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Published by Enhelion, 2019-11-24 08:06:15







Where there is a society there is a law. The

Introduction to Governance of Sports. societal values of the society craft the law.

The importance of Global Governance of Sport has become a part and parcel of every

Sport. society. It started from the ancient history of

We will understand the difference between Gladiators in the arenas of Emperors and

international sports law and global sports has continued to entertain the public in

law. Further, the factors of distinction. various spheres. Nothing can be left

The Structure of the Sporting unkempt and arbitrary, and sports are no

Organizations. exception. The sports ought to be

The available modes of organizational set- regularized, so came the need for the rules

up, in different countries. of the game, which the player or the sport

Taxing provisions related to sports. man must follow. Therefore, the governance

Taxability of different sources of income of these sports became another important

from Sporting Industry. issue at hand. In this module, we shall

discuss the organizational bodies set up to

be the sentinels of the sport: along with their

nature; functioning; role to uphold the sanctum of the sport. This shall be elaborated with
exemplary states’ organizational set up.

Organizational bodies governs sport with autonomy.. The Olympic is the epitome of
internationalized sport, where athletes gather to perform their unique talent and abilities.
However, with the advent of the globalization era, the concept of global sport has taken the
baton. The law and governance together weaves the fabric of sports law. Therefore, the
importance of internationalization of sport is different from the globalized sport. In this
module, we shall also endeavour to comprehend the distinction existing between the

internationalized sport and globalized sport. Furthermore, we would try to educate ourselves
the global governance of sport.

2.2 Global Governance of Sport

The popularity of sport is embedded in its sense of recreation, which an individual obtains.
However, an unorganized sport would frustrate its cause. Empirically, it becomes important
to organize the sport, with set of rules and regulation. The Austinian theory says that the rules
and regulation need to be laid down by a sovereign, who shall enjoy the autonomous power
to regularize. Similarly, to regularize sports with rules and regulations an organization with
autonomous power must be set up. Therefore, there are regulatory authorities in the national
regime, which look after the national level sport athletes. Equivalently, in global and
international regimes there are distinguished authorities regulating the athletes.

With the Olympic movement by Baron de Coubertin, the father of Modern Olympics, the

sense of patriotism raised amongst the sports lovers (mostly called as fans).The national

organizations collaborated and organized bigger and further congregated competition of

athletes from different nation. The organizational set needs to be in place for the organizing a

bigger event. Therefore, the pioneer of International Sport Federation came to the light the

International Olympic Committee. The International Olympic Committee took the torch of

responsibility to organize the event and coordinate with the national organization. These

International Sport Federations, creates rules

and regulation for the specific sport.

When the concept of globalization plunged in

to the market, sporting organizations although Alan Greespan, a renowned economist,
non-profit organization didn’t stand out as an mentions, sport and sport related
exception. The trend of globalization plunged production as a ‘weightless’ economy.

in to the stream of sport event. The

internationalization of sport, although subtle, but can distinguished from globalized sport. For

an instance, The Cricket World Cup conducted by the International Cricket Council (ICC) is

an international federation; however Indian Premier League is a globalized sport.

2.3 International Governance of Sport

The organizational forum established in the international regime called as the International
Sporting Federations. The history of International federation started with the Olympic
movement but continued to accelerate after the national sporting enterprises started
formulating clubs and association, for example, Football Association in England. Although
started in the national regime, later it became international. Today, Football Association is a
global phenomenon.

Uniformity has been one of the strongest hold for governance. Although a myth in many
instances, but authorities always strive to achieve uniformity. The international sport
Organizations are those International Non-Governmental Organizations (INGOs) who strive
to give an umbrella effect to all the sport activities. These are autonomous bodies, who
formulate their own set of rules for the sport. However, there are two school of thoughts, one
which says that, these organization cannot be given independence from the rule of law, or
primarily the review of judiciary; another who follows that, there should be a prevailing
autonomous nature and a lex specilis should prevail.1 These ideologies are no gunshots to the
air, series of judgments and decision have backed them with Swiss Equestrian Case2 and
Reynolds case3 being the brand ambassadors of these ideologies. The former case, elaborates
on the aspect of best suitable method of adjudication of matters related to eligibility of the
competition. Furthermore, recognized the Tribunal Arbitral Du Sport/ Court of Arbitration
for Sport (CAS) as a true court of arbitration.4 Whereas, the latter case made it crystal clear as
to how judicial intervention can stretch a simple dispute in to a marathon.5

The authorities in the law of sport suggested that an autonomous and self-governing body is a
required necessity. As Teubner suggests that, there should be a sui generis institutional
mechanism which would be independent with respect the ‘laws of nation state’, which shall

1 Ken Foster, Is there a global Sport Law?, Entertainment Law, Vol. 2, No. 1, Spring 2003, pp. 1–18. <available
at, last accessed on November 26th, 2016, at 11:33 amz..>
2 Gundel v. The international Equestrian Federation. CAS, I Civil Court, Swiss Fed. Trib. (15 Mar. 1993);
referred in, James A. R. Nafziger, International Sports Law as a Process for Resolving Disputes,
The International and Comparative Law Quarterly, Vol. 45, No. 1 (Jan., 1996), pp.130. <available at, accessed on November 10th, 2016, at 09:46 am>
3 Reynolds v. International Amateur Athletic Fed. 23 F.3d 1110 (6th Circuit, 1994)
4 History of CAS, <available at, last
accessed on November 26th, 2016, at 12:16 pm>.
5 James A.R. Nafziger, Supra note 2

be governed by the International Sport Federations.6 In Martin v. International Olympic
Committee7, the Court refused to interfere with the mechanism of the Los Angeles Olympic
Committees. This emphasizes the importance of International Sport Organizations for the
governance of the sport world-wide.

2.4 Rule of Law or the Rules as Law?

The International Sport Organization enjoys an autonomous character, sui generis
mechanism. Would that suggest they are free from national laws? Would it be empirical to
conclude that they are above the due process of law? Then what about the fundamental
human rights of the athletes? Can the Federations take defense against the rules of these
Organizations to colourably exercise their malicious intent?

The proposed ideology of Nafzinger was that the International sport law is the true process of
adjudication of matter for sports law; however they are part and parcel of the national laws.
On an extended argument, it was further emphasized that international sport law is equally a
part of public international law. Therefore, the jus commune principles of international laws,
including humanitarian laws shall apply to the procedure of this International Sport
Federation as well.

