Welcome back to the final part, readers!
In the final part of our mini-series, we explore Advocate General Nicholas Emiliou’s opinions on the third case, Case C-133/24 (Tondela and others), which involves a no-poach agreement among football clubs in Portugal‘s first and second divisions during the COVID-19 pandemic. This case examines the compatibility of such agreements with EU competition law, specifically Article 101 TFEU.
Introduction
The dispute in this case arises from a no-poach agreement concluded by football clubs in the Portuguese football league’s first and second divisions, in agreement with the national football association, during the COVID-19 pandemic. The agreement aimed to prevent clubs from signing players who had unilaterally terminated their contracts due to the pandemic or any exceptional decisions arising from it.
Legal Framework and Background
The Liga Portuguesa de Futebol Profissional (LPFP) is a private-law not-for-profit association that supports and regulates professional football activities in Portugal. During the 2019/2020 season, the LPFP, in response to the COVID-19 pandemic, decided to suspend the First and Second Divisions indefinitely. Subsequently, the LPFP and the Union of Professional Football Players (SJPF) set up a COVID-19 Monitoring Committee to negotiate measures ensuring the sustainability of the sport.
On April 7, 2020, the LPFP and the clubs participating in the First Division agreed that no club would hire a player who unilaterally terminated their employment contract due to the pandemic. This agreement was later adopted by some Second Division clubs.
Questions Referred for Preliminary Ruling
The Tribunal da Concorrência, Regulação e Supervisão (Competition, Regulation and Supervision Court, Portugal) referred three questions to the Court of Justice for a preliminary ruling:
- Does an agreement such as the no-poach agreement constitute a rule of sporting interest for the purposes of the Meca-Medina case-law?
- Can such an agreement be regarded as proportionate and appropriate, and therefore compatible with Article 101(1) TFEU?
- Does Article 101(1) TFEU preclude an interpretation that an agreement with the characteristics described may be classified as a restriction of competition by object?
Advocate General Emiliou’s Analysis
Scope of the Meca-Medina Case-law: Advocate General Emiliou explains that the Meca-Medina case-law applies to agreements that restrict the freedom of action of undertakings if they are justified by the pursuit of legitimate objectives in the public interest, are genuinely necessary for that purpose, and do not eliminate all competition.
No-Poach Agreements and Restrictions by Object: Emiliou argues that no-poach agreements, which prevent clubs from hiring players who terminated their contracts, can be inherently anticompetitive. However, the specific circumstances of the COVID-19 pandemic and the limited scope of the agreement may exclude its inherently anticompetitive nature.
Proportionality and Appropriateness: The Advocate General suggests that the agreement in question was motivated by the genuine desire to ensure a fair and orderly end to the season, preserving the integrity and fairness of the competition. The agreement had a limited scope, applying only to certain players for a short period, and did not eliminate all competition.
Conclusion
Advocate General Emiliou proposes that the Court answer the questions referred for a preliminary ruling to the effect that:
- A no-poach agreement concluded during the COVID-19 pandemic by professional sports clubs, in agreement with their national sports association, shall not be classified as restrictive by object if its genuine rationale was to preserve the fairness and integrity of the sports competition.
- Such an agreement falls within the scope of the Meca-Medina case-law provided that it genuinely sought to ensure the integrity and fairness of the sports competition and was necessary and proportionate to that objective.
Final Thoughts
This concludes our three-part series on Advocate General Emiliou’s opinions on sports governing bodies’ regulations. We hope you found these insights valuable and informative. Stay connected with us for more updates and detailed analyses on legal developments in the world of sports.
Thank you for reading, and we look forward to sharing more insights with you soon.