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Sport as a Special Case in Youth Training

The Court in Bosman adopted an approach that it subsequently repeated entirely uncritically in Bernard: encouraging the recruitment and training of young players must be accepted as legitimate in sport.n9

The Court in Bosman commented that a transfer fee paid had no relation to the costs of training that player and the pool of other players who were trained but did not succeed in making the grade, and for whom no transfer fee would ever be recovered. So it refused to accept that the prospect of receipt of the fee could be ‘a decisive factor in encouraging recruitment and training of young players or an adequate means of financing such activities’.00 The strong implication was that a system tied in some way to costs incurred in training players would be much more likely to receive a green light. This is confirmed by the discussion in Bernard, albeit the system examined in that case also did not satisfy the Court. Bernard in particular approves a system that is motivated to encourage clubs, especially small clubs, to invest in training young players. However, it insists on a calculation which is based on compensation for the costs actually incurred. The further a system is distanced from this model and, in particular, the higher the deterrent effect on the player’s right to exercise contractual freedom by moving to a club in another Member State, the more likely it is that the system will be found to violate EU law. [1] [2] [3] [4] [5]

That the prospect of receiving training fees is likely to encourage football clubs to seek new talent and train young players is perfectly plausible. But this has never been accompanied by any explanation of why football clubs uniquely need such incentives to invest in youth training. The prospect of receiving training fees might be likely to encourage car-makers, banks, or supermarkets to seek new talent and train young workers, but no one has ever suggested that therefore it should be permitted that car-makers, banks, and supermarkets shall set up collectively enforced arrangements that inhibit the exercise of contractual freedom by their employees once they have been trained. It is conventionally assumed that employers train young talent and try to keep the workers they particularly value by offering them attractive contractual terms and conditions. This is how a market for labour functions. But in stark contrast football superimposes an industry-wide compensation system to benefit the training club and to the disadvantage of the employee. Why is professional football different? The Court has never explained this. It has accepted in both Bosman and Bernard that the transfer system encourages youth training but it has not explained why football deserves and needs this where other sectors do not. And it is fiendishly difficult to imagine any justification.

The closest the Court has got to addressing this issue is in Bernard, where it commented that the disincentive to invest in training would in particular ‘be the case with small clubs providing training, whose investments at local level in the recruitment and training of young players are of considerable importance for the social and educational function of sport’.01 This chimes with the famous paragraph 106 of Bosman, which recognizes legitimate concerns of sport, and it also echoes both the Amsterdam and the Nice Declarations’ embrace of the virtues of sport’s social function. However, the Court’s explanation is remarkably thin. Some small clubs likely do a fine job in this vein: some likely do not. There is no evidence base for the Court’s warm remarks. Perhaps one might argue that the market for players is so very open, because barriers such as linguistic competence play an insignificant role in recruiting employees in professional sport compared with most other sectors of the economy, that clubs in countries with high costs attached to training young talent prefer instead to shop elsewhere and buy mature players. Perhaps sport is special because the capacity of a player to improve is unknown in advance, yet quickly and atypically becomes known to all as a result of on-field performance, with the consequence that because an investing club would rapidly lose the advantage it enjoys in having more information than predator employers about an employee’s developing skills, it suffers an unusually strong sport-specific unwillingness to invest in training.122 But no claims of this type have ever been advanced before the Court of Justice. Even if they were, it would be hard to treat the transfer system as [6] [7]

a proportionate response: the home-grown rule, considered in Chapter 8, seems more apt. In truth Bernard, like Bosman before it, is remarkably generous to sport. It accepts that sport is special in its need to provide incentives to invest in training, inter alia, for social and educational benefit in circumstances where little, if any, evidence has been presented to demonstrate that sport—especially in its professional guise—is different from normal industries in this particular matter.

So, in the absence of evidence, the transfer system should be regarded as unnecessary to achieve the sports-specific concern to promote youth training, because there is no such sports-specific concern. Therefore even a system rearranged to achieve a closer tie between costs incurred in providing training and compensation payable should not be accepted as lawful. It has not been demonstrated that in the matter of the need to encourage youth training sport is special—even if the Court depicted it as such in Bosman and Bernard.

  • [1] See Case C-390/12 Pfleger, judgment of 30 April 2014 (TFEU, Art 56); Case C-98/14Berlington, judgment of 11 June 2015 (TFEU, Art 56); Case C-367/12 Sokoll-Seebacher, judgment of13 February 2014 (TFEU, Art 49).
  • [2] See n 6.
  • [3] cf M Dalziel, P Downward, R Parrish, G Pearson and A Semens, ‘Study on the Assessment ofUEFA’s Home Grown Player Rules’ (2013) 7; 106—107, 111 accessed 29 November 2016, and discussedin Ch 8.10.
  • [4] 119 Bosman (n 1) para 108; Bernard (n 1) para 41. This was accepted too by the Oberlandesgerichtin Wilhelmshaven SV, considered in Ch 2.2.4: its objection was only to the CAS’s neglect of EU law,not to the assumptions within EU law.
  • [5] Bosman (n 1) para 109.
  • [6] Bernard (n 1) para 44.
  • [7] e Fees and G Muhlheuber, ‘Economic Consequences of Transfer Fee Regulations in EuropeanFootball’ (2002) 13 Eur J Law Econ 221; H Dietl, E Franck, and M Lang, ‘Why Football Players mayBenefit from the “Shadow of the Transfer System” ’ (2008) 26 Eur J Law Econ 129. It is questionablewhether the claim, even if in itself valid, is truly sports-specific: eg the logic seems applicable also tomusicians and actors.
 
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