue a public interest objective
and comply with the principle of proportionality.228 In Canal Satélite Digital the
Court specified that in determining whether a system of prior approval complies
with the principle of proportionality, it is important to consider229:
• Whether a system is based on objective, non-discriminatory criteria which are
known in advance so that the regulatory power is not used arbitrarily? (UEFA
criteria for cross-border competitions are prima facie objective and non-dis-
criminatory, however, as will be indicated throughout this section, some of the
requirements should be clarified so as to improve certainty for potential appli-
cants when constructing details of their campaign).
• Whether a system duplicates the control already carried out? (Considering that
concerned national associations and UEFA already carry out a system of prior
control, would the approval of FIFA be necessary, or it only duplicates the con-
trols already carried out?)
• Whether subsequent control system would be too late to be genuinely effec-
tive to attain the aim pursued? (Some of the consequences of the creation of

226 Cited in Master Thesis by Jaka Lucu, Mico Petcovic, Mihai C. Tudoran and Victor Vasiliev,

‘Central European Football League: Dream or Reality’ (International Centre for Sports Studies
(CIES), Neuchatel, 2007), pp. 42–43.
227 For e.g., Case C-67/96 Albany International BV v. Stichting Bedrijfspensioenfonds

Textielindustrie [1999] ECR I-5751.

228 See for e.g., Case C-432/03 Commission v Portugal [2005] ECR I-9665, and Case C-390/99

Canal Satélite Digital SL v. Adminstración General del Estado, and Distribuidora de Televisión
Digital SA (DTS) [2002] ECR I-607.
229 Ibid. para 43.
7.6 The Existence of Elements of Justification 293

breakaway league would be that governing bodies would need to review and
remodel the format of leagues under their umbrella and adapt their short and
long-term business plans to the new situation on the market. They need to make
sure that their mandate and the responsibility towards the rest of the sport can
be fulfilled. Ex post control would not be appropriate to achieve the objectives
of solidarity or effective organisation of sport and could challenge the internal
balance of national and European football).
• Whether on account of its duration and the disproportionate cost it deters the
operators concerned from pursuing their business plan? (There are no costs
involved for the applicants, while at least the maximum allowed duration for
the procedure from the date of application leading up to the formal decision by
UEFA should be specified).
Conditions 3 and 7–12 deal with issues pertaining to regulatory competences
remaining centralised with the governing bodies. Clubs will likely not succeed in a
challenge to this regulatory competence, including the licensing system and cen-
trally designed match calendar. Conditions 3 and 7 provide that all participant
clubs must be affiliated to their national associations and cross-border competition
regulations must comply with UEFA statutes and regulations. Provisions for some
matters such as refereeing, disciplinary matters, independence of clubs and anti-
doping must be included in the regulation of cross-border competitions according
to condition 9. Not much controversy is involved in any of these three require-
ments. The Commission acknowledged that consistency of sporting regulations
and rules of the game can be achieved only by applicability of uniform, centrally
drafted rules.230 Matters of integrity, such as anti-corruption codes, anti-doping
policies, or disciplinary matters are likely to constitute inherent rules in EU sports
law much like in the Meca-Medina case, and are therefore best left to the compe-
tence of governing bodies in charge of their sport (subject to the proportionality
principle). They should not be entrusted to clubs and private promoters as under-
takings interested in private gain as opposed to safeguarding public interest.
Advocate General Kokott similarly saw the uniformity of these rules as enabling
participants to compare their performances, which would not be that easy if rules
varied greatly from one organiser to another. Without them, in her Opinion, the
public’s interest and the recognition of the sport might suffer.231
Moreover, condition 8 provides that all participant clubs must be licensed by
UEFA. In its report on the future of professional football in Europe, the European
Parliament firmly supported the UEFA licensing system,232 whereas the licensing
system for clubs in general was listed as an example of a sporting rule unlikely to

230 Communication from the Commission to the European Parliament, the Council, the

European Economic and Social Committee, and the Committee of the Regions ‘Developing the
European Dimension in Sport’ COM (2011) 12 final, 18. 1. 2011, para 4.2.
231 Opinion of AG Kokott in C-49/07 MOTOE, para 92.
232 European Parliament Report on the future of professional football in Europe

(2006/2130(INI)), Committee on Culture and Education, final A6-0036/2007, p. 14.

294 7 Treatment of UEFA Restrictions on Breakaway Leagues …

infringe the EU competition provisions in the Commission Staff Working

Document.233 Ensuring the financial stability of sport clubs/teams is seen as one of
the objective justifications, as it relates to the organisation and proper conduct of
competitive sport.234 According to the Commission, licensing systems generally
aim to ensure that all clubs respect the same basic rules on financial management
and transparency, but could also include provisions regarding discrimination, vio-
lence, protection of minors and training. The usefulness of robust licensing sys-
tems should be acknowledged for professional clubs at European and national
levels. Such systems may not go beyond what is necessary for the pursuit of a
legitimate objective relating to the proper organisation and conduct of sport.235
While the applicable licensing system itself must be proportionate, it is a separate
question whether the clubs participating in cross-border competitions may be sub-
ject to a proportionate licensing system. The Commission Communication on
Sport saw club licensing systems as offering a valuable tool to ensure the integrity
of competitions and, as discussed above in the section, the regulation of integrity
of sport ought to belong to the competence of the governing body. Furthermore, it
would be untenable to have different bodies implement different licensing regimes
in any open league model based on promotion and relegation. In Piau, the General
Court accepted that FIFA regulations on a mandatory licensing system for football
agents could contribute to economic progress by protecting football players, mem-
bers of a sporting profession with short playing careers.236 Similarly, one of many
effects of the UEFA Club Licensing and Financial Fair Play Regulations is to pro-
tect the interests of football players.
Conditions 10–12 refer to the more controversial centrally controlled match cal-
endar and specify when the clubs participating in a cross-border league are not
allowed to organise their competitions and schedule their matches. Matters such as
the uniform official match calendar are within the regulatory functions of the gov-
erning body. In its draft preliminary guidelines on the Application of Competition
Rules to Sport of 15 February 1999, the European Commission agreed with the
International Rugby Board that control over the official match calendar by a govern-
ing body is necessary for the good of the game, ensuring solidarity and development
of sport at the grassroots level, matters which individual clubs, if allowed to act in
their own self-interest, are unlikely to take into account.237 Control over the official
event calendar is not only necessary to ensure regulatory integrity and a proper bal-
ance between different events. It also ensures that certain revenues are generated not

233 Annex I, para 2.2.1.7 of the Commission Staff Working Document, The EU and Sport:
Background and Context, Accompanying Document to the White Paper on Sport, COM(2007)
391 final.
234 Ibid. Annex I, para 2.1.5.
235 Paragraph 4.7 of the Commission Staff Working Document.
236 Case T-193/02 Laurent Piau v. Commission [2005] ECR II-209, paras 100–106.
237 Jonathan Taylor and Adam Lewis ‘Governing Body Restraint on Breakaways’ paper pre-

sented at ‘Sport and The Law’ conference, London, 31 March 2011.

7.6 The Existence of Elements of Justification 295

just for the elite at the top of the pyramid but also for the benefit of football as a
whole, as the competitive playing base of the pyramid would shrink without such
solidarity.238 In her opinion on the MOTOE case, Advocate General Kokott said that
refusing consent to a rival competition may be objectively justified by the need to
prevent clashes between competitions.239 She argued that it is in the interest of the
participants in the event as well as spectators and the public in general to have indi-
vidual competitions in certain sport incorporated into an overreaching framework
following a specific timetable. This enables participants and spectators to participate
in as many events as possible.240 It can be argued on the basis of the Advocate
General’s submission to the Court that preventing clashes between events increases
output thus contributing towards the pro-competitive nature of the restriction con-
tained in the Article 49 rule. The requirement to avoid conflict with the uniform
international match calendar is closely connected to the obligation on the clubs to
release players for the matches of national representative teams. It was argued in
Sect. 3.3.6.1 that the compulsory release of players is an inherent and proportionate
rule to achieve a set of public interest objectives. Furthermore, preserving viability
of national competitions and keeping smaller clubs financially afloat can only be
achieved if they are not being ousted in the broadcasting market by the dominant
alternative league, which is what condition 12 is aimed at.
Parrish and Miettinen saw the Article 49 rule and UEFA approval policy as
escaping the ‘restriction’ designation under competition provisions if it could be
proven that without such a rule national football competitions could be seriously
undermined.241 This could happen, for example, if the cross-border competitions
were scheduled at the same time as national competitions, thus replacing them in
the broader demand market. Abiding by condition 12 would enable the participat-
ing clubs to play in both leagues instead of depleting the national competitions of
their best teams and players which in turn affects the interest of both public and
broadcasters. The same logic applies to the requirements of condition 11, according
to which the matches of an alternative competition may not be played on the same
day as UEFA club competitions. In a UEFA press release that was published after
the Media Partners International threat was averted, as discussed in Sects. 3.3.2 and
3.3.3, UEFA was opposed to ‘any concept susceptible of having a negative influ-
ence on the existing domestic and European competitions and of endangering the
future of national teams.’242 Existing football competitions can be harmed, for
example, when top teams become dominant players in the sports broadcasting mar-
ket. This would undermine the ability of the governing bodies to finance the rest of
the sport. At the same time, the governing bodies must ensure that the access to the

238 Ibid.
239 Opinion of AG Kokott in C-49/07 MOTOE, paras 91 and 94.
240 Ibid. para 94.
241 Parrish and Miettinen 2008, p. 214.
242 UEFA Press Release. European Club Football—National Associations, their leagues and

clubs want UEFA to remain in charge, 30 July 1998.

296 7 Treatment of UEFA Restrictions on Breakaway Leagues …

broadcasting market remains open for new entrants. Broadcasting time to be allo-
cated to the alternative competitions may become an issue, if a rival is not given
any hope of commercial success due to foreclosure in the downstream market. The
conditions for approval of cross-border leagues should grant a possibility for
healthy economic competition. The Court in MOTOE emphasised that ‘[a] system
of undistorted competition, such as that provided for by the Treaty, can be guaran-
teed only if equality of opportunity is secured as between the various economic
operators [emphasis added].’243 The criterion itself providing for the centrally
designed calendar does not appear to go further than necessary for the attainment
of goals related to effective and proper organisation of sport, as well as solidarity
goals. However, it would be important for UEFA to specify the manner of exercise
of these regulatory functions in more detail.
The uniformity and uniform application of the regulatory rules mentioned in
conditions 7–12 can only be effectively achieved by having all the football clubs
in Europe affiliated to the same regulatory structure in accordance with the
requirements of condition 3. It is the pyramid structure that helps to ensure that
‘the special requirements of sport, such as uniform rules and uniform timetable for
competitions, are taken into account’.244
According to condition 4, geographical aspects will be taken into consideration
and will play a role in the assessment of cross-border competitions by UEFA. This
criterion requires further clarification. It appears to indicate that only the clubs
from national associations that are in geographical proximity or tied by some other
form of geographical logic may fulfil this condition. If so, the pan-European com-
petition prospect would not look promising and only regionally delimited alterna-
tive leagues would be considered for approval by UEFA (such as, for example,
the Balkan league or Scandinavian league). Moreover, condition 4 indicates the
intention of UEFA to support competitions not integrated into the promotion and
relegation system of European football. In fact, none of the 13 conditions men-
tions the requirement to integrate the alternative structures with any part of the
football pyramid and, together with conditions 10–12, this could imply that partic-
ipating clubs are expected to treat their cross-border competitions as merely sup-
plementary venture limited by time and space. A refusal to sanction a competition
due to the location of the participant clubs is potentially discriminatory and cannot
be defended by reference to any of the objective justifications. It should be up to
the participant clubs and private promoters how to organise their competitions in
Europe in geographical terms and select the option that best suits their commercial
goals. Condition 4 should therefore be removed from the list of approval criteria,
as the criterion on geographical aspects goes beyond what is necessary to fulfil the
objectives related to solidarity and effective and proper organisation of sport.
The most controversial of the 13 UEFA conditions are conditions 2, 5 and 6
as they involve strictly commercial matters. Condition 2 provides that the relevant

243 Case C-49/07 MOTOE, para 51.

244 Advocate General Kokott in Case C-49/07 MOTOE, para 96.
7.6 The Existence of Elements of Justification 297

national associations must be the organisers of cross-border competitions and

condition 5 places requires the clubs to transfer ownership of those competitions
with all commercial rights to national association as organisers. This means essen-
tially transplanting the Champions League model. A truly pan-European applicant
league would presumably be asked to transfer the organising functions and com-
mercial rights to UEFA as opposed to national associations, which is in fact the
scheme in the current Champions League. Condition 6 further requires that mini-
mum standards should be fixed with regard to the levels of solidarity contributions
from the core commercial rights revenues thus acquired.
The purpose of the governing body insisting on organising and commercialis-
ing sporting competitions is to control and secure the revenues needed to finance
the rest of the sport. Some commentators saw the actions of private promoters and
breakaway clubs as undermining the governing body ability to generate funds it
needs to invest in the collective, with a consequence that the playing base shrinks,
and the quality of the sport at all levels suffers, so reducing popular demand and
therefore commercial interest.245 However, this danger can be averted with a cen-
tralisation of the regulatory authority, appropriate solidarity mechanisms, and the
instalment of a system of promotion and relegation between the alternative league
and the rest of the football pyramid. It is therefore submitted that centralisation of
organising and commercial functions with a transfer of ownership is not necessary
for solidarity objectives as long as vertical and horisontal solidarity mechanisms
exist to effectively ensure financial contributions for the rest of the sport. Should
the clubs in an alternative league wish to entrust the commercialising functions to
a private promoter or a different agent, this should not, per se, present an obstacle
to their project. The objectives related to effective and proper organisation of sport
do not necessarily require such centralisation in a governing body either. It has
been argued that EU competition law is neutral as regards a choice by a governing
body between on the one hand, outsourcing league functions to a separate entity,
and on the other hand maintaining the dual functionality of a regulatory and com-
mercial entity.246 In other words, given that each system of organisation has its
own advantages and disadvantages, stakeholders in a specific sport are considered
best placed to decide on the structural issues and can choose how to run their dis-
cipline in accordance with the requirements of the industry, but within confines of
the law. Even though it is generally accepted that the strict pyramidal model is the
most efficient way to organise the sport,247 it is not the only way that can pass the
suitability/effectiveness test. Not all sports in Europe, and not all countries in
European football, adhere to the pyramidal model and there exist many practical
examples of alternative structural arrangements.
For example, in England, the Football Association performs largely regulatory
functions while the main concern of the top-level Premier League is profit

245 Jonathan Taylor and Adam Lewis ‘Governing Body Restraint on Breakaways’ paper pre-

sented at ‘Sport and The Law’ conference, London, 31 March 2011.

