Islj 2009 3-4 - TMC Asser Instituut

have a dominant position. Thereafter, the question arises if there is an
abuse of their power (Jones & Suffrin, 2008, pp. 293-349).
In the market of sports agents, with an international character, it
cannot be said that there is a company present with a dominant position.
This article is not yet very relevant for this market, because the
market is very young and innovative with a lot of new entrants. On
the moment, the level of new entrants will go down or will disappear
at all (a mature market), then it could be the case that one company
has a dominant position. It is important that this firm will act according
article 82. For example, when company A has a dominant position
in the market and there is another player, company B, present.
Company B has a much smaller market share than company A.
Company B is trying to increase market share by fair competition.
Company A can react with predatory pricing.
Predatory pricing is setting the price of the product below the marginal
costs. In this way, company B will go out of the market, then
can Company A increase the prices to recoup its losses from the
predatory pricing. The use of predatory pricing is according article 82
of EC Treaty the abuse of the dominant position (Jones & Suffrin,
2008, pp. 443-466). This simple example, explains why firms in the
market of sports agents could be influenced by article 82 in the future.
In the next chapter, there will be a case, which illustrates the impact
of the regulations set by the European Commission.
3.4.1.3. Case Piau - European Commission, FIFA
The Piau case is an interesting case for sports agents. Laurent Piau is
a French sports agent and he lodged a complaint at the European
Commission about the FIFA. The complaint is about the players’
agent regulations that will be discussed in chapter 3.4.2.1. His complaint
contended several aspects, he said it was restricting the competition
and limiting the free movement of services. The Court of First
Instance (CFI) thinks that the FIFA players’ agent regulation was
legitimate. Ultimately, Piau appealed at the European Court of Justice
(ECJ) against this decision. The ECJ rejected the appeal and agrees
with the CFI. So, it is proven that the FIFA does not limit the competition
by setting the players’ agents regulations.
The CFI and the ECJ only looked to the competition regulations,
article 81 and 82 of EC Treaty. They did not look to article 49 about
the free movement of services. In the book of Siekmann et al. (2007),
Roberto Branco Martins has an interesting article about the Piau-case
(Siekmann et al., 2007, pp. 37-56). It becomes clear from the article
that the Piau-case did not lead to legal certainty. It was not challenged
under the free movements of services principle and that is a threat for
the players’ agents regulations. In the article it became clear that the
CFI was incorrect about the regulations in the profession of sports
agents. They state that there are no regulations present in the laws.
The article explains that 93 % of the sports agents, worldwide, fall
under regulations set by international or national governing bodies.
So, there is still legal uncertainty in the market of sports agents.
It is an interesting case for the sports agents worldwide, but it still
does not give legal certainty to the profession. There was a decision by
the CFI and ECJ, but there were some flaws in the decision. So, legal
certainty is necessary for the profession of sports agents, but they still
do not have it.
3.4.2. Regulations of the FIFA
The FIFA is the international organization of the sport football. The
organization is created on the 21th of May in 1904. The FIFA is also
setting some regulations on the different actors in this sport. Not only
the players’ agents (as the FIFA calls sports agents), but also the players,
clubs and referees are restricted by regulations of the FIFA. There
are six continental associations member of the FIFA, the ‘Union of
European Football Associations’ (UEFA) is the European member. In
this research, the focus will be on the regulations of the sports agents.
There are two important set of regulations, which the sports agent
have to take into account, these are the players’ agent regulations and
20 The players’ agent regulations can be
found in the appendix.
21 Article 4.1 of the regulations players’
agents.
the transfer regulation. The first one speaks for itself and the second
set of regulations is important, because the sports agent is negotiating
on behalf of the player during the transfer. It is interesting for the
sports agents to know the regulations set by a transfer of a player.
3.4.2.1. Players’ agent regulations
In the last version of these regulations, there are some important
aspects. 20 First of all, they explain who can carry out the activity of
players’ agents. Every natural person, who is licensed, can carry out
such activity. There are some exemptions on this rule: ‘The parents,
siblings or spouse of the player may represent him in the negotiating
or renegotiating of an employment contract’. 21 Furthermore, legally
authorized lawyers are also exempt of this rule. Any other person, who
wants to represent players during the negotiating contract, needs a
license. In the regulations, there is explained how someone can send
an application for the exam and how the examination procedure
works. The examination procedure is worldwide the same, in order to
avoid any differences in difficulty in the exam between countries.
Every exam consist of twenty questions, fifteen of the questions are
made by the FIFA. The other five questions are made by every national
association themselves (in the Netherlands the KNVB). The FIFA
also have the right to execute spot checks at the associations, with
regard to the examination procedure. With the new procedure, the
FIFA tries to centralize the issue of licenses. In his way, they try to create
one license, which cannot be bought in corrupt countries, for
example. It does not matter if the license is received in Columbia or
the Netherlands for example. The FIFA guarantees that everyone with
the license has done the exam in a proper way. The question is,
whether the license in every country really has the same value.
When a sports agent passes the exam of the license, he is requested
by the association to conclude professional liability insurance. The
FIFA asks the associations in the different countries, to make a list of
the sports agents in each country and the examining date. The FIFA
is keeping this information in a public database. In this way, a club or
player can easily check whether the sports agent have the license or
not. Clubs and players are obliged to use a sports agent with a license
during the bargaining process, if not, they can receive sanctions. The
FIFA wants that every sports agent have to take a re-exam, every five
years. It means that a license expires after five years after the date of
issue as explained in article 17.
There are also some rights and obligations, which have to be taken
into account by the sports agent. Article 19 of the players’ agent regulation
is about the representation contract between the player and the
sports agent. There has to be a written representation contract between
the player and the sports agent. The contract is only valid for two years
and it has to be extended by a new written agreement. Whenever a
player is a minor, the player’s legal guardians shall also sign the representation
contract.
In the contract it should be clear, who is paying the sports agent
and what the commission is. In this way, the transparency will be
improved among sports agents. Also a regulation which will improve
the transparency in the market of sports agents is that the contract has
to be signed four times. The player or club has to keep the first copy
and the second copy is for the sports agent. In order to improve the
registration process a copy have to be sent to the association the player
or club belongs and one copy has to be sent to the association the
sports agent belongs. In this way, every association can keep a record
of the different sports agents who are active and which players they
are representing.
Furthermore, there are some regulations set about the remuneration
of the sports agent (article 20). A sports agent can only ask a
commission for the annual basic gross income of the player and the
signing fee, when he has negotiated the employment contract. Other
benefits cannot be included, like a car or other privileges. The sports
agent has to decide in advance, whether he is receiving his remuneration
in a lump sum payment or annual installments. In the second
case, the sports agents are entitled to the annual installments even
after the expiration of the representation contract. When the sports
agent and the player could not come to an agreement about the remu-
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