On 7 November 2019, the Greek football club Aris FC was found guilty by the FIFA Disciplinary Committee of failing to comply with a decision rendered by the FIFA Dispute Resolution Chamber (the “FIFA DRC”) on 7 June 2013, according to which it was ordered to pay to the player Siston a certain outstanding amount. This decision constitutes a landmark for the Greek football as it was the first time a domestic football club was ordered to pay debts effectively created by its so-called sporting predecessor. Even though the grounds of the pertinent decision are not available, it seems that club Aris FC was found to be the sporting successor of the football club Aris Thessaloniki FC that has entered into liquidation since 2015 and therefore, it is liable for the debts incurred by the latter. At the same time, this decision is the last ring on a long chain of incidents of unequal treatment between Greek and foreign football players, mostly due to the legal landscape of Greek football which in several and severe matters differs from the regulatory framework established by FIFA, hence leading to contradictory decisions and results in favor of Greek football clubs. In this article, the author will attempt to present some exemplary manifestations of this defective treatment at the expense of the Greek football players and examine its legal aspects in comparison with the corresponding provisions of the various FIFA Regulations.
The issue of sporting successor and its legal treatment
By virtue of Article 15(4) of the FIFA Disciplinary Code (the “FIFA DC”), the notion of “sporting successor” is integrated in the regulatory framework of FIFA. According to said provision, the sporting successor of an entity that has failed to comply with these kinds of decisions described in Article 15(1) FIFA DC shall also be considered a non-compliant party and thus, shall be subject to the same sanctions provided under the pertinent provision. When it comes to ascertaining whether a legal entity is to be considered the sporting successor of a non-compliant party, FIFA seeks to determine the connection between the entities concerned on the basis of objective criteria, such as their respective headquarters, names, badges and colors. In this respect, FIFA jurisprudence provides that a “new club” is to be considered the sporting successor of another club in a situation where the new club: a) has created the impression that it wants to be legally bound by the obligations of its sporting predecessor, b) has taken over the license or the federative rights of its predecessor and c) it is treated by the competent federation as the successor of the old club. In overall, FIFA has determined that sporting succession is the result of the creation of a new entity that has taken over the activities of the old club, including the acquisition of the latter’s assets and its establishment in the same city.
The abovementioned approach adopted by FIFA, primarily focuses on what one may call “sporting factors” rather than elements pertaining to the legal form of the entities in question and reflects, in essence, previous CAS jurisprudence on the issue of sporting succession. According to the Panel in the infamous CAS 2016/A/4576: “[A] club is a sporting entity identifiable by itself that, as a general rule, transcends the legal entities which operate it. Thus, the obligations acquired by any of the entities in charge of its administration in relation with its activity must be respected; and on the other side, that the identity of a club is constituted by elements such as its name, colours, fans, history, sporting achievements, shield, trophies, stadium, roster of players, historic figures, etc. that allow it to distinguish from all the other clubs. Hence, the prevalence of the continuity and permanence in time of the sporting institution in front of the entity that manages it has been recognized, even when dealing with the change of management companies completely different from themselves”.
Turning now to Greek football and for one to understand the legal aspects of the matter at hand, it is essential to be provided with some historical information about the applicable regulatory framework. Originally and for as long as the game was played in an amateur level, Greek football clubs were, as the word indicates, clubs (similar to the Spanish “clubes” as Real Madrid CF, FC Barcelona, or Athletic Bilbao or the German football clubs). However, since Greek football became professional, it also became necessary for the domestic football clubs to adopt a different legal form in order to be able to keep up with the constant commodification of the game. As a result, football clubs which until then were common clubs in terms of their legal form, regulated by the Greek civil code, started to create football joint-stock companies (or “PAE”).
Nowadays, articles 64, 73 and 108 of law N. 2725/1999 (the “Greek Sports Law”) dictate that a football club (in the legal sense of a club) meeting the sporting criteria to participate to the national professional football divisions is obliged to create a PAE that will run its football activities and will take over any rights and liabilities of the latter. Further, articles 111(1) and (2) Greek Sports Law provide that in case a PAE loses its right to participate in professional football, due to relegation, divisions’ restructure or any other reason whatsoever, it automatically enters into liquidation and its football activities are taken over by the founding club. It goes without saying that in case the founding club will later reacquire the right to participate in professional football, it can create a new PAE to run its professional football activities, under the circumstances provided by law.
In recent years, the aforementioned scheme has been heavily exploited by several Greek football clubs at the expense of the Greek football players in the following manner; Any PAE facing financial difficulties could freely choose to not participate in the professional football divisions by not registering at all and as a result of this choice, that PAE automatically entered into liquidation as described above. Subsequently, once the founding club (which in the meantime had substituted for the liquidated PAE) had reacquired the sporting right to participate to professional football, it could establish a new PAE that would not be liable for the debts incurred by the liquidated PAE, given that until 2016 there was no legislation whatsoever regulating the issue of sporting successor and the pertinent provisions of the Greek legislation still do not recognise the notion of “legal successor” when it comes to bankrupt entities. In 2016, Article 111(4) N. 2725/1999 was enacted, providing that as of the sporting season 2016-2017, any new PAE would be effectively responsible for 50% of the debts incurred by its sporting predecessor towards players, coaches, clubs, football agents etc. Nonetheless, the lack of any retrospective effect of the pertinent provision led to its application only to PAEs that have been created since the sporting season 2016-2017, leaving the players that had claims against PAEs that were created prior that season without any means to recover the monies due.