246 Norros 2011, p. 37.
247 See Sect. 7.6.2.2.
298 7 Treatment of UEFA Restrictions on Breakaway Leagues …

maximising, and organisation and promotion of a top competition between clubs.

The Football League consists of three professional leagues below the Premier
League and is self-governing. The National League System is below these two
leagues and is under the jurisdiction of the Football Association. All of the leagues
are hierarchically interconnected via the system of promotion and relegation. In
1992 the Premier League was formed with 20 members of the English First
Division breaking away to form their own separate structure. After deduction of
specified sums, such as payments to the Professional Footballers Association and
Good Causes as approved by shareholders, the Premier League’s UK broadcasting
money is distributed to clubs as follows: 50 % equally amongst member clubs,
25 % by way of facility fees on live TV appearances; and 25 % depending on the
league position at the end of the season, whereby the club finishing 20th receives
one share and the club finishing first receives 20 shares. The operating costs of the
league are met from overseas broadcasting money and the rest is distributed
equally amongst the 20 member clubs. Title sponsorship money is distributed
equally amongst all member clubs. Commercial contract and radio contract money
is distributed equally amongst the 20 member clubs.248 Direct financial support
from the Premier League to lower league football includes payments to relegated
clubs (the so-called ‘parachute payments’).249
Structural reorganisation is relatively common in the Italian football. Currently,
Italy has a national regulatory body, the Italian Football Federation (Federazione
Italiana Giuoco Calcio), that organises national football teams for men and
women, the National League of Professionals Serie A (Lega Nazionale
Professionisti Serie A) governing Serie A, and the National League of Professionals
Serie B (Lega Nazionale Professionisti Serie B) governing Serie B. Further below
in the third and fourth tier are the Prima Divisione and the Seconda Divisione run
by the Italian Professional Football League (Lega Italiana Calcio Professionistico).
Each of the divisions has two subdivisions, which are generally split on the basis of
location. Serie D has nine parallel divisions also divided according to geographical
location and organised by the Dipartimento Interregionale of the National Amateur
League (Lega Nazionale Dilettanti). Four further levels (Eccellenza, Promozione,
Prima Categoria and Seconda Categoria) are organised by regional committees and
the last one, Terza Categoria, by provincial committees of the National Amateur
League. The system of promotion and relegation ties Italian football leagues. All
clubs and leagues, as well as national associations of footballers, referees and train-
ers are affiliated with the Italian Football Federation.250 In the National League of
Professionals Serie A, 10 % of the revenues are distributed for the purpose of the

248 A study by European Professional Football Leagues ‘Financial Solidarity at Leagues and
European Level’, July 2010.
249 Seventh Report of Session 2010–2012 ‘Football Governance’. House of Commons: Culture,

Media and Sport Committee, HC 792-I, published on 29 July 2011, p. 50, contains detailed of
this arrangement.
250 For more on the organisation and economics of Italian football see Baroncelli and Caruso

2011, pp. 168–181, and Baroncelli and Caruso 2013, pp. 67–84.
7.6 The Existence of Elements of Justification 299

‘general solidarity of the system’, while the remaining amount is distributed in the
following way: 40 % in equal parts among all Serie A clubs based on the so-called
market pool, 25 % according to the number of fans in each club, 5 % according to
the population of every team city, and 30 % based on sporting results.
In Spain, football is governed by the Royal Spanish Football Federation (Real
Federación Española de Fútbol). At the insistence of the clubs participating in top
flight Spanish competitions, as of the 1984 season this federation delegated pow-
ers to the Spanish Professional Football League (Liga Nacional de Fútbol
Profesional) to organise professional league competitions in Spain in cooperation
with the Federation. Each member club of the Spanish Professional Football
League sells audiovisual rights of the competitions individually, whereas the spon-
sorship of the same competitions is exploited by the League collectively. The
League enjoys autonomy in its internal organisation and operation. Under Spanish
law, clubs are the owners of copyright in their images and of the right to broadcast
their matches and can negotiate individual broadcasting contracts to their home
matches, which is usually done through an agency. This system created problems
of imbalance in the Spanish championship, as FC Real Madrid and FC Barcelona
could sell their rights for significantly higher sums than even their next rival FC
Valencia. As a consequence, the rest of the clubs in the Spanish top league asked
the government to make central negotiations for broadcasting contracts compul-
sory and give the League more power over the individual clubs.251 The Spanish
government has been considering this proposal since early 2013.252 Nevertheless,
it is to be noted that despite these problems Spanish football is overall one of the
most competitive in Europe and the world in both economic and sporting terms.
As an example from other sports, tennis has a global governing body (the
International Tennis Federation), a body governing men’s professional tennis (the
Association of Tennis Professionals), a body governing women’s professional tennis
(the Women’s Tennis Association) and a Grand Slam Committee in charge of the four
biggest annual tournaments that are sanctioned by the International Tennis Federation.
Developmental professional tours, wheelchair tennis and international circuits for boys
and girls under 18 are run by the International Tennis Federation to which all national
tennis associations and six regional associations are affiliated. Each pro-tournament
owner engages in media and sponsorship deals for the tournaments they organise,
while paying certain percentage of the proceeds to the relevant governing bodies.253
These examples illustrate that alternatives to conditions 2 and 5, each with their
own advantages and disadvantages in relation to European-level football governance,
do exist. More specifically, in regard to condition 5 requirement to transfer ownership
of commercial rights to a respective governing body, Article 345 TFEU stipulates that

251 For more on the organisation and economics of Spanish football see Gomes et al. 2013, pp.
182–194.
252 ‘La Liga seeks collective TV rights deal to close gap on Premier League’ by Andy Hunter,

The Guardian, 11 April 2013.

253 For e.g., all men’s professional tournaments (but for Futures that are governed by ITF) pay

fees to ATP in accordance with the Chapter III of the ATP World Tour Rulebook 2014.
300 7 Treatment of UEFA Restrictions on Breakaway Leagues …

the system of property ownership is to be determined by the Member States’ laws.

The issue of who owns the rights in international sporting events (the league, the asso-
ciation or the organiser) may provoke complex legal questions,254 but it is not an issue
that can be dealt with under EU law. However, the allocation of property rights may
fall under the scope of EU economic provisions when it conflicts with the Union’s
goals of economic integration. In its Staff Working Paper, the Commission explained
that resolving the ownership question is important as a preliminary point because in
cases where the rights are solely owned by the football association (this is the case in
France), issues may arise under Article 102 TFEU rather than under Article 101
TFEU, as the sale of rights would be carried out by a single seller and not jointly.255
In the UEFA Champions League decision, the Commission considered that UEFA can
‘at best be considered as a co-owner of the rights’ to individual matches together with
the relevant clubs, but never the sole owner,256 and therefore Article 101 TFEU was
considered applicable. It is, in either case, not a prerequisite that a governing body
acting as an organiser and exclusive seller of the broadcasting rights to league
matches must possess ownership of those rights. Engaging in commercialisation on
behalf of clubs in the agent-like role, or ‘at best’, as co-owners of the commercial
rights, would be a plausible alternative arrangement that would not require the trans-
fer of ownership but would at the same time accomplish the designated objectives.
Condition 6 and arguments for preservation of solidarity mechanisms in
European football, regardless of the choice of organisational arrangement, can find
a strong support in EU law and policy as discussed in Sect. 7.6.1. The High Court
acknowledged in Greig v. Insole,257 that the only competitions likely to generate
any substantial profit are top-tier competitions. The teams participating in those
competitions buy players that have been developed by less successful and smaller
clubs that are dependent on the finances generated at the top level of sport. Taylor
and Lewis noted that governing bodies should, at the very least, be able to require
those who benefit from the collective to support it and not harm it, and commercial
success created by collective must be exploited for the benefit of the whole of the
game, and not for the benefit of the few.258 The professional elite in European
football fully utilise the developmental efforts of the governing bodies and they
therefore owe some solidarity to the sport. The only matter in question relates to
the proportionality of the level of contributions generated from the core commer-
cial rights revenues that UEFA set out as an example of an expected solidarity
scheme under condition 6. The proper test of proportionality would necessitate
detailed calculations to discern the level that would, on the one hand, not make it
unattractive and economically unviable for the alternative organisers to enter the

254 Vollebregt and Brinckman 1998, p. 284.

255 See Annex I, para 3.1.3.1.2.
256 Commission Decision in COMP/37.398—Joint Selling of Commercial Rights (UEFA

Champions League) [2003] OJ L 291/25, para 122.

257 [1978] 1 WLR 302, 309.
258 Jonathan Taylor and Adam Lewis ‘Governing Body Restraint on Breakaways’ paper pre-

sented at ‘Sport and The Law’ conference, London, 31 March 2011.

7.6 The Existence of Elements of Justification 301

market, but that would, on the other hand, offer sufficient financial support for the
rest of the sport thus enabling condition 6 to pass the test of suitability/effective-
ness under the Meca-Medina/Wouters analytical framework. Therefore, it is the
level of contributions that might potentially create a problem from the point of
view of proportionality, not the solidarity requirement itself.
As long as regulatory authority remains with the federations, alternative leagues
are fully integrated into the system of promotion and relegation, and solidarity
mechanisms are in place, there is no justified reason for the governing bodies to
insist on being a single undertaking in a market for the organisational services of
transnational football in Europe or on being the owner of the commercial rights
in cross-border competitions. Hence, conditions 2 and 5 appear to go further than
necessary for the attainment of the designated objectives, as there are less restric-
tive means available. Conversely, the solidarity requirement is a restriction that
does not go beyond what is required, but the levels of contributions set by the gov-
erning body have a potential to offend against the principle of proportionality and
should therefore be carefully planned.

