By Gianguido Ghelardi
On 21st December 2023, the European Court of Justice (ECJ) issued three landmark decisions for European competition law and sports in the cases of International Skating Union, Royal Antwerp Football Club, and the European Superleague Company. The Superleague case certainly attracted the most media attention. This case note seeks to contextualise, explain, and evaluate the implications of that judgement.
Factual and legal background
On 18th April 2021, twelve European football clubs announced the Super League, a new interclub competition with fifteen permanent members and five members who would qualify each year. The fact that the founding members could not be relegated from the competition caused strong backlash from fans and governments and the project was, within two days, abandoned by most clubs.
Under Article 71 of the FIFA Statutes and Articles 49 and 51 of the UEFA Statutes, international matches in Europe require prior authorisation by FIFA or UEFA. The two associations thus threatened those participating in the Super League with exclusion from any FIFA or UEFA organised competitions. The European Superleague Company (ESCL), in response, filed a complaint before the Juzgado de lo Mercantil de Madrid to prevent FIFA and UEFA from taking any steps against the Super League. On 11th May 2021, the Spanish court requested a preliminary ruling from the ECJ on the application of EU competition law and the fundamental freedoms of the internal market.
The Judgement of the Court
The ECJ made two significant preliminary observations. First, it stressed that it was not ruling on the compatibility of the Super League with EU law. Its decision concerned solely the FIFA and UEFA prior approval and participation rules of interclub competitions and the exploitation of rights emanating from such competitions. Secondly, it noted that Article 165 TFEU did not exempt sport from the rules of the internal market and competition law, as had been suggested by Advocate General Rantos.
Article 102 TFEU
The first question the Court addressed was whether the prior approval rules contained in the FIFA and UEFA Statutes and the connected sanctions for non-complying teams and players were an abuse of a dominant position under Article 102 TFEU. In a nuanced reasoning, the Court held that prior approval rules and sanctions such as those at issue were not by themselves an abuse of dominant position, and that they could indeed pursue legitimate aims “in the specific context of professional football”, such as the coordination between competitions and the preservation of sporting merit. Nevertheless, such rules and sanctions were an abuse of dominant position in the absence of a framework of “transparent, objective, precise, and non-discriminatory” substantive criteria and procedural rules. It was left to the referring court to establish whether the FIFA and UEFA prior approval rules and the connected sanctions satisfy such requirements.
Article 101 TFEU
The second question the Court addressed was whether the prior approval rules and sanctions were a decision restricting competition under Article 101(1) TFEU. Again, the Court found that the requirement for the prior approval of interclub competitions and the connected sanctions could in principle be legitimate in the light of “the specific nature of football competitions”. In the absence of a framework of “transparent, objective, precise and non-discriminatory” criteria, however, such rules on prior approval and sanctions had as their object the restriction of competition. Consequently, it was not necessary to consider whether they were also restrictive in their effect.
Justifications
Thirdly, the Court considered possible justifications of the FIFA and UEFA rules on prior approval and the connected sanctions. The Court found that it was ultimately a competence of the referring court to establish whether the restrictions of competition could be justified under Article 101(3) TFEU and Article 102 TFEU case law. However, those justifications could not apply in the absence of a framework of transparent, objective, precise and non-discriminatory criteria.
Exploitation and distribution of rights
Fourthly, the Court considered the rules on the exploitation of rights emanating from interclub competitions. The Court found that granting exclusive control of the commercial exploitation of such rights to FIFA and UEFA under Articles 67 and 68 of the FIFA Statutes was both a decision that had as its object the restriction of competition under Article 101(1) TFEU and an abuse of dominant position under Article 102 TFEU. It was left to the referring court to decide whether they could be justified under Article 101(3) or 102 TFEU.
Article 56 TFEU
Finally, the Court found that the FIFA and UEFA rules on prior approval also violated the freedom to provide services enshrined in Article 56 TFEU and could not be justified in the absence of transparent, objective, precise, and non-discriminatory criteria and procedural rules.
What’s next?
Following the judgement of the ECJ, the Spanish court will render its decision on 14th March 2024. Crucially, in applying the judgement of the ECJ, it will have to take into account the UEFA Authorisation Rules of 2022, which introduce a new framework of criteria and procedural rules for the prior approval of interclub competitions. According to UEFA, these already comply with the ECJ requirements. However, it is likely that the new rules will lead to more litigation to establish whether they are indeed sufficiently transparent, objective, specific, and non-discriminatory. For instance, the Court has only addressed violations of Article 101(1) TFEU by object. If not restrictive by object, the new rules may give rise to questions as to their anti-competitive effect, potentially requiring another preliminary ruling from Luxembourg.
In the meantime, a few hours after the ECJ judgement, A22 published the new Super League project, which now involves 96 clubs and five leagues across men’s and women’s football, without any permanent members. This time, UEFA President Ceferin commented, “we will not try to stop them”. The saga, it seems, has only just started.
What stands out from the judgement as a whole, however, is that while it condemns the discretionality of UEFA’s and FIFA’s prior approval rules, it also endorses the prior approval power of those organisations in so far as it is not discretional. That, it appears, would rather reaffirm than undermine FIFA and UEFA’s position as the central governing bodies of European and world football.
About the Author
Gianguido Ghelardi is currently a postgraduate student of the European Law School at Sapienza University of Rome.
European Studies Review 