Sports Arbitration vs Union Law
On 1 August 2025, the Court of Justice of the European Union ("CJEU") handed down a ruling of enormous relevance to the current sports arbitration model: the decisions of the Court of Arbitration for Sport based in Lausanne, Switzerland ("CAS/TAS") should be subject to effective judicial review by a court of a Member State, whenever they are unilaterally imposed by sports federations, such as FIFA.
Background
The case began in 2015, when the Belgian club Royal Football Club Seraing ("RFC Seraing") entered into financing agreements with the company Doyen Sports, in which it transferred part of the economic rights of some of its players, a notorious practice prohibited by FIFA, known as Third Party Ownership ("TPO"), provided for in articles 18-bis and 18-ter of the "Regulations on the Status and Transfer of Players" (RSTP).
As a result, the club was sanctioned with a ban on registering new players during certain transfer periods and also with an economic penalty, consequences that were confirmed by the CAS and the Swiss Federal Court.
Faced with this scenario, the club appealed to the Belgian courts, claiming that there had been no effective judicial review of the compatibility of these sanctions with European Union law. The case reached the Belgian Court of Cassation, which referred questions to the CJEU for a preliminary ruling in case C-600/23
The CJEU's decision
The CJEU clarified that when arbitration is imposed unilaterally by sports federations (as happened in the FIFA case), it is essential that the respective arbitration decisions are not exempt from a review of compliance with the principles and provisions of EU law, since such decisions cannot live outside the EU legal order.
In this regard, the CJEU emphasised that CAS awards must be subject to such judicial review by national courts, including with regard to competition and free movement rules.
In fact, the CJEU emphasised that, in cases where an arbitration award has been made in the context of a dispute linked to the exercise of a sporting activity of an economic nature within the territory of the Union, and where there is no direct means of appeal against that award to a court of a Member State, individuals must be guaranteed the right to obtain, albeit on an incidental basis, an effective judicial review by a national court as to whether that arbitration award complies with the principles and rules that form part of the public policy of the European Union.
Consequences
The CJEU's decision represents a significant limitation on the authority of res judicata attributed to arbitration awards in sport, particularly when such arbitrations are imposed without any real option on the part of the parties involved.
In any event, this case law reaffirms the protection of fundamental rights guaranteed by EU law, in particular the right to effective judicial protection and respect for the organising principles of EU public order, even in contractual contexts that are so-called "voluntary" in form only.
This ruling is in line with a previous jurisprudential trend, namely in the Achmea and Komstroy case and in the International Skating Union v. Commission ruling, or even in the case law of the European Court of Human Rights itself, in the Mutu and Pechstein case, which also recognised the risks inherent in forced arbitration in international sport. In the latter, there were already concerns about the imposition and irreversible nature of sports arbitration, and the CJEU now emphasises in greater depth the need for effective guarantees of judicial control whenever principles or provisions of EU law are at stake.
What changes?
This CJEU ruling paves the way for clubs, athletes and other parties involved in highly complex contractual matters to appeal to the courts of their own Member States, demanding (i) judicial review of the compliance of CAS decisions with EU law; (ii) the use of precautionary measures, such as injunctions or suspension of arbitration awards, and (iii) the possibility of compensation for damage caused if there is a violation of rules and principles of the EU legal order.
The ruling could trigger a wave of similar claims by clubs or athletes who feel they have been harmed by sports arbitrations, especially when they feel they have been prevented from pursuing any kind of appeal against the decisions handed down.
In addition, organisations such as FIFA and UEFA now need to review their internal regulations, which usually establish arbitration as the only means of resolving disputes, excluding the possibility of recourse to national courts.
This ruling, handed down on 1 August 2025, marks a turning point in the legal treatment of sports arbitration in the European Union's legal system: it reaffirms that CAS decisions - including those imposed by legislation - must be subject to judicial review by the courts of the Member States when they conflict (potentially) with principles and provisions of EU law. This change strengthens the "rule of law" in sport, ensuring that the efficiency of arbitration does not override the rights of clubs, athletes and other stakeholders.
Finally, it reinforces the principle that sports arbitration, while convenient from a practical point of view, cannot override the basic guarantees of EU law, especially in cases of unilateral imposition.
