In December 2023, the European Court of Justice made a ruling concerning the proposed “European Super League,” reflecting Europe’s effort to learn from legal developments in American sports. Following this, the English Premier League has approved a proposal to introduce a salary cap on player spending starting from the 2025-26 season. This comes after years of increasing player wages that have outpaced revenue gains, prompting the U.K. government to consider stabilizing the sport.
American sports leagues, such as the NBA, NFL, and NHL, have implemented salary caps or luxury tax schemes to restrict player salaries. This is due to collective bargaining agreements negotiated between employers and unionized employees, which govern various aspects of the league’s operations. In the case of the Premier League, the absence of a salary cap may be attributed to the resistance from the Professional Footballers’ Association (PFA), the trade union for soccer players in England.
The CJEU’s ruling on the European Super League highlighted that EU sports organizations are subject to competition law, similar to the U.S. antitrust laws. European competition law prohibits conspiring to unreasonably restrain trade, as seen in the Sherman Antitrust Act. The CJEU emphasized the importance of transparent, objective, and non-discriminatory rules in sports organizations, despite the need for competitors to agree on certain rules for competitions.
A legal challenge by Lassana Diarra, a French player, argued that FIFA rules restricting player movement were violations of EU competition law. Advocate General Maciej Szpunar supported Diarra’s position, recognizing that such rules could restrain players’ ability to move between clubs. These issues are familiar to American sports lawyers, who have navigated similar challenges concerning free agency and player movement restrictions.
The American approach to labor relations in sports, based on negotiated agreements between employers and unions, has led to peaceful relations and stable leagues. The non-statutory labor exemption in the U.S. grants antitrust immunity to employers who negotiate rules with their employees’ union, allowing for restrictions on free agency and salary caps. European sports leagues could benefit from adopting similar frameworks to avoid legal issues surrounding player movement and salary restrictions.
In conclusion, Europe’s efforts to learn from American legal developments in sports are evident in recent decisions concerning the European Super League, the Premier League salary cap proposal, and challenges to FIFA rules on player movement. By considering the negotiation processes and labor agreements that have stabilized American sports leagues, European organizations can navigate legal challenges and ensure fair competition in the sports industry.
