Article 45 of the TFEU - Essay Example

The Extent to which Football Clubs and Governing Bodies Restrict Player Rights under Article 45 of the TFEU The Extent to whichFootball Clubs and Governing Bodies Restrict Player Rights under Article 45 of the TFEU Introduction The ECJ delivered the Bosman Case ruling based on the TFEU’s Article 45 establishing EU nationals’ rights not to be discriminated in member states. This ruling contended that EU national football players could negotiate contracts with other clubs if their contracts expired, nullifying the rights of their football clubs to demand for a fee for their move to take place (Siekmann, 2012: p34). This ruling acted to remedy a transfer system that restricted freedom of movement for players, while the 3+2 rule that restricted foreign players that teams could field was also deemed an unlawful constraint and contrary to anti-discrimination principles in Article 45 of the TFEU. This ruling had, probably, the most profound effect on the contractual and organizational dynamics of professional football players and teams. Since the ruling, however, there have been substantial threatened and actual increases in professional football legal regulation, especially since it operates under the transfer system framework. There has also been an overall continued re-demarcation of boundaries between regulation via external legal regulation and sporting rules. Main issues of concern involve transfer system validity and the dynamics of contract that they generate, prohibition of rules that are against discrimination law in the EU, and the level to which football authorities must be subordinate to EU regulation, especially Article 45 of the TFEU (Siekmann, 2012: p36). In addition, football bodies and football teams have sought to introduce measures that have been viewed by some as protectionist nationality quotas. UEFA and, most recently, the FA, have introduced rules such as the home-grown player rule that requires clubs to field a specific number of players developed at the club. Article 45 of the TFEU Since the European Economic Community was created by the Treaty of Rome in 1957, workers’ freedom of movement has been established by a right, initially established under Treaty of Rome in Article 48. This was later revised under the TFEU Article 45, establishing, along with the freedom of movement for workers, free movement of money, free movement services, and free movement of goods (Caiger & Gardiner, 2010: p31). Article 45 of the TFEU refers to rights of workers to move freely within the union. In addition, it also contends that this freedom of movement will involve the elimination of discrimination on the basis of nationality for nationals of member states with regards to remuneration, employment, and conditions of employment and work. It also entails the right to accept employment offers made to a worker, to move freely within the union territory for employment purposes, to stay in a state within the union to work, and remain in a member state subject to regulations drawn up by the Union (McCutcheon, 2012: p310). These latter provisions are subject to limitations on the basis of public health, public security, and public policy. The Football Transfer System Before the Bosman ruling, the football transfer system’s main objective was the maintenance of competitive and financial balance. It was also meant to prevent big, wealthy clubs from securing the best football players that would have resulted in armature clubs ceasing their activities (Davies, 2014: p11). This system, however, also resulted in football players having less bargaining power by ensuring that the movement of players was controlled solely by the clubs. The ruling regarded rules that ensured the sustenance of these practices illegal and invalid, while also significantly changing football’s economic structure. The most significant effects of the ruling involved an increase in the power of football players, which Lee (2006: p1265) also referred to as player power. Just as in other economic sectors, the most prolific football players gained increased control of their careers, as well as improved capacity to demand salaries that were reflective of their ability. In addition, players within the European Community were also enabled to freely move to other clubs sans restriction on the basis of nationality or disagreements between clubs regarding financial settlements that would jeopardize their careers (Gardiner et al, 2011: p77). Moreover, the wealthy, big clubs were also enabled to recruit the best talent through the market-liberalizing effect of this ruling. However, this increased freedom of players had a negative effect on smaller, amateur clubs that could not keep their best players, especially if they declined to sign new contracts. One may deduce from this that big, wealthy clubs and their favourable financial situation is better than that of smaller clubs with economic problems, meaning that they have more capital and resources to remunerate the best football players (Verbon, 2009: p39). This makes players less willing to move away from these clubs or to push for moves away to these clubs. Given the freedom of movement supported by the Bosman ruling, big clubs have been able to gain more competitive advantage, while the rulings declaration of nationality restrictions as illegal has made it easier for these clubs to acquire the best international players. Despite the fact that the older transfer system safeguarded the existence of amateur clubs and their competitiveness, it was also an obstacle to players moving freely from club to club (Verbon, 2009: p42). Following the ruling by the ECJ, there was an increase in the power of players as they attained more rights. The abolition of the 3+2 rule and the transfer system due to their non-compatibility with Article 45 of the TFEU acted to disadvantage smaller clubs in restricting player movement, which led to an unbalanced situation regarding the financial state and competitiveness of football. However, this also led to the increased power