The Bosman case and its influences on the competitive balance in the European football market Essays

The Bosman case and its influences on the competitive balance in the European football market Essays The Bosman case and its influences on the competitive balance in the European football market Essay The Bosman case and its influences on the competitive balance in the European football market Essay The Bosman case and its influences on the competitive balance in the European football market Introduction Jean-Marc Bosman was a football player in the first division in Belgium and wanted to play for the French team Dunkerque after his contract expired in 1990. The transfer did not succeed because Dunkerques transfer fee was not high enough so his club RFC Li? ©ge refused and Bosman had to wait for a higher offer. Subsequently Bosman sued against the FIFA rules and ought to be proved right. The following pages outlines the consequences of the Judgment of the so called Bosman ruling on he transfer system and on the competitive balance of the European football market. The Judgment An indicator that shows the dimension of the Bosman case is the official title it-self: Union Royale Belge des Soci? ©t? ©s de Football Association ASBL v. Jean-Marc Bosman, Royal club Li? ©geois SA v. Jean-Marc Bosman and others and Union des Associations Europ? ©ennes de Football (UEFA) v. Jean-Marc Bosman (Case C-41 5/93. European The case took place at the European Court of Court reports 1995, page 1-4921). Justice (ECJ) in Luxemburg and was about two different issues. The first one Bosmans omplaint addressed two separate issues, one of them concerns the existing transfer regulation, whereby a professional football player is not allowed to transfer for free at the end of the contract. The other subject is the so called 3+2 rule of the European Football Federation (UEFA) which limits the number of foreign players on the field. Five foreign players in play are the maximum in a competitive match upon condition that two of them having played for at least five years in the clubs country (R. Parrish, (2003), Sports law and policy in the European Union, p. 226). Bosman s rgumentation based on the article 48 (Treaties of Rome) which deals amongst others with the free movement of workers in an international labour market and guarantees the equal treatment of workers of the member states regardless their nationality (Rom Treaties, 1957). The legal process lasted five long years, in the end the counter-arguments of the opposition the exceptional position of sport as a cultural goods failed despite the big lobby of sport associations. One basis of decision- making was the landmark case of Walrave in 1974 in which is stated that sport falls nder the scope of application of Community law (Article 2 EEC), therefore the and with this is applicable to the Article 48 (ECC). This Judicature ensured the free movement of workers within the European Union and the abolition of any discrimination based on nationality between workers of the Member States (R. arnsh, (2003), p. 226). Influences on the competitive balance within the European leagues The legal victory at the EC] ought to have a lasting effect on the competitive balance between national European leagues. The open labour market resulted in a shift of ower from the smaller markets for example Netherlands and Scotland to the bigger ones namely England, Spain, Germany, F rance and Italy also known as the big 5. Former important historical teams such as Ajax Amsterdam were not able to keep up with big 5 teams and had to face upcoming teams from Russia and Ukraine in European competitions as well (DeJonghe Van Obstal, 2000). This competitive disadvantage of smaller market teams is correlated to freedom of movement within the member states and the abolition of the limitation of the number of foreign players. The balance of power shifted from the clubs to the players, who could choose the clubs with the highest wages and resulted in a substantial player emigration from smaller to bigger markets. Ever since then, it is an increasing competition to attract the best player talents (DeJonghe Van Obstal, 2000, p. 43). A study published in the Annual Review of the European Players Labour Market tried to measure the creasing concentration of player talent in the big 5 markets. Therefore, the study compared the US World Cup 1994 which took place before the Bosman case and the World Cup in Germany 2006. The comparison of the eleven ountries who participated in both competitions highlighted the dominating position of the big 5 leagues. In 1994, 43 % of the players made their money in the big 5, compared to 50% in 2006. In order to measure the migration of playing talent, the study left out players who worked in their own country, in this regard the fgures increased from 18,2 % in 1994 to 25,3 % in 2006. In contrast to this, the coefficient for the smaller market leagues state the same with a menial decrease from 3,7 % to 3,6 % (DeJonghe Van Obstal, 2000). To underline the decreasing competitive balance between the European football eagues, the percentage of international players in the top five clubs of each league in the big 5 was 64,6 %, while the respectively league average was well below (DeJonghe Van Obstal, 2000). Another interesting indicator for this are the last 17 final results of the Champions League, Ajax Amsterdam won it in the year of the Bosman Judgment and the FC Porto from Portugal in the year 2004. All 15 other possible Champions League goblets went to teams out of the big 5. One approach of sports economists was to combine the European professional football with some characteristics of the US sports model revenue sharing, salary cap, etc. ) to counteract the concentration on the bigger markets. The problem was that this kind of cross-subsidization would be difficult to implement in the structures of European football (DeJonghe Van Obstal, 2000, p. Conclusion The Bosman case is a landmark in the European football history, it created an open labour market with the result of talent concentration on the bigger markets. The World Cup studies as well as the performances of teams in the European Champions League in the last 16 years underline a decline in competitive balance between the European leagues. In my opinion the financial fair play concept of the UEFA is a good approach to antagonize the power concentration on the bigger markets. The idea of the system is to regulate the balance between the financial earning and spending plus the amount of indebtedness of a club. If there is any control deviation the UEFA has the possibility to exclude this club from international competitions. Just one question remains if the UEFA will take decisive action against clubs who trespass against the rules of the game!? References Case C-41 5/93. European Court reports 1995, page 1-4921 R. Parrish, (2003), Sports law and policy in the European Union, Rom Treaties (art. 2 + art. 48) T. DeJonghe, (2000), Rivista di Dritto ed Economica dello Sport Article 48 1 . The free movement of workers shall be ensured within the Community not later than at the date of the expiry of the transitional period. 2. This shall involve the abolition of any discrimination based on nationality between workers of the Member States, as regards employment, remuneration and other working conditions. 3. It shall include the right, subject to limitations Justified by reasons of public order, ublic safety and public health: (a) to accept offers of employment actually made; (b) to move about freely for this purpose within the territory of Member States; (c) to stay in any Member State in order to carry on an employment in conformity with the legislative and administrative provisions governing the employment of the workers of that State; and (d) to live, on conditions which shall be the subject of implementing regulations to be laid down by the Commission, in the territory of a Member State after having been employed there. iministration.