HomepageCommercial LawPrivate LawPublic Law & Human RightsCriminal LawEU & International LawCareers

Accessibility

Have Irlen Syndrome, or need different contrast? Click the button below for options.

Background Colours

Subscribe

Enter you email address below to subscribe to free customisable article notifications.

Alternatively, click the button below for our various RSS Feeds (available journal wide, or per section).

Sports Arbitration Revisited Pt I: Mutu and Pechstein v Switzerland

Article Cover Image

About The Author

Ben Cisneros (Regular Writer)

Ben is a third-year law student at Selwyn College, Cambridge, currently spending this year studying law at the Universidad Autónoma de Madrid as part of the Erasmus scheme. He has a keen interest in Sports law, and is a future trainee of boutique firm, Morgan Sports Law. Outside of academia, Ben is a keen singer and actor with a unflinching love of Wasps and England rugby.

[Read More]

I can imagine no society which does not embody some method of arbitration.

Herbert Read

Earlier this week, the European Court of Human Rights (ECtHR) handed down its decision on the long-awaited case of Mutu and Pechstein v Switzerland [2018]. This case concerned two athletes who had (separately) lost appeals before the Court of Arbitration for Sport (CAS) in their respective cases, and were now arguing that their rights to a fair trial under Article 6(1) of the European Convention of Human Rights (ECHR) had been infringed.

The judgment comes at a fascinating time for sports arbitration, particularly following the decision in the Belgian case of RFC Seraing v FIFA [2018] that was previously discussed by this author for Keep Calm Talk Law. While many of the concerns raised by that article have been addressed by the ECtHR in Mutu and Pechstein [2018], many others questions still remain.

Principally, Mutu and Pechstein [2018] turned on the forced nature of sports arbitration. As this author explained in a previous Keep Calm Talk Law article on the issue of sports arbitration:

Usually, parties will pre-emptively include an arbitration clause in their contract or, once a dispute arises, enter an agreement to arbitrate (as opposed to litigating in the ordinary domestic courts). Yet in sport, this ‘agreement’ is forced: the regulations of SGBs are rarely negotiated in any meaningful sense, so athletes (and all other participants) must either accept them or choose a different career.

Clearly, this ‘forced agreement’ could have significant human rights consequences, given that submitting to arbitration necessarily involves sacrificing the right to make a claim in state courts (thereby waiving rights guaranteed by Article 6(1) of the ECHR).

Indeed, the decision in Mutu and Pechstein [2018] has potentially far-reaching consequences for both Sports Governing Bodies (SGBs) and the sports legal profession, particularly in light of the dissenting judgment. This article will be the first in a two-part Keep Calm Talk Law series that aims to explain and critically analyse the ECtHR’s potentially landmark decision.

Mutu and Pechstein v Switzerland

Pechstein’s Case

Claudia Pechstein is a well-known German speedskater who – since 1992 – has won 60 medals at international competitions including at the Winter Olympics. Despite this glittering career, Pechstein is perhaps more famous for her impact on sports law rather than for her sporting achievements themselves.

Indeed,since receiving a two-year doping ban in 2009, Pechstein has taken every step possible to challenge it. She appealed the original International Skating Union (ISU) decision to CAS, before challenging the adverse CAS award in the Swiss Federal Tribunal (SFT). After failing there, Pechstein turned to the German courts: high-profile judgments on the foundations of sports arbitration were thus delivered by the Munich Court of Appeal and the German Federal Court. A further appeal is pending in the German Constitutional Court.

In the meantime, Pechstein applied to the ECtHR and alleged an infringement of her human rights under Article 6(1) of the ECHR. She argued that, due to the “forced” nature of the arbitration clause in the ISU Anti-Doping Regulations, she had not properly waived her rights; thus, Article 6(1) of the ECHR should apply to CAS in full.