There is another set of ideologies which are agreeing the autonomous character of these
Federations, however, believe that the laws of these federation are independent of the
national law, which known as Global Sports Law. As Teubner argued, the global law is
independent of national laws. Furthermore, argues that it is separate legal order and
administered by the International Federations. The series of argument went to the
rudimentary level, when Houlihan mentioned the distinction between the ‘internationalized
sport’ and ‘globalized sport’. The former, had the connection with the national authorities,
since they do the evaluation and selection of the athletes to represent. However, in case of the
later, the authorities are at footloose with respect to the national authorities. Advancing to an
economical argument, the ‘internationalized economy’ takes the national economy of the
state. However, the ‘globalized economy’ does not consider the national economy. Since,

6 Gunther Teubner Global, Bukowina: Legal Pluralism in the World Society.
7 [1984] 740 F.2d 670 (9th Cir.).

sport as above mentioned, sport is a weightless ‘economy’.8 This argument would not be far-
fetched. Amid these arguments, Beloff argued that the lex sportiva is the true form of law
which should be used by the International Sport Federations to govern the sport. The three
elements of Lex sportiva as per Beloff are9:

• “it has transnational norms generated by the rules and practices of
international sporting federations;

• it has a unique jurisprudence, with legal principles that are different from
those of national courts, and which is declared by the Court of Arbitration for
Sport; and

• it is constitutionally autonomous from national law.”

He believed it to be the Grund norm, since it international and distinct. International, because
the International Sport Federations apply it; distinct, because these principles are not derived
from the national legislations. To which Teubner, throws the “paradox of self-validating
contract”. Argument of Beloff suggests that, the Interantional federation can formulate their
own rules and claim it to be law, without the validation of law. It would be just like, we
validate the rules, because by rules we can validate it.

The debate never stopped for a decade, before the most suitable alternative was initially
proposed by Teubner as solution to the ‘paradox of self-validation contract’, which is a
private contractual order. The concept of private contractual order revolves around the
concept of lex arbitri, where the contracting party makes their own rule and follows the
transnational laws, which has no relation with the national laws.10

A radical alternative view advanced by scholars such as Gaillard is that arbitral legal orders
are per se outside any national legal order and therefore are examples of genuinely
transnational law. Shultz for example has defined them as ‘transnational legal orders that
cannot be reduced to any one public national legal system’. One implication of this view is
that arbitrators must be applying substantive transnational norms whose legitimacy and effect
is not directly justified by reference to any national legal order. The autonomy of the system

8 Id.
9 Ken Foster, Global Administrative law: A next step for global sport law?, Analysis Sports and The Law
Journal,Vol 19 Issue I. <Available at, last accessed on
November 30, 2016, at 11:27>.
10 Supra Note 10

is closed and its legitimacy is self-reflexive in the sense that it must understood beyond the
supervision of the traditional judiciary interference. The independency of these organization
is the substratum, which shall not be supervised by the judiciary unless it is illegal or

2.5 The Kinds of Rules Involved

It has already become a hard task to delineate whether the rules of the International Sport
Federation, are self-governing laws, or they require the recognition from the valid source of
law. So many arguments in, which is theoretical we can concentrate on the generalized and
widely accepted phenomena. The law of the sport can be categorized into segments of rules
which are involved in it, these are as follows:

1. Rule of the Game
2. Ethical principle
3. International Sport Law
4. Global Sport law

2.5.1 Rule of the Games

Primary genre of rules is rudimentary! They are the basic rules of the game. The debate of
intersection lex ludica and lex sportiva doesn’t arise at this point. The rules of the games, are
the fundamental principles on which the player conduct themselves through-out the game.
For example: in the game of football, 22 players should play the game, with the objective of
scoring a goal by passing the goal keeper from a targeted area. The rules of the game are
fundamental functioning of the sport organizations. The rules of the game might shuffle or
change, however, the character of the game should not change.

The rule of law and rule of game debate was clarified by the Arbitration for Sport during the
Atlanta Olympic. The traditional theory of what is rule of law cannot be rule of the game,
which has been modernised as sport has turned in to a global economy. Therefore, the rule of
the game and rule of law cannot be compartmentalize. However, with respect to the
reviewing capacity of the judiciary the court said, “Limited to that which is arbitrary or

2.5.2 Ethical Principle of the Game

“It is an insider’s esoteric art and In the field, colloquial usage of
cannot be applied by an outsider.” the phrase “sportsman spirit”

-Ken Foster must be familiar. However,
this sportsman spirit is nothing

but the second but most vital

rule of any sport. The sense of comity amongst players and athletes enhances or congregates.
These principles are called as the “Ethical principles of the game”. Alternatively, recognized
as the equitable principles with the ‘Rules of the game’. These international sporting

federations endeavour to reserve the sense ethical values and principles which are inherent in

any sport. The four cardinal principles are: fairness, integrity, sportsmanship, and the
‘character of the game’.

• Fairness: It’s all about to play it fair. The sense of competition brings the worst of
you. It is the sense of fairness that makes one a true sportsman. In order maintain the
uncertainty of the outcome, and retain the sense of true competition, fairness forms a
part of the cardinal principle of these ethical principles.

• Honesty: The second distinctive principle is to maintain honesty and integrity of the
sport. Many activities that are legally and morally acceptable outside the sporting
arena may become unacceptable within it. For example, doping practices is amongst
the severe crimes that are committed by the player which is against the integrity of the

• Sportsmanship: A third strand is sportsmanship. This reflects the good faith with
which the sportsperson interprets the rules of the sport, so that certain actions whilst
not strictly against the laws of the game but against the spirit of fair play.

• Character of the game: The last cardinal principle, but the backbone of the all the
principles. The rules of the game can be either altered by the federation or authorities.
However, these rules or principles can’t be so altered that they lose the character of
the game, or the identity of the game.

2.5.3 International Sport Law

The third set of rules is those which are existing along with the rules of the games and ethical
principles of the law. However, these rules are to govern the right of the athletes,
organizations representing them. These set of rules are called as the international sports law.
The set of rules forms symphony with the existing legal principles, which are commonly
understood. It is also called as lex ludica, it derives nexus between the nations legal system
and law of sports.11 For example, the Court of Arbitration for Sport in a recent arbitration said
they comprised a major element of lex ludica12:

“all sporting institutions, and in particular all sporting federations, must
abide by general principles of law … Certainly, general principles of law
drawn from a comparative or common denominator reading of various legal
systems and, in particular, the prohibition of arbitrary or unreasonable rules
and measures can be deemed to be part of such lex ludica.”

There are numerous set of principle, which are accepted general principle of international
laws, such as ‘pacta sunt servanda, equity, the prohibition of unjust enrichment, the doctrine
of proportionality, doctrines of personal liability, and the doctrine of clausula rebus sic

2.5.4 Global Sport Law

Already acquainted with this, global sport law. It is a distinct and independent legal order
which is controlled by a sui generis mechanism. The Global Sport Organization are the
International Non-Government Sport organization that lead this mechanism. Popularly known
as Lex Sportiva, this set of rules are immune from the national legal system. Fundamental
element for the existence of Lex Sportiva;

1. An organization with constitutional governing powers over the sport internationally.
However, the organization may it be, its legislative competency must create social
obligation to the created rules and norms.

11 Siekmann, Robert C.R., What is Sports Law? Lex Sportiva and Lex Ludica: A Reassessment of content and
terminology. [available at
sportiva-and-lex-ludica-a, last accessed on November 26, 2016, 16:10]
12 Ken Foster, Supra Note

2. A uniform global forum dispute settlement. An international or ad hoc arbitration institute
must be constituted to settle all the dispute pertaining the rule of the sport. This must have
a global authority and can apply all aspects of ‘international sporting law.’