of the bigger clubs in restricting player movement, however, because they could offer more lucrative contracts and insert clauses to prevent movement to rival clubs (Dietl, 2008: p135). It was this factor that led the EU, UEFA, national football governing bodies like the FA, and players’ unions to work on a compromised system. This led to a gentleman’s agreement by all parties involved, in which there would be compensation payments for development and training of players, mainly meant for players below the age of 24. Moreover, as stated by Garcia (2011: p19), it also created an extra transfer window for clubs to sell players who did not sign contracts and risked moving for a nominal fee at the end of the season, as well as restrictions for players to move only once in a season and the illegalization of transfers for players under the age of eighteen (Garcia, 2011: p19). This system has proven effective and, because of the increasing economic importance and popularity of football in the EU and the UK, both jurisdictions have been forced to become active participants in legal and economic procedures of football. Unlike in the past, football is today an economic activity that categorically falls under the acquis communautaire. Thus, this has the potential to make the ECJ a major player in football matters in the foreseeable future, reducing the ability of football bodies to make regulations that restrict player rights (Dietl, 2008: p135). The Quota System In the last decade, various football bodies, including the FA and UEFA, have moved towards the re-introduction of quotas for players. UEFA introduced in 2005 its home-grown players rule for competitions under its jurisdiction, such as the Champions League and the UEFA cup as it was known then (Williams & Haffner, 2008: p1018). It also recommended that national associations implemented similar rules, which the FA also did in 2011 with a similar format to the 6+5 rule used by FIFA. This meant that teams could only field 5 non-national players at any time on the pitch. These quota proposals, however, do not place restrictions on players who are not eligible, instead only applying to the team starting line-up with coaches having the opportunity to modify player ratios during the game through substitutions with non-eligible players. While there has been support for these quota proposals for UEFA and the FA, Williams & Haffner (2008: p1018) contend that such player quotas in Europe contravene Article 45 and act as discrimination and unlawful in light of the Bosman ruling. The Institute for European Affairs released a report commissioned by UEFA, which claimed that player quotas are god in light of the detrimental effect of the Bosman ruling, especially with regards to disempowering smaller, amateur clubs. However, player quotas constitute direct discrimination and restrict the movement of players within the European Community, especially as held in Commission v. Italy at the ECJ that direct discrimination is not justifiable through sole reference to Article 45(3) on the grounds of public health, public security, and public policy (Feess & Muehlheusser, 2013: p144). In short, the application of player quotas by football organizations is almost similar to the 3+2 rule that applied prior to the Bosman ruling. The ruling of the ECJ in Viking v. Laval, which concerned the conflict between national rights law and establishment freedoms, gave priority to the protection of TFEU-established freedoms (Feess & Muehlheusser, 2013: p145). The player quotas can also be viewed as restrictive on international players because it contends that the nationality of a player gives them automatic rights to play for the teams in that country. This would mean, for instance, that naturalized players who have, nevertheless, played for another national team may not be eligible to play due to quota restrictions. Since non-nationals cannot play for the national team, they would be at a disadvantage and would appear restricted and discriminated against (Feess & Muehlheusser, 2013: p145). Although the quotas do not limit the number of non-national players that a team can recruit, it will become less viable commercially to employ them. One of the basic tenets of European law holds that policies that are seen as being more discriminatory are more difficult to justify, especially as a proportionate response (Gardiner & Welch, 2011: p319). Ultimately, it is difficult to see any major difference between the 6+5 player quota rule and the pre-Bosman ruling 3+2 rule. In addition, the problems that the player quotas are attempting to address emanating from the Bosman ruling were clearly intended as consequences by the ECJ, especially as it was clear this would give added advantage to the best clubs. In fact, this is the logic of social laws in the EU, which contend that workers are free to move to member states that give them the best reward for labour rendered. Since Article 45 of the TFEU allows freedom of movement between member states irrespective of problems caused to these states, it is clear that invoking specificities is a case of special pleading that restricts the rights of international players within the union (Gardiner & Welch, 2011: p319). In addition, player quotas by UEFA and the FA may only exacerbate the already immense barriers created by national laws on immigration in the European Community (Gardiner & Welch, 2011: p778). England, for instance, only offers work permits to internationals playing for their national teams, which also requires renewal when they move clubs. Thus, although the sporting aims supporting the player quotas are noble, footballers are employees and, as such, the quotas infringe on Article 45 of the TFEU, thus restricting players’ rights. Finally, the European Commission and the European Parliament are of a similar viewpoint, indicating that the player quota proposal is contrary to Article 45, thus discriminates and restricts the rights of non-national players. This falls within the European Parliament’s proposals in the European Sports law, which