She then claimed two violations of those rights: that she had not had her “civil rights” determined by an “independent and impartial tribunal”; and that she had not received a “public hearing” despite requesting one. In this respect, she alleged that the president of the arbitral panel in her case was not impartial (due to his previous refusal to be appointed as an arbitrator by athletes accused of doping), and that CAS’s structure was inherently not independent/impartial due to the influence exerted over it by international sports federations.

Pechstein also made an application for damages to be awarded under Article 41 of the ECHR for the losses she had suffered in unsuccessfully challenging the CAS decision before the German courts. She claimed €3,554,124.09 in pecuniary damages, and €400,000 in non-pecuniary damages.

Adrian Mutu's Case 

Adrian Mutu is a former Romanian professional footballer who signed for Chelsea in 2003. A year later, he tested positive for cocaine and was consequently released by the club. Chelsea sought compensation and, after the case proceeded to FIFA’s Dispute Resolution Chamber, the player was ordered to pay over €17 million in damages.

Mutu’s appeal to CAS against this award was unsuccessful. However, he appealed that decision to the SFT, arguing that CAS had failed to provide him with the necessary guarantees of independence and impartiality under the relevant arbitration laws. This challenge also failed.

The player then applied to the ECtHR arguing that he did not receive a hearing from an “independent and impartial” tribunal. Though his case was joined with Pechstein’s, Mutu’s case differs from Pechstein’s in two key ways:

  • Rather than attacking the structure of CAS as a whole, Mutu simply alleged that two arbritators in his specific case lacked independence;
  • Unlike the clause in the ISU’s Regulations,the FIFA Regulations at the time did not contain a “forced arbitration” clause; Article 42 of the 2001 Regulation merely gave the possibility of acceding to the ordinary jurisdiction.

The Decision

As will be noted in Part II of this Keep Calm Talk Law article series, there are certain aspects of the ECtHR’s reasoning in Mutu and Pechstein [2018] – particularly its order – which appear slightly strange. This explanation intends to make the decision as comprehensible as possible, but there may still be elements which jar somewhat. It should also be noted that this article is based upon an unofficial translation of the French judgment.

Admissibility

The ECtHR in Mutu and Pechstein [2018] first had to rule on whether the Swiss government’s argument that some of the applications were inadmissible was well-founded. It found that they were: firstly, the ECtHR concluded that Article 6(1) of the ECHR was prima facie applicable to the cases at hand, as they concerned the determination of “civil rights” – proprietary rights in Mutu’s case, and the right to practice one’s profession in Pechstein’s.

Secondly, relying on its decision in Ilascu v Moldova and Russia [2004], the ECtHR held that it had jurisdiction on the basis that the SFT had 'failed to correct… a breach [of the ECHR] within the scope of its powers'. As such, Switzerland was the proper defendant in the action, despite the fact the issues originated with CAS.

The Validity of Consent to Arbitration

As this author has previously explained for Keep Calm Talk Law, consenting to arbitration typically entails a waiver of rights under Article 6(1) of the ECHR: the parties agree not to resort to State courts. It is thus unsurprising that while the ECtHR in Mutu and Pechstein [2018] reiterated that the “right to a court” is a crucial aspect of Article 6(1) of the ECHR, it immediately went on to note that this right is not absolute and can be limited in a way which serves a legitimate aim and this aim is pursued proportionately.

Arbitration, which provides undeniable benefits for the administration of justice, has long been held to fall under this. Importantly, however, the ECtHR distinguished between “voluntary” and “forced arbitration”. It noted that it is impossible to waive rights under Article 6(1) of the ECHR where arbitration is compulsory (namely, ‘in the sense that [it] is imposed by law’), but reaffirmed its prior decision in Eiffage v Switzerland [2009] that a voluntary waiver of ECHR rights shall be valid where it is ‘free, lawful and unequivocal’.

The ECtHR then considered the vital question of whether, in accepting CAS’s jurisdiction, the applicants had voluntarily waived their rights under Article 6(1) of the ECHR. In examining the crucial criteria, the ECtHR disregarded case law on commercial arbitration, because it considered the situations of Mutu and Pechstein to be ‘not comparable to those [commercial ones] just described’.

