Case C‑650/22

Fédération internationale de football association (FIFA)

(Request for a preliminary ruling from the cour d’appel de Mons (Belgium))

Judgment of the Court (Second Chamber) of 4 October 2024

(Reference for a preliminary ruling – Internal market – Competition – Rules introduced by an international sports association and implemented by that association with the assistance of its members – Professional football – Private law entities vested with regulatory and control powers, and the power to impose sanctions – Regulations on the Status and Transfer of Players – Regulations relating to the employment contracts concluded between clubs and players – Early termination of an employment contract by the player – Player required to pay compensation – Joint and several liability of the new club – Sanctions – Prohibition on issuing and registering the player’s International Transfer Certificate while a dispute relating to the early termination of the employment contract is pending – Prohibition of registration of other players – Article 45 TFEU – Restriction on the freedom of movement of workers – Justification – Article 101 TFEU – Decision by an association of undertakings having as its object the prevention or restriction of competition – Employment market – Recruitment of players by clubs – Market for interclub football competitions – Participation of clubs and players in sporting competitions – Restriction of competition by object – Exemption)

Judicial proceedings – Intervention – Preliminary ruling procedure – Participation of the parties to the dispute in the main proceedings – Jurisdiction of the Court to exclude such a party from the proceedings – Limits – Status of party to the dispute in the main proceedings acquired subsequently to the submission of the request for a preliminary ruling – Irrelevant

(Art. 267 TFEU; Statute of the Court of Justice, Art. 23; Rules of Procedure of the Court of Justice, Arts 96(1) and 97(1))

(see paragraphs 54-56)
Questions referred for a preliminary ruling – Jurisdiction of the Court – Limits – Question raised concerning a dispute confined within a single Member State – Manifest lack of jurisdiction of the Court – Limits with respect to the fundamental freedoms guaranteed by the Treaty

(Arts 45, 49, 56 and 63 TFEU; Rules of Procedure of the Court of Justice, Art. 94)

(see paragraph 70)
EU law – Scope – Pursuit of sport as an economic activity – Included – Rules adopted solely on non-economic grounds and relating to questions of interest solely to sport – Not included – Rules originating from a sports association relating to the employment contracts of players or to their transfers – Rules having an impact on players’ economic activity – Rules having an impact on the economic activity created by competitions and competition between the sports clubs concerned – Included

(Arts 45 and 101 TFEU)

(see paragraphs 75-82)
EU law – Scope – Pursuit of sport as an economic activity – Included – Rules originating from a sports association relating to the employment contracts of players or to their transfers – Restriction – Justification – Account taken of the specific characteristics of sport

(Arts 45 and 101 TFEU)

(see paragraphs 84, 85)
Freedom of movement of persons – Workers – Restrictions – Rules originating from a sports association relating to the employment contracts of players or to their transfers – Rules providing, in the event of early termination of the employment contract without just cause, for the player to be ordered to pay compensation, and for joint and several liability for the new club – Additional sporting sanction incurred by the new club where the player is signed during the protected period provided for in the employment contract which has been terminated – Pending proceedings relating to the termination of the contract without just cause prohibiting the issuance of the International Transfer Certificate to the player concerned – Not permissible – Justification – Regularity of interclub football competitions – Observance of the principle of proportionality – Verification by the referring court

(Art. 45 TFEU)

(see paragraphs 86, 91-97, 99-114, operative part 1)
Agreements, decisions and concerted practices – Decisions by associations of undertakings – Concept of an ‘association of undertakings’ – Association having national football associations as members – National associations concerned themselves having as members entities that may be categorised as undertakings or as pursuing an economic activity – Organisation and marketing by those associations of interclub football competitions at national level and exploitation of the rights related thereto – Included

(Art. 101(1) TFEU)

(see paragraphs 117, 118)
Agreements, decisions and concerted practices – Decisions by associations of undertakings – Concept – Rules originating from a sports association relating to the employment contracts of players or to their transfers – Rules having a direct impact on the conditions of the member undertakings’ pursuit of the economic activity – Included

(Art. 101(1) TFEU)

(see paragraphs 119-121)
Agreements, decisions and concerted practices – Effect on trade between Member States – Criteria – Rules having universal geographic scope

