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Brussels, 27 June 2002

Commission closes investigation into UEFA rule on multiple ownership of football clubs

The European Commission has closed an investigation into the UEFA multi- ownership rule according to which a company or individual cannot directly or indirectly control more than one of the clubs participating in a UEFA club competition. The investigation had been triggered by a formal complaint lodged by ENIC Plc, an investment company with stakes in 6 clubs. The complaint has been rejected.

Commenting on the case, Competition Commissioner Mario Monti said: "The main purpose of the UEFA rule is to protect the integrity of the competition in other words, to avoid situations where the owner of two or more clubs participating in the competition could be tempted to rig matches"."Although the rule could theoretically be caught by Article 81 of the EU Treaty, it is intended to ensure that sporting competitions are fair and honest, which is in the interest of the public and football fans in particular."

On 18 February 2000, ENIC(1) lodged a complaint against European football governing body UEFA concerning its rule on the "Integrity of the UEFA Club competitions: Independence of clubs". This rule, which was adopted by the UEFA Executive Committee in 1998, states that no two clubs or more participating in a UEFA club competition may be directly or indirectly controlled by the same entity or managed by the same person.

ENIC considered that the rule distorts competition by preventing and restricting investment in European clubs.

After a careful analysis, the Commission has come to the conclusion that although the UEFA rule is a decision taken by an association of undertakings and, therefore, theoretically caught by the prohibition principle set in Article 81(1) of the European Union treaty, it can be justified by the need to guarantee the integrity of the competitions.

It is the task of sports organisations to organise and promote their particular sports, particularly as regards pure sporting rules, such as the number of players that play in a football team or the size of the goal posts. The Court of Justice has ruled on several occasions that the economic aspects of sport are subject to EU law, but also recognised that the special characteristics of the sector must be taken into account when applying the treaty rules.

In the case of the UEFA multi-ownership rule, the Commission established that the purpose of the rule was not to distort competition, but to guarantee the integrity of the competitions it organises.

In any case, the limitation of the freedom of action of clubs and investors which the rule entails does not go beyond what is necessary to ensure its legitimate aim : i.e to protect the uncertainty of the results in the interest of the public.

This decision makes clear that a rule may fall outside the scope of competition rules despite possible negative business effects, provided that it does not go beyond what is necessary to ensure its legitimate aim and that it is applied in a non-discriminatory way.

The Commission has rejected the ENIC complaint. The company has two months to decide whether to challenge the Commission's analysis before the European Court in Luxembourg.

For background on the Commission's analysis of other sports-related cases see the recent decision on the UEFA sale of the broadcasting rights to the Champions League (IP/02/806) and the broader MEMO on the application of EU competition rules to sport (MEMO/02/127).

(1) ENIC owns stakes in six clubs Glasgow Rangers FC in Scotland (25,1%), FC Basel in Switzerland (50%), Vicenza Calcio in Italy (99,9%), Slavia Praga in the Czech Republic (96,7%), AEK Athens in Greece (47%) and in Tottenham Hotspur in England (29.9%)

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