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Issues faced by the commercial bodies in the Sporting Industry

Abstract
The National Courts play an important role in the process of arbitration but the most challenging avatar played by it is relating to the enforcement of the foreign arbitral awards. When an arbitral award is passed the executing Court may refuse to enforce it on the grounds as specified in Article- V of the Convention on the recognition and Enforcement of Foreign Arbitral Awards 1958. (Also known as New York Convention).

These restrictions are incorporated in the national Legislation of most Countries signing the New York Convention and adopting the UNCITRAL Model Law. Public policy is one of the raison d'être as contained in the New York Convention based on which a party can challenge the enforcement of the foreign arbitral awards. At the outset also public policy remains an important weapon in the hands of a national court wishing to interfere with the arbitral process.

To enable a fast and cost-effective forum for resolving international sporting disputes and having regard to the jurisdictional issues faced by the athletes in bringing disputes with information sporting bodies before national courts, the CAS (Courts of Arbitration For Sports) was created. International arbitral awards rendered by the CAS may be recognized and enforced by courts under the New York Convention 1958. The CAS has a wide jurisdiction to entertain disputes that arises between parties pertaining to sports activities and where they have mutually agreed either with or without a prior arbitral agreement for the submission of their dispute to the CAS. Arbitral awards have the same enforceability as a Court Judgments and is final unless the parties have made an appeal or have the award set aside.

Introduction:
As the latest trend and practice in the field of adjudication mechanism in dispute resolving procedure relating to the branch of sports conflicts, the International Court of Arbitration for Sports (CAS) plays a very vital role as an alternative efficacious dispute settlement body and caters to the unique requirement of sports-related conflicts.

It acts as a means for the speedy justice delivery system and also maintains the dignity of the sporting events by keeping confidentiality as required in such awards and along with it also works wonder, in reducing the cost of dispute resolution. Various sports-related adjudicating authorities have been set up to adjudicate disputes, through Alternative Dispute Resolution (ADR) Mechanism Courts of Arbitration for Sports (CAS) is being identified as the Apex body in the field of sports Arbitration.

CAS was established in the year 1983 at Lausanne, Switzerland by the International Olympic Committee (IOC). It is considered as Supreme Court in the dispute settlement pertaining to sports. Every International Sports Federation administers their sports dispute which arises between themselves or relating to any sportsperson by submitting to the authority of CAS for adjudication of the dispute.

Objective & Scope
This research paper primarily focuses and relies upon upon the below-mentioned points, which are carefully drafted and relied upon, as its primary objective and scope of research and specifying the same as its field of the study area, which is thoroughly and fundamentally relied on and analyzed in details.
  1. What are Sports Arbitration and its avenues?
  2. What are the different adjudication modes available for the settlement of disputes in the Sports Industry?
  3. Binding effect of the arbitration award on the parties and specific provisions of laws?
  4. What are the various International Conventions which are supporting Sports Arbitration?
  5. Enforcement of sports arbitral awards passed by CAS and various other arbitration tribunals pertaining to the settlements of sports disputes and the challenges faced by the statutory sports bodies?

Research Methodology
For bonafide research work on this present topic, the author has relied basically on Secondary Data, i.e. Papers on various research articles, publication in journals concerning or relevant to the present topic, e-reports and repositories containing a reliable source of documents that are used and extensively referred to in various studies and research works. The various sources from which the data has been collected are referred to in the last part of this article in the reference Column.

In writing this research paper, the author has done the extensive studies as required and formulated, analyzed the hypothesis and arrived at a conclusion or finding giving due credit to the documents as obtained and relied upon by the author from various sources as stated above. The same documents may be used by any other researcher on carrying out further studies pertaining to this present topic, or any other topic, which is related on the same subject matter.

Functions Of CAS

The CAS functions only when any natural or legal person refers any dispute to it which is directly or indirectly arising out of sports activities including commercial issues. The law applicable in CAS is generally, the Swiss Laws unless otherwise agreed by the parties. The CAS exercises a very wide jurisdiction within the sports field and the disputes arising out of it to settle the same between the parties who agree to submit to its jurisdiction.