(Art. 101(1) TFEU)

(see paragraphs 122, 123)
Agreements, decisions and concerted practices – Criteria for assessment – Distinction between restrictions by object and by effect – Restriction by object – Sufficient degree of harmfulness – Sufficient – Nature of the collusive behaviour

(Art. 101(1) TFEU)

(see paragraphs 124-129)
Agreements, decisions and concerted practices – Adverse effect on competition – Criteria for assessment – Content and objective of an agreement, decision or concerted practice and economic and legal context of its development– Distinction between restrictions by object and by effect – Intention of the parties to an agreement to restrict competition – Not a necessary criterion – Infringement by object – Sufficient degree of harmfulness

(Art. 101 TFEU)

(see paragraphs 130-133)
Agreements, decisions and concerted practices – Adverse effect on competition – Decisions by associations of undertakings – Rules originating from a sports association relating to the employment contracts of players or to their transfers – Rules providing, in the event of early termination of the employment contract without just cause, for the player to be ordered to pay compensation, and for joint and several liability for the new club – Additional sporting sanction incurred by the new club where the player is signed during the protected period provided for in the employment contract which has been terminated – Pending proceedings relating to the termination of the contract without just cause prohibiting the issuance of the International Transfer Certificate to the player concerned – Restriction by object – Exemption – Conditions

(Art. 101 TFEU)

(see paragraphs 138-152, 157, 158, operative part 2)
Agreements, decisions and concerted practices – Prohibition – Exemption – Conditions – Improvement of the production or distribution of goods or contribution to technical or economic progress – Appreciable objective advantages of such a character as to compensate for the disadvantages for competition resulting from that agreement – Indispensable or necessary nature of the conduct at issue – No elimination of all effective competition for a substantial part of the products or services concerned – Burden of proof – Conditions of exemption cumulative

(Art. 101(3) TFEU)

(see paragraphs 153-156)

Résumé

On a reference for a preliminary ruling from the cour d’appel de Mons (Court of Appeal, Mons (Belgium)), the Court again rules on the application of EU economic law to the rules introduced by an international sports federation. ( 1 ) By the present judgment, it clarifies the way in which the articles of the FEU Treaty establishing the principle of freedom of movement of workers and the prohibition of agreements, decisions and concerted practices ( 2 ) apply to the rules adopted by an international sports federation relating to the status and transfer of players.

The Fédération internationale de football association (FIFA) is an association governed by Swiss law whose objectives are, inter alia, to draw up regulations governing the game of football and related matters at world level. It is made up of national football associations which are required, inter alia, to ensure that their own members or affiliates comply with all the rules which it lays down.

In March 2014, FIFA adopted the ‘Regulations on the Status and Transfer of Players’ (‘the RSTP’). The RSTP provide, inter alia, that every new professional football club which signs a player following the termination of an employment contract without just cause is to be jointly and severally liable for payment of the compensation which that player may be required to pay to his or her former club, such compensation being set on the basis of various criteria set out in those regulations. ( 3 ) The RSTP also provide that the new club is to be presumed to have induced the player to terminate the employment contract with his or her former club and may, in certain cases, expose that new club to a sporting sanction consisting in a ban on registering any new players during a specified period. ( 4 ) Lastly, the RSTP provide that the national football association to which the former club belongs cannot issue an International Transfer Certificate (ITC) for the player where there is a dispute pending between that former club and that player arising from the early termination of the employment contract where there is no mutual agreement. ( 5 )

BZ is a former professional footballer residing in Paris (France). In August 2013, he signed a four-year employment contract with a Russian professional football club. The following year, the club terminated that contract on grounds of alleged misconduct by BZ and applied to the FIFA Dispute Resolution Chamber for an order that BZ pay compensation of EUR 20 million, alleging ‘termination of contract without just cause’ within the meaning of the RSTP.

In May 2015, the FIFA Dispute Resolution Chamber upheld the club’s claim in part and ordered BZ to pay it compensation of EUR 10.5 million. It also ruled that the RSTP, in so far as they provide that any new professional football club signing the player is to be jointly and severally liable for payment of such compensation, would not apply to BZ in future. In May 2016, the Court of Arbitration for Sport upheld that decision on appeal.