seeks to apply values of equal treatment and equality that the ECJ has already expressly and generally determined in the Bosman ruling and subsequent rulings (Gardiner & Welch, 2011: p778). The Home-grown Player Rule Because reservations about the restriction placed on non-national players by the player quota system, the European Commission and FIFPro have indicated support for the home-grown players’ rule (Weatherill, 2013: p62). Under UEFA proposals, clubs playing in UEFA competitions must have a minimum number of players developed and trained at the club, in spite of nationality, for at least three years between 15 and 21 years of age. Perceptions about its legitimacy resulted in national associations, including the FA, introducing restrictions similar to the ones by UEFA. Beginning in the 2009 season, the FA required that at least 4 players playing at any time in the football league be registered with the club for three years prior to age of 21. The Premier League also adopted similar restrictions in 2010. However, this rule will affect immigrant workers more than national players, which could mean it could impede Article 45 of the TFEU (Weatherill, 2013: p64). In this case, it will restrict the freedom of movement for migrant players and their access to labour. However, the European Parliament has been supportive of this rule to encourage young player education, considering the incentive measures to be proportionate and calling for the rule’s implementation. In addition, the rule may also promote competitive balance and promote local club, while also reducing the tendency to horde players and increase the national team talent pool. There are lingering doubts as to whether this rule is compatible with European law and, especially, Article 45 of the TFEU. However, this rule also makes it more attractive to attract young players classified as home grown, which may be less restrictive on players since the rule is not based on nationality (Bebbington, 2011: p43). Once a player is aged above 24 and their contract has expired, the player may leave with no transfer fee rights for the club releasing the player, despite money spent in training the player. However, clubs can also enter into collective agreements that allow them to share future income form sale of the player and broadcasting rights money for clubs that invest in academies. In addition, such an arrangement also enhances the foot-balling experience for fans by allowing international players into the team with no restrictions on the basis of nationality. In addition, it is also less restrictive on local domestic players since it enables them to be trained alongside international players and to be traded with other teams, including outside their country, as home-grown players (Bebbington, 2011: p44). In fact, this rule is less restrictive than the salary cap proposals that seek to solve the calls for a more proportionate response in football. This is because they act artificially and restrict the remuneration of international players, which is also against Article 45. In addition, a further alternative to the home-grown rule in countering the effects of the Bosman ruling has been the transfer fee caps, which has been seen as more attractive in restoring competitive balance (Relvas et al, 2010: p171). While it will restrict the signing on fees earned by player moving to other clubs, which is in contravention of Article 45(3) of the TFEU with regards to remuneration, it is more preferable to restrictions on player remuneration. However, getting back to the home-grown rule, the view that this will increase the national talent pool is a weak argument. It is evident that the best clubs always recruit the best players from their nation, meaning that there will be adequate numbers of eligible players to play for the national team. As observed by Relvas et al (2010: p172), the Scottish national team is not affected by the fact that most of their best players chose to play in the Premier League, while he also comments on the fact that the influx of international players into national leagues tends to improve football skills of the domestic footballers, instead of stunting their development. In addition, any player with no basis on nationality can become home-grown if they play in the league for three years before their 21st birthday (McArdle, 2013: p51). This means that there will be fewer restrictions on player’s rights as compared to the player quota system. Gardiner & Welch (2011: p832) estimates that the home-grown rule has resulted in the transfer of more than 500,000 minors every year, in football. This is evidence that the home-grown rule, despite restricting the number of international players playing in teams, has also led to less restrictions for younger international player rights, especially when they play for 3 years in a specific country. However, it is also important to note that the rule could lead to clubs abusing the notion of the real definition of a home-grown player, rather than use it to develop domestic talent. UEFA and the FA have moved to counter this by requiring that players below the age of 18 can only move if their parents move with them, as well as the fact that the parents can only move for reasons not related to football. However, there is increasing evidence of clubs creating jobs for parents of young international talent in the past (Gardiner & Welch, 2011: p832). Even considering these exploitative tendencies, it is clear that the home-grown rule is less restrictive on player rights to play across the European Community as long as they are considered home-grown. References Bebbington, C. (2011). Agency theory: the effects of the Bosman ruling on the football industry. Dublin, University College Dublin. Caiger, A., & Gardiner, S. (2010). Professional sport in the European Union: regulation and re-regulation. The Hague, T.M.C. Asser. Davies, C. (2014). Footballs transfer system post-Bosman: freedom of movement for players versus footballs financial future? 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