Royal Antwerp case shows European sport ought to copy US interventionist approach
Football fans digesting doom-laden commentary on the Royal Antwerp FC case on the legality of Uefa’s homegrown player regulations may be forgiven for recalling Brenda from Bristol’s reaction to the calling of general elections: “What, another one?”
In recent years, legal challenges before European and national courts have sought to strike down various football regulations, including the approval of new competition formats, limitations on player participation in rival tournaments, rules governing agent activity and elements of the transfer system.
As Belgium’s national courts gear up to hear the complex legal arguments in the Royal Antwerp case this week, following guidance from the Court of Justice of the European Union, it is surely now legitimate to ask: does it have to be this way?
Alternative ways to run sport more effectively and without the constant involvement of courts do exist, with a compelling illustration unfolding now. US college sport finds itself in an unprecedented state of turmoil, reflected in fevered political and public comment on what needs to be done to preserve its unique status and heritage.
What is significant in the US context has been the cross-party commitment to swiftly reform, before it is too late, a system no longer working effectively. Legislation has been drafted and is making its way through Congress. It covers critical policies on the pooling of media rights, player eligibility, transfers, and other competition and regulatory provisions.
These are all key components and especially vulnerable to legal challenge in the absence of clear or sports-specific parameters to guide regulators and the market.
How did it come to this ?
The National Collegiate Athletic Association (NCAA), for so long the unchallenged regulator and competition organiser of inter-collegiate sport, has over the last five years been compelled to adjust and weaken fundamental aspects of its regulatory framework. It followed a series of legal actions which tore through its established rules on amateurism, the status and movement of athletes between different colleges, and the commercialisation of its events.
Judgments in various courts mean that the NCAA is now susceptible to the direct application of antitrust legislation and general labour laws and is facing far more stringent limitations on its enforcement powers, undermining its ability to operate in the face of growing player power, dominant actors, and other external challenges.
The state of play in US college sports is somewhat ironic. US courts, in dealing with legal challenges to the NCAA rulebook, have acted in a similar fashion to European courts when dealing with challenges to the regulations and commercial activities of European sports bodies, international federations and competition organisers.
The European courts have all too readily struck down purportedly anti-competitive sporting regulations based on the application of the single-market competition laws and freed players from restrictions on movement. This has undermined the European model of sport in the eyes of many observers and badly compromised the level playing field in team sports across Europe. Despite a clear need for intervention, no help has been forthcoming from European institutions.
In contrast, the US political establishment has recognised the dangers facing the NCAA and, accordingly, is trying to reassert effective safeguards via legislation, reinstating a sports-specific framework with relevant protections. This allows the NCAA to function as an effective regulator and competition organiser, acting in the wider interest of all college sports, with the benefit of exemptions from the general application of US laws never introduced with the specific attributes of the sports or college sector in mind.
The way forward
There will be very different opinions on what players, regulators, investors and commercial partners of certain colleges want to see play out as the legislative interventions become clearer. Yet, such a proactive approach is preferable to the frequent cliff-edge legal challenges often lasting years and with the ever-present risk of subsequent class actions prolonging sporting and financial insecurity seen in Europe.
If the underlying legal framework across Europe could be similarly adjusted via exemptions from certain labour and antitrust laws in recognition of the unique attributes of sport and the imperative of maintaining uncertainty of sporting outcomes, then the relevant sporting authorities could introduce more effective regulations to address the many problems that exist in football and other codes. This would help avoid defensive regulation and the fear of legal challenges which has limited the confidence of sports regulators to take the steps necessary to preserve its special characteristics.
The contrast between the European or free-market approach to sport and the far more interventionist US model is highly significant. Such reversal of philosophical approach is arguably confined to the sports sector alone, which is telling. As we await the Royal Antwerp decision and the potential dismantling of football regulation as we know it, the US approach increasingly feels the right one.
Darren Bailey is a consultant at Charles Russell Speechlys LLP.