Middle East investment in Manchester United or Liverpool: Sports law predictions for 2023

As has become traditional at this time of year, Morning Wire has called on the wisdom of Mishcon de Reya’s Simon Leaf and Tom Murray to dust off the crystal ball, don their best Mystic Meg outfits and offer their sports law predictions for next year. So here is our take on 2023 – and a look at how we fared with our predictions from 2022 

Sport in the Middle East

Last year was one of the busiest to date for sports lawyers. Not only did we see the first ever men’s football World Cup held in the Middle East but also the growing influence of investors and nation states from that part of the world. 

Saudi Arabia looks set to continue its sporting dominance in the region, following on from its hosting of the “Rage on the Red Sea” heavyweight boxing bout between Oleksandr Usyk and Anthony Joshua, in which we had the pleasure of being involved, with further boxing and other sporting events on the cards in the kingdom for 2023.

This is in addition to the four Grand Prix races set for the Middle East in 2023 and the late 2021 takeover of Newcastle United FC by a consortium led by the Saudi Public Investment Fund – the body which also backs the LIV Golf project that has sent shockwaves throughout the golfing world through its on-going competition with the PGA Tour. 

We advised clients on a number of the above matters and predict that the Middle East will continue to be a central focus for the sports world in 2023 and beyond – with at least one of either Manchester United or Liverpool receiving investment from the region. 

Regulators on a roll

At the end of 2021, we noted that sports regulators around the world were gearing up for increased regulation; a call which proved to be correct. This looks set to continue in 2023 – particularly in the world of football, with plans to move ahead with a new independent regulator.

This was one of 10 recommendations put forward by Tracey Crouch MP following the Independent Fan Led Review of Football Governance, which was instigated in part as a reaction to the failed European Super League project.

The introduction of an independent regulator, whose primary role will be to oversee the financial regulation of English football, is likely to bring about the most significant reforms of the financial and governance frameworks in football since the introduction of the Premier League in 1992.

This is in addition to world governing body Fifa’s plans to reform the regulation of football agents. The key change which looks set to come into force next year is that payments to agents will be capped at three per cent of a player’s salary where the agent acts for the buying club or the player and 10 per cent of the transfer fee where the agent acts for the selling club.

We predict that there will be further developments in each of the above areas despite the inevitable push-backs from those affected – including to resist the increased regulatory oversight.  

Tech your data flows

Last year, we predicted that Project Red Card, in which colleagues of ours are involved, would not necessarily amount to any substantive legal claim but that other data disputes would emerge. Broadly speaking, we were right.

For those who are unfamiliar with Project Red Card, the dispute relates to potential claims by a group of ex-professional footballers against a wide range of companies who they argue unlawfully used their personal data contrary to data protection legislation. Despite a second significant push in the media, from a legal perspective very little has happened over the past year.

Last year was set to be an important one for data disputes, although two of the most high-profile cases ultimately settled. In June 2022, Sports Information Services Limited and The Racing Partnership settled their on-going dispute relating to the provision of live horse racing and associated odds data that was due to be heard by the Supreme Court.

Similarly, in October 2022, a live sports data dispute between Sportradar, Betgenius and Football DataCo reached a confidential settlement during proceedings before the Competition Appeal Tribunal. The dispute related to Sportradar using data from football matches without going through the official data collector, Genius Sports, and raised various issues, including relating to competition law.

These settlements leave a number of important questions unanswered. By depriving the Courts the opportunity to hear and determine these disputes, both licensees and rights-holders are left without much-needed legal certainty over the issues which gave rise to the disputes in the first place – creating a breeding ground for future disputes. A separate case involving Genius, against Soft Construct (Malta) Limited, is continuing to make its way through the courts and should be monitored.

The pervasiveness of data capture in sport is clear. During the 2022 football World Cup, for example, we have seen an unprecedented level of tracking. We predict that this will continue to pose novel legal questions about the ability to commercially exploit and access such data, which will keep sports lawyers busy in 2023 and beyond.

Separately, given the rise of “rogue” sports technology providers, promising the world but then failing to deliver, we predict an increase in the termination of such deals, with only the more-established reputable providers – particularly in the crypto space – being able to meet new increased regulatory requirements that we foresee being introduced.

Simon Leaf is Head of Sport and Tom Murray is Managing Associate at Mishcon de Reya.