Global sports law has distinct and unique norms. These norms are generally accepted
principle or customs of the International sport federation. Therefore, these principles or rules
need be legislated in harmony with the transnational norms and principles.
These principles can’t be formulated from the comparative or common law denominator
principles. These principles need to be distinct and unique from any national law. Those
principles are covered under international sports law.
Global sports law shall create an ‘immune system’ that is recognized and adhered by the
national judicial bodies. The reason being the transnational nature of this law. It operates as a
constitutional directive to national courts that there are global principles that grant autonomy
to the global sporting system.

2.6 Sporting Organization

Sporting organizations are the governing or regulatory body that upholds the character of the
game, by creating rules of the game, conducting and organising event, and implement
discipline in the game. These bodies are the authorities which shall have autonomous power
regarding the specific sport. However, this power to all the sporting bodies flows from the
Olympic Charter.13 The Olympic Movement initiated by the ‘father of modern Olympics’,
Pierre de Coubertin, the Olympic Charter was the influential outcome of the entire
movement, which resulted in creation of three organs of this movement, viz., International
Olympic Committee, International Federations and the National Olympic Committee.14 All
though there are three heads in this Charter but there is a subtle hierarchy which has to be
followed by these sporting organizations. In the pyramid of power, the International
Committee stands at the top, which has the authority to recognize the International Federation
or National Olympic Committees.15

13 ¶ 2 of Rule 1 of the Olympic Charter [Available at, last accessed on November 27, 2016, at 19:03]
14 Id.
15 Rule 2 of the Olympic Charter, Id.




2.6.1 International Olympic Committee

Baron Pierre de Coubertin, the pioneer of games in this modern era founded on June 23, 1894
the International Olympic Committee (IOC). IOC is an international non-governmental
organization which has an existing legal status, approved under the Swiss Federal Council in
2000.16 The Olympic Charter confers IOC the ownership rights of the Olympic symbols, flag,
motto and anthem.17 Rule 7 of the Charter further, throws lights up on all the facets which are
owned without any limit; marketing rights, media rights, registration of audio-visual
recordings and broadcasting rights.

16 Rule 15 of the Olympic Charter, Id. at
17Organization & Legal Structure of the Olympic Games, [Available, last accessed on November 27, 2016].

This committee is led by, currently Thomas DID YOU KNOW?
Bach, a president. The president shall have
the power to convene all the meetings, Modern Olympics has been inspired
including the sessions which and when they by ancient Olympics which was also
are conducted. The President is assisted by held in every four years in the honour
the Board of Executive, who have the
responsibilities to convene the meeting, to of Zeus.
draft the annual report, to make the material Furthermore, Ancient Olympic games
issues that needs to be discussed in the was part of Panhellenic Games, which
sessions, to coordinate with other various included major sporting festival of
commissions that are part and partial of Greek Society, which included Pythian
IOC, and above all, it has the responsibility Games, Nemea Games and Isthmian
to check on the compliance of the rules of Games. These games were celebrated
the Charter and the Olympism.18 in Honour of Greek Gods, importantly


The Sessions: It is the final Authority in the IOC, the legislative body of the Committee
which is convened by the members of the IOCs. They even have the power to amend the
Olympic Charter for the greater good.19 Some of the powers of the Sessions can be enlisted
as: -

• To elect the members of the IOC.
• To elect the President, Vice-President, the honorary president, honorary member.
• They select the venue for the games.
• They appoint the audit committees
• They decide on awarding or withdrawal of full recognition from any International

Federation of National Sporting Organizations.
• To decide on all the matter that are vested on it by law or the Charter.
There are several commissions that are established to undertake specific responsibilities,
emphasizing on few; Ethics Commission, Finance Commission, IOC Member Election
Commission, and many more.

18 Bye Laws to Rule 2.
19 Id.

The IOC, has individual members that natural person who represents a country. The sessions
select every individual member. The respective countries have delegates, which are also part
of this Committee. There are currently there are 139 members, consisting 98 members, 39
Honorary Members, 1 Honorary President and 1 Honour Member.20

2.6.2 International Federations

International Federations (IFs) are international Non-Government Organizations, which gets
legal status under the Olympic Charter after due recognition from the IOC. These are
federation which are generally, association which are incorporated as per the local laws.
However, after the recognition from the IOC enjoys the full privilege and autonomy on the
governance of the sport world-wide. They assume responsibility to the proper coordination
and governance of the sport during the games. The main objective of these federations is to
control the National Olympic Committees with respect to the sport they regulate, and
propagate the spirit of Olympics. For example - Fédération Internationale de Football
Association is International federation for the governance of football around the world.

2.6.3 National Olympic Committees

The primary responsibility of National Olympic Committees (NOCs) is to spread the
fundamental principle of Olympism amongst the athletes and their respective sporting bodies
at a national level. These are the exclusive authority for selection of the team from their
respective countries. NOCs exercise autonomy with respect to the selection process,
development, improvement of performance, infrastructure, and so on. However, the only
check on the autonomous power is Olympic Charter. Therefore, any action against the
Olympic Charter shall result into withdrawal of recognition, as happen to NOCs of Kuwait.

United States:

United States Olympic Committee is a federally chartered non-profit organization
corporation. It functions as a corporation, with all the rights to common seal and legal status.
This legal status to the Committee is vest by the Ted Stevens Olympic and Amateur Sport on

20 Members List of IOC. [Available at, last accessed on November
27, 2016]

1978. This doesn’t receive funding from the government.21 The USOC is administered by a
16-member BOD, and has a corporate organizational status. They enjoy civil claims against
unpermitted usage of logos or emblems of the Organizations. Further, it gives the USOC the
absolute ownership upon the marketing of products other than that of the sponsoring body,
and actionable claim on breach of this rule.22 In San Francisco Arts & Athletics, Inc. v.
United States Olympic Committee23 the Supreme Court said that usage of ‘Olympic’ need to
be regularized in accordance with Olympic Charter, since the USOC enjoys the absolute
marketing rights during the games.

The Indian Olympic Association (IOA) was established in 1927 by Sir Dorabji Tata and Dr.
A.G. Noehren, after Olympic Movement arose to its peak.24 Then it was a small association,
which was registered under Societies Registration Act, 1860. The Indian Olympic
Association’s mission and vision statement, upholds the sanctity of the Fundamental
Principles of Olympism. IOA has the responsibility to undertake selection process for the
Indian teams, for Olympic games, Asian Games, or assist the National and State Federation
for participation in International or National meets.

India first participated in the 1900 Olympics with only

one participant, Norman Pritchard.
Then, India got its first team in 1920.