If you are confused, imagine the following scenario: The Greek player A. and the Italian player B. play for the PAE C. during the sporting season 2011-2012. PAE C faces financial difficulties and enters into liquidation by the end of the season 2012-2013, being substituted by its founding club. The latter acquires the right to participate again in the lowest professional division of Greek football as of the season 2014-2015 and to this end, it creates a new PAE, called D. In the meantime, the Greek NDRC and the FIFA DRC have respectively adjudicated that PAE C is liable to A and B for certain outstanding amounts. According to what was set out above about the issue of sporting successor on a national and international level, B will be able to recover any monies due by PAE D once the pertinent decision becomes final and provided that he has been what the FIFA Disciplinary Committee calls “a diligent creditor”, whereas A’s claim will be barred under the Greek legislation as he will not be able to make recourse to the FIFA deciding bodies.
By the same token, the Greek players A and B play for the PAEs C and D respectively and under the exact circumstances as those described above, both the latter enter into liquidation by the end of the season 2012-2013. However, the founding club of PAE C creates a new PAE before the beginning of the sporting season 2014-2015, while the founding club of PAE D establishes a new PAE by the season 2017-2018. Again, whereas B will be able to recover any amounts due by the sporting successor of its employer, A will be limited solely to the outcome of PAE C’s liquidation proceedings, irrespective of the fact that their cases were identical.
It is evident from what was set out above that the legal framework of Greek football has created cases of unequal treatment not only in terms of the players’ nationality but also ratione temporis. By not aligning its regulations with the regulations of FIFA in this respect, the Hellenic Football Federation has led identical or similar cases to be treated differently only because the player in question is of a specific nationality or because the sporting successor of its debtor was established before or after 2016. Given that the principles of equal treatment and legal certainty are considered among the key legal objectives of FIFA, it is extremely arguable whether the aforementioned approach is compatible in this regard.
The issue of treatment of employment agreements
The recent Covid-19 outbreak shocked the whole world and football could not be an exception. Given the unavoidable financial consequences of the pandemic and the disruption of football activities, FIFA issued a set of recommendations, officially called “FIFA Covid-19 Football Regulatory Issues vol. I”. By this means, FIFA attempted to provide the MAs with a set of guidelines to address all the practical issues arising from the pandemic, especially with regard to the players’ contracts and the transfer system in general.
Concerning the employment relationships between football clubs and players and considering that the principle of contractual freedom constitutes a key doctrine of its regulatory framework, FIFA primarily proposes for the parties to work together in order to find amicable solutions, where employment agreements can no longer be performed as originally anticipated. In the same context, FIFA has advised the various stakeholders that unilateral decisions to vary contractual agreements will only be accepted if provided under the respective national law or any CBA structure. When the pertinent issues are not addressed by national law or CBA agreements and the parties have failed to reach an amicable agreement, unilateral decisions shall be accepted only if they are reasonable, proportionate, and implemented in good faith. In analysing the reasonableness of such decisions, FIFA will primarily take into consideration their financial parameters, as well as elements pertaining to their consistent application on the entire squad and the prior efforts of the club to negotiate with the players. As an ultimate solution, FIFA proposes the uniform suspension of all employment agreements provided that “proper insurance coverage is maintained, and adequate alternative income support arrangements can be found for employees during the period in question”.
Nonetheless, the HFF Executive Committee decided to implement a slightly different approach; By means of its decision dated 9.4.2020 and captioned “Measures for the support of professional football” the aforementioned Committee decreed the provisional suspension of Article 11(6) HFF RSTP until 30.6.2020. According to this article, the termination of an employment agreement with just cause by a football player is null and void unless an extrajudicial notice has been properly notified to the employer-PAE in this respect, at least 8 days prior to the termination. In other words, the HFF Executive Committee decided instead of unilaterally suspending all the effective employment contracts (a decision that was taken sporadically by certain clubs) to suspend the right of football players to terminate their contracts with just cause, regardless of whether such just cause occurred prior of following the Covid-19 outbreak. From a practical point of view, the decision in question enabled the various PAEs to suspend any payments towards their employees, given that the latter cannot longer meet the necessary preliminary requirements in order to seek for a new employer even after a prolonged period of non-payment.
It should also be mentioned that by means of its Circular Letter 1720 which encloses the “FIFA Covid-19 Football Regulatory Issues- Frequently Asked Questions”, FIFA forbids the MAs to unilaterally alter terms contained in employment agreements by means of regulations amendments, unless said amendments are permitted by national law and have been collectively agreed with the various social partners (players’ and coaches’ unions). It goes without saying that the aforementioned decision of the HFF Executive Committee directly affects the employment agreements in the Greek region, as it suspends the provisions pertaining to the termination of said employment agreements when the latter are governed by the Greek RSTP.
