Final Whistle: Red Card For Res Judicata As Member State VAR On EU Law Awaits CAS Awards

On 1August 2025, the Grand Chamber of the Court of Justice of the European Union (CJEU) handed down its preliminary ruling in Case C‑600/23 - RFC Seraing SA v FIFA, finding that an award made by the Court of Arbitration for Sport (CAS) must be open to "effective judicial review" by a court or tribunal of a member state of the EU (Member State) for consistency with EU public policy. This decision confirms that the ability of Member State courts to engage in public policy judicial review of CAS decisions is not limited to issues of competition law, thereby expanding the previous remit of judicial review as established in C-124/21 P, International Skating Union v European Commission.

While this strikes a blow to the finality of CAS decisions, it does not go as far as suggested in Attorney General Ćapeta's (the AG's) opinion (see our blogpost: CAS to VAR review? CJEU Advocate General proposes court oversight of CAS awards), that mandatory arbitration imposed by sports governing bodies, such as Fédération Internationale de Football Association (FIFA), could be subject to a full review of all applicable EU law in the courts of a Member State.

Background

This case concerns a dispute between Belgian football club Royal Football Club Seraing (Seraing) and FIFA over compliance with FIFA's regulations on the Status and Transfer of Players (RSTP). Seraing received financing from a Maltese company, Doyen Sports (Doyen), in exchange for the economic rights in specific players. These rights would allow Doyen to share in the sums received, for instance, when those players were loaned out or transferred, or from the commercialisation of their image rights. FIFA deemed this a breach of its prohibitions on third parties (i) acquiring the ability to influence club activity, and (ii) participating in the economic rights of players.

Seraing challenged FIFA's decision to the FIFA Appeal Committee, then before CAS, and subsequently in Switzerland's Federal Supreme Court, being unsuccessful at each step.

Doyen and Seraing challenged FIFA's prohibitions on third party influence and ownership in the Belgian Courts, arguing that such prohibitions are contrary to EU law, specifically, Articles 45 (free movement of workers), 56 (free movement of services), 63 (free movement of capital), 101 (lessening of competition in the internal market) and 102 (abuse of dominant position) TFEU. The Brussels Commercial Court found that it had no jurisdiction to decide these issues. The Brussels Court of Appeal also rejected Seraing's appeal, noting that Seraing's arguments had already been rejected in the CAS award, which must be regarded as res judicata in accordance with Belgian law.

Seraing then brought an appeal to the Belgian Court of Cassation, arguing that the Court of Appeal's treatment of the CAS award as res judicata was in breach of Article 19(1) TEU, Article 267 TFEU and Article 47 of the Charter of Fundamental Rights of the European Union (the Charter), which enshrine the protection of EU law by Member State courts. The Belgian Court of Cassation stayed the proceedings and referred to the CJEU the question of whether those provisions of EU law prohibit the treatment of an arbitral award as res judicata where the award has been reviewed for conformity with EU law by a non-Member State court (i.e. a court not permitted to refer a question to the CJEU).

The CJEU's Decision

(i) General principles

As to the relationship between effective judicial protection and recourse to arbitration in general, the CJEU held that:

• Article 19(1) TEU requires the courts of Member States must interpret or apply domestic law in a way that meets the requirements essential to effective judicial protection (Article 19(1) TEU).
• The right to effective remedy requires the courts of Member States to be able to carry out an effective judicial review of behaviour alleged to infringe the rights that EU law confers (Article 47 of the Charter).
• The mechanism for a national court to request a preliminary ruling from the CJEU concerning the interpretation of EU law is a keystone of the EU judicial system in ensuring judicial protection of EU law rights (Article 267 TFEU).
• While these principles do not prevent recourse to arbitration, a distinction must be drawn between compulsory arbitration and voluntary arbitration. Under a voluntary arbitration, an individual may waive certain rights under EU law. However, where an arbitration mechanism is imposed by an agreement which is to be implemented in all or part of the EU, in the context of disputes relating to the pursuit of economic activity in that territory, it must be implemented in a way that ensures (i) compatibility with the judicial architecture of the EU and (ii) effective compliance with EU public policy (C-124/21 P, International Skating Union v European Commissionaffirmed).
• Thus, awards made by an arbitral body under such an agreement must be amenable to judicial review. However, in the light of the requirements relating to the effectiveness of arbitration proceedings, the judicial review of those awards may legitimately be limited in nature.
• It must also be possible for individuals affected by such awards to obtain a review of the awards by the courts of an EU Member State, which is able to seek a preliminary ruling from the CJEU on whether the relevant issues are consistent with the principles of public policy under EU law.
• Freedom of movement of workers, services and capital as guaranteed by Articles 45, 56 and 63 TFEU form part of EU public policy, as do Articles 101 and 102 TFEU relating to competition law.