The procedure and rules apply to those cases where the parties voluntarily agreed about referring their dispute to the CAS. The official language of CAS shall be either French or English as decided by the parties vide agreement or contract. The CAS has two divisions which are (1) The Ordinary Arbitration Division- which handles matters of the first instance. (2) The Appellate Arbitration Division- which deals with appeals from the decision of federation association and other sports bodies and authorities.

According to Article R47 of the CAS code an appeal against a decision of a federation, association, or sports-related body maybe filed with the CAS if the statute and regulations of the authority so stipulate and if the parties to the dispute have made a specific arbitration agreement and has exhausted all the legal remedies available to him, before making an application to the CAS for appeal. The CAS also exercises certain advisory jurisdiction, pertaining to non-contentious matters and allows certain sports bodies to seek an advisory opinion from the CAS.

Also, the CAS exercises mediation procedure too, where the parties seek the same. The International Council for Arbitration for Sports (ICAS) is the supreme body, which safeguards the independence of the CAS and protects the rights of the parties. Its looks like the administration and financing part of CAS. It has 20 members who are all high-level jurists and are well versed in arbitration and sports laws.

Jurisdiction Of CAS

A very significant decision pertaining to jurisdiction of CAS arose from the Sydney Olympics (1999) whereby the Australian Court in the case of Raguz Vs. Sullivan[1] refused to exercise jurisdiction on the basis of lack of jurisdiction. The Australian Court has pointed out that in the agreement for reference to CAS for arbitration form was signed by the parties does not come within the ambit of domestic arbitration agreement within the commercial Arbitration Act 1984 but was a foreign agreement, hence it was outside the jurisdiction of Australian Courts.

Prima facie it is observed that the National Courts orders are not binding on non-national parties but are binding to those who fall within its jurisdictions. In India in case of sports disputes the International Forum as CAS is not being accessed on a regular basis as compared to other nations, but recently in the case of Aswini AC, Priyanka Panwar, Sini Jose, and Tiana Mary Thoma, as they were representing India in the Common Wealth Games and Asian Games, they were found positive on a doping test and were suspended for a period of 1 year, by the National Anti-Doping Disciplinary Panel (NADDP). In an appeal to NAADP by World Anti Doping Agency (WADA) for enhancement of suspension period of the above-said sportspersons who found positive on dope testing, the WADA has cited many rulings of the CAS while making his submissions before the NADP.

Hence it is crystal and clear that in case of Sports-related disputes, the CAS plays an important part in global disputes resolution, pertaining to sports conflicts but in the context to the Indian Courts, the decisions passed by the International arbitration Institution such as CAS, it is doubtful and shaky after the findings as laid down by the Supreme Court of India pertaining to Venture Global Engineering Vs. Satyam Computer Services Ltd and Others[2]. In this case, the Hon'ble SC has held that the Indian Courts could exercise their jurisdictions to set aside foreign arbitral awards in pursuance of the the ratio of Bhatia International Case.

Intervention Of Indian Courts Pertaining To International Arbitral Agreements And Awards:

The arbitration and Conciliation Act of 1996 was enacted to amend the law pertaining to domestic arbitration, international arbitration and enforcement of foreign arbitral awards and also to define the law pertaining to conciliation and for matters connected therewith and incidental thereto. Part-1 of the Arbitration and Conciliation Act is largely based on the the framework of United Nation International Trade Law (UNCITRAL) MODEL. The UNCITRAL RULES as adopted by the General Assembly of the UN and also recommended the use of such rules by all Member Countries in cases of any dispute that arises into the context of International Commercial relations and where the parties seeks amicable settlement of their disputes vide recourse to conciliation.