Considering that the HFF RSTP applies primarily to employment relationships between Greek players and clubs, while the FIFA RSTP is applicable in employment-related disputes of an international dimension, it becomes clear that potential future disputes of similar nature and factual background, will be treated differently, depending on the applicable regulations and the respective deciding body (HFF NDRC or FIFA DRC). Once again, Greek players will be in a disadvantageous position compared to their foreign peers, as the latter will be entitled to terminate their employment contracts with just cause and seek a new employer, even during this period of pandemic.
It should also be noted that the FIFA RSTP contain explicit provisions on the protection of the principle of contractual stability. Whereas Article 14 FIFA RSTP (the international equivalent of Article 11 HFF RSTP) as such is not binding at a national level, each MA “shall include in its regulations appropriate means to protect contractual stability, paying due respect to mandatory national law and collective bargaining agreements”. It is at least arguable whether such decision would entail disciplinary consequences for the HFF under the general clause of Article 2(2) FIFA Disciplinary Code. FIFPro however, has already publicly demonstrated its disapproval towards such practices and has pleaded to the HFF to align with the recommendations of FIFA in this respect.
The aforementioned situations are indicative of the problems that Greek football has to deal with, in terms of its regulatory framework and its general orientation. Apart from the harm that is caused to its credibility and reputation, there are issues that pertain to its foundations; By virtue of Article 15(2) law N. 4326/2015 is provided that “Issues of football and the organisation and operation of the football federation are regulated by the Hellenic Football Federation (HFF), in the context of its self-governing operation in accordance with its statutes and regulations, which must be harmonised with Constitution, the current legislation, given that the HFF manages its affairs, independently and without influence from third parties, and in accordance with the regulations of the World and European Football Federation, of which HFF is a member.” The effect of this provision is that, as of 2015, the independency and self-governance of the HFF was restricted, given that its regulations have to be compatible not only with the various FIFA and UEFA regulations – which was the case so far – but also with the domestic legislation. It is the author’s opinion that the aforementioned provision constitutes indirect interference to the independency of the HFF, as the latter is obliged to regulate its activities not only in accordance with the various FIFA and UEFA regulations but also in accordance with the Greek law. In other words, the state legislator may at any time prevent the HFF from aligning with the regulatory framework of football’s governing bodies for its own political purposes; the legal treatment of sporting successor has proved to this end.
Further, the decision taken by the HFF Executive Committee about the treatment of employment contracts during the Covid-19 outbreak was, as set out above, almost entirely out of line with the guidelines provided by FIFA in this respect; and it’s not the first the one. It would be an understatement to say that the HFF sought to secure only the interests of the clubs, as it effectively diminished until the end of the season the right of the players to terminate their employment contracts after a prolonged period of non-payment. For a country like Greece, where there is a majority of players that were unpaid even before the pandemic, the impact of such a decision is incalculable. In a world of football that constantly changes and “the players are the new players” to treat your assets as such, shows a clear lack of perspective.
Antonis is a Law graduate from Dimokrition Panepistimion Thrakis. Currently Studying for LLM in International Sports Law at ISDE in Madrid. He is an Intern at EFRAIM BARAK – Sport Law & Consultancy (Israel).
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-  Unfortunately, the decision is not published in the database of the FIFA Disciplinary Committee, due to the failure of the sanctioned party to request the grounds of the decision. However, the operative part of the decision was published in several Greek media. Indicatevely, “ https://www.metrosport.gr/idoy-to-eggrafo-tis-fifa-gia-tin-apofasi-kata-toy-ari-docs-216632 “
-  Article 15(4) FIFA DC
-  DC 170528/13.2.2020 PFC CSKA Sofia, available at https://resources.fifa.com/image/upload/dc-170528-13-02-2020-pfc-cska-sofia.pdf?cloudid=k56zekepzb1ontqddadg
-  DC 180683/25.9.2019 Hapoel Tel Aviv, available at https://resources.fifa.com/image/upload/dc-180683-25-09-2019-hapoel-tel-aviv-fc.pdf?cloudid=sok2dx6nfrmcjtw5ieqn
-  CAS 2016/A/4550 Darwin Zamir Andrade Marmolejo v. Club Deportivo La Equidad & FIFA CAS 2016/A/4576 Újpest 1885 FC v. FIFA
-  The term is identical to the Spanish “SAD”
-  Which is also embedded in Annex 1 of the HFF Regulations on Football Matches (the “KAP”)
-  Article 111 (4) (b) N/ 2725/1999
-  According to the jurisprudence of the FIFA Disciplinary Committee, a creditor claiming any amounts due by the sporting successor of its debtor, should have previously tried to recover such amounts by participating in the bankruptcy proceeding of the latter.
-  Available at https://img.fifa.com/image/upload/zyqtt4bxgupp6pshcrtg.pdf
-  Article 1(3)(b) FIFA RSTP
-  The press release by FIFPro is available at: https://www.fifpro.org/en/rights/fifpro-supports/fifpro-supports-greek-players-association-requst-to-f-a