In December 2015, BZ brought proceedings before the tribunal de commerce du Hainaut (division de Charleroi) (Commercial Court, Hainaut (Charleroi Division), Belgium), seeking an order that FIFA and the Union royale belge des sociétés de football association ASBL (URBSFA) pay him compensation of EUR 6 million for the loss which he claimed to have sustained by not being able to be employed in 2015 by the Belgian club Sporting du Pays de Charleroi SA, by reason of the requirements imposed by the RSTP. In January 2017, that court found that claim to be well founded in principle and ordered the two associations to pay a provisional sum.

On appeal by FIFA, the referring court asks the Court whether, having regard to the specificity of sport, in particular as it relates to the proper conduct of sporting competitions, the rules at issue must be considered to constitute a restriction on the freedom of movement of workers and on competition.

Findings of the Court

As a preliminary point, the Court states that the rules at issue in the main proceedings have a direct impact on players’ working conditions and, therefore, on their economic activity. In addition, since the composition of the teams is one of the essential parameters of competitions, the rules at issue must be considered to have a direct impact on the conditions of pursuit of the economic activity to which those competitions give rise and on competition between the clubs pursuing that activity. The rules at issue therefore come within the scope of Articles 45 and 101 TFEU, which the Court, in the light of the differences in sphere attaching to those two provisions, interprets in turn.

In the first place, as regards Article 45 TFEU, the Court finds that there is a restriction on the freedom of movement of workers. In that regard, it observes that the rules at issue in the main proceedings are likely to discriminate against players who wish to pursue their economic activity on behalf of a new club established on the territory of a Member State other than that of their residence or of their current place of work by unilaterally terminating their employment contract with their former club for what the former club may or may not claim is not just cause. The existence and combination of those rules have the consequence that those clubs bear significant legal risks, unpredictable and potentially very high financial risks and major sporting risks which, taken together, are clearly such as to dissuade them from signing such players.

As regards the existence of possible justification, the Court points out that the objective of ensuring the regularity of sporting competitions constitutes a legitimate interest of general interest that can be pursued by a sports association. That objective is also of particular importance in the case of football, given the essential role afforded to sporting merit in the conduct of competitions. In addition, the Court observes that, since the composition of teams is one of the essential parameters of competitions, maintaining a certain degree of stability in the player rosters of clubs, and therefore a certain continuity in the related contracts, may thus be regarded as one of the means capable of contributing to the pursuit of that objective.

However, the Court considers that, subject to the verifications which it will be for the referring court to carry out, the various RSTP rules at issue in the main proceedings seem to go beyond what is necessary to achieve that objective, a fortiori because they are intended to apply, to a large extent, in combination and, for some of them, for a significant period of time, to players whose careers are relatively short. That is the case, inter alia, of the criteria for the calculation of the compensation payable where the unilateral breach of the employment contract by the player takes place ‘without just cause’. It appears that such criteria for compensation seem to be intended more to protect the clubs’ financial interests in the economic context specific to the transfers of players than to ensure what is alleged to be the proper conduct of sporting competitions. That also seems to hold true for the rule which provides, as a matter of principle and therefore without taking account of the particular circumstances of each case, in particular of the actual conduct of the new club which signs that player, that a club is to be jointly and severally liable for payment of the compensation payable by the freshly signed player to his or her former club in the event of the unilateral breach of the contract without just case. That also holds true for the possibility of adopting, virtually automatically, a sporting sanction against the new club on the basis of a presumption that it induced that player to breach his or her contract, as well as a general prohibition on the issuance of an ICT as long as a dispute relating to that breach is pending, irrespective of the circumstances in which that breach of contract occurred.

Consequently, the Court rules that Article 45 TFEU precludes rules such as those at issue in the main proceedings, unless it is established that those rules, as interpreted and applied on the territory of the European Union, do not go beyond what is necessary to pursue the objective consisting in ensuring the regularity of interclub football competitions, by maintaining a certain degree of stability in the player rosters of professional football clubs.

