By Dr. David McArdle, School of Law, Stirling University
The disputes of Adrian Mutu and Claudia Pechstein are the two high-profile sports-related rulings of the ECHR. But they aren’t what I’m going to talk about, other than to say they were joined cases and were heard by the ECHR in late 2016. Both concerned alleged breaches of Article 6(1) of the ECHR on the grounds of an alleged lack of independence and impartiality on the part of CAS arbiters. So the ECHR deals mainly with the issues of independence and impartiality of the CAS. It doesn’t deal with independence and impartiality on the part of the initial, domestic, decision-makers; Ali Riza does and that’s why it’s important. Few aggrieved athletes are ever going to pursue a case to the CAS, let alone the ECHR but as a question of good governance there are important issues for sports arising from the judgment.
Briefly, in 2006 Omer Ali Riza signed a contract with Trabzonspor – which is one of Turkey’s most successful clubs. Two years into it, he went to England and said he wasn’t coming back because the club had failed to pay his salary for several months. He has dual nationality and he’s now the men’s u-23 coach at Watford FC, in the English second tier. The club fined him for leaving the club without permission, missing training sessions and failing to return. He said he was ending his contract when another month’s salary went unpaid. In July 2006, the club lodged an appeal with the Turkish FA’s dispute resolution committee, seeking damages from the player for wrongful termination of contract, payment of the fines it had issued and a ban on him joining another club.
The DRC found for the club. He appealed the DRC decision to the Turkish FA’s arbitration committee, which upheld the decision that he had wrongfully terminated his contract although it reduced the fine and removed the playing ban. In November 2009 he appealed to the CAS, but the CAS said it had no jurisdiction because the dispute had no international element. That’s a timely reminder that the CAS doesn’t have jurisdiction over everything – its jurisdiction is limited to what the parties give it, and FIFA’s dispute regulations require an international dimension.
But Turkey is a signatory of the European Convention and has been since the 1950s, so the ECHR did have jurisdiction.
The ECHR looks at the relevant Turkish provisions in detail. If you wanted to set up a sports governance and disciplinary structure that was destined to end in tears, this would be it. It noted that the Turkish Football Federation is established by an Act of Parliament, so it is a body established by law as Article 6 requires, but its own statutes and regulations then govern what it does. The problem was in the ‘independence and impartiality’ elements of the structures it had created.
There are three main bodies within the Turkish Federation, one of which – the legal committees, plural – has three sub-committees, namely a dispute resolution committee, a disciplinary committee and an ethics committee. An arbitration committee serves as the final authority to review the decisions of the dispute resolution committee and of the disciplinary committee, but not the ethics committee. The dispute resolution committee had exclusive jurisdiction over all disputes on football contracts. So there was a mandatory arbitration clause which meant that Ali Riza had to go to the legal committees and, through that, to the dispute resolution committee, his avenue of appeal was then to the arbitration committee and there was no further appeal against its rulings.
So you are already dealing with a complex committee structure where power is divided between lots of different entities. That’s not fatal of itself, but that division of power, which on its face might look like facilitating an appropriate level of independence and impartiality, didn’t actually lend itself to either.
An immediate problem concerned who could actually sit on the arbitration committee. Like the CAS the list of arbitrators is closed, unlike the CAS, the number of arbitrators was tiny and there was no scope for the parties choosing which individuals would hear the case. The chair and all six members of the committee usually heard each case and there were six substitute members. All were appointed by the Turkish Football Federation’s Board of Directors – who were in turn appointed by the Federation’s Congress, which I will come back to, and applicants for the Board of Directors had to hold senior posts within the member clubs and be approved by the Federation President. The arbitration committee members had to be law graduates with at least five years’ professional legal experience, but once appointed they could not be removed unless the resigned or died. It was a job for life which was in the gift of people who shared the same vested interests; and that alone should set the alarm bells ringing.
The Federation’s statutes obliged the committee members to decide cases in an independent and impartial manner. Well, you’d rather hope they would. Its decisions were originally not appealable to the courts, but the Turkish courts had struck down that provision as unconstitutional. So Turkey amended the constitution to limit the role of the courts in respect of private arbitral processes and thus get the outcome the government wanted. That might also strike most people as a bit untoward.
