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SPORT AND SPORT AND COMPETITION LAWCOMPETITION LAW

AT EU LEVELAT EU LEVELbeyond the White Paper on beyond the White Paper on

SportSportISDE, April 2008ISDE, April 2008

MICHELE COLUCCIMICHELE COLUCCIwww.europa.euwww.europa.euinfo@colucci.euinfo@colucci.eu

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WHAT IS THE WHITE WHAT IS THE WHITE PAPER ?PAPER ?

A POLITICAL DOCUMENTA POLITICAL DOCUMENT NOT LEGALLY BINDINGNOT LEGALLY BINDING DRAFTED BY THE EUROPEAN DRAFTED BY THE EUROPEAN

COMMISSIONCOMMISSION COMPREHENSIVE FRAMEWORK COMPREHENSIVE FRAMEWORK

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SPORT AND EU: SPORT AND EU: in the name of in the name of

Autonomy and SpecificityAutonomy and Specificity

NICE DECLARATION (2000): NICE DECLARATION (2000): Sporting organizations and Member Sporting organizations and Member States have a primary responsibility States have a primary responsibility in the conduct of sporting affairs, in the conduct of sporting affairs, with a central role for Sports with a central role for Sports Federations”. BUT…Federations”. BUT…

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‘‘Limited’ AutonomyLimited’ Autonomy

Sporting Organizations have to Sporting Organizations have to exercise their task to organise and exercise their task to organise and promote their particular sports “with promote their particular sports “with due regard to national and due regard to national and Community legislation”Community legislation”

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THE LISBON TREATYTHE LISBON TREATY13 December 200713 December 2007

““The Union shall contribute to the The Union shall contribute to the promotion of European sporting promotion of European sporting issues while taking account of its issues while taking account of its specific naturespecific nature, its structures based , its structures based on voluntary activity and its social on voluntary activity and its social and educational function”. (art. 124 and educational function”. (art. 124 a) ) a) )

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The ‘societal’ role of The ‘societal’ role of sportsport

Enhancing public health through Enhancing public health through physical activityphysical activity

Fight against dopingFight against doping Education and trainingEducation and training Social inclusion, integration and Social inclusion, integration and

equal opportunitiesequal opportunities Prevention and fight against racism Prevention and fight against racism

and violenceand violence

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The ‘economic’’dimension The ‘economic’’dimension of sportof sport

15 million people or 5.4 % labour 15 million people or 5.4 % labour forceforce

Value-added of 407 billion eurosValue-added of 407 billion euros Tool for local and regional Tool for local and regional

developmentdevelopment TourismTourism

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The Organisation of The Organisation of SportSport

SELF-REGULATION respectful of:SELF-REGULATION respectful of: Good governance principlesGood governance principles EU lawEU law

The European CommissionThe European Commission Plays a “facilitating role” or Plays a “facilitating role” or Takes action if necessaryTakes action if necessary

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General PrincipleGeneral Principle

Sport as economic activity:EU LAW Sport as economic activity:EU LAW appliesapplies Competition LawCompetition Law Internal Market rulesInternal Market rules No discrimination on basis of No discrimination on basis of

nationalitynationality

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Specificity of ‘sporting Specificity of ‘sporting activities’activities’

Separate competitions for men and Separate competitions for men and womenwomen

Limitations on the number of Limitations on the number of participantsparticipants

Need to ensure encertainty Need to ensure encertainty concerning outcomesconcerning outcomes

Preserving a competitive balancePreserving a competitive balance

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Specificity of the ‘Sport Specificity of the ‘Sport structure’structure’

Autonomy and diversity of sport Autonomy and diversity of sport organisationsorganisations

Pyramide structure of competitionsPyramide structure of competitions One national federation per sportOne national federation per sport

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The European Model of The European Model of SportSport

The “Pyramid” modelThe “Pyramid” model

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CharacteristicsCharacteristics

Promotion and relegationPromotion and relegation Grassroots approach (starting from

the clubs) Stakeholders and their role (who

does what)

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EC TREATYEC TREATY

ART. 81 EC: Are incompatible (and void )with the common market all agreements between undertakings, decisions by associations of undertakings and concerted practices which may:

affect trade between Member States have as their object or effect the

prevention, restriction or distortion of competition within the common market

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ExceptionsExceptions Agreements which contributes to improving:

the production or distribution of goods or to promoting technical or economic progress, while allowing consumers a fair share of the resulting benefit,

And which does not:(a) impose on the undertakings concerned restrictions which are not indispensable to the attainment of these objectives;(b) afford such undertakings the possibility of eliminating competition in respect of a substantial part of the products in questio

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ABUSE OF DOMINANT ABUSE OF DOMINANT POSITIONPOSITION

ART. 82 EC:ART. 82 EC:Any abuse by one or more

undertakings of a dominant position within the common market or in a substantial part of it shall be prohibited as incompatible with the common market in so far as it may affect trade between Member States.

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ABUSE OF DOMINANT ABUSE OF DOMINANT POSITIONPOSITION

Such abuse may, in particular, consist in: (a) directly or indirectly imposing unfair purchase

or selling prices or other unfair trading conditions; (b) limiting production, markets or technical

development to the prejudice of consumers; (c) applying dissimilar conditions to equivalent

transactions with other trading parties, thereby placing them at a competitive disadvantage;

(d) making the conclusion of contracts subject to acceptance by the other parties of supplementary obligations which, by their nature or according to commercial usage, have no connection with the subject of such contracts.