In the second place, that Court recalls that, in order for a decision by an association of undertakings to be regarded as being caught by the prohibition laid down in Article 101(1) TFEU, it is necessary to show either that it has as its object the prevention, restriction or distortion of competition or that it has such an effect. As regards the existence of an anticompetitive object, which, as it recalls, refers exclusively to certain types of coordination between undertakings that reveal a sufficient degree of harm to competition, the Court observes that the collusive conduct of the undertakings may consist, for example, in limiting or controlling the essential parameter of competition consisting, in certain sectors or on certain markets, in the recruitment of highly skilled workers, such as players who have already been trained in the professional football sector.

In the present case, it is clear on a combined reading of the rules of the RSTP at issue in the main proceedings, first, that they are such as to constitute a generalised and drastic restriction, from a substantive viewpoint, of the competition which, in their absence, could pit any professional football club established in a Member State against any other professional football club established in another Member State as regards the recruitment of players already employed by a given club. Second, that restriction of cross-border competition between clubs in the form of the unilateral recruitment of players who are already employed, extends to the entire territory of the European Union and is permanent, in that it covers the entire duration of each of the employment contracts which a player may conclude successively with one club, then, in the event of a negotiated transfer to another club, with the latter club.

Indeed, since the conduct of interclub professional football competitions is based, in the European Union, on matches between and gradual elimination of the participating teams and since it is essentially based on sporting merit, it may be legitimate for an association such as FIFA to seek to ensure the stability of the composition of the player rosters that serve as a pool for the teams which are put together by those clubs during a given season or year. However, the specificity of football and the actual conditions of the functioning of the market constituted by the organisation and marketing of interclub professional football competitions cannot mean that it must be accepted that any possibility for clubs to engage in cross-border competition by unilaterally recruiting players already employed by a club established in another Member State or players whose employment contract with such a club has purportedly been terminated without just cause should be restricted in a generalised, drastic and permanent manner. Ultimately, such rules, even if they are presented as being intended to prevent player-poaching practices by clubs with greater financial means, can be treated as being equivalent to a general, absolute and permanent ban on the unilateral recruitment of players who are already employed, imposed by decision by an association of undertakings on all the undertakings which the professional football clubs are and borne by all the workers which the players are. On that basis, they constitute a manifest restriction of the competition in which those clubs would be able to engage in their absence.

Thus, the rules at issue in the main proceedings present, by their very nature, a high degree of harm to the competition in which professional football clubs could engage. In those circumstances, those rules must be considered to have as their object the restriction, indeed the prevention, of that competition, throughout the territory of the European Union. There is accordingly no need to examine their effects

Lastly, clarifying the conditions in which conduct having an anticompetitive object may be exempted under Article 101(3) TFEU, the Court states that, in order to determine whether the condition requiring the conduct at issue to be indispensable or necessary is satisfied in the present case, the referring court will have to take into consideration the fact that the RSTP rules in question are characterised by a combination of factors, a significant number of which are discretionary or disproportionate. It will also have to take account of the fact that those rules provide for a generalised, drastic and permanent restriction of the cross-border competition in which professional football clubs could engage by unilaterally recruiting highly trained players. Each of those two circumstances, taken on its own, prima facie precludes those rules from being considered indispensable or necessary to enable efficiency gains to be made, if such gains were proven to exist.

Consequently, the Court rules that, on the wording of Article 101 TFEU, the abovementioned rules of the RSTP constitute a decision by an association of undertakings which is prohibited and which cannot be exempted under that provision unless it is demonstrated, through convincing arguments and evidence, that all of the conditions required for that purpose are satisfied.

( 1 ) See judgments of 21 December 2023, Royal Antwerp Football Club (C‑680/21, EU:C:2023:1010); of 21 December 2023, European Superleague Company (C‑333/21, EU:C:2023:1011); and of 21 December 2023, International Skating Union v Commission (C 124/21 P, EU:C:2023:1012).

( 2 ) Article 45 and Article 101 TFEU, respectively.

( 3 ) See Article 17, paragraphs 1 and 2 of the RSTP.

( 4 ) See Article 17, paragraph 4 of the RSTP.

( 5 ) As the International Transfer Certificate is necessary in order for the player to be registered with the new club, the player cannot therefore participate in football competitions for that new club. See Article 9, paragraph 1 of the RSTP and Article 8.2.7 of Annexe 3 to those regulations.