7.7 Effect on Intra-Union Trade

It follows from the case law of the Court that

in order that an agreement between undertakings may affect trade between Member
States, it must be possible to foresee with a sufficient degree of probability on the basis of
a set of objective factors of law or fact that it may have an influence, direct or indirect,
actual or potential, on the pattern of trade between Member States, such as might preju-
dice the realization of the aim of a single market in all the Member States.259

The concept of effect on intra-Union trade serves to establish a jurisdictional

threshold between the respective areas of EU and Member States’ competence.
This analytical point is uncontroversial as regards the Article 49 rule in the UEFA
Statutes—the required effect on intra-Union trade exists. Agreements or decisions
covering or being implemented in all Member States are by their very nature capa-
ble of affecting cross-border economic activity between Member States.260
UEFA’s Article 49 rule is specifically designed to control cross-border formations
(in the language of the Article 49 rule, ‘international competitions’) and it applies
to all UEFA Member Associations territories. Article 51(1) of the UEFA Statutes,
which operates alongside the Article 49 rule prohibits ‘combinations or alliances
between UEFA Member Associations or between leagues or clubs affiliated,
directly or indirectly, to different UEFA Member Associations [to] be formed with-
out the permission of UEFA’.261

259 See, for e.g., Case 42/84 Remia v Commission [1985] ECR 2545, para 22.
260 This follows from the Commission Notice—Guidelines on the effect on trade concept con-
tained in Articles 81 and 82 of the Treaty OJ C 101, 27.4.2004, para 61.
261 Emphasis added.
302 7 Treatment of UEFA Restrictions on Breakaway Leagues …

7.8 The Conditions of Article 101(3) TEFU

The Commission Guidelines on the application of Article 101(3) TFEU draw a

clear distinction between the application of the ancillary restraint concept under
the Article 101 prohibition provision and the defence under the exemption provi-
sion. Accordingly, balancing of economic benefits produced by restrictive agree-
ments against their anti-competitive effects can take place only in the framework
of the exemption provision.262 The application of the ancillary restraint concept
does not involve any weighing of pro-competitive and anti-competitive effects, but
is motivated by a somewhat more subjective doctrine that justifies the restriction
on competition on the basis of being objectively necessary for the implementation
of legitimate goals in the public interest.
Article 101(3) TFEU provides that an agreement found restrictive under Article
101(1) TFEU may be declared applicable if it fulfils four cumulative conditions that
include: contributing to improving the production or distribution of goods or to pro-
moting technical or economic progress, allowing consumers a fair share of the result-
ing benefits, restrictions which are necessary to the attainment of the objectives, and
which do not afford undertakings the possibility of eliminating competition in respect
of a substantial part of the product or service concerned. An accompanying document
to the White Paper makes clear that a justification under Article 101(3) TFEU is most
likely to apply where a rule is not inherent in the organisation or proper conduct of
sport so as to justify the application of the Meca-Medina/Wouters test, but where the
beneficial effects of a rule outweigh its restrictive effects.263 Consistency requires
that Article 101(3) be interpreted as precluding any application of this exemption to
restrictive agreements that constitute an abuse of a dominant position. On the other
hand, a company holding a dominant position may benefit from an exemption under
Article 101(3) of the Treaty when its conditions are fulfilled.264 In the Piau case,
decided in the sporting context, the General Court held that if the conduct of a domi-
nant company satisfies all the conditions of Article 101(3) such conduct should not
be classified as an abuse under Article 102 of the Treaty.265
However, it is submitted as per the convergence theory set in Chap. 6, that these
considerations are only important when competition law alone applies to the case
to the exclusion of internal market rules. In Murphy, where both sets of provisions
were relevant, the Court only referred to its finding that the measure was dispro-
portionate under internal market law to hold that the exemption in Article 101(3)

262 Commission Guidelines on the application of Article 81(3) of the Treaty OJ C 101/97, para

30. See also Case T-112/99 Métropole télévision (M6), Suez-Lyonnaise des eaux, France Télécom
and Télévision française 1 SA (TF1) v Commission of the European Communities [2001] ECR
II-2459, para 107.
263 Commission Staff Working Document, Annex I, para 2.1.6.
264 See Commission Guidelines on the application of Article 81(3) of the Treaty, OJ C 101,

27.04.2004, pp. 97–118, para 106.

265 See Case T-193/02 Piau, para 119.
7.8 The Conditions of Article 101(3) TEFU 303

TFEU did not apply in the case.266 This is a confirmation of the Opinion of the
Advocate General in Murphy, who argued that the ‘conflicting assessments of the
fundamental freedoms and competition law are to be avoided in principle […]’.
Consistency between the economic provisions of the Treaty demands that a meas-
ure considered disproportionate under the objective justification framework of the
internal market provisions and the Meca-Medina/Wouters test cannot obtain a justi-
fication under Article 101(3). If a measure survives both the objective justification
test and the Meca-Medina/Wouters test then there is no reason to examine it further
under Article 101(3) TFEU. If a measure fails their shared test, it means that it has
failed to establish its legality under EU free movement law and to prove that it is
worthy of the exception. Even if such a measure produced economic efficiencies
which outweigh the negative effects of restraints on competition under Article
101(3) TFEU, that fact still does not legalise the measure under freedom of move-
ment provisions. The measure will be illegal and will have to be abandoned or
modified to comply with the requirements of free movement rules. In other words,
once the internal market rules apply alongside competition law, as is the case with
the Article 49 rule of UEFA Statutes, Article 101(3) TFEU becomes obsolete. This
is the opinion shared by Advocate General Lenz in Bosman in whose view
it would admittedly appear theoretically conceivable that the Commission might grant those
rules, which are in breach of Article [45], an exemption from the prohibition in Article
[101(1)]. Since such an exemption would, however, make no difference to the breach of
Article [45], it would make sense for the Commission to take that factor into account in the
exemption procedure. A uniform result ought to be aimed at in any case. That would mean
that an exemption under Article [101(3)] would also have to be ruled out.267

The result of the analysis of any measure to which the Meca-Medina/Wouters

framework applies, and which is being examined also from the internal market
point of view, will exclusively depend on the result of the analysis under the inter-
nal market and Meca-Medina/Wouters framework.

7.9 Collective Dominance and Collusion by Elite Clubs

Individual elite clubs are undertakings for all purposes268 and thus the situations
originating from contractual relations or concerted practices between these clubs
may breach Article 101 TFEU. In the Bosman case, Advocate General Lenz

266 Paragraph 145. The Court’s selected reference to paras 105–124 also confirms the point

made above in Sect. 4.10.2.4, that encouraging public to attend and participate in matches is
probably not accepted as objective worthy of protection under EU law, and that the Court was
only dealing with the point of proportionality.
267 Opinion of AG Lenz in C-415/93 Bosman, para 278.
268 Opinion of Advocate General Lenz in C-415/93 Bosman, para 255.
304 7 Treatment of UEFA Restrictions on Breakaway Leagues …

considered that football clubs in a professional league could be ‘united by such

economic links’ to be regarded as collectively dominant.269 This in particular
applies to the elite clubs in European football, former members of G14 and the
addresses of the Media Partners proposal (as argued in Sect. 7.4.2.2 that spelled
out the links between the elite clubs that support the conclusion on tacit coordi-
nation). Hence, their behaviour may offend against Articles 102 TFEU and/or
101 TFEU.
Some of the actions of the elite clubs addressed in the Chap. 3, such as the pres-
sure exerted in the context of Oulmers litigation/player release rule, or the composi-
tion of the Executive Board of the ECA, can be considered as an abuse of dominant
position and a concerted practice. In fact, every time that elite group of clubs exerts
pressure over a regulatory body to alter the system so as to serve their common com-
mercial interests to the detriment of the smaller clubs and the sport as a whole may
constitute a breach of competition law provisions. Van den Brink argued that the top
clubs could be found to engage in a concerted practice under Article 101(1) TFEU
and an abuse of their (collective) dominant position under Article 102 TFEU in try-
ing to force football’s regulatory bodies to adapt the European leagues solely to their
benefit.270 Pursuing commercial goals by breakaway threats, or any other kind of
pressure resulting from the position of collective dominance and/or collusion, should
not be allowed to negatively affect the competition on the market for provision of
clubs’ services and competitiveness of other actors on that market, or stand in the
way of public interest goals being safeguarded by the governing bodies. The domi-
nance of the elite clubs in Europe as powerful ‘buyers’ of transnational organisa-
tional services271 fits the concept of ‘superdominance’ as elaborated by Advocate
General Fennelly in Compagnie Maritime Belge.272 It confers onto them a corre-
spondingly high level of special responsibility not to distort competition.273
However, taking a hard stand or a legal action in response to the behaviour of
elite clubs by UEFA could possibly cause an unsanctioned breakaway of the type
envisaged under the Media Partners proposal in 1998. Such a formation would be
prone to legal challenges.
First and foremost, many commentators have been of the opinion that a closed
European Superleague would not pass the scrutiny under the EU competition law.
The Commission could open up an ex officio investigation into such closed league,
while UEFA and national associations would have recourse to legal action at their
disposal. A study on the professional sport in the internal market pointed out that
‘[q]uite apart from the difficulties that such a league is likely to encounter in gain-
ing acceptance in different cultures, and UEFA’s opposition, the closed circle

269 Ibid. para 285.

270 Van den Brink 2000, p. 426.
271 See Sects. 7.4.2 and 7.3.1.
272 See Opinion of Advocate General in C-396/96 P Compagnie Maritime Belge, para 137.
273 See Sect. 5.7 on the concepts of superdominance and special responsibility.
7.9 Collective Dominance and Collusion by Elite Clubs 305

model for a European League will not work in practice, for the sole reason that it is
contrary to the provisions of European competition law.’274 Van den Brink did not
necessarily see a new European Superleague as a bad development, as long as it
has a fair system of relegation and qualification and part of the broadcasting reve-
nue is used to the advantage of the smaller clubs, as ‘it would clearly be in the
interest of fair competition and therefore all participating clubs to ensure that the
small and big clubs do not lose touch with each other’.275 He was of the opinion
that Article 101(1) TFEU would preclude the emergence of a football Superleague
with discriminative entrance requirements and long-term exclusive participation for
the privileged few.276 Similarly, Parrish and Miettinen argued that in order to com-
ply with Articles 101 and 102 TFEU the closed league as a cartel of undertakings
would be expected to adopt fair and non-discriminatory access rules, either by way
of promotion or relegation or by way of franchise system. A closed league system
without such access conditions would be precluded under those Treaty articles as
this could foreclose the market to aspiring entrants and amount to abuse of a domi-
nant market position.277 Conversely, Hornsby defended the closed league model
and saw it as a good candidate for sporting exception.278 It must be emphasised,
however, that the author adopted this line of argument in 2001 when the when the
contours of the sporting exception concept in EU law were still far from clear.
Apart from launching a challenge to a closed league model, another option at
the disposal of UEFA and national associations would be to impose boycotts on
the participating clubs and/or their players, and be ready to defend those boycotts
in ensuing legal proceedings. Such boycotts may involve, for example, banning the
participating clubs and/or their players from championships organised by national
associations and UEFA. There is no doubt that this would trigger the application
of the EU law on free movement and competition. Restrictions may be defended
by reference to the specificity of sport under Article 165(1), financial solidarity
goals, preserving viability of European and national competitions, and the need
for proper and effective organisation of sport. As the attack on the functioning
of football, future of national and European competitions, and the central regu-
latory functions of the governing bodies would be particularly severe in case of
pan-European elite breakaway, the robust response by UEFA and national associa-
tions might be deemed proportionate by the EU institutions if it remains confined
to what is necessary for the realisation of the said public interest goals.
Secondly, in ENIC ethical considerations on multi-club ownership prevented
Commission to find the rule restrictive under competition law, and instead, it was
considered ‘inherent’. Specifically, the rule stated that no two or more clubs

274 Professional Sport in the Internal Market, Project No IP/A/IMCO/ST/2005-004, Commissioned

by the Committee on the Internal Market and Consumer Protection of the European Parliament
(September 2005), p. 61.
275 Van den Brink 2000, p. 426.
276 Ibid.
277 Parrish and Miettinen 2008, p. 213.
278 Hornsby 2001, pp. 162–167.
306 7 Treatment of UEFA Restrictions on Breakaway Leagues …

participating in a UEFA club competition may be directly or indirectly controlled

by the same entity or managed by the same person. According to the Commission
the rule was designed to ‘ensure the uncertainty of the outcome and to guarantee
that the consumer has the perception that the games played represent honest sport-
ing competitions […]’.279 CAS in ENIC stated that the crucial element of integrity
in football is the public’s perception of the authenticity of results and that the most
important requirement for football is not honesty in itself or authenticity of results
in itself but rather the public perception of such honesty and such authenticity.280
From a league-wide economic perspective, an increase in competitive balance and
the absence of dominant teams brings about the increase in attractiveness of the
championship and is therefore economically preferable. The traditional notion of
economic competition where undertakings strive to attain monopoly status in
order to maximise profits does not apply in a league.281 In accordance with this
classic economic theory, profit maximisation strategies are optimal when teams are
relative equals. This might create a concern from the point of view of integrity of
competitions in breakaway leagues. Given that match-fixing has plagued European
football for long and that effective mechanisms of post control to discover, and
prior control to prevent this sporting fraud do not exist, integrity of competitions in
the breakaway structure could become an issue if its ownership structures lend
themselves to enhanced possibility or incentive to fix the outcome of matches. A
prohibition on certain ownership structures in cross-border club competitions with
the purpose of ensuring fair sporting competition would therefore be necessary
and might still fall under regulatory authority of UEFA. In addition, it is worth
mentioning that all EU Member States treat match fixing as criminal offence,282
thus the possibility of conflict of interests must be avoided by proportionate means
at any cost. Consumers must have the perception that competition represents an
honest game and wagering in the sports betting markets must remain a matter of
relative sporting chance. Same ethical considerations as in ENIC would apply in
the case of breakaway leagues and any conflict of interest that can negatively
affect perception of integrity of competition should be avoided. In addition, in the
line with Commission reasoning in ENIC, public’s perception of integrity is an
essential precondition to keep the consumer confidence and interest, as well as
marketability of sporting competitions. Otherwise, as an inevitable consequence
over time, ‘[c]lubs would be less capable of extracting value from ancillary activi-
ties and investment in clubs would lose value’.283 Without such value, the breaka-
way competitions would produce less profit and consequently, effectiveness of
financial solidarity mechanisms would be affected. UEFA could therefore have a

279 Commission Decision in Case COMP IV/37.806—ENIC/UEFA, para 28.

280 CAS arbitral award dated 20 August 1999 in Case CAS 98/200 AEK Athens and Slavia Prague
v. UEFA, cited in para 20 of Commission Decision in Case COMP IV/37.806—ENIC/UEFA.
281 Dietl et al. 2011, p. 3.
282 Study on Match-fixing in Sport: A Mapping of the Criminal Law Provisions in EU 27’

(2012), pp. 15–16.