IOA has opened the access of membership to limited associations, including the national
federation, state federation and importantly, the State Olympic Association, members from
the International Olympic Committees. Every State has a State Olympic Association, which
shall endeavour to conduct the events and organize the teams for the National games. These

21Inside USOC, <Available at, last accessed on
November 28th, 2016>.
22 Rule 40 of the Olympic Charter.
23 483 U.S. 522 (1987)
24 B. Majumdar and N Mehta, India and the Olympics, Taylor and Francis, 2009.

will be the member due to the recognition of the National Olympic Association. The Indian
Olympic Association has the power at its discretion for the approval or withdrawal of the
membership. The State Olympic Associations are the mandatory members of this IOA. These
members convene the Annual General Metings.
.The Executive Council have major role to in the daily basis. The members don’t convene
meeting every day, therefore, the Executive Council convene ordinary meeting to decide on
certain financial matters, also consider the financial funding to the State Olympic
Associations. They also decide up on the feasibility of the Annual Report which must be
submitted by the Secretary General.25

Senior Vice President.
Vice-Presidents. (8 nos.)
Secretary General
Joint Secretaries (6 nos.)
Executive Council members (10 nos.)
One representative elected out of the Athletes Commission.

The Olympic Charter provides absolute autonomy to seek assistance from governmental or
non-governmental authorities in the National Level. In India, the Ministry of Youth Affairs
and Sports takes absolute responsibilities to improve the performance, develop
infrastructures, and education of young athletes. Under this ministry we have special
organization known as the National Sport Federation, which looks after the promotion of
sports and educate the benefits of sport in grooming an individual. This Ministry is a

25 Rule XII of Memorandum of IOA, Id.

supporting agent to the Indian Olympic Association for the better governance of the games in
process of selection, and organization of all the events.

2.6.4 Other Sporting Organizations

There are numerous other sporting organizations, which are in different levels of sport, viz.,
International, National, and Regional. International Cricket Council is one of the international
federations that organizes all the cricket events and tournament, including the ICC World
Cups. This organization lately got recognition from the International Olympic Committee as
an International Federation. ICC enjoys all the privileges as enjoied by an International
Federation under the Olympic Charter. In ICC Development (International Ltd. v. Arvee
Enterprises and Anr.26 the court recognized the marketing rights that ICC as a legal entity
enjoys against ambush marketing.

State Federations plays a vital and direct effect to the development of regional sport and the
feeling of Olympism. These are the sporting bodies which governs the sporting enthusiasm
and education amongst the young talents at a regional level. In India, other than State
Olympics Association, there are National Federation and Sports Authority of India (SAI).
These National Federations, includes Olympic sports and Non-Olympic sports as well. Sports
Authority of India, is a government run organization which falls directly under the Ministry
of Youth and Sport Affairs. SAI provides infrastructure and financial sport to the athletes,
including medical benefits and coaching, inclusive of education.

2.6.5 Sporting Clubs

Sporting Clubs are formed for the recreational purpose of the members of the club. However,
the sporting club trend now has developed in to competition inter-club, and it is a globalised
business. The major leagues for example Football Association(FA) is now sensation in the
global market. Clubs registered under these international federations, and become part of lex

Organizational set up of a club
Sporting clubs, generally, are association of members who choose a sport to be the game for
recreation. They can have their bye-laws and rules of the game, however, can’t change the

26 2004 (1) RAJ 10.

character of the game. The sporting clubs are generally incorporated societies, which in India
are registered under the Indian Societies Act, 1860, or other State Societies Acts. Elucidating
some of the forms of sporting clubs that are currently functioning and their legal status.

1. Unincorporated Association – An unincorporated association means a club, which
has not been registered under any Act. Therefore, the club doesn’t enjoy any legal
status or a separate legal entity. Therefore, all the members of the clubs are jointly or
individually liable. The sporting clubs can formulate the bye-laws only to the extent
of the contract they have entered before coming in to force.

2. Incorporated Society – All the clubs or any federation are generally societies
registered under the respective Societies Act prevailing in the Local law. Mostly,
clubs which have no motive for gains. To be a registered society, following things
need to highlighted: -
a. Name of the Club
b. Objective of the club
c. Members
d. Number of members.
e. Managing Committee and office-bearers
f. Election of members.
g. Resignation.
h. Expulsion of a member
i. Hours of the club.
j. Management
k. Introduction of guests.
l. Liability of members.
m. Amendment of rules and of bye-laws.
n. Dissolution

Incorporated society creates a legal entity. They have an organizational structure, which shall
consist of; One President, Vice President, Treasurer and Members. Now, incorporated
associations, appoints coaches and trainers for the development of the sporting
performance in the country.

3. Company- Most of the proprietary clubs, where the main motive is gains, they
generally prefer a corporation form of organizational set up. They follow the
companies Act, and fulfill all the requirements, including the corporate social
responsibilities. Most of the association, register themselves under ‘charitable’
companies, which gives them financial tax benefits. They convene general meeting
annually, and own marketing rights of their company. In Indian Premier League, all
the teams were Franchises, which were bought by hot-shot business men.

These sporting bodies can take any of the above-mentioned methods for establishing a
sporting club in their country. The incorporation of the association should be in
accordance with the law of the nation, in such matter the law of sport shall not come in to
picture. The law of the nation shall guide these club to their benevolent structure.


Sporting Clubs can adopt any of the following mode of organizational set-up

Unincorporated Association, which won’t confer any legal status
Incorporated Society, which will provide legal identity and tax benefits
A Company, will provide a separate identity and limited liability. Further,

being a cause for promoting sport will also get tax exemptions.

2.7 Funding and Grant Forms

Sport Organizations have shouldered an important task of developing sporting enthusiasm
amongst the aspirants. They are responsible to coordinate and organize all the sporting
events, international and national level. Now, sporting events are the most commercially
competitive events. To organize such event funds are required. However, all these sporting
bodies are Non-profit Organization; since profit is not motive they can’t be financially sound
after couple of years. Therefore, funds or grant from government becomes a vital source of
finance. In various countries, the governments of the respective states have initiated schemes
which shall help the sporting organization which shall uphold the responsibilities enshrined in
the Olympic Charter. There are further sources of fund raising in this globe.

2.7.1 Sources of Funds to these Sport Organization

Membership Funds
In all the non-profit organization, the members are the key personnel of the organization. The
motive being to work for the betterment of public, these organization don’t earn profit.
Therefore, members fund collection is the most important source of fund for these
organizations. It starts with membership fees, then gradually increases to collection of funds
for a specific purpose.

Event Fees
Irrespective of any kind of sporting body, they impose event fees/ entry fee for those who are
participants. Generally, event fees are collected for balancing the cost incurred for organising
and conducting the event. However, the target is never to reach the break-even point, the
target is to propagate the sporting culture. Events may include tournaments, championships,
fixtures and other special competitions.

Government Grants
Sporting Organizations need to develop not just the performance of the athletes, further,
required to supply them with proper environment, food, training, and place for hibernation.
This cumulatively means, the sporting bodies require to hire good coaches, look after their
stadia, also improve the residential area as well. Different governments of different countries

have started providing government funds. In United States, the International Sports
Programming Initiative (ISPI) has been initiated as an annual open competition that allows
U.S. public and private non-profit organizations meeting to submit proposals to reach
underserved youth and/or their coaches/sports administrators who manage youth sports
programs, meetings as recognized under the Internal Revenue Code section 26 U.S.C.
501(c)(3). The International Sports Programming Initiative has made sports as medium to
help underserved youth around the world develop important leadership skills, achieve
academic success, promote tolerance and respect for diversity.
In India, the Ministry of Youth and Sports affair, divulges interest in raising funds for the
development of infrastructure and facilities. Therefore, led to formation of a fund known as
the “National sports Development Fund in year 1998” under Charitable Endowment Act,
1890.27 The main objective of this Fund can be generalised as the following:

1. Administration and application of the funds to promote multiple discipline of sport,
general or special focused sports person, to achieve best performance in the national
and international level competitions.

