–Ketan Gupta, N.Y.U. School of Law
The unipolar nature of sports governance, wherein the gameplay as well as the economics of a sport are shaped by one dominant sport federation, stretches across geographies and across sports such as golf, tennis, and football. Even though breakaway leagues are not a recent phenomenon, incumbent sports governing bodies have always tended to use their economic dominance and internal rules to protect their position in the sports market.[1] In this context, when the gatekeeping function of a dominant sports federation is challenged and new nascent federations are allowed to enter the market as administrators or organizers of competitions, there is a sense of excitement and possibility in relation to what the future of the sport could look like.
All this true is even more true for football in Europe, where football not only commands serious historical and cultural currency, but is also seen as a vehicle of pan-European identity-building and as a means to achieving Europe integration.[2] Given FIFA and UEFA’s dominance of the market for football competitions in Europe, and considering the complexities that inform any regulatory or policy-based controls that the EU Commission and the European Court of Justice (CJEU) may exercise over both federations,[3] the CJEU’s recent judgment—labelling UEFA and FIFA’s internal rules as an abuse of dominance—is nothing short of a revolution. Since its founding in 1954, UEFA has profoundly transformed the game of football from an amateur activity to a fully professionalized and commercial enterprise, and for decades, it has controlled football clubs in Europe both politically and financially, negotiating their sources of revenue while also deciding how to share them.[4] While technically a not-for-profit organization, UEFA behaves like a monopolist—particularly in the market for sports media rights—and its control over clubs has only grown as their dependence on media rights has increased.[5] In this context, the April 2021 announcement of the “Super League” project—an independent pan-European competition—by European Super-League Corporation (ESLC), a business entity incorporated in Spain,[6] shook the European sports ecosystem, signaling a serious challenge to the status quo.[7] The European Court of Justice’s judgement on December 21, 2023, relates to the legal controversy that this announcement kicked off.
When threatened with sanctions by FIFA and UEFA, ESLC lodged a complaint in a Spanish court.[8] The Spanish court then posed three questions along with its request for a preliminary ruling, addressing the UEFA statutes’ provision for prior approval and asking whether sanctions against participating clubs and participating players are lawful.[9] AG Rantos consolidated the three questions into two, namely:
1) Whether the UEFA regulation for prior approval can be seen a restriction by object per Art 101; and
2) Whether the exclusion of a rival competition can be seen as necessary in pursuing a legitimate objective.[10]
The authors first describe the standard of review when it comes to deciding whether conduct is anticompetitive by object or by effect.[11] Only when there is no strong anticompetitive prior is it necessary to look at the effects of conduct, in parallel to American courts’ distinction between per se illegal conduct and conduct that is judged under the rule of reason.[12]
While organizations in the EU are sometimes allowed to approve or exclude their own competitors, American courts would tend to look at such conduct with inherent suspicion, since boycotting competitors can implicate American antitrust statutes and make markets less competitive.[13] Even so, vague approval criteria were held by the General Court to be a relevant element in deciding whether an approval system was restriction by object.[14] Confusingly, AG Rantos disagreed with the General Court, holding that vague criteria were not indicative of restriction by object and that anticompetitive exclusion was merely a theoretical possibility.[15] Here, AG Rantos seemed reluctant to link formal legal logic with clear economic incentives. This opinion also potentially challenges T-Mobile, which held that an agreement could be seen as restriction by object if it had the capability of having anticompetitive effects.[16]
AG Rantos seemingly misapplied precedent, since Maxima Latja and DLG do not appear to be on point for this particular case.[17] Further, Remia and others vs Commission and Pronuptia de Paris are both cases where the Court refers to a less competitive outcome in the counterfactual and concludes that the restriction led to more competition on balance. However, these counterfactuals are not applicable to UEFA’s case.[18]
The second question relates to whether a restriction has a “legitimate objective.” The CJEU held in Wouters that, to the extent that a legitimate objective is pursued and that the restriction of competition is inherent in its pursuit and proportionate, there is no violation of Article 101.[19] This carveout is similar to the cognizability of procompetitive benefits in American courts, as shown by BMI.[20]
The AG holds the pursuit of the European Sports Model (ESM) to be a legitimate objective, per Article 165 of the TFEU.[21] However, in my view, AG Rantos reads too much into Article 165; the EU is only supposed to support its members states’ prerogatives, not impose restraints on member states. AG Szpunar clarified that UEFA was a commercial enterprise and could not be the target of Article 165.[22] The AG confusingly attributes public policy objectives to a commercial organization whose own statutes don’t mention these goals!