The preamble of the Arbitration and Conciliation Act 1996, also lays down that the Model Law and Rules make a significant contribution in the establishment of a unified legal framework, for the fair and efficient settlement of the disputes which arise out of international commercial relations. While Part-I of the Arbitration and Conciliation Act deal with UNCITRAL Model Law and is applicable where the Place of Arbitration in India.

And Part-II of the Act gives effect to the Geneva and New York Convention for enforcement of Foreign Arbitral Awards.

However, the Hon'ble Supreme Court has eroded the distinction between domestic and foreign awards in its finding and judgment as pronounced in the Bhatia International Case. The SC has opined that Section-9 could be invoked to support foreign Arbitral proceedings. Hence Part I of the Arbitration and Conciliation Act was no longer limited to application for domestic awards but also extends its applicability to foreign awards.

New York Convention And Uncitral Model Law And Rules

The New York Convention and UNCITRAL Model law has been with an objective to facilitate enforcement of foreign arbitral awards. However, it prescribes certain limitations on the enforcement of foreign arbitral awards as has been contained in Article-V of the Convention. Article –V of the convention prescribes the below-mentioned grounds that are to be proven by a party in order to be successful in desisting the enforcement of the award.

Those restrictions are as stated below:
  1. Where the party to the arbitration agreement was having incapacity.
  2. Where the arbitration agreement itself is invalid.
  3. Where the arbitral award which is the subject matter of enforcement was already seaside at the place where it was passed.
  4. Where the arbitration award has no binding effect on the parties.
  5. Where the arbitral award is not passed in accordance with the arbitral agreement between the parties or is against the general law or public policy where the arbitration proceedings took place.
  6. Where the issues decided in the arbitration proceeding and the award was not in concurrence with the purpose of submission for arbitration.
  7. Where the arbitral tribunal was affected by procedural unfairness and bias.

Even several nations have laid down their own legislation which excludes the enforcement of foreign arbitral awards that depart from the plain language and go beyond the exclusion list as contained in the New York Convention. For example: Article-459 of the Vietnamese CPC which prohibits enforcement of a foreign arbitral award that is contrary to the basics principle of Vietnamese Law.

Other Sports Arbitral Bodies

In UAE and many other GCC Countries at par with international practice sports disputes are routinely adjudicated through arbitration. The Arbitration Committee of UAE Football Association( UEFA) is the perfect example of how the UAE Sports Federation has established arbitral; bodies to settle their sports-related dispute vide.

Arbitration mode, In Parlance with the Federation International De Football Association hereinafter referred to as (FIFA) statute, the UAEFA Statues also prohibits their members, players, officials, agents, etc from taking their sports disputes to the local Courts, unless it is specifically permitted within the ambit of UAEFA and FIFA Statutes. Another International Arbitral body is Basketball Arbitral Tribunal herein as referred to as (BAT), which was created by Federation International De Basketball herein as referred to as (FIBA). It was created with an option for the parties to settle their conflicts pertaining to basketball-related international disputes by resolving the same through an efficient and effective mode of dispute settlement by submitting their disputes to the BAT jurisdictions.

Challenges In Enforcement Of Sports Arbitral Awards

The basic challenges faced in the enforcement of Sports arbitral awards are as follows:
  1. The Parties are forced to sign the arbitration agreement. The Courts has explicitly stated that the arbitration agreement which was signed by an athlete was void because the Sports authorities have a monopolistic and dictatorial attitude thereby not allowing the athletes to make a choice of signing or not signing the agreement. Rather the athletes are compelled to sign the agreement if they wanted to participate in the game.[3]
     
  2. Another challenge faced relating to the non- enforcement of international Sports arbitration award is because it violates sometimes the public policy. The German Courts are not treating it as binding, of the findings of CAS, if the arbitral award is against the German Public policy, within the meaning of Section-1061 of German Code of Civil procedure (ZPO) in conjunction with Article-V of the New York Convention. The fundamental part of German Law is considered an integral part of Germany's public policy.[4]
There has been no defined notion or definition pertaining to Public Policy or International Public Policy as it is deemed to be not possible to confine the meaning within a specified boundary. The most substantiated meaning is contained in the case of Parsons and Whitten more (US Court of Appeals) 1994 in which the Judge has stated that enforcement of the foreign award should be denied, ‘Only where enforcement would violate the forum state's most basic notions of morality and justice.