283 Commission Decision in Case COMP IV/37.806—ENIC/UEFA, para 32.
7.9 Collective Dominance and Collusion by Elite Clubs 307

legitimate claim of negatively regulating ownership structures in a breakaway

league to the extent necessary to prevent the conflict of interests.
Finally, certain legal considerations discussed in Sect. 5.5.4 may preclude the
joint sales of broadcasting rights by the clubs, as it would amount to price fixing by
the league. Clubs could argue for the exemption under Article 101(3) on the basis
of improved distribution and economic efficiencies, and rely on other arguments
brought up by the UEFA and accepted by the Commission in the UEFA Champions
League case.284 However, even though there is no such thing as per se violation of
Article 101(1) TFEU under the EU competition law, it is highly unlikely that the
Commission and the Court would be receptive to such arguments under Article
101(3) in the context of hard-core cartel such as price fixing. Weatherill was also of
the opinion that collective selling designed solely a tool of wealth maximisation for
the participants alone would not be exempted.285 There are few options available to
clubs to avoid joint selling as a legal hurdle and the most obvious one is for the
clubs to engage in individual sales of broadcasting rights. However, this would
mean missing the economic efficiencies involved in central marketing, which gen-
erates more profits for the clubs in the professional league than individual sales.
Another option for the clubs is to create a single economic entity by, for instance,
setting up a full-function joint venture.286 On the basis of annual turnovers of the
elite clubs such joint venture will have the ‘EU dimension’ in accordance with
Article 1 of the EU Merger Regulation, and might not be approved by the
Commission, or would require commitments (for example, divestitures) which
would defeat its profit maximising purpose. Moreover, a joint venture owned by
the clubs in a professional league would be possible to implement only in a closed
league model and would nevertheless be subject to review under Article 102 TFEU.
The least radical and legally most acceptable set up for any newly formed break-
away league is to remain structurally integrated via the system of promotion and
relegation, as well as to remain financially connected by solidarity mechanism with
the football pyramid. This could enable the league to obtain recourse to the concept
of sporting exception under EU law. Otherwise, such a defence would not be avail-
able for exploitation to a purely commercial entity that acts solely to safeguard its
private interest. Having said that, ‘politics will dictate that there will be a number of
interim models before the league finally takes shape, all of which will conform to

284 Commission Decision in Case COMP/37.398—Joint Selling of Commercial Rights (UEFA

Champions League) [2003] OJ L 291/25, paras 136–196.

285 Weatherill 2004, p. 131.
286 In certain circumstances, a joint venture may be considered full-function even if it does not

own the resources that it needs in order to operate on the market, provided it has sufficiently firm
access to such resources. In Celanese/Degussa (Case COMP/M.3056, 11 June 2003), ownership
of certain production facilities that were to be used by the joint venture was retained by one of
the parents, for technical reasons. Despite this, the Commission confirmed that the joint venture
was full-function, as it would have exclusive access to the production capacity of the plant in
question. See http://uk.practicallaw.com/1-107-3702.
308 7 Treatment of UEFA Restrictions on Breakaway Leagues …

the open circle model […]’.287 At the end of this volume, it must be acknowledged
that is not inconceivable that the distant future might evolve in the direction that
will require a different legal approach to serve football’s public interest goals.

7.10 Concluding Remarks

A potential legal conflict brought about by the Article 49 rule in the UEFA Statutes
is as much a challenge to EU policy as it is a legal challenge under economic pro-
visions of the Treaty. A decision that would hold this controversial rule illegal
and contrary to the free market principles would certainly send a shockwave of
new financial arrangements and restructuring in the football industry throughout
Europe. However, fully supporting an economic-based approach and demolishing
the pyramid structure would be politically embarrassing. As apparent from the dis-
cussion in Sect. 3.2.1, EU sports policy is built on socio-cultural considerations
that strongly support the preservation of the traditional European model of sports
structures and recognise the central role of sports federations in ensuring solidar-
ity between different levels of sport. Even though policy documents are not legally
binding they played a role in the Court’s sports jurisprudence and were cited in
its sports-related judgments of Deliège and Lehtonen. In para 77 of Bosman, the
Court accepted that the possible practical consequences of its judicial decisions on
the organisation of football as a whole must be carefully weighed, but that this
cannot go so far as to diminish the objective character of the law and compromise
its application. Thus, it can be expected that a certain degree of political pres-
sure on the Commission and the Court, as well as the pressure of practical conse-
quences on the organisation of European football, will not be ignored.
A decision upholding the legality of the Article 49 rule of UEFA Statutes along
with all of its 13 accompanying requirements would make UEFA chiefly responsible
for the future structure of European football and, at least for the time being, pre-
serve the structural status quo. The most important unintended consequence of such
an outcome would be a shift of balance in the power struggles in football governance
in favour of UEFA, as breakaway threats by elite clubs would become a matter of
the past. However, it is highly unlikely that the Article 49 rule of the UEFA Statutes
would find such unconditional support in EU law. As discussed in Sect. 7.6.4.3,
some of the 13 requirements placed on the clubs aspiring to create alternative
leagues go beyond what is necessary for the attainment of the relevant objectives
and, as such, fails to conform to the limits of proportionality principle under the
Meca-Medina/Wouters test and the internal market objective justification framework.
Finally, one must remember that the EU institutions do not have competence to
impose a particular structural model on any sport in Europe, but they may prohibit

287 Professional Sport in the Internal Market, Project No IP/A/IMCO/ST/2005-004, Commissioned

by the Committee on the Internal Market and Consumer Protection of the European Parliament
(September 2005), p. 62.
7.10 Concluding Remarks 309

any arrangements within the chosen models that offend against economic provisions
of the Treaty. Ultimately and exclusively, it is up to the leading actors in European
football to decide on their regulatory and organisational/commercial strategies
within the limits of the legal and practical considerations discussed in this volume.

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Table of Cases

EU Courts

Joined Cases 56 and 58/64 Etablissements Consten SA & Grunding-Verkaufs-

GmbH v. Commission [1966] ECR 299.
Case 56/65 Société La Technique Minière v. Maschinenbau Ulm GmbH [1966]
ECR 235.
Case 23/67 Brasserie de Haecht SA v. Wilkin [1967] ECR 407.
Case 5/69 Völk v. Vervaecke [1969] ECR 295.
Case 41/69 ACF Chemiefarma NV. v. Commission (the Quinine Cartel) [1970]
ECR 661.
Case 48/69 ICI v. Commission [1972] ECR 619.
Case 6/72 Europemballange Corporation and Continental Can Company Inc. v.
Commission [1973] ECR 215.
Case 8/72 Vereeniging van Cementhandelaren v. Commission [1972] ERC 977.
Cases 6 and 7/73 Istituto Chemioterapico Italiano Spa and Commercial Solvents
Corp. v. Commission [1974] ECR 223.
Case 2/74 Reyners v. Belgian State [1974] ECR 631.
Case 33/74 Van Binsbergen v. Bestuur van de Bedrijfsvereniging voor de
Metaalnijverheid [1974] ECR 1299.
Case 36/74 Walrave and Koch v. Union Cycliste Internationale and others [1974]
ECR 1405.
Case 43/75 Gabrielle Defrenne v. Société anonyme belge de navigation aérienne
Sabena [1976] ECR 455.
Case 13/76 Gaetano Donà v. Mario Mantero [1976] ECR 1333.
Case 26/76 Metro SB-Großmärkte GmbH & Co. KG (Metro I) v. Commission
[1977] ECR 1875.
Case 27/76 United Brands v. Commission [1978] ERC 207.
Case 71/76 Thieffry v. Conseil de l' Ordre des Avocats à la Cour de Paris [1977]
ECR 765.
Case 85/76 Hoffmann-La Roche v. Commission [1979] ECR 461.

© t.m.c. asser press and the author 2015 311

K. Pijetlovic, EU Sports Law and Breakaway Leagues in Football,
ASSER International Sports Law Series, DOI 10.1007/978-94-6265-048-0
312 Table of Cases

Case 106/77 Amministrazione delle Finanze dello Stato v. Simmenthal SpA [1978]
ECR 629.
Case 22/78 Hugin Kassaregister v. Commission [1979] ECR 1869.
Case 175/78 Regina v. Saunders [1979] ECR 1129.
Case 149/79 Commission v. Belgium [1982] ECR 1845.
Case 270/80 Polydor Limited and RSO Records Inc.v. Harlequen Records Shops
Limited and Simons Records Limited, [1982] ECR 329.
Case 15/81 Gaston Schul Douane Expediteur BV v. Inspecteur der Invoerrechten
en Accijnzen, Roosendaal [1982] ECR 1409.
Case 322/81 Nederlandsche Banden Industrie Michelin (Michelin I) v. Commission
[1983] ECR 3461.
Case 7/82 Gesellschaft zur Verwertung von Leistungsschutzrechten mbH (GVL) v
Commission [1983] ECR 483.
Case 96/82 IAZ International Belgium v. Commission [1983] ECR 3369.
Case 319/82 Société de Vente de Ciments et Bétons de l’Est v. Kerpen & Kerpen
GmbH & Co KG [1983] ECR 4173.
Cases 29 and 30/83 Compagnie Royale Asturienne des Mines SA and Rheinzink
GmbH v. Commission [1984] ECR 1679.
Case 42/84 Remia BV and Others v. Commission [1985] ECR 2545.
Case 161/84 Pronuptia de Paris GmbH v. Pronuptia de Paris Irmgard Schillgallis
[1986] ECR 353.
Case 311/84 Centre Belge d’Etudes du Marché-Télémarketing (CBEM) v. CLT SA
[1985] ECR 3261.
Joined Cases 89, 104, 114, 116, 117, 125 to 129/85 Ahlström Osakeyhtiö and others v.
Commission of the European Communities(Wood Pulp II) [1993] ECR I-1307.
Case 62/86 AKZO v. Commission [1991] ECR I-3359.
Case 66/86 Ahmed Saeed Flugreisen and Silver Line Reisebüro GmbH v. Zentrale
zur Bekämpfung unlauteren Wettbewerbs e.V. [1989] ECR 803.
Case 247/86 Société alsacienne et lorrainne de telecommunications et
d’électronique v. SA Novasam [1988] ERC 5987.
Case 30/87 Corinne Bodson v. Pompes Funèbres [1988] ECR 2497, [1989] 4
CMLR 984.
Case C-227/87 Sandoz Prodotti Farmaceutici Spa. v. Commission [1990] ECR
I-45.
Cases C-69/88 Krantz v. Ontvanger der Directe Belastingen [1990] ECR I-583.
Case T-30/89 Hilti v. Commission [1991] ECR II-1439.
Case T-51/89 Tetra Pack Rausing SA v. Commission [1990] ECR II-309.
Cases T-68/89 etc. Società Italiano Vetro SpA v. Commission [1992] ECR II-1403.
Case C-260/89 Elliniki Radiophonia Tiléorassi AE (ERT) and Panellinia
Omospondia Syllogon Prossopikou v. Dimotiki Etairia Pliroforissis and Sotirios
Kouvelas and Nicolaos Avdellas and others [1991] ECR I-2925.
Case C-2/90 Commission v. Belgium (Walloon Waste) [1992] ECR I-4431.
Case C-41/90 Höfner and Elser v. Macrotron [1991] ERC I-1979.
Cases C-241-242/91 P RTE & ITP v. Commission [1995] ECR I-743.
EU Courts 313

Case C-267 and 268/91 Criminal Proceedings against Keck and Mithouard
[1993] ECR I-6097.
Case C-320/91 Criminal Proceedings against Paul Corbeau [1993] ERC I-2533.
Case C-19/92 Dieter Kraus v. Land Baden Württemberg [1993] ECR I-1663.
Case C-93/92 Motorradcenter v. Pelin Baskiciogullari [1993] ECR I-5009.
Case C-250/92 Gøttrup-Klim e.a. Grovvareforeninger v Dansk Landbrugs
Grovvareselskab AmbA [1994] ECR I-5641.
Case C-393/92 Almelo v. NV Energiebedriff Ijsselmij [1994] ECR I-1477.
Cases T-24/93, T-25/93, T-26/93 and T-28/93 Compagnie Maritime Belge v
Commission [1996] ECR II-1201.
Case C-323/93 Centre d’Insémination de la Crespelle v. Coopérative de la
Mayenne [1994] ECR I-5077.
Case C-415/93 Union Royale Belge Sociétés de Football Association and others v.
Bosman and others [1995] ECR I-4921.
Case C-55/94 R. Gebhard v. Consiglio dell'Ordine degli Avvocati e Procuratori di
Milano [1995] ECR I-4165.
Case T-290/94 Kaysersberg SA v. Commission, judgment of 27 November 1997.
Case C-333/94 P Tetra Pak International SA v. Commission [1996] ECR I-5951.
Joined Cases T-374-5, 384 and 388/94 European Night Services v. Commission
[1998] ECR II-3141.
Cases T-25/95 etc. Cimenteries CBR SA v Commission [2000] ECR II-491.
Cases C-225-227/95 Kapasakalis, Skiathis and Kougiagakas v. Greece [1998]
ECR I-4329.
Case C-265/95 Commission v. France (Spanish Strawberries) [1997] ECR I-6959.
Case C-343/95 Diego Calì & Figli v. SEPG [1996] ECR I-1547.
Case C-35/96 Commission v. Italy [1998] ECR I-3851.
Joined Cases C-51/96 and C-191/97 Christelle Deliège v. Ligue francophone de
judo et disciplines associées ASBL, Ligue belge de judo ASBL, Union européenne
de judo and François Pacquée [2000] ECR I-2549.
Case C-67/96 Albany International BV v. Stichting Bedrijfspensioenfonds
Textielindustrie [1999] ECR I-5751.
Case T-102/96 Gencor Ltd. V. Commission [1999] ECR II-0753.
Case T-111/96 ITT Promedia v. Commission [1998] ECR II-2937.
Case C-176/96 Jyri Lehtonen and Castors Canada Dry Namur-Braine ASBL v.
Fédération royale belge des sociétés de basket-ball ASBL (FRBSB) [2000] ECR
I-2681.
Case C-203/96 Chemische Afvalstoffen Dusseldorp BV and Others v Minister van
Volkshuisvesting, Ruimtelijke Ordening en Milieubeheer [1998] ECR I-4075.
Joined Cases C-395/96 P and C-396/96 P Compagnie Maritime Belge Transports
SA, Compagnie Maritime Belge SA and Dafra-Lines A/S v Commission [2000]
ECR I-1365.
Case C-7/97 Oscar Bronner GmbH & Co. KG v. Mediaprint Zeitungs [1998] ECR
I-7791.
Cases C-10-22/97 Ministero delle Finanze v. IN.CO. GE’90 Srl [1998] ECR
I-6307.
314 Table of Cases

Case C-67/97 Criminal Proceedings against DitlevBluhme [1998] ECR I-6717.

