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EDITORIAL

It is with much pleasure that we welcome readers to the March 2020 edition (citation: GSLTR 2020/1) of our ground-breaking journal and on-line database (www.gsltr.com): Global Sports Law and Taxation Reports (GSLTR). As usual, association football (soccer) continues to claim widespread attention, both on and off the field of play. Following the European Court of Human Rights Decisions in the Pechstein and Mutu cases of 2 October 2018 and confirmed on 4 February 2019 by the Grand Chamber of the Court, there has been another landmark decision issued by the Court on 28 January 2020 in the case of Ali Rıza and Others v. Turkey (application nos. 30226/10, 17880/11, 17887/11, 17891/11 and 5506/16). This is purely a football case and the Court came to the conclusion that Turkey must reform its system for settling football disputes to conform to art. 6.1 of the European Convention on Human Rights.[1] In view of its importance, we set out the text of the Court press release of 28 January 2020 giving the details of the case and the findings as follows: Principal facts The applicants were Ömer Kerim Ali Rıza, a dual British and Turkish national, and Fatih Arslan, Şaban Serin, Mehmet Erhan Berber, and Serkan Akal, Turkish nationals, who were born in 1979, 1974, 1980, 1981, and 1977 respectively. They live in Broxbourne (the UK), Muğla, Kocaeli and Zonguldak (Turkey). Mr Rıza was a football player for Trabzonspor Kulübü Derneği, a club in the top Turkish professional league. He returned to England, his home country, in 2008 and the club brought proceedings against him with the Turkish Football Federation (“the TFF”) for breach of contract. In his defence he submitted that the club owed him salary arrears and match appearance fees. The TFF Arbitration Committee ultimately found in 2009 that he had wrongfully terminated his contract and fined him approximately 61,596 euros (EUR). He applied against this decision to the Swiss-based Court of Arbitration for Sport, but his application was declared inadmissible for lack of jurisdiction. An appeal to the Swiss Federal Court was dismissed in 2011 and he has since brought an application (no. 74989/11) against Switzerland with the European Court, which is ongoing. The second to fourth applicants are amateur football players. Proceedings were brought against them with the TFF when they were accused in 2010 of match-fixing during an important end of season match for their team, İçmeler Belediyespor Kulübü. In a first-instance decision by the Amateur Football Disciplinary Committee of the TFF, it was found that the applicants had committed the disciplinary offence of “influencing the match result” and were banned from any football-related activities for a year. This decision was then unanimously upheld by the Arbitration Committee. Mr Akal, the fifth applicant, is a football referee. He lodged an objection with the TFF Arbitration Committee in 2015 about the Federation’s decision to downgrade him from top-level assistant referee to “provincial referee”. The committee dismissed his objection, finding that his downgrading had been in accordance with the law and procedure.     Complaints, procedure and composition of the Court Relying on Article 6 § 1 (right to a fair hearing and access to court), all five applicants alleged that the proceedings before the Arbitration Committee had lacked independence and impartiality. They alleged in particular that the members of the Committee who had decided on their cases were biased towards football clubs because they had been appointed by the TFF’s Board of Directors, which was predominately composed of former members or executives of football clubs. They all, except for Mr Rıza, also made several other complaints under Article 6 § 1 about procedural shortcomings in the proceedings, and the lack of judicial review of the decisions against them. The second to fourth applicants complained under Article 1 of Protocol No. 1 (protection of property), taken alone and in conjunction with Article 13 (right to an effective remedy), that banning them for a year from football had deprived them of their income. The application was lodged with the European Court of Human Rights on 20 April 2010.     Judgment was given by a Chamber of seven judges, composed as follows:     Robert Spano (Iceland), President,     Marko Bošnjak (Slovenia),     Valeriu Griţco (the Republic of Moldova),     Egidijus Kūris (Lithuania),     Ivana Jelić (Montenegro),     Arnfinn Bårdsen (Norway),     Saadet Yüksel (Turkey),     and also Stanley Naismith, Section Registrar.       