The detailed opinion dated 15th December 2022 ("Opinion"), rendered by Mr. Athanios Rantos, Advocate General of the European Court of Justice (ECJ) regarding the characteristics of the proposed European Super League (ESL), which is supported by Barcelona, Real Madrid, and Juventus, is a major setback for the said project. It has been rendered following the request for a preliminary hearing made to the ECJ by the Commercial Court, Madrid ("Referring Court"). The European Super League Company ("ESLC") accused FIFA and UEFA of violating the Treaty for the Functioning of the European Union ("TFEU")1, and accused them of anti-competitive practices2.
ISSUES BEFORE THE ECJ:
- Whether Articles 22, 71, 72, and 73 of the FIFA Statute3, and Articles 49 and 51 of the UEFA Statute4, violate Articles 101 and 102 of TFEU?
- Whether Articles 101 and 102 TFEU permit FIFA and UEFA to threaten sanctions of exclusion of the ESL members?
- Whether Articles 66 and 67 of the FIFA Statutes violate Articles 101 and 102 TFEU?
- Can ESLC claim protection under the exceptions in Article 101(3) of TFEU, and would the sanctions threatened by FIFA and UEFA constitute abuse of dominant position under Article 102 TFEU?
- Whether prior approval system violates Articles 45, 49, 56, and 63 TFEU?
- The European Sports Model: Rantos examined the European Sports Model envisaged by Article 165 of TFEU, which requires EU to promote European sporting issues, considering the specific nature of sport, the structures based on voluntary activity, and social and educational functions. It also describes the EU's objective of developing European dimensions in sport, by promoting fairness and transparency in competitions, cooperation between governing bodies, and protecting sportspersons' integrity. Its objective is to promote open competition, with a transparent system and competitive balance, prioritising sporting merit. It also propounds financial solidity, which ensures revenue generation, and redistribution thereof. Sports federations must ensure effective governance and compliance of the rules with respect to the concerned sports.5. Article 165 should be read with Articles 101 and 102 TFEU, which apply to sporting activities, especially with economic considerations.
- Conflict of Interest of FIFA & UEFA: The next point discussed was the conflict of interest of FIFA and UEFA, in performing economic activities, namely the organising and marketing competitions, and also having regulatory powers. The ECJ held in Motosykletistiki Omospondia Ellados NPID v Elleniko Dimosio6, that if a rule confers on a legal person, organizing and commercially exploiting events, the power to designate persons to organise the same, and set the conditions thereto, such entity has an advantage over its competitors, thereby preventing entry of other entities into the market. This power should be subject to restrictions and review, to prevent distortion of competition. In this case, UEFA's dual role is established, and is subject to restrictions while performing its regulatory duties. It should ensure that third parties are not unduly denied access to the football market. It may impose restrictions on third-party entry, which should not infringe Articles 101 and 102 TFEU.
- UEFA & FIFA Statutes Vis-à-vis TFEU: Rantos then examined whether prior approval, and the sanctions threatened by FIFA and UEFA infringe Articles 101 and 102. He pointed out that their members are national associations, all engaging in football as economic activity. FIFA and UEFA would qualify as "undertakings", and as "associations of undertakings", under Article 101. Associations adopting UEFA and FIFA statutes, indicate acceptance thereof, and FIFA and UEFA may regulate their conduct, regarding participation in international competitions, thereby being considered 'decisions by associations of undertakings'.7 Also, FIFA and UEFA are not public entities, with exclusive rights, therefore any third party seeking to organise football tournaments would not require their prior approval, nor would they be bound by the governing laws/statutes of such organisations. However, the ESL members wish to retain UEFA affiliation and derive the benefits thereto, while also having a separate tournament, thereby a conflict of interest. Therefore, UEFA's measures to tackle dual membership, its refusal to recognise the ESL, and the threat of sanctions issued to participant clubs/players, would only be restrictive if the concerned clubs wish to retain UEFA affiliation, and it cannot be held to be manifestly restricting competition under Article 101(1). The power of sports federations to impose sanctions depends on its recognition by the affiliated clubs and players, which voluntarily agree to be governed by its rules and regulations. Further, the objectives of FIFA and UEFA Statutes comply with the European Sports Model, and hence their legitimacy cannot be questioned. They are necessary to ensure a certain level of equality between clubs. Also, since football involves multiple stakeholders at various levels with respect to the conduct of matches and competitions, the prior approval system is an essential governing feature, required to ensure uniformity, and that the objectives pursued thereof are achieved.