(ii) Judicial review of CAS awards

As to the judicial review of CAS awards, the CJEU moved away from the AG's call for "full judicial review" of awards resulting from mandatory or compulsory arbitration. The CJEU held that:

• Recourse to CAS arbitration under FIFA's statutes must be regarded as being unilaterally imposed on individuals, and thus mandatory in nature. In such circumstances, where no provision has been made for a direct legal remedy in the courts of a Member State, the individuals concerned must have recourse to the courts of a Member State for judicial review of an award's consistency with principles of EU public policy.
• National courts, in their process of judicial review, must be able to deliver the appropriate remedies. In the context of infringement of competition rules, this would include ordering damages and the cessation of activities which give rise to the infringement. It also includes the granting of interim measures, such as the power to request a preliminary ruling from the CJEU. Any rule of national law or of a sports organisation that precludes such a power must be disapplied.
• Public policy review of foreign arbitral awards is consistent with the New York Convention, which, although not binding on the European Union, is binding on all Member States and the Swiss Confederation.
• In the light of the above, Article 19(1) TEU, read in conjunction with Article 267 TFEU and Article 47 of the Charter, must preclude courts of Member States from conferring the authority of res judicata on CAS awards where (i) the dispute is linked to the pursuit of sports as an economic activity within the territory of the European Union and (ii) the consistency of that award with principles and provisions of EU law forming part of EU public policy has not been subject to effective review by a court of a Member State.

Comment

The CJEU, in the first part of the judgment, explored the relationship between arbitration in general and the right to effective judicial protection under EU law. It emphasised the distinction between 'compulsory' and 'voluntary' arbitration, noting that, public policy judicial review by a court of a Member State must be available for the former. The CJEU also noted that its approach is consistent with the New York Convention, which also provides for public policy judicial review of arbitral awards. While the latter part of the judgment emphasises the unique features of CAS arbitration, which puts it squarely within the category of 'compulsory arbitration', it remains to be seen what other types of arbitrations may also be categorised in this way. The development of CJEU jurisprudence in this area should be closely observed.

For now, this decision strikes a surgical blow to the finality of CAS arbitration. By interpreting 'public policy' broadly to include freedom of movement for workers, services, and capital, the decision expands the remit of C-124/21 P, International Skating Union v European Commission, where the scope of public policy judicial review by the courts of a Member State was limited to EU competition law. This opens up a much wider category of disputes that will not be finally resolved by CAS, but instead by the courts of a Member State. In turn, this could lead to lengthier disputes across different forums.

Notably, however, the CJEU did not go as far as the AG's opinion that "the scope of review should not be limited to public policy, but should include all relevant EU law provisions". Instead, the court found that the judicial review of arbitral awards (even mandatory ones) may be legitimately limited in nature in the interest of securing the effectiveness of arbitral proceedings. It also did not adopt the AG's alternative suggestion that public policy judicial review could be used as a gateway to a full review in respect of EU law and noted that effective judicial protection did not mean there must necessarily be a consideration of all questions of fact and law by a court of a Member State. Thus, while expanding the scope of review of CAS awards by the courts of Member States, this decision does not completely undermine the CAS process. Given the potentially expansive scope of review available on public policy grounds, however, stakeholders will be eager to understand how this "effective judicial review" should be limited in practice.

CAS will be relieved that the decision does not undermine the sports arbitration framework itself, as the CJEU reaffirmed that mandatory sports arbitration is permissible. However, there is now more doubt regarding the finality of CAS awards with Member States and the CJEU holding final say on matters of EU law. The CJEU also considered whether the fact that CAS is seated in Switzerland (outside the EU) impacts the EU law review but determined that this does not prevent EU courts from reviewing its awards – the emphasis is on whether EU law is engaged and whether EU-based judicial review is available, not on the arbitral seat.

For sports advisors, this decision emphasises the need to: (i) be alert to, and advise on, EU law challenge rights; (ii) carefully scrutinise any CAS awards for potential breaches of EU competition law or fundamental freedoms, which could open an additional disputes frontier for any parties unsatisfied with CAS decisions; and (iii) closely monitor future cases relating to the interpretation of "effective judicial review" applying the Seraing precedent to understand the scope of EU law challenge.

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