Enforcement Of CAS Awards By FIFA

The CAS awards are enforced by FIFA through its internal disciplinary power. The Swiss Federal Court all though recognizes the CAS independence very much and hence implements its awards without any question and hassle. The CAS awards have their own complexity at the time of execution due to their Global character. Hence it does not need a judicial intervention while executing the same or for compliance. It is enforced through disciplinary sanctions within the sports federations by using the dominant and monopolistic character of the sports body (FIFA).

But the problem arises when enforcement of an award of CAS is pertaining to the decision that is rendered in the ordinary procedure of CAS. Although Article-64 of the FIFA Disciplinary Code which lays down provisions to pay penalty to the FIFA, in case a player, a coach, or a club does not obey the award.

Sports In India & Dispute Settlement Body

In India, sports-related activities are booming in a significant manner. Indian players are gaining a high reputation in the international sports arena. many sports bodies like Indian Hockey League, Indian badminton League, Pro-Kabaddi League, Indian Premier League has been established which regulates sports activities in their specified field.

Since the sports activities are prowling day by day, simultaneously sports-related disputes also increasing in manifold between the sports players or between the sports authorities and players. There are many sports laws in India, i.e. National Sports Policy 2001, Youth affairs and Sports Department of Sports, Sports Authority of India, the sports Broadcasting Signals Mandatory Sharing with Prasar Bharati Act).

These sovereign Sports authorities acts as a watchdog to protect sports laws and also regulates and makes new law as and when required.
As because the sportspersons career are very short and they need immediate relief in case of disputes, hence our traditional way of the adjudicatory mechanism through courts are not fit and proper in resolving sports disputes because the procedures are very lengthy and time taking and also very tiring. So a sportsperson cannot afford to wait for such a long period of time in order to short out his disputes pertaining to his sports activities. Therefore it caused a challenge for sportspersons and sports authorities to adjudicate their disputes and conflicts.

In order to do away with this unsupportive and sorry state of affairs in the sports dispute adjudication mechanism in India, the International Olympic Association (IOA) as directed by the International Olympic Committee to establish an Indian Court of Arbitration for Sports:
(ICAS) to adjudicate disputes related to sports in India. The ICAS was set up in the year 2011 and it consists of eight Supreme Court of India retired Judges and resolves disputes in a very fast-paced manner. It works even better than a regular civil court. The ICAS adjudicates disputes pertaining to national sports, whilst the CAS adjudicates international Sports disputes. The ICAS has given a sigh of relief to all the National Sports persons who now can adjudicate their sports-related disputes domestically by approaching the ICAS which in turn decided their case in an efficacious and speedy manner and also in a very cost-effective way.

Conclusion
The CAS is an adjudicatory body or alternative dispute settlement mechanism which is independent of any sports organization and which provides settlement of disputes in the sports arena through arbitration and mediation process and by interpreting the rules and regulations which are meant for Sports. The judgments and awards of CAS has the same effect and force as in the case of the judgments passed by the ordinary Courts. The CAS also allows parties to sort out the disputes and differences through conciliation, where both the parties to the dispute signify by an agreement, to sort out their differences by such means.

Any disputes related to the sports industry maybe submitted to CAS for adjudication even though it may be of commercial in nature. In order to refer a dispute to CAS for adjudication, there must be a written agreement between the parties which may be in nature of a contract pertaining to a sports organization. The Parties in CAS Court may represent their case either in person or through a representative who may not necessarily be a lawyer.