Decision of the Court     Amateur footballers’ complaints The Court rejected the applicants’ complaints under Article 6 § 1 as inadmissible because that provision was not applicable to the proceedings against them. In particular, at the time of the events under Turkish law, influencing a match result was a disciplinary offence involving the risk of a three-year ban and did not concern the determination of a criminal charge under Article 6. Nor could the proceedings come under the scope of civil rights and obligations. Domestic law stated that amateur football players were not remunerated and therefore their right to exercise a profession was not at stake. Furthermore, although it might be common practice in Turkey for amateur football players to receive a salary or other benefits, the applicants had not provided proof of receipt of such payments or of any kind of contract with their club. They had thus failed to prove that the dispute had involved any kind of pecuniary right. Owing to that lack of proof regarding pecuniary losses, the Court also rejected as inadmissible these applicants’ complaint under Article 1 of Protocol No. 1 and Article 13.     Professional footballer’s and referee’s complaints The Court noted that at the time of the applicants’ proceedings the Arbitration Committee had exclusive and compulsory jurisdiction over the respective football disputes brought by Mr Rıza and Mr Akal, and stressed that that body’s rulings were final and not amenable to judicial review by any court. As such, it had to provide the same safeguards as guaranteed under Article 6 § 1 of the Convention. However, the Court considered that there were inadequate safeguards to protect the members of the Arbitration Committee from outside pressure, notably from the TFF’s executive body, the Board of Directors, which had an undeniably strong influence on the way the Committee was organised and functioned. In particular, the Board of Directors, which appointed the members of the Arbitration Committee, had always largely consisted of members or executives of football clubs. Those who represented the interests of football other than those of clubs were in the minority. The Arbitration Committee, composed mostly either of lawyers or academics who specialised in sports law, were not bound by any rules of professional conduct. They neither had to swear an oath or make a solemn declaration before taking up their duties. Moreover, they were not protected from civil liability actions. Furthermore, TFF rules had no fixed term for members’ term of office. Their mandate was the same as the Board of Directors’, unduly aligning their tenure with the executive body. In addition, members did not have to disclose circumstances affecting their independence and impartiality and there was no specific procedure to deal with challenges to a member on those grounds. As concerned Mr Rıza, who was involved in a contractual dispute, the Court therefore considered that the balance had been tipped in favour of the football club, given that at the time of the proceedings against him, all members of the Arbitration Committee had been appointed by the Board of directors, predominantly composed of former members or executives of football clubs. Similarly, the wide powers given to the Board of Directors had to have been at work in Mr Akal’s dispute, which was of a regulatory nature. The board set the rules governing the composition, principles and procedure of the functioning of the Central Referee Committee of the TFF, the first-instance body which had decided on his case. Indeed, TFF rules required that the list of referees prepared by the Central Referee Committee had to be submitted to the Board of Directors for prior approval. In sum, the applicants had had legitimate reason to doubt that the Arbitration Committee members would approach their case with the necessary independence and impartiality. There had therefore been a violation of Article 6 § 1.     Other complaints The Court considered that there was no need to examine separately the other complaints about the fairness of the proceedings, including the right of access to court, before the Arbitration Committee.     Article 46 (binding force and implementation) The Court noted that the violation found revealed a systemic problem regarding the settlement of football disputes in Turkey. It considered that the State should take measures to reform the system for settling such disputes under the auspices of the TFF, such as restructuring the Arbitration Committee so that it was sufficiently independent from the Board of Directors. Article 41 (just satisfaction) The Court held that Turkey was to pay Mr Rıza and Mr Akal 12,500 euros (EUR), each, in respect of non-pecuniary damage. It awarded Mr Rıza EUR 6,975 in respect of costs and expenses. It dismissed, by six votes to one, the remainder of these two applicants’ claim for just satisfaction. Separate opinion Judge Marko Bošnjak expressed a partly concurring and partly dissenting opinion. His opinion is annexed to the judgment. We now turn to the financial results of the January 2020 football transfer window, which, as usual, has produced some impressive figures. According to the financial analysis made