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Expert opinion: From Belgium again, a threat to the football compensation system

Alfonso Valero, a sports law expert at Nottingham Law School, comments on the latest compensation case to hit European football.

Bouncing football
Could this case accelerate negotiations for a new football compensation system?

I read in the blog of Asser International Sports Law about the case of Mohamed Dahmane and his former club Racing Genk. As the post correctly points out, this is hardly a milestone case which would smash the current compensation system, but it does deserve attention because it could set a persuasive precedent in other jurisdictions and / or if the case is taken to the European Court of Justice (the CJEU).

The facts of the case are as follows. Dahmane unilaterally terminated his contract with his club, Racing Genk in 2008 when he was demoted to play with the B team and no longer invited to train. The case was taken to the Employment Tribunal and the player was ordered to pay an equivalent of 36 months’ salary. It is important to note here that the case was decided entirely on the basis of Belgian law and its special legislation for players.

One common tendency when dealing with sports cases is to think that the courts will not be involved and that the matter will be dealt internally. This tendency is supported by the many examples of football-related disputes that end up resolved by arbitration panels (also called tribunals) and by the regulations of FIFA. However, the Statutes and Regulations of FIFA also allow for employment-related matters - ultimately, football contracts are employment contracts - to be taken to the courts when the national legislation so prescribes.

One common tendency when dealing with sports cases is to think that the courts will not be involved.

Alfonso Valero, Nottingham Law School sports law expert

Another element which may resonate here is the fact that compensation from players to clubs is generally paid on the basis of football regulations; for example, former Chelsea FC player, Adrian Mutu, was ordered to pay in excess of eleven million pounds on the basis of his contract and it was resolved entirely by sports-related tribunals.

None of this happened in this case: the matter was dealt with by the ordinary jurisdiction on the basis of Belgian law.

The relevant part of the background is that the player’s appeal was upheld and the Court understood that the special legislation regulating the employment relation of sport professional players was found discriminatory. Accordingly, any compensation due by the player should be calculated in accordance with the normal regime of employees. The actual amount is of no substance for this purpose, but the legal principle is: considering that football players have a special employment relation is discriminatory and that they should be protected with the general employment laws of the country.

FIFPro – World football players’ union – has of course celebrated the result claiming the Belgian court is vindicating their longstanding position: that footballers are normal workers and that the Belgian regulation was limiting the freedom of movement of workers guaranteed by European Union Law. However, this is far from clear since it seems that the Belgian courts did not consider application of EU law.

Two aspects are worthy of consideration from an English perspective. Could the case be replicated here? And what would have happened had the case being considered in light of EU law?

As to the first question, it is very unlikely. English Courts don't have the authority to misapply legislation, even if they think it goes against the constitutional principles of law. If the case had actually be taken to arbitration, the likelihood of a similar result would be slimmer, because sports arbitrators don't tend to declare sports regulations are invalid and discriminatory. This is not because they don't have the authority to do it, but because by definition they are considered in favour of sports self-regulation.

In this case it could be argued that the player was in fact redundant to the needs of the club.

Alfonso Valero

However, had the case been taken to the CJEU, the ruling would have likely been that compensation of players to their employers needs to be proportional and justifiable so that not to hinder the ability to move freely.

Is the contract of professional football players a different kind of employment relation that deserves additional guarantees in the event of early termination by way of a substantial compensation? In my opinion, yes; if a player terminates a contract during the competition, it will seriously hinder the ability of the club to maintain its performance. The only deterrent would be a significant compensation.

In this case it could be argued that the player was in fact redundant to the needs of the club since he wasn't even included in the squad. This is actually provided for in the regulations of FIFA and it is a considered a just cause for termination of the contract.

Either way, the aftermath of this case will be important and it could accelerate the negotiations of a new system of compensation for football contracts.

Alfonso Valero
Nottingham Law School senior lecturer and sports law expert

Expert opinion: From Belgium again, a threat to the football compensation system

Published on 22 May 2014
  • Category: Press office; Nottingham Law School

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