2. Provisions for special training and coaching in relevant sports disciplines to
sportspersons, Coaches and sports specialists;

3. Constructions, maintenance and development of infrastructure to promote sport and

4. Supply sport equipment to association, organizations and other sporting bodies.
5. Promote research and development wing, for in-depth knowledge of physiological

and psychological technique for performance development.
6. Promotion of International event for the development of national importance of

sporting culture.
7. Cumulatively, to provide loans at low rate of interest for the meeting of any of these

above-mentioned objectives.
The Ministry of Youth affairs and Sports, regulate this fund along with the Sports Authority
of India, which provides financial support from this fund. Anybody can donate funds in this
Fund. In total, per the report, total donation in this Fund touches approximately 97.46

27 National Sports development Fund, Department of sports. <Available at
sports-development-fund-0, last accessed on November 29, 2016, 13:27>

crores.28 Compared to the expenditure in 2015-16 is around 22.46 crores.29 The scheme for
Human resource development in sport, has objectified the importance of grants and funds for
promotion of sport and sporting culture. The Ministry regularly announces dates for
acceptance of application for assistance from sporting federations. The grant includes
categories of grants. For example, in the scheme of Human Resource Development in Sports,
the ministry is ready to provide fellowship to sportsperson in either masters or doctorate
level; also, grant for the lodging of coaches and sportsperson; grant for conducting seminars
on issues pertaining to the field of sports; grant for developing the research and development
wing on any federation.30

Since 1993 non-profit organizations in Queensland have been able to apply for a license to
install and run gaming machines in their own club premises. Organizations need to have a
liquor license before they can do this and an application does guarantee that a gaming
machine license will be granted.31

Many Non-profit organizations use sponsorship and sale as their source of incomes.
However, the special form of sales are permitted for the non-profit organization. The non-
profit organizations can sale, if and only if, all the revenue collected shall be used for the
purpose or the objective enshrined.32

28Annexure XI- Contribution to NSDF from various sources.<Available at, last accessed on November 29, 2016, at 15:51>
29 Annexure XII – Details of Assistance given to institution or sports person from the NDSF. <Available at, last accessed on November 29, 2016, at 15:52>
30 Calling for Application for Grant of Financial Assistance to match officials, Coaches and Supporting
Personnel, Sports Authority of India Website <Available at, last accessed on November 29, 2016
at 16:28>.
31 Sources of Income for Sport Organizations, <Available at, last accessed on November 29, 2016, 16:30>.
32 Id.

2.7.2 Taxation of Sporting organizations

The power to levy taxes in India, vests with the Union of India, as per the Union List, where
sports fall under the bring bracket of ‘entertainment’33. All the sport organization and athlete
either resident or otherwise, in some way or the other are liable to pay tax to the Union, if
they are deriving income within the territory of India or persons, who are citizens of this
territory. The most important taxing statute which has direct nexus with sportsperson and
sporting events is the Income Tax Act, 1860. This tax legislation provides for exemption to
certain categories of institutes or persons, we shall analyse the taxing liability of the sporting
bodies. Sporting Organizations

As per the Income Tax Act, 1860, only person who are recognized under the section 6 of the
Act can be made liable to pay the tax. Irrespective of whether the person, an individual or any
legal entity, resident or non-resident should pay tax in India, if it accrues or arises in India.34
However, most of the organizations are registered as a trust, charitable purpose, or non-profit
organization, which provides them exemptions. The formation of the sports organization as
an incorporated association for the promotion of sports enjoys exemption under section
10(23). Therefore, the sporting organization don’t have to pay income taxes. Association
formulated in the form of trust are also exempted under the provisions of the Income Tax
Act, 1860.35 Sporting Events

In the era of globalization, where different forms of economies started taking shape, nobody
saw sport as a form of global economy. This became the reason for shifting the legislative
mind to promote sporting events and created tax exemption for sporting events.36 During the
Common Wealth games, the government of India notified the income which shall be
generated from the international sport events shall not be the part of total income of the
person. Indian Premier league is one of the example, where the Government approved teams,

33 YV Srinivasamurthy v State of Mysore, AIR 1959 SC 894.
34 Section 6 of the Income Tax Act, 1961.
35 Section 12 A of the Income Tax Act, 1961.
36 Section 10(39) of the Income Tax Act, 1961.

which are franchises are enjoying tax benefits. Similarly, income earned from the gross
collection of tickets, events and matches by the Board of Cricket Council in India (BCCI) are
not under total income in that assessment year.

To provide encouragement to sports in India and to promote sporting endeavors, the income
tax act provides that Incomes arising from any sporting event held in India to any person or
persons can be fully exempted from Income tax. This can be accomplished based on
approvals by the central government using the provisions in section 10(39) of the income tax
act 1961.

As per the section, any specific income arising can be exempted provided:

• Such event is sanctioned/approved by the international body regulating such sport
• The event has the participation of more than two countries
• The event has been notified by the central government in the official gazette for this

This exemption shall extend only to incomes earned specifically from such events and to no
to any other incomes earned by the organizers of such sporting events. Incomes exempted
may include gate revenues, sponsorship money etc.

Professional sports leagues, such as the IPL and other “premier” leagues that have emerged in
recent years are for profit ventures and are therefore , quite justifiably, not always accorded
exemption by the government. The lack of such recognition from the government often forces
such leagues to adopt various complicated structures involving multiple layered entities, both
offshore as well and local, this increases the cost of compliance but helps bring down the
total tax liability.

Other sports bodies such as various sports federations work without profit motives, more
often than not, and are therefore organized as non-profit entities in the form of trusts that
have exempt status in the form of Section 12A registration under the income tax act. Sportsperson

The sportsperson of India who resides in India, and is a resident of India as per section 6 of
the Act, is liable to pay the tax. However, difficulties arise when a non-resident should pay
the tax out of the income that accrued, or arose in India.

Where the non-resident sportsperson is the assesse, then the total income is calculated under
section 115BBA of the Income tax, which includes income received from; the competition
participated, advertisements, and article published in any of the newspaper or magazines.
Furthermore, section 115 BB of the Income Tax Act also calculates the income earned from
the crossword puzzle or lotteries.

In case, the sports person is taxable, they are mostly taxed at source by their sponsor,
management or association. In Transmission Corp. of AP Ltd. v. CIT, AP37 the court specified
that, “…provision is for tentative deduction of income-tax thereon subject to regular
assessment and by the deduction of the income-tax; right of the parties are not, in any
manner, adversely affected”. Therefore, it legitimate procedure for deducing at source and
sending directly to the Government. The withholding tax can be deducted from various
sources, like salary (section 192), interest (section 194A), dividends (section 194), winning
from lottery or crossword puzzle (194B), winnings from horse race (section 194BB),
payments to non-resident sportsmen or sport associations38

As per the section, incomes earned by the aforementioned category of assesses shall be
subject to tax at a flat rate of 20% in India without any deductions in respect of any
expenditure of allowances under any other section.