- ESL's Characteristics Vis-à-vis EU Competition Law: Rantos then pointed out that the ESL clearly violate the European Sporting Model. It entails guaranteed participation, and members would continue to participate in UEFA and FIFA competitions. He opined that it would reduce the appeal of national championships which the clubs are members. The element of qualifying for European club competitions based on domestic performances would severely undermined. The founding members would be permanent members, immune from competition for places therein, thereby lacking sporting merit, which is clearly not factored therein. Guaranteed participation would assure additional revenue for the clubs, while also competing in UEFA/FIFA competitions against clubs with no opportunities to raise additional revenue, thereby increasing disparities between clubs. Therefore, the consequent threats of sanctions and exclusion, imposed by UEFA and FIFA, are justified, as they seek to avoid dual membership, which would weaken their position in the football market, as the ESLC's object is for the members to remain in European football competitions, without following UEFA's regulations. Therefore, UEFA is not prevented from protecting its own economic interests thereto, provided such restrictions are inherently pursuant to its objectives.
- Abuse of Dominant Position: The ECJ has laid down in previous judgments that merely because a federation organising and regulating competitions, would not constitute abuse of dominant position. To prevent conflict of interest, federations can lay down prior approval procedures and restrictions. Mr. Rantos referred to the 'essential facilities' doctrine laid down in Oscar Bronner GmbH & Co. KG v. Mediaprint Zeitungs- und Zeitschriftenverlag GmbH & Co. KG, which states refusal by any undertaking in a dominant position, to grant access to infrastructure/services would only constitute abuse if it is likely to eliminate all competition from the market of the person requesting such services, which would be indispensable to such person carrying on its own business, and there is no actual substitute for the same. He stated that this is not applicable here, and prior approval is only required if ESL members wish to retain UEFA affiliation. Further, UEFA's refusal to recognise the ESL is justified in sporting terms, basis UEFA's legitimate objectives; as well in economic terms, to prevent dual membership. Therefore, Articles 22, 71-73 of FIFA Statutes, and Articles 49 and 51 of UEFA Statutes do not violate Article 102 TFEU.9
- The query relating to the exceptions under Article 101(3) TFEU was referred without FIFA or UEFA having any opportunity to respond, hence the same is not answered.
- Exploitation of International Competitions by FIFA and its Affiliates: Rantos reiterated the tenets of the European Sports Model, which includes the redistribution of profits stemming from the commercial rights arising out of FIFA and UEFA competitions, among all clubs, including those at the lower levels of the football pyramid. Also, the exploitation of these rights is related to a sport with social importance. Subsequently, he concluded that Articles 67 and 68 of FIFA Statute, do not violate Articles 101 and 102 TFEU.
- Prior Approval and Economic Freedoms: While sports federations can establish their own rules, their autonomy does not permit them to act in violation of the fundamental economic freedoms provided by TFEU. It was observed that prior approval and participation rules restrict Articles 49 (freedom of establishment) and 56 (freedom to provide services) TFEU, of undertakings who wish to enter the market for organising football competitions. Secondly, due to the sanctions involved, the said rules may adversely impact the likelihood of clubs setting up their own competition, and supplying services to third-party competitions. Thirdly, they may reduce the appeal of the likelihood of free movement of players, under Article 45 TFEU, to clubs which are not ESL members, and thereby hampering their careers, which is an economic activity. Fourthly, free movement under Article 63 is also affected. However, it was also observed that the restrictions may be justified as long they as they conform to the inherent objectives of the sports federations. While establishing rules for competitions, the rules shall not go transcend the federation's objectives. The ECJ has also held in TopFit eV & Daniele Biffi v Deutscher Leichtathletikverband eV, that any prior authorisation scheme must be based on non-discriminatory and objective criteria, known in advance, and must ensure there is no arbitrary exercise of discretion by the federation.10 He therefore held that the prior approval scheme is limited to what is necessary to uphold the necessary objectives of UEFA.