As such, the ECtHR in Mutu and Pechstein [2018] performed an analysis on basic principles, holding – in what may prove to be a significant dictum for sports arbitration – that:

Contrary to the choice offered to the applicants [in the commercial cases cited above] – which had the opportunity to conclude a contract with one trading partner rather than with another – the only choice available to [Pechstein] was to accept the arbitration clause and be able to earn a living by practicing her discipline at the professional level, or to not accept it and have to completely give up earning a living by practicing her discipline at such a level.

In view of the restriction that the non-acceptance of the arbitration clause would have brought to the applicant's professional life, it cannot be said that the latter accepted this clause in a free and unambiguous manner.

The Court concludes that, although it was not imposed by law but by the rules of the ISU, the applicant's acceptance of the CAS's jurisdiction must be regarded as a "forced" arbitration within the meaning of the case-law…This arbitration should therefore offer the guarantees of Article 6(1) of the [ECHR].

Therefore, the ECtHR held that in Pechstein’s case (one of clear “forced arbitration”) CAS should have offered all the guarantees of Article 6(1) of the ECHR.

In Mutu’s case, however, due to the wording of Article 42 of the 2001 Regulation, it was not possible to speak of 'forced arbitration'. Nonetheless, given the way in which Mutu had requested the disqualification of an arbitrator during proceedings, and in light of Suovaniemi v Finland [1999], the ECtHR found that the waiver of the rights under Article 6(1) of the ECHR had not been 'unequivocal'. As such, the arbitration proceedings in Mutu's case also had to offer all the guarantees of Article 6(1) of the ECHR.

An ECHR Violation for a Lack of Independence/Impartiality?

Before considering whether CAS was “independent and impartial”, the ECtHR first had to consider whether CAS could be considered a “tribunal established by law” – if not, it would be impossible for Article 6(1) of the ECHR’s requirements to be satisfied. After discussing the concepts of independence and impartiality, and noting the importance of the principles that “justice must not only be done, it must also be seen to be done”, it conducted a brief analysis of CAS’s status:

The CAS was the emanation of a foundation in private law… it enjoyed full jurisdiction to consider the basis of norms of law and, following an organised procedure, any question of fact and of law which was submitted in the context of the disputes before it… Its decisions provided a jurisdictional solution to these disputes and could be appealed to the [SFT] in the circumstances exhaustively listed in [the Swiss Private International Law Act].

Moreover, the [SFT], in its settled case-law, regards the awards rendered by the CAS as "real judgments, similar to those of a state court".

When deciding on the respective causes of the applicants… the CAS thus appears to be a "tribunal established by law" within the meaning of Article 6(1) [of the ECHR).

This is another potentially hugely significant dictum, as discussed in Part II of this Keep Calm Talk Law article series. For the purposes of the judgment, however, this conclusion allowed the ECtHR to then consider the substantive issues of independence and impartiality.

In Mutu’s case, the ECtHR dismissed the arguments against the independence and impartiality of two arbitrators on the CAS arbitration panel in his case. The fact that the first had sat on the panel which decided an earlier dispute in the same case was held insufficient to constitute a violation of the ECHR due to impartiality, as the legal issues were distinct. It was found that allegations that the second arbitrator was a partner in a law firm which represented the interest of Chelsea FC’s owner were unproven. As such, there was no violation of Article 6(1) of the ECHR.

Pechstein’s case was premised on not only the possible partiality of the president of the arbitral panel who ruled on her case, but also attacked the structure of CAS itself (as in the Pechstein German litigation). The first of these arguments was dismissed as 'too vague and hypothetical'. With regard to the structural concerns about CAS, the ECtHR also found that there was no breach of the requirements of independence and impartiality. In coming to this conclusion, the Court noted that, in the same way CAS is funded by international sports organisations, State courts are financed by the State – it does not necessarily mean a lack of independence. It also considered the system for appointing arbitrators to be sufficiently independent/impartial. Hence, there was no violation of Article 6(1) of the ECHR on the grounds of a lack of independence/impartiality.