Cases C-115, 116 & 117/97 Brentjens’ Handelsonderneming BV v Stichting
Bedrijfspensioenfonds voor de Handel in Bouwmaterialen [1999] ECR I-6025.
Case C-219/97 Maatschappij Drijvende Bokken BV v. Stichting Pensioenfonds
voor de Vervoer- en Havenbedrijven [1999] ECR I-6121.
Case T-228/97 Irish Sugar plc v. Commission, judgment of 7 October 1999.
Case T-65/98 Van den Bergh Foods v. Commission [2003] ECR II-4653.
Joined Cases C-180/98 to C-184/98 Pavlov and Others [2000] ECR I-6451.
Case C-190/98 Graf v Filzmozer Maschinebau GmbH [2000] ECR I-493.
Case T-191/98 Atlantic Container Line AB v Commission of the European
Communities [2003] ECR II-3275.
Case C-281/98 Roman Angonese v Cassa di Risparmio di Bolzano SpA [2000]
ECR I-4139.
Case T-112/99 Métropole télévision (M6) and others [2001] ECR II-2459.
Case T-144/99 Institute of Professional Representatives before the European
Patent Office v. Commission [2001] ECR II-1087.
Case T-219/99 British Airways plc v. Commission judgment of 17 December 2003.
Case C-309/99 J.C.J Wouters, J.W. Savelbergh, Price Waterhouse Belastingadviseurs
BV v. Algemene Raad van de Nederlandse Orde van Advocaten [2002] ECR I-1577.
Case T-319/99 Federación Nacional de Empresas de Instrumentación Cientifica,
Médica, Técnica y Dental (FENIN) v. Commission ECR II-351.
Case T-342/99 Airtours plc. v. Commission [2002] ECR II-2585, judgment of
6 June 2002.
Case C-438/00 Deutscher Handballbund v. Kolpak [2003] ECR I-4135.
Case T-203/01 Manufacture française des pneumatiques Michelin v Commission
(Michelin II) [2003] ECR II-4071.
Case T-210/01 General Electric v. Commission judgment of 14 December 2005.
Joined Cases C-264/01, C-306/01, C-354/01 and C-355/01 AOK Bundesverband
and Others [2004] ECR I-2493.
Case T-114/02 BaByliss SA v. Commission, judgment of 3 April 2003.
Case T-193/02 Laurent Piau v. Commission [2005] ECR II-209.
Case T-313/02 David Meca-Medina and Igor Majcen v Commission [2004] ECR
II-3291.
Case C-265/03 Igor Simutenkov v. Ministerio de Educación y Cultura, Real
Federación Española de Fútbol [2005] ECR I-2579.
Case C-470/03 A.G.M.- COS.MET Srl v Suomen Valtio, Tarmo Lahtinen [2007]
ECR I-2749.
Case C-551/03 P General Motors BV v. Commission [2006] ECR I-3173.
Case T-99/04 AC-Treuhand AG v Commission [2008] ECR II-1501.
Case C-222/04 Ministero dell’Economia e delle Finanze v.Cassa di Risparmio di
Firenze and Others [2006] ECR I-289.
Cases C-403/04 P and 405/04 P Sumitomo Metal Industries Ltd. v. Commission,
judgment of 25 January 2007.
Case C-434/04 Criminal Proceedings against Ahokainen and Leppik [2006] ECR
I-9171.
EU Courts 315

Case C-519/04 David Meca-Medina and Igor Majcen v Commission [2006] ECR
I-6991.
Case C-341/05 Laval un Partneri Ltd. v. Svenska Byggnadsarbetareförbundet and
Others [2007] ECR I-11767.
Case C-438/05 International Transport Workers' Federation. and. Finnish Seamen's
Union. v. Viking Line ABP and OÜ Viking Line Eesti [2007] ECR I-10779.
Case C-243/06 SA Sporting du Pays de Charleroi, G14 Groupment des clubs de
football européens v Fédération internationale de football association (FIFA),
removed from the Court’s registrar.
Case 279/06 CEPSA Estaciones de Servicio SA v. LV Tobar e Hijos SL, judgement
of 11 September 2008.
Cases C-468-478/06 Sot. Lelos kai Sia and others EE v. GlaxoSmithKline AEVE
Farmakeftikon Proionton [2008] ECR I-7139.
Joined Cases C-501/06 P, C-513/06 P, C-515/06 P and C-519/06 P GlaxoSmithKline
Services and Others v Commission and Others [2009] ECR I-9291.
Case C-49/07 Motosykletistiki Omospondia Ellados NPID (MOTOE) v Elliniko
Dimosio, judgment of 1 July 2008.
Case C-209/07 Competition Authority v. Beef Industry Development Society Ltd
and Barry Brothers (Carrigmore) Meals Ltd [2008] ECR I-8637.
Case T-385/07 Fédération Internationale de Football Association (FIFA) v.
Commission, judgment of 17 February 2011.
Case C-8/08 T-Mobile Netherlands BV and Others v. Raad van bestuur van de
Nederlandse Mededingingsautoriteit, judgment of 4 June 2009.
Case T-55/08 Union des associations européennes de football (UEFA)v.Commission,
judgment of 17 February 2011.
Case T-68/08 Fédération Internationale de Football Association (FIFA) v.
Commission, judgment of 17 February 2011.
Case C-152/08 Real Sociedad de Fútbol SAD and Nihat Kahveci v Consejo Superior
de Deportes and Real Federación Española de Fútbol [2008] ECR I-6291.
Case C-325/08 Olympique Lyonnais SASP v. Olivier Bernard and Newcastle United
FC judgment of Grand Chamber of the Court delivered on 16 March 2010.
Joined Cases C-403/08 and C-429/08 FAPL and others v. QC Leisure and others;
and Karen Murphy v Media Protection Services Ltd., judgment of 4 October 2011.
Case C-52/09 Konkurrensverket v TeliaSonera Sverige AB [2011] ECR I-000.

Commission Decisions

Case IV/36.888—1998 Football World Cup [2000] OJ L 5/55.

Case M.779—Bertelsmann/CLT [1996] C 364/3.
Case IV/36.539—British Interactive Broadcasting/Open [1999] OJ L 312/1.
Case IV/F 1/36/718—CECED [2000] OJ L 187/47.
Cases IV/33.384 and IV/33.378—Distribution of package tours during the 1990
World Cup [1992] OJ L 326/31, [1994] 5 CMLR 253.
316 Table of Cases

Case IV/37.806—ENIC/UEFA [2002] unpublished decision of 27 June 2002.

COMP/M.2483—Group Canal+/RTL/GJCD/JV [2001] OJ L 2985.
COMP/37.398—Joint Selling of Commercial Rights (UEFA Champions League)
[2003] OJ L 291/25.
COMP/C-2/38.173—Joint Selling of Media Rights to the FA Premier League
[2006] C 2006/868 final.
COMP/E3/36.85—Lille/UEFA (‘the Mouscron case’) [1999] unpublished decision
of 3 December 1999.
COMP/C-3/37.792—Microsoft [2005] 4 CMLR 965, IP/03/1025.
COMP D3/38.044—NDC Health/IMS Health: Interim measures [2002] OJ L 59/18.
Case IV/27.958—National Sulphuric Acid [1980] OJ L 260/24.
Case IV/30.804—Nuovo Cegam [1984] OJ L 99/29, [1984] 2 CMLR 484.
Case IV/30.373—P&I Clubs [1999] OJ L125/12.
Case IV/31.990—Port of Rødby [1994] OJ L 55/52, [1994] 5 CMLR 457.
Case IV/37/400—‘Project Gandalf’ [1999] OJ 13, C 70/5.
Case IV/34.174—Sealink/B&I Holyhead: Interim Measures [1992] OJ 378/4, 5
CMLR 255.
Case No. IV/36.237—TPS [1999] OJ L 90/6.
COMP/29.373—Visa International—Multilateral Interchange Fee [2000] OJ L
318/17, [2003] 4 CMLR 283.
Case IV/30.350—Zink Producer Group [1984] OJ L 220/27, [1985] 2 CMLR 108.

Opinions of Advocate Generals

Opinion of AG Trabucchi in Case 7/75 Mr and Mrs F v Belgian State [1975] ECR
679, delivered on 10 June 1975.
Opinion of AG Lenz in Case C-66/86 Ahmed Saeed Flugreisen v Zentrale zur
Bekampfung Unlauteren Wettbewerbs [1989] ECR 803, delivered on 11 January
1994.
Opinion of AG Lenz in Case C-415/93 Union Royale Belge Sociétés de Football
Association and others v. Bosman and others [1995] ECR I-4921, delivered on
20 September 1995.
Opinion of AG Jacobs in Case C-203/96 Chemische Afvalstoffen Dusseldorp and
others v. Minister van Volkshuisvesting, Ruimtelijke Ordening en Milieubeheer
[1998] ECR I-4075, delivered on 23 October 1997.
Opinion of AG Fennelly in Joined Cases C-395/96 P and C-396/96 P Compagnie
Maritime Belge Transports SA, Compagnie Maritime Belge SA and Dafra-
Lines A/S v Commission [2000] ECR I-1365, delivered on 29 October 1998.
Opinion of AG Alber in Case C-176/96 Jyri Lehtonen and Castors Canada Dry
Namur-Braine ASBL v. Fédération royale belge des sociétés de basket-ball
ASBL (FRBSB) [2000] ECR I-2681, delivered on 22 June 1999.
Opinions of Advocate Generals 317

Opinion of AG Jacobs in Case C-53/03 Synetairismos Farmakopoion Aitolias &

Akarnanias (Syfait) and Others v. GlaxoSmithKline plc and GlaxoSmithKline
AEVE, formerly Glaxowellcome AEVE, delivered on 28 October 2004.
Opinion of AG Kokott in Case C-222/07 Presidente del Consiglio dei Ministri v
Regione Sardegna [2009] ECR I-1404, delivered on 4 September 2008.
Opinion of AG Sharpston in Case C-325/08 Olympique Lyonnais SASP v. Olivier
Bernard and Newcastle United FC judgment of Grand Chamber of the Court,
delivered on16 July 2009.
Opinion of AG Kokott in Joined Cases C-403/08 and C-429/08 FAPL and others v.
QC Leisure and others; and Karen Murphy v Media Protection Services Ltd.,
delivered on 3 February 2011.

Other Cases

Greig v. Insole [1978] 1 WLR 302 (Ch D 1977).