Summing up the 2022 decision, there seem to have been some lapses in the AG’s reasoning about the legitimacy and motivations behind UEFA’s restriction on and threat of sanctions against the Super League.
The 2023 decision takes a completely different direction, with the European Court of Justice holding that UEFA and FIFA abused their dominant position in the market by implementing rules that restricted, on pain of sanctions, the setting-up of an alternative pan-European football competition.[23] The Court first confirms that Articles 45, 49, 56, 63, 101, and 102 of the TFEU apply to the conduct of private associations like FIFA and UEFA.[24] The Court reviewed FIFA and UEFA’s implementation of their rules in the dispute at issue, and determined that their sanctions against the Super League were in violation of Article 102 of the TFEU since FIFA and UEFA abused their dominant position in the market for organizing football competitions by adopting rules which stopped other entities from setting up a new interclub competition in EU territory.[25] This part of the Court’s analysis is crucial, since it brings sports governing bodies (SGBs) like UEFA and FIFA squarely into the ambit of EU competition law, and classifies them as economic actors operating in a market even though their product—competitive professional sports—may differ in terms of “production” and “consumption” from the products of other economic actors.
The Court also evaluated the object of FIFA and UEFA’s restrictions in light of article 101 of the TFEU, finding that since “…there is no framework providing for substantive criteria and detailed procedural rules suitable for ensuring that they are transparent, objective, precise, non discriminatory and proportionate,”[26] these restrictions come under Article 101’s prohibition on anticompetitive restrictions, with no need for a review their actual or potential effects.[27] The Court even cites Meca-Medina and Majcen v Commission to concede that in some contexts, restrictive rules that limit athletes’ freedom of action or competition among athletes are legitimate under Article 101(1) of the TEFU if they “…safeguard the fairness, integrity and objectivity of the conduct of competitive sport, ensure equal opportunities for athletes, protect their health and uphold the ethical values at the heart of sport, including merit.”[28] However, the Court makes clear that it is uncertain whether UEFA and FIFA’s rules qualify for the exemption under Article 101(3) of the TFEU, based on any efficiency gains these rules yield and depending on whether the market position of UEFA and FIFA don’t make it so that these rules eliminate effectively all competition in the market.[29] Here, the Court clarifies that even though sports organizations have enjoyed certain regulatory exemptions in order to produce something of value to the European community, there still needs to be a solid basis for such exemptions, and that SGBs cannot compromise the fairness or integrity of a sport in the process of imposing restrictions on its players or clubs.
The Court then describes the balancing test contained in Article 102, wherein “…an undertaking may demonstrate, to that end, either that its conduct is objectively necessary, or that the exclusionary effect produced may be counterbalanced or even outweighed by advantages in terms of efficiency which also benefit the consumer.”[30] Here, it seems that the discretionary nature of UEFA and FIFA’s rules preclude the possibility that they may be objectively justified as a technical or commercial necessity.[31] The threshold for these rules to be justified under Article 102 or exempted under Article 101(1) of the TFEU is quite high, and the burden is on UEFA and FIFA to prove with evidence and arguments that the conditions required for the exemption and/or justification have been fulfilled.[32]
The Court held that Articles 67 and 68 of the FIFA Statutes fall under the ambit of Articles 101 and 102 of the TFEU and are not excepted from the TFEU as Swiss private law,[33] since FIFA and UEFA control the right to organize and the revenue emanating from interclub competitions in EU territory.[34] The Court also found that FIFA and UEFA’s rules violate Article 56 of the TFEU by impeding the freedom to provide services,[35] and further, do not seem to be justifiable on the basis of a legitimate public interest objective (the European Sports Model referenced above).[36]
In sum, this ruling declares the rules utilized by FIFA and UEFA to stop the establishment of the Super League in 2021 to be violations of EU law. This opens the door, potentially, for other well-funded challenger competitions in multiple sports. Overall, the court takes a completely different approach from AG Rantos. Whereas AG Rantos drew every favorable presumption in favor of FIFA and UEFA, it seems that the Court undertook an extensive and detailed analysis of the UEFA and FIFA rules and decided that they were likely prohibited by various provisions of the TFEU. It is noteworthy, however, that the Court does not affirmatively demand that a league like the Super League must be approved.[37] This leaves the door open for future controversies in the establishment of the Super League.