In the case of non-residents it is also worth examining the provisions of the relevant Double
Taxation Avoidance Agreements (DTAA) since such provisions are applicable as per section
90(2) of the income tax act wherever they are more beneficial.

DTAAs usually specify a separate article (article 17 as per the model convention) that deals
with incomes of entertainers and sportspersons who perform internationally. The model

37 [1999] 239 ITR 537. at
38 Direct Tax Code 2013. KPMG News, April 3, 2014. [Available on, last accessed
November 30, 2016].

convention as well the most DTAAs entered into by India provide for taxation of incomes
earned at the country of source, which for the purposes of this study is India. As per the
provisions of article 17(1) other incomes earned by the sportspersons by way of consideration
for interviews, articles, press conferences etc. shall also be deemed to be closely associated
with the performances of the sportspersons and shall be subject to tax in the country of

Furthermore, incomes earned by agents, star companies, and other mechanisms on behalf of
the sportspersons are also subject to tax in the country of source per the articles. Though their
own incomes remain outside the scope of both 115BBA of the domestic statue as well as
article 17. With reference to star companies, where any sportsperson is paid a salary instead
of payments for a separate performance then the proportionate amount of salary earned for
performance in the source country (India) will be liable to tax in India.

Star companies, or entities formed in low tax jurisdictions to avoid taxes by way of diverting
incomes from the sportspersons themselves and tax them in the hands of such entities instead
of the sportspersons have been addressed by way of clause 17(2) of the model convention
which stipulates that the incomes of such companies be taxed in the country of source. Clause
17(2) can further be used state of source to tax at the level of the team the portion of the
performance income which cannot be taxed in the hands of the individual performers,
regardless of whether the team has a permanent establishment in that country.

In India, the ‘gambling and lotteries’ falls within the ambit of the Union Government, where
have regularized the action through the Central laws pertaining to lotteries and gambling. In
most of the states has been regularized and the governments have entered in to several
agreements with ‘distributor and selling agents’ for selling of lotteries on their behalf.39 The
rationale behind discouraging the concept of gambling is that, it majorly a game of chance,
which against the Lockean Labour theory. The government endeavour the public to indulge
in activities which would give them desired result instead of depending on chance. Later, it
was realized that not all gambling in all forms are wrong. Gambling had been defined as:

39The Curious Case of the Indian Gambling Laws – Legal Issues Demystified, Nishith Desai
[Available at
Curious_Case_of_the_ Indian_Gaming_Laws.pdf, last accessed on November 30, 2016, at 11:57].

“…a game determined entirely or in part by lot or mere luck, and in which judgement,
practice, skill or adroitness has honestly no office at all…”40

However, in certain circumstances, there is an element of skill and talent, which reduces the
possibility of chance. In State of Bombay v RMD Chamarbaugwala41, the court laid down the
following point as law:

• The games where a substantial degree of skill is involved then such games won’t be

called as gambling.

• Even a preponderance of skill of would constitute the game to be distinct from


Later, in Dr. KR Laksmanan v State of TN42, the POINTER:
court said that in case of horse racing there is a

substantial degree of skill involved. Primarily, the In RMDC’s case, the

bettors are skilled to analyse the status of horse and court laid down the two-test
jockey before the race.43 Therefore, the court principle to decide whether

standing on the stage on stare decisis, decided that the game consists of skill or

horse racing is not a form of gambling. The award not.

or prize received from these competitions are This principle was later

taxable, whether the person is resident or non- followed in Laksmanan v

resident. State of T.N.


An introduction to the role played
by courts in shaping sports law

The role played by the tribunals in
developing sports law

The importance of Court of
Arbitration for Sports.

The Organizational structure of
Court of Arbitration for Sports

40 Rex v Fortier, 13 Que K.B. 308.: referred in Mukul Mudgal, Law & Sport in India – Developments, Issues
and Challenges, Lexis Nexis Butterworths Wadhwa, Nagpur.(2011), at 173.
41 AIR 1957 SC 699.
42 (1996) 2 SCC 226.
43 Mukul Mudgal, Supra note 52, at 179.

2.8 Role of courts and tribunals

In its broad sense, governance can be defined as the management of an organization through
the exercise of power. The judicial system has an important role to play in ensuring better
public governance. There may be a plethora of regulations, rules and procedures but when
disputes arise, they have to be settled in a court of law. In sports governance, as well, courts
play a pivotal role in the effective functioning of sporting organizations, and as a result, the
wide range of participants involved. These participants include each and every person – be it
individual or group – such as players, clubs, organizations (local, national and international),
spectators, media, interested parties (commercial and non-commercial) as well as educational
and training bodies. Considering the fact that there is a pretty large percentage of population
which is affected by the organization of sports, evolution of courts and tribunals specializing
in sports was inevitable.

Now let’s imagine you’re a female athlete who is undergoing training for a very important
international competition such as the Commonwealth Games. You’ve been preparing for
months, you’re in shape, and you’ve never felt more confident about your performance. A
month before the competition, you’re told that you can’t compete because your testosterone
levels are higher than ‘regular’ women, giving you an unfair advantage. How would you feel?
This is exactly what happened with Dutee Chand, an Indian sprinter who was banned from
the 2014 Commonwealth Games because her body testosterone levels were naturally higher
than others. A similar incident had also occurred with South African distance runner Caster
Semenya, investigated in 2009. So what will you do? Who provides you the remedy?

Situations like the aforementioned are exactly the reason why we need a designated panel
providing dispute resolution mechanism specifically for sports. Historically, the idea of sports
and conflict resolution originated around 776 BC, during the first Olympic Games. It is
believed that a civil war was tearing Greece apart, and after the Olympic Games were held in
Olympia – Greece flourished and the war came to an end making the Olympics a lasting
symbol of peace.

Coming back to the present, today we have analysts talking for hours about each and every
move made by a player along with intense media and public pressure, it is safe to say that the
career of a sportsperson is short lived and the underlying risk of injuries and loss of form is
immense. Therefore, it is essential that sports dispute resolution be effective as well as

The need to be autonomous combined with the pressure to be accountable make the
governance of sports quite confusing. While autonomy of sport from the state has been a
prized virtue, it has often been used to shield some abysmal governance. This is difficult to
countenance because several important rights are at stake, including the basic livelihood of
many athletes.