by the Deloitte Sports Business Group, clubs in the English FA Premier League (Premier League) spent a total of £ 230 million in the January 2020 transfer window. This surpasses the January 2019 transfer window total of £ 180 million and is the second-highest gross spending total for the winter window. Other highlights: ­­–  Premier League clubs spent a total of £ 1.6 billion on transfers during the 2019-202 season, the second-highest seasonal gross transfer expenditure (record 2017-2018: £ 1.9 billion); –  net transfer expenditure (player purchases less player sales) for Premier League clubs totalled £ 165 million for the window, a record for the January transfer window; –  intra Premier League sales made up just 2% of gross transfer spend, significantly less than the previous low of 11% set in January 2019, with Premier League club’s favouring talent from Europe; and –  Premier League clubs spent £ 25 million on the deadline day, significantly less than the record sum of £ 150 million set in January 2018. Furthermore, the total gross spend (i.e. before including player sales) of £ 1.6 billion for the 2019-2020 season is the second-highest since the introduction of the transfer window in January 2003. This compares to £ 1.4 billion in 2018-2019 and is £ 0.3 billion short of the all-time record of £ 1.9 billion set in the 2017-2018 season. Premier League clubs’ restraint in transfer spending in the January 2020 transfer window may also be driven by the global value of Premier League broadcast rights for the 2019-2020 – 2021-2022 cycle, seeing only a slight uplift compared to the previous cycle. This transfer window follows a record-breaking summer 2019 window, which saw the “big five” European leagues spend in excess of £ 5 billion for the first time, with four leagues setting transfer records for spending in a single window in the process. In January 2020: Serie A £ 180 million (2019: £ 140 million), the Bundesliga £ 165 million (2019: £ 65 million), La Liga £ 110 million (2019: £ 65 million) and Ligue 1 £ 100 million (2019: £ 65 million) have all increased their transfer expenditure since last season’s window. Spending across the “big five” European leagues has reached record levels this season. The unprecedented level of spending by European clubs has been driven by a number of factors, including increased income from improved domestic league broadcast agreements and the participation in and subsequent financial distributions from UEFA club competitions. Additional findings: –  Premier League clubs spent a total of £ 230 million in the January 2020 transfer window, according to analysis by Deloitte’s Sports Business Group. This surpasses last year’s January window total of £ 180 million and is the second-highest gross spending total for the winter window; –  Premier League clubs spent £ 230 million to acquire new players in the January 2020 transfer window, falling short of the record achieved in 2018 (2019: £ 180 million; 2018: £ 430 million; 2017: £ 215 million; 2016: £ 175 million; 2015: £ 130 million); –  Premier League clubs recorded net transfer spend of £ 165 million in January 2020 (2019: net spend of £ 55 million; 2018: net spend of £ 90 million; 2017: net receipts of £ 40 million; 2016: net spend of £ 100 million; 2015: net spend of £ 40 million); –  the “big six” Premier League clubs accounted for 52% of the total gross expenditure in the January 2020 transfer window, compared to 43% in January 2019; –  Premier League clubs have been reluctant to transfer players within the Premier League, with 2% of gross transfer spend as a result of intra Premier League sales in the January 2020 window, compared to an overall long term intra Premier League average of 29%; –  Premier League clubs’ deadline day expenditure totalled £ 25 million, which represented a decrease of £ 125 million from deadline day in January 2019; –  the Premier League was the highest-spending league amongst the “big five” European football leagues in the 2020 January transfer window: Serie A (£ 180 million/€ 215 million), Bundesliga (£ 165 million/€ 195 million), La Liga (£ 110 million/€ 130 million) and Ligue 1 (£ 100 million/€ 120 million) all spending less; and –  on a seasonal basis the Premier League remains the highest-spending league amongst the “big five” European football leagues, with £ 1.6 billion/€ 1.9 billion. La Liga (£ 1.2 billion/€ 1.4 billion), Serie A (£ 1.2 billion/€ 1.4 billion), Bundesliga (£ 785 million/€ 930 million) and Ligue 1 (£ 690 million/€ 820 million) clubs all spent less than Premier League clubs. Further information may be obtained at www.deloitte.co.uk/sportsbusinessgroup. (accessed 17 February 2020). We would also mention the Nike Vaporfly running shoes controversy which has recently led to some changes in the Regulations of World Athletics (the world-wide governing body of track and field), and which were issued on 31 January 2020. Essentially, the new