Ordinarily, the procedure and law applies in CAS are of SWISS LAW, unless otherwise agreed by the parties and governed by sports arbitration. In case of the ordinary procedure the facts and cost of arbitrators are calculated on the fixed scale along with the share of the cost of the CAS.

And in case of disciplinary proceedings and appeals it's free of cost but except for the court fee. The ordinary procedure of CAS are confidential in nature but the appeal procedure is not confidential. The award of the CAS is final and binding on the parties and is enforced in accordance with the New York Convention which is signed by 125 nations.

Challenging the CAS awards are limited on very specific grounds, such as lack of jurisdiction, violation of the natural procedure, failure to adhere to procedural laws etc and appeal against CAS award lies to SWISS Federal Tribunal only, that is to be made within 30 days of passing of the award. In India however the local Courts many a time intervene and refuse to enforce the award of CAS, if the Courts feel that there exists a disparity, which limits bargaining power between the parties to the dispute.

In such cases, in order to prevent victimization of a weaker person, who are always the sports individual and to ensure justice, the awards passed by the CAS, are sometimes seaside by the Indian Courts, Under Section-34 of the Arbitration and Conciliation Act 1996. Hence the award passed by the CAS has to undergo scrutiny by the Indian Courts. But this supervisory power, as used by the Indian Courts in a very least number of cases and only with great circumspection.

Therefore it can fairly be said that, the sports-related arbitration mechanism like CAS and other statutory adjudication bodies are in fact a welcome initiative to adjudicate and settle a dispute, pertaining to the sports industry and that to in a speedy and efficacious manner. Hence CAS is no doubt, definitely proved to be an asset, as dispute settlement authority, pertaining to the sports arena, but last but not least, it is my personal opinion and suggestion that, if this international adjudicatory body (CAS) would be established locally in every nation and country by opening its branches, it would lead to more efficacy in terms of enforcement of its awards, as well as it will provide a shy of relief to those poor marginally oppressed players and will enable them to file their cases locally, vindicating their sports-related disputes, which they are currently unable to do so, because of their financial scarcity and by default, they refrain from approaching the international sport adjudicatory body, the CAS Court.

References:
  1. Raguz v/s, Sullivan NSWCA, 290.
  2. Venture Global Engineering Ltd Vs. Satyam Computer Services Ltd & Others 2008-4-SCC-190
  3. Claudia Pechstein Vs. The International Skating Union(ISU) Case 4A_612/2016.
  4. Damian Strurzaker & Kate Goddard, The Olympic legal legacy Melbourne Journal of International Law(2001),2 P.g-241, 242.
  5. The Swiss International Arbitration Law Reports,2007-2009, Volume - 1 – 3 Consolidated (Juris Net, Newyork 2012).
  6. IJAL, Volume-1, Issue-1, Devyani Jain, Indian Courts on Sports Arbitration Award.
  7. Gabrielle Kaufmann Kohler, Arbitration at the Olympics, The Hague (2001)
  8. Matthie Reeb, Digest of CAS Awards Vol-1, Bem (1988) & Vol- II & III, The Hague (2002 & 2004)
  9. Convention on the Recognition and enforcement of Foreign Arbitral Awards (New York Convention) 1958.
  10. Journal of International Dispute Settlement, Vol-1, No-1,(2010), p.g-217-265.
  11. Arbitration and Conciliation Act 1996.
Written By: Mr.Chinmoy Patra has completed his 5 years Integrated Law (B.A LLB Hons.) from Madhusudan Law College, now Madhusudan Law University Cuttack in the year 2004. He is Pursuing his 1-year L.L.M Degree with specialization in (Corporate and Financial Law ) for the Academic Year 2019-20, from Siksha O Annusandhan National Institute Of Law, Deemed University, Bhubaneswar.
Email id- [email protected], PhNo- 9861076210 / 7008846740
Address- C.D.A Plot No-1348/5/C, Sector-6, P.O- Avinab Bidanasi, P.S- Markat Nagar, District-Cuttack, Pincode-753014, Odisha. India

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