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CJEU: "FIFA AND UEFA'S BLOCKING OF THE EUROPEAN SUPER LEAGUE IS ANTI-COMPETITIVE."



With its judgment dated 21.12.2023 and numbered Case C-333/21, the Court of Justice of the European Union (''CJEU'') ruled that the decisions taken by the Association of International Football Associations ('Fédération Internationale de Football Association') (''FIFA'') and the Union of European Football Associations (''UEFA'') for the European Super League project in 2021 are contrary to competition law and the freedom to provide services. The CJEU, upon the application of the Commercial Court of Madrid, examined the dispute under the preliminary ruling procedure for compliance with European Union law.


As it is remembered, in 2021, twelve major European football clubs came together and announced the establishment of the European Super League separate from UEFA and FIFA's inter-club competitions. Thereupon, FIFA and UEFA announced that the clubs that are members of their national federations must obtain their approval to organize such an organization and that they would impose sanctions on the relevant clubs and footballers if such approval was not obtained. After these announcements, the European Super League project was suspended and this decision of FIFA and UEFA was brought before the Madrid Commercial Court on the grounds that it was contrary to the European Union's rules on competition and freedom to provide services. The Madrid Commercial Court also brought this dispute before the CJEU.


Before addressing the decision of the Madrid Commercial Court and the CJEU, the organization of the institutions involved in the dispute should be examined as follows:


  • UEFA is a regional organization under private law that deals with European football issues, controls football developments in Europe and organizes and conducts international football competitions and tournaments at European level.

 

  • FIFA, on the other hand, is an international organization governed by private law, to which national or, like UEFA, regional football federations are affiliated, and which is responsible for organizing and sanctioning international competitions. According to the FIFA Statutes, member federations, leagues affiliated with member federations and clubs are prohibited from joining another member federation or participating in a competition on the territory of that federation without the approval of FIFA and its competent regional confederations. At the same time, according to the FIFA Statutes, all financial, commercial, marketing and incorporeal rights derived from international competitions belong exclusively to FIFA, regional confederations and member associations. Unions, national leagues and clubs affiliated to associations that are members of UEFA and FIFA are also indirectly members of this organization and are bound by its rules.

 

  • After providing information about UEFA and FIFA, it is necessary to mention the legal infrastructure of the European Super League project. This project is owned by the European Super League Company (The European Super League Company, S. L.) (''ESLC''), a limited liability company founded and owned by twelve major European clubs. ESLC has also established partner companies in charge of financial, marketing, broadcasting rights, investment and other areas related to the European Super League.

 

When the ESLC presented the European Super League project to the public in 2021, FIFA and some of its affiliated federations and leagues declared that they did not recognize this project and warned that sanctions would be imposed on the clubs and footballers involved in this project. Subsequently, the European Super League project ended in failure and the investments it received were canceled.


Thereupon, ESLC filed a lawsuit before the Madrid Commercial Court. The Madrid Commercial Court, which examined the dispute, stated that FIFA and UEFA are monopolies in terms of organizing and authorizing international competitions and assessed that the practices of FIFA and UEFA may constitute a violation of Article 102 of the Treaty on Functioning of the European Union ("TFEU") prohibiting abuse of dominant position and Article 101 prohibiting agreements restricting competition and other fundamental freedoms. In this framework, the Madrid Commercial Court applied to the CJEU for a preliminary ruling on the compatibility of the matter with European Union law.


The CJEU considered the organization of inter-club football tournaments and the exercise of media rights as an economic activity and emphasized the obligation to comply with competition rules and freedom of movement in this field. The CJEU also stated that dominant undertakings have the power to determine the conditions for potentially competitive market entrants and therefore, dominant undertakings must act transparently, impartially, proportionately and not discriminate. Thereupon, the CJEU found that FIFA and UEFA had abused their dominant position in breach of Article 102 TFEU as they did not fulfill these criteria. The CJEU also found that FIFA's and UEFA's practices constituted agreements in restraint of competition within the meaning of Article 101 TFEU and infringed the freedom to provide services.


Furthermore, it was also stated that FIFA's and UEFA's rules on the exercise of broadcasting rights were likely to harm European football clubs, companies in the broadcasting market, consumers and viewers. The CJEU also emphasized that this was an obstacle to potentially innovative and attractive competitions. However, the task of determining whether the rules on the exercise of broadcasting rights benefit different stakeholders was left to the Madrid Commercial Court, which will examine the merits of the dispute.


It is important to note that the CJEU's judgment does not obligate the approval of the European Super League project. The CJEU also drew attention to this in its announcement and emphasized that it did not give a specific decision on the European Super League project.

 

 

Osman Yunus Özey – Legal Intern

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