Olympia Equipment Leasing v Western Union Telegraph 797 F 2d 370 (7th Cir
1986).
Case CAS 98/200 AEK Athens and Slavia Prague v. UEFA—CAS arbitral award
of 20 August 1999.
Hendry and others v. WPBSA [2001] All ER (D) 71.
Case No. 1001/1/1/01 Napp Pharmaceutical Holdings Ltd v. Director General of
Fair Trading [2002] CAT 1, [2002] CompAR 13.
Verizon Communications Inc v Law Offices of Curtis V. Trinko 540 US 398 (2004),
124 S.Ct 872.
Murphy v Media Protection Services Ltd [2012] EWHC 466 (Admin).
Table of Legislative Acts

Binding EU Legislation
Regulation 17/62 (EEC), the first regulation implementing Articles 85 and 86 of
the Treaty, OJ 013, 21/2/1962, pp. 204–211.
Regulation (EEC) No. 1612/68 of the Council of 15 October 1968 on freedom
of movement for workers within the Community (OJ, English special edition,
1968 (II), p. 475).
Council Regulation (EEC) No. 2137/85 of 25 July 1985 on the European
Economic Interest Grouping (EEIG) OJ L 199, 31. 7. 1985.
Council Regulation (EC) No. 1/2003 of 16 December 2002 on the implementation
of the rules on competition laid down in Articles 81 and 82 of the Treaty OJ L
1, 04/01/2003, pp. 1–25.
Council Regulation (EC) No. 139/2004 of 20 January 2004 on the control of
concentrations between undertakings (the Merger Regulation). OJ L 24,
29/01/2004, pp. 1–22.
Regulation (EU) No. 492/2011 of the European Parliament and of the Council of
5 April 2011 on the freedom of movement of workers in the Union OJ L 141,
27/5/2011.
Council Directive of 27 June 1985 on the assessment of the effects of certain pub-
lic and private projects on the environment 85/337/EEC OJ L 175, 05/07/1985,
pp. 40–48, as amended by Council Directive 97/11/EC of 3 March 1997, OJ
L 73, 14/3/1997; Directive 2003/35/EC of the European Parliament and of the
Council of 26 May 2003, OJ L 156, 25/6/2003; and Directive 2009/31/EC of the
European Parliament and of the Council of 23 April 2009, OJ L 140, 5/6/2009.
Council Directive 93/83/EEC of 27 September 1993 on the coordination of certain
rules concerning copyright and rights related to copyright applicable to satellite
broadcasting and cable retransmission (Satellite Broadcasting Directive) [1993]
OJ L 248/15, 06/10/1993.
Council Directive 96/9/EC of 11 March 1996 on the legal protection of databases
OJ L 077, 27/3/1996.

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K. Pijetlovic, EU Sports Law and Breakaway Leagues in Football,
ASSER International Sports Law Series, DOI 10.1007/978-94-6265-048-0
320 Table of Legislative Acts

Council Directive 98/84/EC on the legal protection of services based on, or con-
sisting of, conditional access. OJ L 320/54, 28/11/1998.
Commission Decision 98/500/EC on the establishment of Sectoral Dialogue
Committees promoting the dialogue between the social partners at European
level, OJ L 225/27, 12/8/1998.
Council Directive 2000/78 establishing a general framework for equal treatment in
employment and occupation OJ L 303/16, 2/12/2000.
Directive 2004/38/EC of the European Parliament and of the Council of 24
April 2004 on the right of citizens of the Union and their family members to
move and reside freely within the territory of the Member States amend-
ing Regulation (EEC) No. 1612/68 and repealing Directives 64/221/EEC,
68/360/EEC, 72/194/EEC, 73/148/EEC, 75/34/EEC, 75/35/EEC, 90/364/EEC,
90/365/EEC and 93/96/EEC, OJ L 158, 30/4/2004, pp. 77–128.
Directive 2010/13/EU of the European Parliament and of the Council of 10 March
2010 on the coordination of certain provisions laid down by law, regulation or
administrative action in Member States concerning the provision of audiovisual
media services (Audiovisual Media Services Directive), OJ L 95, 15/4/2010,
pp. 1–24.
Commission Decision 2005/842/EC on the application of Article 86(2) of the EC
Treaty to State aid in the form of public service compensation granted to cer-
tain undertakings entrusted with the operation of services of general economic
interest OJ L 312/67, 29/11/2005.
The Additional Protocol, signed on 23 November 1970 in Brussels and con-
cluded, approved and confirmed on behalf of the Community by Council
Regulation (EEC) No. 2760/72 of 19 December 1972 (OJ 1973 C 133,
p. 17) (‘the Additional Protocol’), annexed to the Agreement establishing an
Association between the European Economic Community and Turkey, signed at
Ankara on 12 September 1963 by the Republic of Turkey, of the one part, and
by the Member States of the EEC and the Community, on the other part, and
concluded, approved and confirmed on behalf of the Community by Council
Decision 64/732/EEC of 23 December 1963 (OJ 1973 C 113, p. 1) (‘the EEC-
Turkey Association Agreement’).
Europe Agreement establishing an association between the European
Communities and their Member States, of the one part, and the Slovak
Republic, of the other part, signed in Luxembourg on 4 October 1993 and
approved on behalf of the Communities by Decision 94/909/EC, ECSC,
Euratom of the Council and the Commission of 19 December 1994 (OJ 1993 L
359, p. 1) (‘the Association Agreement with Slovakia’).
Agreement on partnership and cooperation establishing a partnership between
the European Communities and their Member States, of the one part, and
the Russian Federation, of the other part, signed in Corfu on 24 June 1994
and approved on behalf of the Communities by Decision 97/800/EC ECSC,
Euratom: Council and Commission Decision of 30 October 1997 (OJ 1994 L
327, p. 1) (‘the Communities-Russia Partnership Agreement’).
Notices, Guidelines, and Policy Documents from EU Institutions 321

Notices, Guidelines, and Policy Documents from EU

Institutions

Treaty of Amsterdam—Presidency Conclusions (2 October 1997) OJ 1997 C 340,

10/11/1999, (No. 29: Declaration on Sport).
Commission Notice on the definition of relevant market for the purposes of
Community competition law, OJ C 372, 9.12.1997, pp. 5–13.
Notice on the application of competition rules to access agreements in the tele-
communications sector OJ [1998] C 265/2, 5 CMLR 521.
Communication made pursuant to Article 19(3) of Council Regulation No. 17
concerning request for negative clearance or for exemption pursuant to Article
81(3) of the EC Treaty Case No. 37.632—UEFA rule on integrity of the UEFA
club competitions: independence of clubs 1999/C 363/02.
Opinion of the Committee of the Regions on ‘The European Model of Sport’
1999/C 374/14.
European Commission Discussion Paper at the First European Conference on
Sport ‘Relations between Sport and Television’, Olympia, 21 and 22 May 1999.
Commission White Paper on Modernisation of the rules implementing Articles
81 and 82 of the EC Treaty, Commission Programme No. 99/027 1999/OJ C
132/1.
European Commission, European Model of Sport, Consultation Document of DG
X (September 2008).
Report from the Commission to the European Council with a view to safeguarding
current sports structures and maintaining the social function of sport within the
Community framework ‘The Helsinki Report on Sport’ Brussels, 10 December
1999 COM(1999) 644 final (‘Helsinki Report’).
Declaration on the specific characteristics of sport and its social function in
Europe, of which account should be taken in implementing common policies
13948/00, Annex to the Presidency Conclusions following the Nice European
Council Meeting of 7, 8 and 9 December 2000 (‘Nice Declaration’).
Notice published pursuant to Article 19(3) of Council Regulation No. 17 concern-
ing Cases COMP/35.163—Notification of FIA Regulations, COMP/36.638—
Notification by FIA/FOA of agreements relating to the FIA Formula One World
Championship, COMP/36.776—GTR/FIA & others (2001/C 169/03).
Xth European Sports Forum, Conclusions of the working group on the follow up
to the Nice Declaration, Brussels 17–18 October 2001.
Commission Notice on agreements of minor importance which do not appreciably
restrict competition under Article 81(1) of the Treaty establishing the European
Community (de minimis), OJ C 368/07, 22.12. 2001.
Commission Notice—Guidelines on the effect on trade concept contained in
Articles 81 and 82 of the Treaty OJ C 101, 27. 4. 2004, pp. 81–96.
Communication from the Commission—Notice—Guidelines on the application of
Article 81(3) of the Treaty OJ C 101/97, 27. 4. 2004.
322 Table of Legislative Acts

Guidelines on the assessment of horizontal mergers under the Council Regulation

on the control of concentrations between undertakings 2004/C 31/03.
Consultation Conference with the European Sport Movement on the Social
Function of Sport, Volunteering in Sport and Fight Against Doping, ‘The EU
and Sport: Matching Expectations’, Brussels 14–15 June 2005.
Professional Sport in the Internal Market, project No. IP/A/IMCO/ST/2005-
004, Commissioned by the Committee on the Internal Market and Consumer
Protection of the European Parliament (September 2005).
European Commission DG Competition Discussion Paper on the application of
Article 82 to exclusionary abuses, Brussels (December 2005).
Communication from the Commission to the European Parliament, the Council
and the European Economic and Social Committee—Implementing the part-
nership for growth and jobs: making Europe a pole of excellence on corporate
social responsibility, Brussels 22. 3. 2006, COM(2006) 136 final.
European Parliament Report on the future of professional football in Europe
(2006/2130(INI)), Committee on Culture and Education, final A6-0036/2007,
p. 14.
Commission White Paper on Sport, Brussels 11 July 2007 COM(2007) 391 final,
(White Paper on Sport).
Commission Staff Working Document, The EU and Sport: Background and
Context, Accompanying Document to the White Paper on Sport, COM (2007)
391 final.
White Paper Consultation by Commissioner Figel with European Sport
Federations, Sport Governance in Europe, Brussels 20/09/2006.
Commission Consolidated Jurisdictional Notice under Council Regulation (EC)
No. 139/2004 on the control of concentrations between undertakings (2008/C
95/01).
European Parliament resolution of 8 May 2008 on the White Paper on Sport
(2007/2261 (INI)).
Communication from the Commission—Guidance on the Commission's enforce-
ment priorities in applying Article 82 of the EC Treaty to abusive exclusionary
conduct by dominant undertakings, OJ C 45, 24. 2. 2009.
Commission Notice—Guidance on Vertical Restraints, Brussels SEC (2010) 411.
European Parliament, Directorate-General for Internal Policies, study on the
Lisbon Treaty and EU Sports Policy (2010), p. 12.
Communication from the Commission—Guidelines on the applicability of Article
101 of the Treaty on the Functioning of the European Union to horizontal co-
operation agreements OJ C 11, 14. 1. 2011, pp. 1–72.
Communication from the Commission to the European Parliament, the Council,
the European Economic and Social Committee, and the Committee of the
Regions ‘Developing the European Dimension in Sport’ COM(2011) 12 final,
18. 1. 2011.
European Parliament Resolution of 2 February 2011 on the European Dimension
in Sport, 2011/2087(INI).
Other Legislation 323

Other Legislation

UK Copyright, Designs and Patents Act of 1988, as amended.

Liikuntalaki (Sports Law) 18. 12. 1998/1054, as amended.
Spordiseadus (Sports Act) passed on 15. 6. 1998 (RT I 1998, 61, 982), Chap. 1,
General Provisions, § 2.
Spordiseadus (Sports Act) passed on 6. 4. 2005 (RT I, 2005, 22, 148), as last
amended on 29. 12. 2011.
Physical Activity and Sport Act, passed on 19. 3. 2003, S.C. 2003, c.2, as last
amended on 17. 10. 2011.
Resolution adopted by the UN General Assembly [on the report of Sixth
Committee (A/64/458)], 22 October 2009.
Recommendation No. R (92) 13 Rev. of the Council of Europe’s Committee of
Ministers to Member States on the Revised European Sports Law Charter (the
European Sports Law Charter) adopted by the Committee of Ministers on
24 September 1992 at the 480th meeting of the Ministers' Deputies and revised
at their 752nd meeting on 16 May 2001.
Index

0–9
13 conditions (for approval of cross-border league(s), 26, 48, 51, 54, 66, 92–93, 238,
leagues) 240, 257, 260, 278, 280, 282, 284, 291,
legal analysis of, 292–301 295–297, 301, 308, see also Breakaway
list of, 73–74, 291–292 league(s)
structure, 26, 48, 55, 261, 282, 288, 296
American model of sport, 27, 38, 40–41, 50,
A 277, see also US model of sport
Abuse Amsterdam Declaration on Sport, 12, 19, 49,
exclusionary, 160–161, 166, 205, 207, 265, 119, 120
271 Analytical framework
of a collective dominant position, 68, 166, for commercial rules, 173–179
173, 239 for regulatory rules, 18, 32, 179–187
of a dominant position, 150, 158, 160–162, Anti-doping, 8, 10, 17, 73, 76, 179, 218, 227,
168, 190, 200, 229, 238, 265, 266, 267, 234, 249, 269, 280–281, 291, 293
286, 302, 304 Arbitration, 10, 179
of rights, 137–139 Arnaut Report, 2, 9, 11, 28, 67, 75, 88,
risk of an, 190–191 194–195, 270, 275–276
Access device Article 49 rule, 26, 74, 239–240, 242, 248–249,
conditional, 137, 139 251–254, 259–261, 263–269, 271–272,
illicit, 136–139 277–282, 286, 290, 295, 301, 303, 308
Accountability, 6, 9, 12, 76, 79, 196, 279 Article 165 TFEU, 13, 16, 18, 21–22, 27, 32,
Activities 34, 36, 51, 90, 100, 116, 123, 126–127,
commercial, 137, 240 134, 140–143, 215, 238, 268, 270, 272,
economic, 104, 119, 169, 185, 189, 222, 286, 305, see also Sports article
248, 250, 252 Association
Agreement(s) of undertakings, 25, 151, 169, 174, 182,
anti-competitive, 232, 252 233, 234, 238, 248–253, 262
commercialisation, 157, 174 purchasing, 152, 200, 238
franchising, 152 Association Agreement(s), 121–122
horizontal cooperation, 157 Athlete(s)
joint selling, 157, 177, see also Collective see also Player(s)
sales free movement of, 116
Alternative professionals, 84, 103–104, 106–107, 109, 115,
competitions, 51, 54, 71, 291, 295–296 118, 121, 124, 127–129, 132–134, 230
selection of, 32, 119, 227
trainees, 124, 129–131

