Nobody wants boring football – Homegrown Rules under attack as European football’s status quo is challenged by its clubs (again)

The last few years has seen competition law at the heart of a number of sporting disputes, in Europe and beyond. We have discussed this at length on this blog – see here for our previous commentaries.

Most recently, both the organisational role of European sports governing bodies (SGBs) and the primacy of the European Sports Model (a concept reaffirmed by the European Commission and more recently by AG Rantos in his opinions relating to the high-profile European Super League (ESL) and International Skating Union cases), have been called into question.

Competition law is also central to the recent challenge brought by FC Swift Hesperange (analysed here), and is in the spotlight once again as part of a legal challenge by Belgian club Royal Antwerp F.C. and a professional football player (identified only as UL) pertaining to quotas for ‘locally trained players’ (Homegrown Rules), amongst other matters.

This post considers AG Szpunar’s recent non-binding opinion in the Royal Antwerp case, and what it could mean, if followed by the Court of Justice of the European Union (CJEU), for players, clubs and the future of sports governance in Europe.

Homegrown Rules

UEFA’s Homegrown Rules set out that ‘locally trained’ players are those who, regardless of their nationality, have been trained by their club or by another club in the same national association for at least three years between the ages of 15 and 21. Clubs participating in UEFA competitions must include at least eight such players in a squad of up to 25, with at least four of those eight required to be trained by the relevant club itself.

UEFA’s Homegrown Rules have generally been either replicated or imitated by national football associations, such that they effectively apply across Europe’s domestic competitions. Central to the Royal Antwerp case is the Royal Belgian Football Association’s (URBSFA) form of Homegrown Rules, which broadly aligns (with some distinctions) with UEFA’s.

The questions referred by the Brussels Court of First Instance enquire about the compatibility of both UEFA’s and URBSFA’s Homegrown Rules with (i) the freedom of movement of workers in the EU and (ii) EU antitrust law.

Royal Antwerp’s case – mining for freedom to field more foreign diamonds

Royal Antwerp, Belgium’s oldest football club, views the Homegrown Rules as “incompatible” with EU law and has contested these rules in court. The club argues that the rules impede the free movement of workers by fostering “indirect discrimination on the basis of nationality”, because in most instances, a club’s ‘locally trained’ player will be a citizen of the Member State in which the club is based.

Royal Antwerp contends that this also hinders fair competition in UEFA competitions, as the Homegrown Rules favour clubs based in larger Member States, which benefit from a wider player recruitment pool and to which promising young footballers of smaller Member States often relocate. The club’s representatives went as far as to say that a club like R.S.C. Anderlecht – one of Belgium’s biggest (and Royal Antwerp’s greatest rivals) – has “no chance of winning” the UEFA Champions League.

UEFA and URBSFA’s defence – a justifiable restriction

Meanwhile, UEFA and URBSFA argue that there are overriding public interest reasons in favour of the Homegrown Rules, namely: (a) encouraging the training and recruitment of young players; (b) improving the competitive balance between clubs; and (c) the protection of young players, in so far as their social and family environment should be maintained. The European Commission supported the legality of the Homegrown Rules, despite a capacity to restrict competition, on the basis that they appear to proportionately pursue a legitimate objective. The question of proportionality is central to the Royal Antwerp case.

AG Szpunar’s Opinion

In his opinion, AG Szpunar found that UEFA’s and URBSFA’s Homegrown Rules (partially) unjustifiably restrict the free movement of workers.

AG Szpunar finds that the Homegrown Rules restrict the free movement of workers. In his view, these rules indirectly discriminate against nationals of other Member States, as “it is a fact of life that the younger a player is, the more likely it is that that player resides in his place of origin”. Interestingly, although the original questions referred also cited Article 101 TFEU, the CJEU “requested” that the AG’s opinion be confined to the free movement of workers “only”. It is unclear why the CJEU gave such directions, but the answer might relate to the CJEU’s ruling in the ESL case being expected this Spring. With respect to the justification of this restriction and in line with previous case law, AG Szpunar observes that encouraging the training and recruitment of young players and improving the competitive balance between teams is a legitimate aim. AG Szpunar maintains that Article 165 TFEU has legal bearing with regards to identifying what is a justified restriction and what is acceptable when it comes to proportionality. It is in “this respect” that AG Szpunar “can fully subscribe” to AG Rantos’ opinion in the ESL case.

However, AG Szpunar recalls that private SGBs, rather than public bodies, are driven by private commercial interests that might conflict with public objectives. In particular, AG Szpunar notes that: (a) it is not for private SGBs to “pursue” or “implement” a Union policy (like Article 165 TFEU); (b) regarding the European Sports Model, the functions of EU institutions are not outsourced to UEFA or URBSFA; and (c) crucially, UEFA and URBSFA "cannot obtain a blank cheque" to restrict fundamental freedoms by reference to Article 165 TFEU.

Furthermore, AG Szpunar finds that although the Homegrown Rules are, in principle, suitable to achieve a legitimate aim, the definition of a ‘locally trained player’ is “not coherent” to the extent that it applies to players outside of a given club, but inside the relevant national league. The AG holds that “if a club in a major national league can ‘buy’ up to half of HGPs, the objective of encouraging that club to train young players would be frustrated”. 

Comment

There is a clear theme connecting the Royal Antwerp, FC Swift Hesperange and ESL cases – UEFA, as defendant, is attempting to tackle allegations of clubs – large and small – that its rules and position conflict with laws underpinning fundamental freedoms of EU law. In defence of those allegations, UEFA relies on what it considers to be proportionate measures to pursue legitimate goals in its governance of European football. This is a delicate test, however, and one that clubs are increasingly keen to scrutinise before the courts. Whilst AG Rantos seems to support a prominent role of Article 165 TFEU that would generously justify the actions of the SGBs within the EU, AG Szpunar pushes back and dilutes the exceptionalism of sport and the role of SGBs within the wider European legal framework.

As stakeholders wait to see how the CJEU weighs in on this pivotal issue in its imminent ESL ruling, UEFA’s reforms of its rules and competitions continue, with recent changes to its ‘Financial Fair Play’ regime and a revamped Champions League due to launch in 2024/2025. Repeated legal challenges, however, raise the question as to whether all future reforms will be on the governing body’s terms.

On the question of Homegrown Rules specifically, if the CJEU’s ruling (expected later this year) follows similar reasoning to AG Szpunar’s opinion, football clubs (both up and down the pyramid) across Europe will need to take notice. Changes to the Homegrown Rules could well have significant implications for academy programmes, the development and management of squads, and both domestic and global transfer markets.

Sign up to SportingLinks for more dedicated legal opinion on topical issues in the sports sector.