The European Super League saga took an unexpected turn yesterday when the Court of Justice of the European Union (CJEU) declined to follow the advisory opinion of its Advocate General and instead ruled that FIFA and UEFA’s rules on the approval of new competitions are anti-competitive. In addition to the Super League itself, the judgment, which was issued at the same time as judgment in the International Skating Union case, has important implications for sport governing bodies in the EU.

Background

In 2021, 12 leading European football clubs announced the formation of a European Super League (ESL) to be organised by the European Super League Company (ESCL), of which they were founder members.  The intention was for the ESL to operate alongside existing football tournaments run under the auspices of Fédération Internationale de Football Association (FIFA) and Union of European Football Associations (UEFA), respectively, football’s worldwide and European governing bodies.

Under FIFA-UEFA’s Statutes, ESLC required prior approval for the new competition. ESLC did not apply for approval and FIFA-UEFA refused to recognise the ESL, declaring that any teams and players participating in the new competition would be excluded from FIFA and UEFA competitions and subject to sanctions.  ESLC applied to the Madrid Commercial Court, complaining of anti-competitive conduct on the part of FIFA and UEFA. The Court in Madrid then referred questions to the CJEU for a preliminary ruling on whether the conduct of the governing bodies was in breach of EU law, specifically competition law.

In December 2022, Advocate General Rantos issued his opinion on the reference.  He was in no doubt as to the importance of the case, stating that “the future of European football will turn on the answers given by the Court to problems related primarily to competition law and, secondarily, to fundamental freedoms.”  He contrasted the ESL model which is a closed league with the European Model of Sport which is given expression in Article 165 of Treaty for the Functioning of the EU and which includes as core elements, a pyramid structure with amateur sport at its base and professional sport at its summit, the promotion of open competitions accessible via promotion and relegations and financial solidarity which allows the redistribution of revenues at lower levels for the benefit of  the sport as a whole.  Finding that EU competition law had to be applied in the light of Article 165, the Advocate General advised the CJEU to respond to the Madrid Court to the effect that: 

1. FIFA-UEFA’s rules on the approval of new competition are compatible with EU law as they are required to uphold objectives relating to the nature of the sport and competitions.
2. FIFA-UEFA should be able to threaten sanctions against member clubs participating in other competitions which may undermine the objectives of FIFA-UEFA competitions.
3. EU law does not preclude FIFA’s rules giving it exclusive marketing rights for competitions as it is necessary for the performance of objectives relation to the nature of sport.
4. EU law does not preclude the provisions of FIFA-UEFA Statutes requiring prior approval of any European competition as it is necessary for the proper running of the competitions.

The judgment of the CJEU

On 21 December, the CJEU published its judgment to the effect that FIFA and UEFA’s rules on requirement for football competitions, such as the Super League, to be approved by it are contrary to EU law on competition.  It reached this conclusion because there is no framework under the relevant FIFA and UEFA rules to ensure that they are transparent, objective, non-discriminatory and proportionate.  The Court gave much less emphasis to Article 165 than the Advocate General had suggested that it should do.   

The CJEU emphasised that FIFA and UEFA were in a dominant position and their rules effectively allowed them to determine whether and on what basis competing tournament organisers (such as ESLC) can come into the market.  Given this conflict of interest, it was abusive for the rules to be exercised without provisions that ensure that they are transparent, objective, non-discriminatory and proportionate.  The rules also breach EU rules on restrictive agreements (Article 101) and the Court considered the relevant provisions to have the object of restricting competition because of the conflict of interest referred to above. It left the determination of whether the rules might benefit from an exemption to the Madrid court (although it indicated that this is unlikely).

The CJEU also considered the provisions in FIFA’s rules on the commercial rights associated with competitions approved by them and found that those provisions infringe Article 101 (and indeed have the object of restricting competition) and most likely amount to the abuse of a dominant position.  It was left to the Madrid court to assess whether the rules might justify an exemption under Article 101(1) and could be regarded as objectively justified under Article 102  “inter alia in the light of the achievement of efficiency gains and the profit reserved for users”.

Next steps

As mentioned above, the judgment is a response to questions put to the CJEU by the Madrid Commercial Court.  That court will now decide whether the relevant provisions of FIFA’s rules are justified under the competition law exemptions available to it under Article 101(3).

In any event, it is important to appreciate that the judgment is about the terms of FIFA and UEFA’s rules and does not mean that the Super League must be approved by UEFA and FIFA.  It is likely that FIFA and UEFA will need to rewrite their rules and consider, on the basis of rules that are compatible with EU law, whether to approve the ESL project.