An ECHR Violation for the Lack of a Public Hearing?

The ECtHR then went on to consider Pechstein’s second claim: that Article 6(1) of the ECHR had been violated as she had not been given a public hearing by CAS. This was straightforwardly accepted. As the ECtHR had found that Article 6(1) of the ECHR must apply to the CAS proceedings in her case and given that 'the publicity of judicial proceedings is a fundamental principle enshrined in Article 6(1) [of the ECHR]', the fact that she was denied a public hearing despite her explicit request to the contrary meant that there was a clear violation of the ECHR.

The Application for Damages

The ECtHR considered Pechstein’s application for damages under Article 41 of the ECHR. The ECtHR found 'no causal link between the violation and the pecuniary damage alleged by the applicant' as:

There is nothing to suggest that, if the arbitral award had been pronounced by an arbitral tribunal having ruled in open court, the conclusions of that arbitral tribunal would have been favourable to the applicant.

However, the Court did award EUR 8,000 for non-pecuniary damage – some way short of the amount claimed.

Summary

By way of summary, the key findings of the ECthR in Mutu and Pechstein [2018] were:

  1. “Forced” arbitration clauses, such as those commonly used in SGB Regulations, are not an effective waiver of rights under Article 6(1) of the ECHR.
  2. CAS is a “tribunal established by law” for the purposes of Article 6(1) of the ECHR and must therefore comply with its requirements.
  3. The CAS system is sufficiently “independent and impartial” to satisfy the requirements of Article 6(1) of the ECHR.
  4. Neither Adrian Mutu nor Claudia Pechstein’s rights to have their cases determined by an “independent and impartial tribunal” under Article 6(1) of the ECHR were violated.
  5. Claudia Pechstein’s right to a “public hearing” under Article 6(1) of the ECHR was violated.

For the latest articles straight to your inbox, you can subscribe for free. Alternatively, follow @KeepCalmTalkLaw on Twitter or Like us on Facebook.

Tagged: Alternative Dispute Resolution (ADR), Contract Law, Human Rights, Regulators, Sport Law, Trade

Comment / Show Comments (0)

You May Also Be Interested In...

Sports Arbitration Revisited Pt II: Mutu and Pechstein v Switzerland

16th Oct 2018 by Ben Cisneros

Forced Arbitration in Sport: A Knock-Out Blow?

14th Sep 2018 by Ben Cisneros

Event Report: Capturing European Views on the Progress of Brexit Negotiations

27th May 2018 by Dimitri Schneider (Guest Author)

The Biggest Challenges Facing the Legal Profession in 2018

2nd Jan 2018 by Keir Baker

Commercial Awareness: The Fortnightly Round-Up (w/b 18th September)

24th Sep 2017 by Jack Turner

A Duty of Candour in Our Hospitals

9th Jun 2014 by Emily Clements

Section Pick December

Secession and the EU: Brave New World or Continuation of Membership?

Editors' Pick Image

View More

KCTL News

Changing of the Guard: Moving Keep Calm Talk Law Forward

12th Aug 2018

An Anniversary or Two: Four Years of Keep Calm Talk Law

11th Nov 2017

Rising from the Ashes: The Return of Keep Calm Talk Law

18th Nov 2016

Two Years On, Keep Calm Talk Law’s Legacy is Expanding

11th Nov 2015

Keep Calm Talk Law's First Birthday

11th Nov 2014

Twitter

Javascript must be enabled for the Twitter plugin to function. Click below to visit us on Twitter.

Free Email Subscription

Subscribe to Keep Calm Talk Law for email updates, and/or weekly roundups. You can tailor your subscription on activation. Both fields are required.

Your occupation / Career stage is used to tailor your subscription and for readership monitoring.

Uncheck this box if you do not want to receive our monthly newsletter.

By clicking the Subscribe button, you agree to our privacy policy and terms of service. Please ensure you read these in full.

Free Subscription