On 15 December 2022, Advocate General Rantos delivered his opinion in case C-333/21. This case pertains to whether certain provisions of the FIFA and UEFA Statutes comply with EU competition law and the fundamental freedoms.
The present case concerns three major actors in the field of football competitions. On the one hand, International Association Football Federation (“FIFA”) and Union of European Football Associations (“UEFA”) are both governing bodies established in Switzerland holding a monopoly in respect of the authorisation and the organisation of international professional football competitions in Europe. On the other hand, the European Super League Company (“ESLC”) is a company founded by elite European football clubs to set up the first closed annual pan-European football competition named the “European Super League” (“ESL”). Although the ESL would exist independently of UEFA, its clubs would continue to participate in the football competitions organised by UEFA and FIFA.
The FIFA and UEFA Statutes provide, inter alia, for a prior authorisation regime for the establishment of a rival tournament. Failure to comply with this requirement would result in the imposition of sanctions such as disciplinary measures (e.g. exclusion of clubs and players participating in the ESL). Furthermore, under these rules, all the rights connected with the exploitation of international football competitions belong to FIFA and UEFA.
Following FIFA and UEFA’s refusal to recognise the ESL, ESLC brought proceedings before a Spanish court which requested the Court of Justice (“Court”) to rule on the compatibility of FIFA/UEFA rules with EU law.
As a preliminary remark, AG Rantos stresses that Article 165 Treaty on the Functioning of the EU (“TFEU”) gives expression of the recognition of the “European Sports Model”. This model is characterised by a pyramid structure whose primary objective is the promotion of open competitions and is based on financial solidarity. Moreover, sports are an area of significant economic activity with a special social character which, in some respects, may justify a difference in treatment. Indeed, the social and educational function of sport, intrinsically linked to Article 165 TFEU, may be relevant in the analysis of any objective justification for restrictions on competition or fundamental freedoms.
In addition, AG Rantos considers that the sports federations, such as UEFA, play a key role in this model from an organisational perspective as they guarantee respect for and uniform application of the rules. He states that the fact that UEFA is both the regulator and a commercial actor organising international competitions raises a risk of conflict of interests, but that alone does not suffice to establish a violation of competition law.
AG Rantos then proceeds to examine the compatibility of the FIFA/UEFA rules (i.e. the ex-ante approval scheme and related sanctions) with EU law.
Compatibility with Article 101(1) TFEU
Firstly, AG Rantos observes that, even if FIFA/UEFA rules relating to the prior approval scheme are liable to have the effect of restricting the access of UEFA’s competitors to the market of the organisation of football competitions in Europe, such a finding does not manifestly mean that those rules have the object of restricting competition within the meaning of Article 101(1) TFEU.
Secondly, AG Rantos recalls that, where a restriction by object is not evidently established, a complete analysis of its effects must be carried out for the purposes of Article 101(1) TFEU. To that end, according to AG Rantos it is necessary to study the potential impact of the above-mentioned sanctions.
In that same vein, AG Rantos points out that, to fall outside the scope of Article 101(1) TFEU, the restrictions caused by the UEFA/FIFA rules must pursuit legitimate objectives and be proportionate to those objectives, without going beyond what is necessary for their achievement. In that context, he finds support for his analysis on the ancillary restraints doctrine.
With regard to the legitimacy of the objective pursued by the UEFA rules, AG Rantos finds that, because most of the objectives invoked by UEFA/FIFA derive from the “European Sports Model”, their legitimacy cannot be contested (i). Additionally, he considers that both the ex-ante approval mechanism and the sanctions can be regarded as inherent to the pursuit of FIFA/UEFA legitimate objectives. Indeed, the aim of the approval mechanism is to maintain the principles of participation based on sporting results, equal opportunities and solidarity, characterising the above-mentioned pyramid structure, and to avoid dual membership scenarios (ii). Finally, AG Rantos observes that the sanctions UEFA/FIFA threatened to impose to the football clubs aiming to be part of the ESL may appear proportionate given the incompatibility of such new competition with the fundamental principles structuring the functioning of European football (iii).
For all these reasons, in AG Rantos’ opinion, Article 101(1) TFEU must be interpreted as not precluding UEFA/FIFA rules to provide a prior approval scheme since the restrictive effects which stem from this scheme seem to be inherent in, and proportionate for achieving, the aforementioned legitimate objectives.
Compatibility with Article 102 TFEU
Given its dominant position as the sole organiser at the European level of major football competitions, the particular responsibility borne by UEFA materialises in its obligation to ensure, when examining new competition requests, that third parties are not unduly denied access to the market. AG Rantos considers that the analysis developed regarding the application of the case-law on “ancillary restraints” can be transposed when examining the measures at issue in the light of Article 102 TFEU.
Compatibility with the fundamental freedoms
According to AG Rantos, even though the ex-ante approval system set up by FIFA/UEFA rules may be regarded as being liable to restrict the fundamental economic freedoms, such restriction may be justified by legitimate objectives related to the specific nature of sport.
The present opinion reflects the “constitutional” importance given to the “European Sports Model” in the European Union. Given the special nature of sport, the legitimate objectives embedded in that model can justify the compatibility of certain rules with EU law, even though, at first sight, the concerned practice appears to be restrictive of both competition and fundamental freedoms provisions.
The final ruling of the Court in this case is expected in the course of 2023. By way of reminder, the Court is not obliged to follow the opinion of the advocate general in its final decision.
For further information about this case and/or for general legal advice relating to Belgian and EU competition law, please contact Pierre de Bandt or Raluca Gherghinaru.