Regulations implement three key changes: – from 30 April 2020, any shoe used in competition must have been previously available on the open market for a period of at least four months; – the sole must be no thicker than 40 mm; and – the shoe must not contain more than one rigid embedded plate or blade This is important because, in recent years, there have been suggestions that shoes, such as the Nike Vaporfly, may give a performance advantage of 4-5% by improving running economy. At its core, the question for regulators was whether the performance advantage was such that it changed the nature of the competition for athletes. Also, whether athlete restrictions in accessing certain prototype shoes was contrary to the value of universality. Of particular note, however, were the conclusions of World Athletics on how the loopholes affected the spirit of sport: “If people want to run a marathon in Vaporflys or any other shoe, it’s not our job to stop them, but if you want a ratified record, then you are classified as elite and have to abide by the rules.” According to Kris Lines, this is a pragmatic solution to balancing integrity with participation, although it runs contrary to the UK Supreme Court Decision in Ivey v. Genting Casinos (UK) Ltd t/a Crockfords [2017], which is the subject of a post on the GSLTR website on 3 February 2020, and also an in-depth article by him in this issue of GSLTR, that every gambler/sports person be treated the same. On the sports law side, we publish the following articles: – “Just how marginal can gains be? Why Ivey v. Genting Casinos (UK) Ltd may have implications for sporting competition” by Kris Lines; – “Interview with Formula 3 and 4 driver Vladimiros Tziortzis” by Athena Constantinou; – part two of “Gender discrimination impact on US sports” by Paul J. Greene, Matthew D. Kaiser and Yelena G. Hazin; – “FINA v. International Swimming League. A new tension between sport and competition law?” by Rohit Walavalkar; – “Basketball: Image rights agreements and guaranteed employment contracts” by Vassil Dimitrov; and – part one of “Settling international sports disputes through the Court of Arbitration for Sport by Prof. Dr. Ian Blackshaw. On the sports tax side, we publish the following articles: – part one of “International tax aspects of esports” by Robert Esau; –  “Esports gamers cannot be considered as sportspersons for income tax purposes according to the Turkish tax administration” by Dr. Alara Efsun Yazicioğlu; – “Football: Assignment of image rights and the Xabi Alonso case” by Mariana Díaz-Moro Paraja; – “CAS jurisprudence through the lens of the tax expert” by Mario Tenore and Panagiotis C. Roumeliotis; – “Sun, sand and bright lights. Taxation of artists and sportspersons in Portugal” by Serena Cabrita Neto, Dinis Tracana and João Rodrigues. Finally, and as always, we would welcome and value your contributions in the form of articles and topical case notes and commentaries for our journal and also for posting on the GSLTR dedicated website at www.gsltr.com.   So, now read on and enjoy the March 2020 edition of GSLTR.   Dr. Rijkele Betten (Managing Editor) Prof. Dr. Ian S. Blackshaw (Consulting Editor)   March 2020   [1] Under art. 43 and 44 of the Convention, this Chamber judgment is not final. During the three-month period following its delivery, any party may request that the case be referred to the Grand Chamber of the Court. If such a request is made, a panel of five judges considers whether the case deserves further examination. In that event, the Grand Chamber will hear the case and deliver a final judgment. If the referral request is refused, the Chamber judgment will become final on that day. Once a judgment becomes final, it is transmitted to the Committee of Ministers of the Council of Europe for supervision of its execution. Further information about the execution process can be found on www.coe.int/en/web/execution (accessed 17 February 2020).

 
The Journal

Global Sports Law and Taxation Reports feature: articles; comparative surveys; commentaries on topical sports legal and tax issues and documentation.

The unique feature of Global Sports Law and Taxation Reports is that this Journal combines for the first time up to-date valuable and must-have information on the legal and tax aspects of sport and their interrelationships.

The Editors

The editors of  the Journal Sports Law & Taxation are Professor Ian Blackshaw and Dr Rijkele Betten, with specialist contributions from the world's leading practitioners and academics in the sports law and taxation fields.

The Editors

Managing editor
Dr. Rijkele Betten

Consulting editor
Prof. Dr. Ian S. Blackshaw

Editorial board

Prof. Guglielmo Maisto
Maisto e Associati, Milano

Dr. Dick Molenaar
All Arts Tax Advisors, Rotterdam

 

Mr. Kevin Offer
Hardwick & Morris LLP, London

Mr. Mario Tenore
Maisto e Associati, Milano

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