This decision is also consequential for the broader world of sports, beyond just football, since SGBs are now faced with well-funded challenger competitions in many sports, such as LIV in golf, which was a rival to the traditional incumbent PGA Tour[38] before the two decided to merge.[39] While SGBs have generally responded to the emergence of rival SGBs or would-be rivals by enforcing strict rules limiting competion,[40] the ECJ verdict will curtail such strategies in the future on the part of SGBs by defining and regulating their activity as economic activity and applying the full swath of antitrust regulation to their conduct, be it in Europe, the U.S., or elsewhere. While the UEFA and FIFA insist that the verdict does not change the status quo much and certainly does not legitimize the Super League, and while it is true that the ECJ did not explicitly affirm the launch of the Super League, the ruling has certainly constrained SGBs like UEFA and FIFA in their dominance of sports markets[41] and has created the possibility of—if not granted certainty to—the launch of rival SGBs in the future.
Suggested citation: Ketan Gupta, A Super Judgment on the Super League: The CJEU’s Antitrust Decision on Football, Int’l J. Const. L. Blog, Jan. 12, 2024, at: http://www.iconnectblog.com/a-super-judgment-on-the-super-league-the-cjeus-antitrust-decision-on-football/
[1] Josh Noble & Samuel Agini, World sport rattled by rulings that open route to goal for new entrants, The Financial Times, https://www.ft.com/content/6cf1cf1e-154d-448d-869e-e76855183017?accessToken=zwAGDX5Nf4DQkc9s8c8eFU1EjdOGnudoVRgwFw.MEYCIQC7f1hLktcsyOLWuf6pYi5sewOs – zenlpKkTjDTumsVQIhAObgwmoFm3jyL1QgSW1ybFo3STD1RgBX9mCo0xDrNc2h&sharetype=gift&token=8a999cd5-d7bc-495b-8f66-2b2c33745efa
[2] Tobias Finger et al., “RESEARCHING FOOTBALL, IDENTITY AND COHESION IN EUROPE,” Sports Law, Policy & Diplomacy Journal 1, no. 1 (2023): 131–57, https://doi.org/10.30925/slpdj.1.1.5.
[3] Arnout Geeraert, “The EU’s Engagement with FIFA and UEFA: Principals, Agents, and Supervisors,” essay, in The EU in International Sports Governance : A Principal-Agent Perspective on EU Control of FIFA and UEFA (London: Palgrave Macmillan UK :Imprint: Palgrave Macmillan, 2016).
[4] Massimo Ruberti, “Why Does the European Football Market Need a Revolution?,” Accounting, Auditing & Accountability Journal ahead-of-print, no. ahead-of-print (2023), https://doi.org/10.1108/aaaj-06-2022-5885.
[5] Massimo Ruberti, “Why Does the European Football Market Need a Revolution?,” Accounting, Auditing & Accountability Journal ahead-of-print, no. ahead-of-print (2023), https://doi.org/10.1108/aaaj-06-2022-5885.
[6] Petros C. Mavroidis & Damien Neven, The EU Court of Justice AG Rantos argues that a football federation’s exclusion of a rival football competition is not a restriction by object and is necessary to protect the European Sport Model (ESLC / UEFA / FIFA), Concurrences: e-Competitions (Dec. 15, 2022), https://www.concurrences.com/en/bulletin/news-issues/december-2022-4460/the-eu-court-of-justice-ag-rantos-argues-that-a-football-federation-s-exclusion.