© t.m.c. asser press and the author 2015 325

K. Pijetlovic, EU Sports Law and Breakaway Leagues in Football,
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326 Index

Audio Visual Media Services (AVMS) as undertakings, 25, 168, 255, 297
designated events, 135–136 founder, 56, 58–59
Directive, 19, 134–136 independence of, 74, 230, 249, 291, 293
events of major importance, 135 licensing of, 40, 73–74, 88–89, 240, 246,
Authorisation, 25, 54, 74, 137–139, 145–146, 273, 291, 294
188–189, 191, 240–242, 259, 292 multiple ownership of, 153, 183, 227
Collective
Bargaining, 82–87
B dominance, 158, 162–167, 170, 172–173,
Balkan (Super) League, 72, 257, 296 255, 259, 303, 304, see also Dominant
Baltic League, 72 position
Bans entity, 165, 172, 250
Prospective, 289 sales, 39, 59, 93, 176, 251, 306, see also
Retrospective, 288–289 Agreements, joint selling
Barriers to entry, 159, 205, 256, 259 Commercial ancillarity, 152, 286
BeNe League, 72, 266, 284 Commercialisation, 3, 24, 27, 50–51, 53, 112,
Betting, 35, 42–43, 306 275, 281, 285, 300
Blocked hours, 142–144 Commonwealth of Independent States Cup, 71
Blocking competing organisations, 187, 198, Communication on Developing European
286 Compensation
Boycott(s), 2, 105, 260–261, 266, 305 pool, 27, 65–68, 132, 257
Breakaway league(s), 27–29, 44, 48–49, 54, training, 105, 109–110, 123–125, 127–134
72–74, 92–94, 237, 239, 240, 256, 261, Competition(s)
266, 268, 285–286, 288, 293, 306–307, balanced, 86, 283
see also Leagues, alternative cross-border, 73–74, 240, 247, 259, 284,
British Sky Broadcasting (BSkyB), 3, 177 290–297, 301
Broadcasting rights, see also Media rights domestic, 56, 273, 282–283, 288, 295
collective sale (joint selling) of, 93, 147, fair, 305
255, 273, 280, 307 international, 54, 56, 59, 60, 63, 67–68,
sale of, 9, 147, 170, 174, 196, 255, 274, 102, 107, 118–119, 239, 243, 276–277,
300, 307 301
transfer of, 35, 59 national, 57, 60, 260, 305
unbundling of, 177–178 open, 38, 51–52, 94, 238, 272
Bundesliga, 80, 176–178, 110, 144 regularity of, 33, 77, 140, see also
Burden of proof, 223, 233–234, 269 Matches, regularity of
rival, 244, 285–287, 295
Competitive balance, 33, 35, 37, 41–42, 60,
C 67, 68, 79, 86, 91–92, 94, 96, 106,
Champions League, see UEFA Champions 108–110, 112, 115–118, 144, 175, 210,
League 221, 276, 282–283, 290, 306
Channel One Cup, 71–72 Composition of teams, 104
Charter of Fundamental Rights of the EU, Compulsory player release, 25, 27, 62, 64–68,
11, 18 111, 221, 304
Clauses Dimension in Sport, 20, 33, 51–52, 80, 272,
nationality, 107, 114, 225 294
policy-linking, 153, 155–156 Concerted practice(s), 68, 150–151, 162, 164,
restrictive, 287 179, 248, 253, 303–304
Closed periods, see Blocked hours Conditional Access Directive (CAD), 137
Club Competitions Committee (CCC), 81, 257 Conflict of interests, 24, 191–192, 196, 198,
Club Licensing and Financial Fair Play 283, 285–286, 306–307
Regulations (CLFFP), 17, 41, 88 Consumer(s)
Clubs final, 208, 245–246, 264
Welfare, 67, 155–157, 163, 202, 283
Index 327

Contract(s) Dual functionality, 286, 297

professional, 40, 124, 127, 129, 132–133 Dual membership, 200, 241
Convergence, 16, 22, 26, 28, 38, 145, 154,
174, 179, 182, 186–187, 211, 215–234,
267, 269, 302 E
Cooperation Agreement, 122, 157 Economic
Copyrights, 137, 140, 145–146, 178, 299 Activity, 14–15, 18, 23, 102–103,
Corporate Social Responsibility (CSR), 26, 118–119, 150, 169, 173–174, 180–181,
28, 74, 76, 208–209 189, 202, 218–221, 223–225, 248,
Corruption, 69, 284, 293 252–253, 266–267, 301
Council of Europe, 6, 10, 14 Arguments, 153, 231
Court of Arbitration for Sport (CAS), 8, 10, Benefits, 155–156, 229, 302
171, 179, 279 Constitution, 100
Criteria Efficiency, 93, 184, 229
financial, 38, 88 Links, 164–165, 167, 173, 304
ownership, 56 Economic Interest Grouping, 27, 61, 75
selection, 56 Educational function of sport, 21, 35, 100,
Cross-border league, 72–73, 239, 251, 260, 116, 126–128, 130, 134, 140, 142, 196,
266, 280, 284–285, 291–292, 294, 296 228, 270
Cross-elasticity, 158, 243, see also Effect(s)
Substitutability, Interchangeability appreciable, 186
Culture, 2, 14, 17–18, 40, 49–50, 155, 180, disproportionate, 129
276, 284, 304 on trade, 151, 160, 184, 186–187, 301
Efficiency
Arguments, 184
D Defence, 161–162, 184, 229, 233–234,
Decisions 287–288
by association of undertakings, 150, 154, Employment, 2, 8, 32, 36, 42, 81, 100, 103,
169, 193, 248–253 105–107, 109, 114, 122, 124–126,
commercial, 243, 280 154–156, 216, 226
commitment, 28, 211, 307 Entrustment, 189, 193–196, 292
Decoder Essential facilities, 160–161
card, 136, 143, 145–147, 178 Ethical values, 7, 33, 142, 281
foreign, 136–138 Europa League, 70, 81, 111, 116–117, 242,
De minimis, 151, 186 244–245, 247, 273
Democracy, 12, 49, 51, 76, 210, 279 European Club Association (ECA), 28, 54,
Direct effect, 103, 122, 217, 266 62, 64–66, 69, 75, 77–81, 83–85, 87,
Disciplinary measures, 25, 37, 63, 73, 239, 91–92, 94, 97, 111, 117, 239, 257, 264,
260 290, 304
Discriminatory conditions of work, 114, European Club Forum (ECF), 75, 77
122–123 European Football League (EFL), 55, 59, 78
Discriminatory measures European Golden Cup, 62
directly, 32, 102, 104, 106–107, 111–112, European Parliament, 14, 18, 20–21, 24, 41,
115, 126, 220–222 81, 112, 275
indirectly, 101–102, 112, 114–115, 126, European Professional Football Leagues
230, 266 (EPFL), 28, 75, 79, 83–85, 117
Dominant position, 150, 158–168, 173, European social dialogue, 52, 81, 83–84,
190–192, 198, 200, 203, 205–207, 229, 86–87, 111
238, 253–255, 258, 265–267, 286, 302, European sports model, 37, 51–53, 61, 96, 112
see also Collective dominance EU sports policy, 12, 14, 24, 34, 51, 123, 308
Doping, 5, 8, 10, 33, 35, 74, 76, 141, 179, 182, Exceptional circumstances, 157, 161, 205,
185, 195, 210, 218, 221, 227, 234, 249, 254, 256–257
269, 280–281, 293
328 Index

Exclusive rights, 150, 177–178, 189, 190–191, Fundamental rights, 2, 18, 135, 226, 234, 269
193, 244–245, 250 Funding, 9, 40, 44, 67, 275
Exclusive purchasing agreements, 264
Exclusivity
territorial, 141–142, 178 G
Executive Board (in ECA), 28, 78–79, 83, 87, G14
97, 257, 304 dissolution of, 27–28, 62–66, 78
formation of, 61–62
Gate receipts, 43, 58, 143–144
F Global sports law, 8
Fans, 53, 58, 61, 63, 92, 245–246, 281, 299, Governance
see also Supporters corporate, 209
FAPL, 136–137, 143–144, 146–147, 176, 178, decentralisation of football, 28, 48, 68,
see also Premier League 79, 97
FIA, 28, 196–199, 260, 285–286 football, 48–49, 68, 87, 92, 96, 271, 299,
FIFA 308
Regulations on the Status and Transfer of good, 11–12, 26, 34, 48, 88, 195, 259,
Players, 62–63, 109 273, 279
Statutes, 69 model, 239, 258
World Cup, 3–4, 24, 37, 39, 63–66, 94, self, 196
111, 135, 172, 207, 245, 250 Grassroots, 25–26, 35–36, 40, 75–76, 275,
FIFPro, 52, 75, 80, 82–85, 87, 117, 130 280, 288, 294
Financial
Contributions, 251, 271, 297
Criteria, 38, 88 H
Fair Play Regulation, 17, 44, 52, 86, Helsinki Report, 19, 49, 275–277
88–90, 294 Home and away rule, 172, 183
Instability, 91, 108 Home-grown player rule, 28, 36, 111–119
Penalty, 25, 197
Solidarity, 23–25, 42, 52, 59, 61, 67, 74,
270, 272, 275–276, 280, 305–306 I
Stability, 88, 90, 294 Independent European Sports Review, see
Support, 210, 298, 301 Arnaut Report
Survival, 144, 274, 283 Indispensability, 156–157, 161, 224, 231,
Financing of sport, see also Sport financing 242, 271
macroeconomic aspects, 42–43 Inherency requirement/inherent rules, 32–33,
microeconomic aspects, 43–44 120, 153, 182–184, 202, 210, 224–230,
Fixtures, 65, 69 238, 267, 270–271, 278–280, 293, 295,
Football Association Premier League (FAPL), 302, 305, see also Necessity
136–137, 143–144, 146, 176, 178 Integration, 2, 7, 14–15, 100, 155, 157, 159,
Foreign players, 66, 104–105, 108, 112, 116, 171, 276–277, 300
119–120, 126 Integrity, 21, 33, 74, 88, 141, 182, 230, 249,
Formula One, 4, 28, 196–199, 260, 286 281, 291, 293–294, 306
Franchise, 39, 56–57, 152, 305 Intellectual property, 2, 56, 140–141, 152,
Free agent(s), 107, 109, 134 160, 178, 244
Free movement of services, 18, 25, 102, Interchangeability, 157–158, 171,
119–120, 135, 139, 179–180, 220, 245–247, see also Substitutability,
231–232, 240, 261, 266 Cross-elasticity
Freedom of movement for workers, 18, 102, Interdependence, 34, 51, 165, 166
105–107, 125, 186 Interests
Freedom of establishment, 135, 216, 231 commercial, 5, 14, 25, 27, 48, 60, 67–68,
Fundamental freedoms, 15, 118, 138, 143, 77–79, 83, 97, 244, 257, 280, 283–284,
222, 224, 232, 266, 303 286, 288, 304
Index 329

economic, 24, 144, 189, 194, 208, 281 for players, 171, 173
non-economic, 201, 220 for organisation, 241–243, 246, 257–258
International Cricket Council, 288 foreclosure, 29
International Olympic Committee (IOC), 2, 5, geographic, 158–159, 172, 175, 189, 247,
9, 169, 179, 281 290
labour, 109, 117, 122–123, 170–171, 225,
238, 246
J media rights, 171
Juridification, 3, 5, 8, 10–11 merchandising, 171
product, 158, 160, 170, 172, 189, 240,
244–245, 282
L relevant, 24, 29, 74, 151, 158–159, 163,
League(s) 165, 168–171, 173–174, 189, 198,
closed, 27, 51, 95, 111, 261, 283, 304–305, 203, 205, 240–243, 247–248, 250–259,
307 263–265
hermetic, 282 shares, 204–206, 254, 256, 258
open, 38, 51, 86, 96, 294 sponsorship, 171
pan-European, 37, 48, 244, 247, 291 supply, 67, 170
regional, 72, 261, 282 upstream, 175, 208, 240, 246–247,
regionally delimited, 291, 296 254, 256
sanctioned, 54, 72, 290, 299 Matches
supranational, 282 of national team(s), 25, 27, 220, 221, 295
top, 28, 83, 95, 273, 299 participation in, 143, 220
unsanctioned, 74, 240, 252, 260, 289, 304 regularity of, 77, see also Competitions,
Legal certainty, 17, 20, 216 regularity of
Legitimate aim(s), 28, 101–102, 106, 125, Match calendar, 64, 66, 72, 74, 240, 261, 291,
141, 209–211, 227, 229, 238, 269, 272, 293–295
see also Objectives, legitimate Match-fixing, 17, 185, 284, 306
Lex sportiva, 7–8, 16, 26 Measures
Licenses, 17, 38, 40–41, 56, 73–74, 88–89, directly discriminatory, 32, 102, 104,
120–121, 136, 141–142, 145, 171, 106–107, 111–112, 115, 126, 220–222
175–176, 178–179, 188, 196–199, indirectly discriminatory, 101–102, 112,
239–240, 242, 244, 246, 251, 259, 273, 114–115, 126, 230, 266
291, 293–294 restrictive, 18, 116, 125, 137, 141, 269,
Lisbon Treaty, 17–18, 20–22, 27–28, 34, 36, 282
51, 100, 123, 140 Media Partners, 27, 54, 55, 59–61, 78, 244,
257, 269, 282, 285, 295, 304
Media rights, 39, 42, 52, 56, 89, 94, 143, 171,
M 177–178, see also Broadcasting rights
Major League Baseball (MLB), 39–40 Membership
Market dual, 200, 241
Access, 101, 186, 198, 224–228, 230, organised, 199, 240, 287
266–267 Memorandum of Understanding, 52, 54, 62,
ancillary, 160, 171 65, 66, 69, 78, 83, 96, 239, 264, 290
broadcasting, 5, 92, 174, 245, 247, Merchandising, 35, 44, 48, 56, 170–171, 244
295–296 Model of sport, 36–38, 50, 53, 241, 275–277,
capital, 44, 170, 171 308
contest, 170 Monopoly, 92, 163, 174, 188–189, 191, 193,
definition, 243–244 195, 203–206, 211, 246, 254, 258, 263,
downstream, 5, 161, 174–176, 244, 296 286, 306
entry, 257, 264, 266, 292
exploitation, 74, 96, 170, 240–245
for gate revenues, 171
330 Index

