ISLJ 2008-1-2_Def - TMC Asser Instituut

including the fans. But where do you fix the limits? And what effectsdo such limits give rise to under the local law, especially CompanyLaw, and, in particular, in relation to protected minorities, as mostfootball clubs are limited liability companies. And how do you avoidforeign interests operating through trusts and other legal mechanismsand devices, including the use of nominees, to get round any quantitativerestrictions? There is a clear need for openness and transparencyin such respects. Likewise, the source of the foreign investors’ fundsalso needs to be clear. In this connection, highly leveraged financialarrangements that may be involved need to be specified and clarified,especially if the result of them will be to burden the club with heavydebt in the future.Also, to preserve the integrity of the game and the clubs themselves,a so-called ‘fit and proper person’ rule could be introduced - similarto the one that operates in the English Premier League; the world’smost successful and lucrative League. But, again, there is the questionof how you define the concept and what objective - rather than subjective- criteria apply. And also, how you control and police such ameasure. A matter for the sports lawyers and not an easy one to boot!One could also introduce a requirement that foreign investors mustset out their plans for the future development and benefit of the clubconcerned over, say, a five-year period, and, in particular, in whatways and how soon fans may be expected to gain from the businessplan. Again, how do you legally frame and enforce such plans, whichmay turn out to be wishful thinking and good intentions only on thepart of investors and not legally binding, as well as being based on somany assumptions and subject to so many ‘caveats’. Again, all veryfine in theory, but not easy to apply and enforce in practice.At the end of the day, some would argue that perhaps it is better toleave matters to free trade and market forces and adopt a ‘laissez-faire’approach, because, after all, football is now big business and, as such,has come to rely on mega sums coming into the game from a varietyof sources to keep it going and secure its future.Big questions, with no easy answers and, therefore, quite a challengeto sports administrators and their legal advisers alike, but notone, it is submitted, to be ducked. So, it is over to you Mr Blatter!Foreign Player Quotas in Football Teams: Sporting and LegalPros and ConsSepp Blatter, the President of FIFA, the world governing body of football,has been concerned for some time with the preponderance offoreign players, not least in the English FA Premier League, the mostsuccessful and popular of the Football Leagues, with devoted followersthroughout the world. And Blatter has recently been pontificatingon the subject, announcing that he wants to introduce a cap on thenumber of foreign players in football teams. And, furthermore, willtake on the European Commission if there are any objections to thismove on the grounds of discrimination, freedom of movement ofplayers or incompatibility with European Union (EU) CompetitionLaw. Indeed, UEFA, the European governing body of football, isalready working on its so-called ‘home grown players’ regulations,with the same aims and objectives.So, what are the arguments for and against such initiatives, from asporting and a legal point of view?The main sporting argument in favour of such caps appears to bethat the use of foreign players is detrimental to developing homegrown talent. In other words, young non-foreign players, who wouldeventually be eligible to play in national teams in international footballcompetitions, such as the World Cup and the UEFA Cup, are notbeing encouraged, trained and brought on, as substantial financialresources are being committed to buying foreign expensive players.Another sporting reason in favour of limiting the number of foreignersper team is that such restrictions would help to balance out thegame. In other words, there would be more foreign players to goround the various teams and this would even out and enhance thecompetitive element and make for better matches. After all, leaguesthrive on real competition and uncertainty of outcome!Whereas, the main sporting argument against foreign player caps,taking again the example of the English FA Premier League, seems tobe that such leagues and competitions would be less attractive fromthe fans’ and also from the broadcasters’ points of view. One main reasonfor the success of this League is the presence of leading foreignplayers in the teams that compete in this competition, adding excitementand passion to the game. In turn, this makes such a Leagueattractive also to broadcasters, who are willing to pay mega sums forthe TV rights. For example, the English Premier League, the richestin the world, has sold its principal broadcast rights to its matches forthe next three seasons, beginning in August 2007 and ending in 2010,for a record sum of £1.7bn. Again, the lion’s share of these rights,namely 92 live matches per season, have been sold to the satellitebroadcaster, BSkyB, which will be shown as part of its Sky Sportspackage on a subscription basis. The deal means that BSkyB is payingabout £4.8m per game. The Irish pay-TV firm, Setanta, has won theright to show 46 matches per season, at a cost of about £2.8m pergame. Since acquiring the rights, BT (British Telecom) has enteredinto an alliance with Setanta, under which BT will offer its subscribersto its broadband service, BT Vision, packages to view ‘nearlive’ Premier League matches (that is, at 22 00 hours on the day of thegames) on a monthly subscription basis. Such sums and deals are notto be sniffed at or ignored by football clubs and broadcasters alike. So,it all seems to be a matter of money, and, the view in many quarters,particularly amongst fans, is that this obsession with the financial sideof football is tending to undermine the integrity of and tarnish ‘thebeautiful game’.But what of the legal position regarding these caps? Would suchschemes limiting foreign players pass muster under EU Law?Particularly now since the decision of the European Court of Justicein the Meca-Medina case (Case C-519/04P, Meca-Medina and Majcenv. Commission, ECR 2006, I-6991), which, to some extent, has limitedthe application of the so-called ‘sporting exception’ (or to use EUspeak the ‘specificity of sport’) to such restrictions under EU Law. Theeffect of this ruling is that there is no general exemption where restrictionsare imposed for sporting reasons; each case must be consideredon its own particular circumstances and merits. In any case, therestrictions should go no further than is reasonably necessary toachieve the particular sporting objective.Also, does the so-called ‘White Paper’ on Sport, recently publishedby the European Commission, shed any light on the legal situation?The ‘White Paper’ accepts and takes stock of the ‘acquis communautaire’(the existing body of European Law, particularly comprising rulingsof the European Court of Justice) in the sports field. And pointsout that the specificity of sport has been recognised and taken intoaccount in various decisions of the European Court of Justice and theEuropean Commission over the years. Take Bosman (Case C-415/93[1995] ECR I-4921), for example, the European Court of Justice statedthat:“In view of the considerable social importance of sporting activitiesand in particular football in the Community, the aims of maintaininga balance between clubs by preserving a certain degree of equality anduncertainty as to results and of encouraging the recruitment and trainingof young players must be accepted as legitimate.”108 2008/1-2OPINION