[7] Massimo Ruberti, “Why Does the European Football Market Need a Revolution?,” Accounting, Auditing & Accountability Journal ahead-of-print, no. ahead-of-print (2023), https://doi.org/10.1108/aaaj-06-2022-5885.
[8] Petros C. Mavroidis & Damien Neven, The EU Court of Justice AG Rantos argues that a football federation’s exclusion of a rival football competition is not a restriction by object and is necessary to protect the European Sport Model (ESLC / UEFA / FIFA), Concurrences: e-Competitions (Dec. 15, 2022), https://www.concurrences.com/en/bulletin/news-issues/december-2022-4460/the-eu-court-of-justice-ag-rantos-argues-that-a-football-federation-s-exclusion.
[9] Petros C. Mavroidis & Damien Neven, The EU Court of Justice AG Rantos argues that a football federation’s exclusion of a rival football competition is not a restriction by object and is necessary to protect the European Sport Model (ESLC / UEFA / FIFA), Concurrences: e-Competitions (Dec. 15, 2022), https://www.concurrences.com/en/bulletin/news-issues/december-2022-4460/the-eu-court-of-justice-ag-rantos-argues-that-a-football-federation-s-exclusion.
[10]Petros C. Mavroidis & Damien Neven, The EU Court of Justice AG Rantos argues that a football federation’s exclusion of a rival football competition is not a restriction by object and is necessary to protect the European Sport Model (ESLC / UEFA / FIFA), Concurrences: e-Competitions (Dec. 15, 2022), https://www.concurrences.com/en/bulletin/news-issues/december-2022-4460/the-eu-court-of-justice-ag-rantos-argues-that-a-football-federation-s-exclusion.
[11] Petros C. Mavroidis & Damien Neven, The EU Court of Justice AG Rantos argues that a football federation’s exclusion of a rival football competition is not a restriction by object and is necessary to protect the European Sport Model (ESLC / UEFA / FIFA), Concurrences: e-Competitions (Dec. 15, 2022), https://www.concurrences.com/en/bulletin/news-issues/december-2022-4460/the-eu-court-of-justice-ag-rantos-argues-that-a-football-federation-s-exclusion.
[12] Antitrust Per Se Standard, Practical Law Practice Note w-024-5969; see also Texaco Inc. v. Dagher, 547 U.S. 1, 5 (2006).
[13] Mishawaka v American Electric Power Co. (ND Ind) 465 F Supp 1320.
[14] Petros C. Mavroidis & Damien Neven, The EU Court of Justice AG Rantos argues that a football federation’s exclusion of a rival football competition is not a restriction by object and is necessary to protect the European Sport Model (ESLC / UEFA / FIFA), Concurrences: e-Competitions (Dec. 15, 2022), https://www.concurrences.com/en/bulletin/news-issues/december-2022-4460/the-eu-court-of-justice-ag-rantos-argues-that-a-football-federation-s-exclusion.
[15] Petros C. Mavroidis & Damien Neven, The EU Court of Justice AG Rantos argues that a football federation’s exclusion of a rival football competition is not a restriction by object and is necessary to protect the European Sport Model (ESLC / UEFA / FIFA), Concurrences: e-Competitions (Dec. 15, 2022), https://www.concurrences.com/en/bulletin/news-issues/december-2022-4460/the-eu-court-of-justice-ag-rantos-argues-that-a-football-federation-s-exclusion.
[16] Petros C. Mavroidis & Damien Neven, The EU Court of Justice AG Rantos argues that a football federation’s exclusion of a rival football competition is not a restriction by object and is necessary to protect the European Sport Model (ESLC / UEFA / FIFA), Concurrences: e-Competitions (Dec. 15, 2022), https://www.concurrences.com/en/bulletin/news-issues/december-2022-4460/the-eu-court-of-justice-ag-rantos-argues-that-a-football-federation-s-exclusion.