N P
National Player(s), see also Athletes
Championships, 65, 74, 105, 107, 240, amateur, 119
243, 277, 292 as free agents, 107, 109, 134
court(s), 64, 101, 278 assimilated, 105, 112–115
law, 101, 124, 137, 141, 151, 153 association-trained, 113
team(s), 2, 10–11, 27, 37, 54, 64–67, club-trained, 113
103–104, 107, 109, 111–112, 115, 118, home-grown, 111–113, 116–118
120, 135, 219–221, 269, 273, 277, 295 locally-trained, 113
National Basketball Association (NBA), 39–41 mobility, 14, 108, 123, 170
National Football League (NFL), 39–40, 244 non-Community, 121
National Hockey League (NHL), 39–40 out-of-contract, 134
Nationality clauses, 107, 114, 225 professional, 84, 103–104, 106–107, 109,
Necessity, 9, 131–132, 194, 224, 268–269, 115, 121, 124, 127–129, 132–134, 230
270, 272, 278–279, 285, see also release, 25, 27, 62, 64–68, 111, 221, 304
Inherency requirement/inherent rules Players’ agent, 171–174, 250
Nice Declaration, 11, 19, 32, 49, 80, 174, 210, Premier League, 3–4, 38, 41, 43, 44, 56,
271, 275–276, 279 70, 83, 92, 110, 136, 140, 142–145,
Non-discriminatory 176–177, 260, 297–298, see also FAPL
Criteria, 193, 227, 291–292 Presumption(s), 159, 222–223, 254, 256, 262,
Measures, 101, 126, 186, 230 267
rule(s), 104, 106, 219–220, 224–227, Principle(s)
266–267, 305 of good governance, 11–12, 26, 34, 48, 88,
Non-economic activity(ies), 104, 218 195, 259, 273, 279
of proportionality, 106, 210, 259, 287, 292,
301
O of supremacy, 101
Objective justification: Private
attendance at stadiums, 35, 143–144 Agreements, 114, 145, 198
effective and proper organization of sport, bodies, 9, 16, 122, 153, 217
121, 153, 269, 272, 277, 279–280, 286, entities, 216, 243, see also Undertakings,
293–294, 296–297, 305 private–
encouraging recruitment and training, 106, interests, 198, 286-287, 307
116, 127 promoter, 240, 246, 263, 288–290, 293,
maintaining the competitive balance, 33, 296–297
35, 37, 68, 91, 106, 108, 109–110, 112, Pro Cup, 55, 57
115–118, 144, 175, 210, 221 Professional
preserving uncertainty of results, 33–34, Activities, 104, 118
41, 106, 110, 141, 230, 271, 306 Contract, 40, 124, 127, 129, 132–133
regularity of competitions, 33, 140 Opportunities, 102
safeguarding integrity of sport, 182, 230, Professional Football Strategy Council
249 (PFSC), 28, 52, 78–80, 84–85, 87, 97,
Objectives 257
legitimate, 112, 124–125, 144, 183, 224, Promotion and relegation, 37–40, 48, 52, 60,
230, 269, 278, 280–281, 283, 287, 289, 70, 74, 88–89, 93–94, 96, 110, 170,
291, 294, see also Legitimate aims 244, 275, 283, 294, 296–298, 301, 307
non-competition, 153, 183 Property rights, 56, 135, 140–141, 152, 160,
non-economic, 161 244, 300
Obstacle approach, 107, 125 Public
Oulmers affair, 27, 62–64, 66, 257, 304 Authority, 9, 16, 23, 90, 103, 125, 153,
Ownership, 44, 56, 73, 86, 92, 153, 171, 183, 189, 194, 196, 198, 216–217, 266,
227, 230, 260, 291, 297, 299–300, 291–292
305–307 House, 146
Index 331

interest objectives, 101, 263, 269, 288, Restrictive rule(s), 25, 41, 122, 128, 153,
292, 295 210–211, 222, 224, 232, 253, 272,
original, 146 286–287, 290
policy, 43, 140, 155–156, 161–162, 201, (Rookie) draft system, 39, 283
230–231, 278 Rule(s)
policy justifications, 161, 278 inherent, 120, 224–229, 267, 278, 293
policy objectives, 155–156 of reason, 152, 156, 201, 228, 231
undertakings, 150, 188 of the game, 22–24, 184, 218, 227, 293 see
Purely sporting also Purely sporting rules
Interests, 103–104, 181, 185, 219, 221 purely sporting, see Purely sporting rules
Motives, 181, 221–222 selection, 119–120, 220, 225
rule(s), 23–24, 181, 218, 228, see also
Rules of the game
Pyramid, 24, 27, 33, 36–38, 40, 43, 48, S
50–53, 55, 66, 74, 76, 80, 86, 96, Salary cap, 39, 41, 86, 283
238, 252, 261, 271–272, 277, Self-governance, 12, 196, 279, 298, see also
279–280, 283–284, 295–297, Sporting autonomy
307–308 Services
clubs’, 246–247, 254–255, 271, 304
free movement of, 18, 25, 102, 119–120,
Q 135, 139, 179–180, 220, 231–232,
Quotas 240, 261, 266
3+2 rule, 28, 104–105, 107, 112–115, 126, input, 246–247
220 of general economic interest, 150, 189,
6+5 rule, 111–112 193–195
organisational, 240–243, 246–247, 290,
301, 304
R Setanta Cup, 72
Real training costs, 123, 128, 132, 134 Single economic entity, 154, 168, 307
Recruitment of young players, 125, 128 Social
Regulatory Dialogue, 52, 80–87, 97, 111
ancillarity, 153, 278, 286–287,see also function of sport, 6, 135–136, 210, 248,
Restraints, ancillary 268–271, 274–276, 283
function, 191, 262, 285–286, 292, 294, importance of sport, 3, 106, 119, 125–126,
296–297, 305 230, 271
Relevant market, 24, 29, 74, 158, 163, inclusion, 35, 49, 195, 277
165, 168–175, 189, 198, 202, objectives, 100
205, 240–243, 247–248, 250–259, Solidarity
263–265 Contributions, 93, 240, 273–275, 297
Representation, 9, 11–12, 28, 48, 51, 59, 68, Mechanism, 33, 35, 39, 42–43, 68, 79, 110,
79–80, 86–87, 96–97, 279 144, 274, 297, 300–301, 306–307
Required economic effect, 222–223 Payments, 96, 110, 243, 251, 255, 272–273
Restraints Principle, 25, 76, 174, 270, 274–275, 280
ancillary, 152, 228, 302, see also Special responsibility, 28, 159, 202–209, 211,
Regulatory ancillarity 271, 304
horisontal, 157, 176 Special rights, 191
vertical, 254, 256, 264–265 Specific nature of sport, 16, 21, 32–34, 100,
Restrictions 140–141, 173, 270, 272
by effect, 151, 186 Specificity of sport, 11, 16, 18, 20–21, 23, 27,
by object, 145, 156, 178, 222, 262 32–34, 36, 51–53, 116, 123, 126–127,
hard core, 156 130, 136, 140–141, 183–184, 196, 198,
...obligations and review, 191–192, 292 222, 238, 261, 269, 305
per se, 222, 307 Spectators, 2, 6, 88, 274, 295
332 Index

Sponsorship, 3–4, 9, 42–44, 56, 65, 95–96, Superdominance, 28, 202–206, 255, 304
171, 174–175, 189, 191, 196, 242, SuperLeague, 55, 57–58, 62, 69, 72, 91, 95,
244–245, 247, 289, 298–299 282–285, 304–305
Sport(s) Supporters, 12, 53, 56, 60, 75, 77, 244, see
article, 13, 22, 27, 115, 123, see also also Fans
Article 165 TFEU Suspension, 105, 179
associations, 52, 119, 170, 238, 254, 260
definition of, 6–7
federations, 8–9, 14–15, 23–24, 33, 52, T
122, 169, 195, 210, 217, 271, 279, 308 Television (TV)
financing, 42–43, see also Financing of free-to-air, 19, 94
sport pay-per-view, 175
governance, 7, 43 Ticketing, 5, 170
juridification of, 3, 5, 8, 10–11 Training
league(s), 34, 38, 186 Cost, 123, 128–134
organisations, 8, 10–11, 12, 15, 33, 42, of young players, 33, 106, 116, 124–125,
120, 194–196, 279 127–128, 131–132, 141
teams, 40, 103, 218–219 Transfer
Unit, 17 of players, 36, 62, 86, 95–96, 104, 109,
Sporting 132
autonomy, 15, 23, 123, 182–184, see also rules, 104–107, 109–111, 220–222, 226
Self-governance windows, 120–121, 126, 227, 238
criteria, 60, 73, 88, 291 Transparency, 12, 20, 76, 88, 96, 163, 164,
events, 4, 9, 94, 140–141, 180, 189, 209–210, 279, 294
219–221, 245–246, 275, 300
industry, 27, 31, 34, 36, 93, 140
Sporting competitions U
integrity of, 182 UEFA
regularity of, 33, 140 11 values, 53
Sporting exception (exception) Approval, 292, 295–296
category I, 185, 218, 223, 227, 267 Champions League, 27, 37, 41, 55, 59–62,
category II, 181, 185, 218, 223–224, 70, 73, 81, 91–92, 94–95, 110–111,
226–228, 267 116–117, 175–177, 242, 244–247, 252,
category III, 224, 267 257, 260–261, 273, 275, 282, 297, 300,
category IV, 228, 229 307
in EU law, 27, 103, 217, 305 club competitions, 41, 52, 74, 80–81, 230,
scope of, 11, 104, 106, 119, 181, 184, 305 249, 291, 295
SSNIP test, 158, 172, 243, 245 Club Competitions Committee (CCC), see
Stakeholder(s), 11–12, 19–20, 23, 27–28, 34, Club Competitions Committee (CCC)
43, 48–49, 51–53, 68, 74–77, 79–80, Club Licensing System see Clubs, licens-
86–87, 96–97, 118, 195, 208–209, ing of
256–257, 259, 279, 280, 285, 297 Concessions, 38, 53, 59, 60, 62, 64, 93,
Standard of proof, 211, 233, 268, 282 257, 260, 275
Study Congress, 251–252
on the Lisbon Treaty, 20–22, 34, 100 EURO, 65–66, 94, 135, 246, 273
on the UEFA’s ‘Home grown players rule’, Executive Committee, 54, 80–81, 90, 169,
114, 116–117 239, 249, 251
Stuff Working Paper, 38, 269, 300 Mandate, 25, 54, 68, 74, 76–77, 240, 255,
Subsidiarity, 14, 53, 114–115, 186–187, 194 271, 280, 286
Substitutability, 158, 170, 245, 276, see also Member Associations, 54, 73, 94, 239,
Interchangeability, Cross-elasticity 291–292, 301
Suitability, 116, 123, 127–128, 131–132, 144, Mission Statement, 76, 280
210, 224, 268, 272, 275–276, 281–282,
297, 301
Index 333

Statutes, 10, 15, 25–26, 51, 54–55, 73–74, US model of sport, 38, 40–41, 50, 277, see
77, 142, 239–240, 251–253, 259, 291, also American model of sport
293, 301, 303, 308
Uncertainty of outcome, 33, 41
Undertaking(s) W
association of, 25, 151, 169, 174, 182, White Paper on Sport, 11, 19–20, 22, 33–34,
233–234, 238, 248–251, 253, 262 36, 50, 116, 195, 249–250, 279, 281,
entrusted, 150, 189, 191, 193, 195–196, 294, 302
256, 263, 279, 293 World Cup, 3–4, 24, 37, 39, 63–66, 94, 111,
private, 137, 145, 153, 216, 257, see also 135, 169, 172, 207, 245–246, 250
Private entities World Series Cricket, 288–289
public, 150, 188, 216
superdominant, 28, 204–209, 211