Unlike most forms of law, sports do not have a fixed hierarchy of mechanisms available for
grievance redressal. There is no fixed lower court or court of original jurisdiction. There are
basically three methods for conflict resolution –

1. You can file a complaint with internal authorities present within sports federations,
which are there at the national and international level both,

2. Depending on whether the offence falls under the category of civil or criminal, a writ
petition can be instituted in a court of law, and

3. You can try to resolve the issue through alternative dispute resolution (ADR).44

Filing a writ petition in the High Court or Supreme Court is a viable option, especially when
the questions of law involved is one which interlinked with other Indian laws – such as the
case of Zee Telefilms and Another v. Union of India.45 Despite calls from reforms from the
public or from the network of agreements that bind it to the international Olympic movement,
sports in India have failed to respond. Rampant corruption throughout the country and
administrative apathy lead us to the assumption that there are glaring conflicts of interest at
the very top of the administration where the directions flow from. The fact that this is the
with cricket as well, which is probably among the best-governed sports in the country, is the

44 Mukul Mudgal and Vidushpat Singhania, “Law and Sports in India”, (2016), [367].
45 (2005) 4 SCC 649.

reason that the pressure to reform has come from a third direction - the law of the land in the
form of writs instituted in courts.46

If dispute does not work out through intervention from a court of law, the modern method of
resolving disputes i.e. Alternative Dispute Resolution or ADR encompasses any or all
‘methods of resolving disputes in sports’ otherwise, that through the traditional method of
normal trial in courts.

The types of ADR in sports vary according to the dispute that has arisen. According to that,
ADR can be of the following kind – arbitration, mediation, and other forms such as sports
ombudsman, expert determination, good offices, negotiation and conciliation.

• How Courts Gain Jurisdiction to get involved in the Affairs of Sports Governing

The jurisdiction of a body or a tribunal essentially lies in the parent statue, rule or regulation
under which under which it has been created and is exercising its decision-making powers.
The governance of sports is all about rules – without rules and a mechanism to enforce, sports
cannot function properly. The general rule is that international federations are the primary
source of law – and all the regional federations and clubs in a particular country are under
their jurisdiction. Occasionally, more than one sporting body may have jurisdiction over a
certain matter of dispute due to the sport or different governing bodies having charge of
different areas of the sport. In cases like this, jurisdiction is determined by the doctrine of
‘pith and substance’. This means, the dispute has to be addressed by the body under whom
the cause of action of the dispute falls, in order to prevent multiple jurisdictions for a singular
sporting dispute.

In Internal Dispute Resolution proceedings, the jurisdiction can be conferred on the
defaulting party through –

1. An express contract – Before entering any competition, the participant signs the
participation form.

2. An implied contract

46 Aju John, “How SC verdict on BCCI has pushed Indian sports towards accountability”, Jan 23, 2015,
<Available at

3. Membership of an affiliated club

4. Acceptance of rules and regulations of the governing body and submitting oneself to
its procedures.47

This was held in the case of Diane Modahl v. BAF,48 in which Modahl was accused of a
doping offence and found guilty by a disciplinary committee appointed by the defendant
(BAF). An appeal to an independent appeal body was successful and the ban was lifted as the
drug testing had been carried out by an unaccredited laboratory, therefore the evidence was
not completely reliable. Modahl sought civil action due to BAF’s breach contractual duties
and sought damages for expenses and loss on income.

• Arbitration

As with all arbitration, the parties' consent to CAS arbitration is paramount. Arbitral
jurisdiction is based on an agreement between the parties to submit a dispute for arbitration,
and this agreement can occur either before or after the dispute has arisen. Usually, the
agreement is before the dispute only, in the form of an arbitration clause in the contract
between the parties or as a rule contained within the regulation or statute of a sports
organization which governs the parties or is the party itself.

An appeal against the decision of a federation, association or sports related body may be filed
with the CAS if the statutes or regulations of the said body so provide, or insofar as the
parties have concluded a specific arbitration agreement and if the Appellant has exhausted the
legal remedies available to him prior to the appeal, in accordance with the statutes or
regulations of the said sports-related body.

Arbitral jurisdiction is very straightforward – parties may adopt the jurisdiction of a body
providing an arbitration service, a sports, organization may adopt a rule providing for
arbitration which automatically becomes binding on all members of that particular
organization, or two or more parties may agree to simply submit a dispute to particular
tribunal on ad hoc basis. The arbitral tribunal must be fair and independent in compliance
with the standards and must follow the due process of law or it will be subject to scrutiny of

47 Mukul Mudgal and Vidushpat Singhania, “Law and Sports in India”, (2016), [397].
48 [2002] 1 WLR 1192.

state courts49 e.g. The Swiss Federal Code on Private International Law provides for judicial
review of a CAS arbitration award by the Swiss Federal Tribunal (SFT) on very narrow

Rule 27 of the CAS Code talks about Application of the Rules, where it is mentioned that –

These Procedural Rules apply whenever the parties have agreed to refer a sports-related
dispute to CAS. Such reference may arise out of an arbitration clause contained in a contract
or regulations or by reason of a later arbitration agreement (ordinary arbitration
proceedings) or may involve an appeal against a decision rendered by a federation,
association or sports-related body where the statutes or regulations of such bodies, or a
specific agreement provide for an appeal to CAS (appeal arbitration proceedings).

Such disputes may involve matters of principle relating to sport or matters of pecuniary or
other interests relating to the practice or the development of sport and may include, more
generally, any activity or matter related or connected to sport.50

CAS’ jurisdiction depends more or less on the arbitration clause incorporated in the statutes
of various sporting federations or organizations, or in declarations signed by athletes when
they’re entering the national team or international tournaments.

The CAS has its seat in Lausanne. In the context of ordinary arbitration, the parties are free to
agree on the law applicable to the merits of the dispute, which in case of failure leads to the
applicability of Swiss law. Judicial recourse to the Swiss Federal Tribunal is allowed on a
very limited number of grounds, such as lack of jurisdiction, violation of elementary
procedural rules (e.g. violation of the right to a fair hearing) or incompatibility with public

• Mediation

Mediation has very different judicial scrutiny as compared to arbitration or litigation
proceedings, as its nature is very non-binding and a binding decision cannot be imposed on

49 Mukul Mudgal and Vidushpat Singhania, “Law and Sports in India”, (2016), [429].
50Tribunal Artribunal Du Sport <Available at

parties against their will. It is upon the parties to halt litigation or arbitration proceedings to
try dispute resolution through mediation.51

In recent times, there has been a development of court ordered or mandatory mediation as a
pre-perquisite to filing litigation proceedings in the area of jurisdiction in mediation. This was
done with the view of reducing the burden on courts and possibly reaching a settlement
between the parties quickly as compared to the long winded procedure of commercial courts.
Many commentators were of the opinion that the mediation will fail unless all parties are
participating voluntarily. The case of Star Sports v. Hathway Dispute in India is an example,
after the appointment of Telecom Disputes Settlement and Appellate Tribunal as a mediator.