[17] Petros C. Mavroidis & Damien Neven, The EU Court of Justice AG Rantos argues that a football federation’s exclusion of a rival football competition is not a restriction by object and is necessary to protect the European Sport Model (ESLC / UEFA / FIFA), Concurrences: e-Competitions (Dec. 15, 2022), https://www.concurrences.com/en/bulletin/news-issues/december-2022-4460/the-eu-court-of-justice-ag-rantos-argues-that-a-football-federation-s-exclusion.
[18] Petros C. Mavroidis & Damien Neven, The EU Court of Justice AG Rantos argues that a football federation’s exclusion of a rival football competition is not a restriction by object and is necessary to protect the European Sport Model (ESLC / UEFA / FIFA), Concurrences: e-Competitions (Dec. 15, 2022), https://www.concurrences.com/en/bulletin/news-issues/december-2022-4460/the-eu-court-of-justice-ag-rantos-argues-that-a-football-federation-s-exclusion.
[19] Petros C. Mavroidis & Damien Neven, The EU Court of Justice AG Rantos argues that a football federation’s exclusion of a rival football competition is not a restriction by object and is necessary to protect the European Sport Model (ESLC / UEFA / FIFA), Concurrences: e-Competitions (Dec. 15, 2022), https://www.concurrences.com/en/bulletin/news-issues/december-2022-4460/the-eu-court-of-justice-ag-rantos-argues-that-a-football-federation-s-exclusion.
[20] Broad. Music, Inc. v. Columbia Broad. Sys., Inc., 441 U.S. 1, 24 (1979).
[21] Petros C. Mavroidis & Damien Neven, The EU Court of Justice AG Rantos argues that a football federation’s exclusion of a rival football competition is not a restriction by object and is necessary to protect the European Sport Model (ESLC / UEFA / FIFA), Concurrences: e-Competitions (Dec. 15, 2022), https://www.concurrences.com/en/bulletin/news-issues/december-2022-4460/the-eu-court-of-justice-ag-rantos-argues-that-a-football-federation-s-exclusion.
[22] Petros C. Mavroidis & Damien Neven, The EU Court of Justice AG Rantos argues that a football federation’s exclusion of a rival football competition is not a restriction by object and is necessary to protect the European Sport Model (ESLC / UEFA / FIFA), Concurrences: e-Competitions (Dec. 15, 2022), https://www.concurrences.com/en/bulletin/news-issues/december-2022-4460/the-eu-court-of-justice-ag-rantos-argues-that-a-football-federation-s-exclusion.
[23] C-333/21, European Superleague Company v. Féd’n int’l de football ass’n (FIFA) and Union of Eur. Football Ass’ns (UEFA), ECLI:EU:C:2023:1011, ¶ 178, (Dec. 21, 2023).
[24] C-333/21, European Superleague Company v. Féd’n int’l de football ass’n (FIFA) and Union of Eur. Football Ass’ns (UEFA), ECLI:EU:C:2023:1011, ¶¶ 82-82, (Dec. 21, 2023).
[25] C-333/21, European Superleague Company v. Féd’n int’l de football ass’n (FIFA) and Union of Eur. Football Ass’ns (UEFA), ECLI:EU:C:2023:1011, ¶¶ 151-152, (Dec. 21, 2023).
[26] C-333/21, European Superleague Company v. Féd’n int’l de football ass’n (FIFA) and Union of Eur. Football Ass’ns (UEFA), ECLI:EU:C:2023:1011, ¶ 178, (Dec. 21, 2023).
[27] C-333/21, European Superleague Company v. Féd’n int’l de football ass’n (FIFA) and Union of Eur. Football Ass’ns (UEFA), ECLI:EU:C:2023:1011, ¶ 178, (Dec. 21, 2023).
[28] C-333/21, European Superleague Company v. Féd’n int’l de football ass’n (FIFA) and Union of Eur. Football Ass’ns (UEFA), ECLI:EU:C:2023:1011, ¶ 184, (Dec. 21, 2023).
[29] C-333/21, European Superleague Company v. Féd’n int’l de football ass’n (FIFA) and Union of Eur. Football Ass’ns (UEFA), ECLI:EU:C:2023:1011, ¶¶ 189-200, (Dec. 21, 2023).