The learned AG has therefore observed that the said provisions of the UEFA and FIFA Statutes do not violate Articles 101, 102, 45, 49, 56 and 63 of the TFEU, but stressed that any restrictions and sanctions so imposed must not exceed the sporting objectives of FIFA and UEFA.
CONCLUSION: Mr. Rantos' opinion is non-binding, but it is likely to play majorly in the minds of the judges at the time of the final ruling on these issues. The manner in which the ESL was announced was violative of the FIFA and UEFA Statutes, and its characteristics very clearly undermine the European Sporting Model, as has been described above. The probability of the ESL project being held as illegal is therefore very high, and rightly so. At a time when UEFA is attempting to reduce economic disparities between clubs, projects like the ESL seriously undermine these endeavours.
The entire saga of the ambitious European Super League (ESL) project witnessed a new development, in the form of the opinion dated 15.12.2022 issued by Athanois Rantos, the Advocate General of the European Court of Justice (ECJ), in which he has analysed elaborately as to why the provisions of FIFA and UEFA Statutes mandating prior approval for establishment of new football competitions, are compatible with EU competition law, and that UEFA and FIFA's threat of suspensions to all the clubs participating in the ESL or any other competition which is formed without approval of FIFA and UEFA, is therefore not anti-competitive. There is also a detailed analysis of how the proposed ESL project is in blatant violation of EU Competition Law and therefore, why the restrictions set forth in the FIFA and UEFA Statutes, and the threat of sanctions issued to any clubs/players participating in any leagues, are not violative of EU Competition laws. The opinion is non-binding in nature and while the ECJ may not be bound by the same, it is still likely to play a significant role in the minds of the judges, as the ECJ's final judgment on the queries sent for ruling, by the Commercial Court, Madrid, is awaited.
Keywords: ESL, FIFA, FIFA Statute, UEFA, UEFA Statute, ECJ, TFEU, EU Competition Law, Article 101, Article 102, Abuse, Dominant Position, Competition, Restriction, Athanios Rantos
Meta Title: The Legal Feasibility of the European Super League in Europe's Footballing Ecosystem
5. OPINION OF ADVOCATE GENERAL ATHANIOS RANTOS, Delivered on 15 December 2022, Case C-333/21: European Superleague Company SL v Unión de Federaciones Europeas de Fútbol (UEFA), Fédération internationale de football association (FIFA), interveners: A22 Sports Management SL, Liga Nacional de Fútbol Profesional, Real Federación Española de Fútbol, https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:62021CC0333#Footref65, ¶30-31
6. Motosykletistiki Omospondia Ellados NPID v. Elliniko Dimosio, Case C-49/07, https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:62007CJ0049&from=EN
7. OPINION OF ADVOCATE GENERAL ATHANIOS RANTOS, Delivered on 15 December 2022, Case C-333/21: European Superleague Company SL v Unión de Federaciones Europeas de Fútbol (UEFA), Fédération internationale de football association (FIFA), interveners: A22 Sports Management SL, Liga Nacional de Fútbol Profesional, Real Federación Española de Fútbol, https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:62021CC0333#Footref65, ¶59
8. Case C-7/97, 1998 E.C.R. I-7791, https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:61997CJ0007&from=IT
9. OPINION OF ADVOCATE GENERAL ATHANIOS RANTOS, Delivered on 15 December 2022, Case C-333/21: European Superleague Company SL v Unión de Federaciones Europeas de Fútbol (UEFA), Fédération internationale de football association (FIFA), interveners: A22 Sports Management SL, Liga Nacional de Fútbol Profesional, Real Federación Española de Fútbol, https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:62021CC0333#Footref65 , ¶134-144
10. Case C-22/18, EU:C:2019:497, https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:62018CJ0022&from=EN
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