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Fields of application in Fields of application in SportSport

Transfer rulesTransfer rules Sale of ticketsSale of tickets Broadcasting rightsBroadcasting rights Monopoly of federationsMonopoly of federations Multi-ownership of clubsMulti-ownership of clubs

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Basic Principles of Basic Principles of Community LawCommunity Law

EC law applies to Sport in so far it EC law applies to Sport in so far it constitutes an economic activity (ECJ constitutes an economic activity (ECJ case law)case law)

No Activities “purely” social, artistic No Activities “purely” social, artistic or sporting ......or sporting ......

but then “MECA MEDICA” judgement but then “MECA MEDICA” judgement of 18 July 2006... of 18 July 2006...

Test of “Necessity”Test of “Necessity” Test of “Proportionality”Test of “Proportionality”

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The Legal Methodology The Legal Methodology in the Meca Medina casein the Meca Medina case

STEP 1STEP 1: Are the EC anti-trust rules, i.e. : Are the EC anti-trust rules, i.e. Articles 81 and/or Art. 82 applicable to Articles 81 and/or Art. 82 applicable to Sporting rules?Sporting rules?

STEP 2STEP 2: If EC anti-trust rules are applicable, : If EC anti-trust rules are applicable, does the sporting rule fall outside the does the sporting rule fall outside the prohibition of Articles 81 (1) and 82?prohibition of Articles 81 (1) and 82?

STEP 3: Can the rule be considered STEP 3: Can the rule be considered compatible with EC anti-trust rules because compatible with EC anti-trust rules because it fulfils the conditions of Article 81(3) EC or it fulfils the conditions of Article 81(3) EC or because of an objective justification under because of an objective justification under Article 82 EC?Article 82 EC?

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Step 1Step 1 1. Is the sports association that adopted the

rule in question an “undertaking” or an“association of undertakings”? a. The sports association is an “undertaking” to the

extent it carries out an “economic activity” itself (e.g., the selling of broadcasting rights).

b. The sports association is an “association of undertakings” if its members carry out an economic activity.

If no economic activity, Articles 81 and 82 do not apply

Is trade between MS affected (geographical market, production market, Community interest...)?

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Step 2Step 2

Compatibility of rules with the Community Compatibility of rules with the Community rules on competition cannot be assessed in rules on competition cannot be assessed in the abstract.the abstract.

Taking into account:Taking into account: “ “the overall context” in which the decision of the overall context” in which the decision of

the association of undertakings was taken or the association of undertakings was taken or produces its effects.produces its effects.

Its objectives: Its objectives: measures inherent in the pursuit measures inherent in the pursuit of those objectives and proportionate to themof those objectives and proportionate to them. .

Proportionality of measures (quid sportive Proportionality of measures (quid sportive sanctions?)sanctions?)

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Step 3Step 3

Can the rule be considered Can the rule be considered compatible with EC anti-trust rules compatible with EC anti-trust rules because it fulfils the conditions of because it fulfils the conditions of Article 81(3) EC or because of an Article 81(3) EC or because of an objective justification under Article objective justification under Article 82 EC?82 EC? Case by case approachCase by case approach No General sports exception!No General sports exception!

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Sporting rules that are Sporting rules that are more likely to comply with more likely to comply with

Art. 81 and Art. 82 ECArt. 81 and Art. 82 EC Selection criteria for sport competitionSelection criteria for sport competition At home and away rulesAt home and away rules Transfer periodsTransfer periods Nationality clauses for national teamsNationality clauses for national teams Rules prohibiting the multiple Rules prohibiting the multiple

ownership of clubsownership of clubs Antidoping rulesAntidoping rules Rules of the gameRules of the game

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Sporting rules that are less likely to comply with Articles 81 and 82

EC

Rules regulating professions ancillary Rules regulating professions ancillary to sportto sport

Rules excluding legal challenges of Rules excluding legal challenges of sports awards before ordinary Courtssports awards before ordinary Courts

Rules limiting the number of foreign Rules limiting the number of foreign playersplayers

Rules requiring transfer payments for Rules requiring transfer payments for players at the end of their contractsplayers at the end of their contracts

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THE NEW SCENARIOTHE NEW SCENARIO

RETHINKING SPORT AT EU LEVEL?RETHINKING SPORT AT EU LEVEL? NEW STRATEGIES AMONG NEW STRATEGIES AMONG

STAKEHOLDERS?STAKEHOLDERS? CO-OPERATION WITH THE EU CO-OPERATION WITH THE EU

INSTITUTIONS?INSTITUTIONS? CHANGE THE EU LEGISLATION IN CHANGE THE EU LEGISLATION IN

THE NAME OF AUTONOMY AND THE NAME OF AUTONOMY AND SPECIFICITY OF SPORT?SPECIFICITY OF SPORT?

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CONCLUSIONSCONCLUSIONS

ALL ROADS LEAD TO ALL ROADS LEAD TO ROME BUT FIRST ...ROME BUT FIRST ...

THEY GO THROUGH THEY GO THROUGH BRUSSELSBRUSSELS