[30] C-333/21, European Superleague Company v. Féd’n int’l de football ass’n (FIFA) and Union of Eur. Football Ass’ns (UEFA), ECLI:EU:C:2023:1011, ¶ 202, (Dec. 21, 2023).
[31] C-333/21, European Superleague Company v. Féd’n int’l de football ass’n (FIFA) and Union of Eur. Football Ass’ns (UEFA), ECLI:EU:C:2023:1011, ¶ 203, (Dec. 21, 2023).
[32] C-333/21, European Superleague Company v. Féd’n int’l de football ass’n (FIFA) and Union of Eur. Football Ass’ns (UEFA), ECLI:EU:C:2023:1011, ¶ 209, (Dec. 21, 2023).
[33] C-333/21, European Superleague Company v. Féd’n int’l de football ass’n (FIFA) and Union of Eur. Football Ass’ns (UEFA), ECLI:EU:C:2023:1011, ¶ 211, (Dec. 21, 2023).
[34] C-333/21, European Superleague Company v. Féd’n int’l de football ass’n (FIFA) and Union of Eur. Football Ass’ns (UEFA), ECLI:EU:C:2023:1011, ¶¶ 217-230, (Dec. 21, 2023).
[35] -333/21, European Superleague Company v. Féd’n int’l de football ass’n (FIFA) and Union of Eur. Football Ass’ns (UEFA), ECLI:EU:C:2023:1011, ¶ 250, (Dec. 21, 2023).
[36] C-333/21, European Superleague Company v. Féd’n int’l de football ass’n (FIFA) and Union of Eur. Football Ass’ns (UEFA), ECLI:EU:C:2023:1011, ¶¶ 256-257, (Dec. 21, 2023).
[37] Bart H. Meijer & Rohith Nair, European Super League back in spotlight after landmark ruling, Reuters, https://www.reuters.com/sports/soccer/court-rules-uefa-fifa-breached-eu-law-over-super-league-2023-12-21/.
[38] Josh Noble & Samuel Agini, World sport rattled by rulings that open route to goal for new entrants, The Financial Times, https://www.ft.com/content/6cf1cf1e-154d-448d-869e-e76855183017?accessToken=zwAGDX5Nf4DQkc9s8c8eFU1EjdOGnudoVRgwFw.MEYCIQC7f1hLktcsyOLWuf6pYi5sewOs – zenlpKkTjDTumsVQIhAObgwmoFm3jyL1QgSW1ybFo3STD1RgBX9mCo0xDrNc2h&sharetype=gift&token=8a999cd5-d7bc-495b-8f66-2b2c33745efa.
[39] Lillian Rizzo, PGA Tour agrees to merge with Saudi-backed rival LIV Golf, CNBC, https://www.cnbc.com/2023/06/06/pga-tour-agrees-to-merge-with-saudi-backed-rival-liv-golf.html.
[40] Josh Noble & Samuel Agini, World sport rattled by rulings that open route to goal for new entrants, The Financial Times, https://www.ft.com/content/6cf1cf1e-154d-448d-869e-e76855183017?accessToken=zwAGDX5Nf4DQkc9s8c8eFU1EjdOGnudoVRgwFw.MEYCIQC7f1hLktcsyOLWuf6pYi5sewOs – zenlpKkTjDTumsVQIhAObgwmoFm3jyL1QgSW1ybFo3STD1RgBX9mCo0xDrNc2h&sharetype=gift&token=8a999cd5-d7bc-495b-8f66-2b2c33745efa.
[41] Josh Noble & Samuel Agini, World sport rattled by rulings that open route to goal for new entrants, The Financial Times, https://www.ft.com/content/6cf1cf1e-154d-448d-869e-e76855183017?accessToken=zwAGDX5Nf4DQkc9s8c8eFU1EjdOGnudoVRgwFw.MEYCIQC7f1hLktcsyOLWuf6pYi5sewOs – zenlpKkTjDTumsVQIhAObgwmoFm3jyL1QgSW1ybFo3STD1RgBX9mCo0xDrNc2h&sharetype=gift&token=8a999cd5-d7bc-495b-8f66-2b2c33745efa.
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