And where do the FIFA Rules come into this? Well, those rules require national FAs to have a provision prohibiting recourse to the courts “unless the FIFA Regulations or binding legal provisions specifically provide for or stipulate recourse to ordinary courts of law,” to quote Article 59 of the FIFA Regs. Art 59 goes on to say that instead of recourse to the courts, provision is to be made for disputes to go to an independent and duly constituted arbitration tribunal. That is FIFA’s preferred course of action and there is nothing inherently wrong with that – but if there are ‘binding legal provisions’ under national law which says to the contrary, FIFA’s default position is usurped.
In the context of what makes a sports tribunal ‘independent’ the ECHR noted that FIFA’s provisions require both parties to have equal influence over the appointment of arbitrators in the domestic panels. That wasn’t happening here. For example, there has to be scope for arbitrators to be rejected if there is any legitimate doubt as to their independence, but that hadn’t happened here. FIFA also says that the principles of a fair hearing and a right to equal treatment must be respected, which is what Article 6 also says. Article 6 rights are not always absolute and may be subject to limitations, but the compliance of FIFA’s Regs with the ECHR were not the issue; the problem was what the Turkish FA had done, with the connivance of the Turkish state. Here, neither a player nor a club had any choice other than to submit to arbitration because of the applicable rules. Turkish law did not provide for an alternative path – to the contrary, that path had been firmly closed by amending the constitution.
From para 182, the ECHR discusses whether the arbitration committee was independent and impartial given the circumstances and, to no great surprise, it found that it was not. This raises important issues for sports bodies in other signatory states because it wasn’t just the arbitration committee that caused concern, it was the wider structures under which that specific element had flourished. The player had pointed out that only a small number of the delegates to the Congress – remember, the body which appoints the Board of Directors who are themselves representatives of the clubs and which effectively controlled committee composition and lifetime appointments – represented the interests of players rather than clubs, and since Congress elected the members of the board of directors who in turn elected the members of the arbitration committee, players and clubs could not be considered to have equal influence in the arbitration committee’s composition. It was effectively controlled by the clubs because of the board of directors’ role in appointing the arbitration committee members.
The court pointed out that determining ‘independence’ involved looking at the manner of appointment, the members’ term of office, guarantees against outside pressure and whether there was an appearance of independence. Impartiality could involve looking at both the characteristics of an individual judge and the wider composition. It agreed with Ali Riza that the manner of members’ appointment, the term of office and also their remuneration were not independent of the board of directors. To the contrary, they were decided in accordance with instructions from it.
On that issue of arbitrators’ appointment, the Court made several points but for our purposes the key difficulty was the existence of “a number of strong organisational and structural ties between the board of directors and the arbitration committee…it gives an indication as to the significant level of influence that the Board of Directors enjoys over the functioning of the Arbitration Committee” (para 216). Against that background, the implicit bias towards the clubs in the composition of the congress and, especially, the board of directors who appointed the arbitration committee gave the applicant “a legitimate reason to doubt that the members of the arbitration committee, in the absence of adequate safeguards protecting them against outside pressures, particularly from the board of directors, would approach their case with the necessary independence and impartiality” (para 222). Article 6(1) rights had thus been violated.
So I’m going to leave it there, but please note i) there is a lot more going on here than I’m able to cover in 20 minutes; ii) the court declined to award pecuniary damages to Ali Riza, saying it could not speculate on what the outcome of the proceedings would have been if the violation hadn’t occurred; iii) there is a dissenting opinion which questions whether the alleged over-representation of the football bodies existed at all; and iv) the dissent further argued that the majority was wrong to deny pecuniary damages. If he’d been successful before the arbitration committee, he’d have received EUR 73,000, which is what he’d been fined, and he might have been successful under other heads too. Once the Article 6 violation had been established – which the dissent did not agree with – Ali Riza should have been properly compensated for it. All in all, he’s better off at Watford.
The key issues for sports to think about
- Does domestic law oblige you to offer parties the opportunity to take any disputes to ordinary courts?
- If so, are there limits on what sorts of disputes that applies to (employment contracts? doping? selection disputes?)
- What do the international federations and national associations’ rules say on the matter? Do they purport to introduce mandatory arbitration clauses?
- Are there any tensions between what the sports bodies say and what national law allows?
- Has there been anything in the history or composition of your structures that might look like political interference?
- Do any restrictions on who can be on your various committees, on how long they can serve, or on how your committees are structured, serve a legitimate purpose? If they might seem to be unfair to athletes, can you explain why things have to be the way they are?
- If your structures were ever to be challenged before domestic courts/tribunals (in the first place) is there anything that you think might make you vulnerable? Can you make any changes now to prevent that arising?