• Courts

Internal Dispute Resolution does provide quite a few remedies, however, there is a third
option available to the aggrieved in a sports dispute. Aside from Arbitration and Mediation,
they can still go to regular courts, unless they are specially ousted from doing so. With
reference to the ordinary commercial, criminal or non-regulatory activities of sporting bodies
– courts can act as a good medium for resolving these issues where there is no need for a high
specialized branch of Sports Law. The reason people don’t prefer to go to courts is majorly
the costs associated with invoking jurisdiction of courts, creation of animosity between
parties, negative publicity and media image, and several times – the ineffective remedies
awarded by the court in sporting disputes.52

However, on the evidence of today, constitutional courts acting in exercise of their writ
jurisdiction seem like a useful device for pushing sports governing bodies towards better
governance. The new era of legal reforms in sports started from the case of Ajay Jadeja53
where it was held that sporting bodies perform certain functions and are amenable to the writ
jurisdiction of High Court. This principle was upheld by the Supreme Court in the Zee
Telefilms case. The scope of jurisdiction of writ petitions under Article 226 was also
propounded upon in detail in the Aditya Verma v. BCCI case – where it was laid down that
the BCCI performs certain number of public functions, therefore it was held that their
decisions would bear the same scrutiny as quasi-judicial decisions.

51 Mukul Mudgal and Vidushpat Singhania, “Law and Sports in India”, (2016), [430].
52 Supra 53
53 Ajay Jadeja v. Union of India, 95 (2002) DLT 14.

• Sports Governing Bodies and their Judicial Scrutiny

Sports in the 21st century is big business and sporting governing bodies wield very
considerable power and control over large number of individuals and organizations. The
commercialization of sport has added a new layer of complexity to the role of the sport
governing bodies. International sporting federations legislate and create their own general
norms. They operate a discrete independent regulatory regime globally. In this sense, they are
a legally plural regime independent of nation states. They can thus be said to create an
‘international governance of sport.’ In several countries sporting bodies exercising monopoly
status are increasingly coming under judicial scrutiny. The fact that the sporting associations
are performing some public functions and affecting vital public interest cannot be denied.
Judicial opinion in Scotland, New Zealand and Canada is already in favour of judicial
supervision of sporting bodies, while in England, changes are being advocated.

The extension of the scope of Judicial Review in
recent years to bodies that are not necessarily thought

of as public bodies has been the most interesting and
promising development in the field of public law. Fourteen cricketers of India,
And the growing acceptance of the philosophy all including the then captain, were
those who wield power should be accountable and penalized for the unauthorized
should be subject to the general principles of good cricketing trip to the USA by being
administration indicates possibilities for developing banned from international cricket.
the role of court in controlling the power of private
corporations and self-regulatory bodies. In India, a
public law remedy in writ jurisdiction can, in given cases, be swift. Fourteen cricketers of
India, including the then captain, were penalized for the unauthorized cricketing trip to the
USA by being banned from international cricket. This penalty was challenged in the Supreme
Court in Vineet Kumar v. BCCI. In about a span of 6 weeks, by two hearings in the Supreme
Court, the ban was revoked and the cricketers reinstated. Since the ban on the cricketers was
revoked and the dispute resolved amicably, the Supreme Court did not have the occasion to
go into the issue of the maintainability of the writ petition. The Court's supervisory
jurisdiction helps to ensure that public bodies do not abuse their power and do not act
arbitrarily, capriciously, unreasonably or unfairly. Whatever other regulatory control they
may be subject to, it is becoming increasingly desirable that private bodied wielding

controlling power be generally subject to some measure of judicial supervision. Litigation
and the possibility of litigation can play a useful regulatory role.

An important question which surfaced in India was whether the autonomous bodies
representing different sports in India fell within the purview of ‘State’ or other authorities as
given under Article 12 of the Indian Constitution, and thus, were they amenable to the writ
jurisdiction of the High Court and Supreme Court. In fact, this question had been raised in
1989 at the Supreme Court in a writ petition challenging the ban on fourteen Indian cricketers
penalized for playing an unofficial match not approved by BCCI in USA, while on their way
back from the West Indies Tour.

The following extract from the decision of the Hon’ble Supreme Court of India in Binny Ltd.
v. V. Sadasivan54, is particularly instructive in this regard:

“Judicial review is designed to prevent the cases of abuse of power and neglect of duty by
public authorities. However, under our Constitution, Article 226 is couched in such a way
that a writ of mandamus could be issued even against a private authority. However, such
private authority must be discharging a public function and the decision sought to be
corrected or enforced must be in discharge of a public function.

Even when it comes to international sports, one of the most contentious issues in relation to
sports governing bodies (such as the Jockey Club – which was the subject of many cases
concerning judicial scrutiny) is Judicial Review. Over the years, there has been considerable
discussion on whether the actions of sports governing bodies could be challenged in a court
of law.

The starting point has always been - because sports governing bodies are private bodies, they
are not subject to judicial review. The English courts have displayed a marked reluctance to
extend the boundaries of public law to include judicial review of the competency of sports
bodies. Firstly, given the contractual relationship between the parties involved, the English
courts have long preferred to bring in in private law proceedings for deciding sporting
disputes upon which effective actions for a declaration, an injunction or damages can be
based without resorting to judicial review. Secondly, the approach of judicial review is
somewhat limited in the scope it can have over the sports governing bodies.

54 (2005) 6SCC 657.

This view has prevailed over the years, by creating enormous exclusions and limitations to
challenges, particularly against decisions of disciplinary and other decision making bodies
belonging to sports governing bodies. This view, however, is no longer absolute. The
apparent firmness of the English courts on this point is at odds with a number of other
comparable jurisdictions. Moreover, and in line with recent developments in the general area
of public law, consideration is given as to whether the decisions of sports bodies might be
exposed to judicial review on the basis that it is sufficiently within the ‘public interest’ that
they are held accountable in this fashion.

Since 2005, no more attempts have been made to persuade the courts that sporting
governance is an aspect of state governance more generally. But that does not mean that
public law has no role to play in sporting governance. Rather, public law principles play a
significant role in the judicial supervision of sports governing bodies, but this role is an
indirect one. The court sidestepped the great divide between public and private law, by
injecting into contractual or other relationships by which governance is established in these
bodies based on common law principles.

The Court of Appeal has confirmed on several occasions such as the case of Bradley v.
Jockey Club55, Flaherty v. National Greyhound Racing Club56, and R (Mullins) v. Appeal
Board of the Jockey Club57 that sports governing bodies are not public bodies for the
purposes of judicial review. Their actions or decision may, nevertheless, be subject to judicial
control, in the same form of review for public bodies.

R (Mullins) v. Appeal Board of the Jockey Club is the most recent case, and it focused upon
the November 2002 edition of the Hennessy Gold Cup at Newbury when Irish jockey David
Casey rode the Willie Mullins trained ‘Be My Royal’ to victory at odds of 33-1.
Subsequently, a urine sample taken from the horse was found to contain morphine. However,
although the Disciplinary Committee of the Jockey Club acknowledged morphine might be
found in a horse entirely innocently, applying a strict liability construction, the Disciplinary
Committee found there had been a breach of Rule 53 of the Orders and Rules of Racing and
disqualified the horse. Therefore, Mr. Mullins appealed to the Appeal Board of the Jockey
Club, which upheld the decision of the Disciplinary Committee, so Mullins then sought

55 [2004] EWHC 2164 (QB).
56 [2006] ISLR, SLR-8.
57 [2005] EWHC 2197 (Admin).

judicial review confining his claim to a declaration that the disqualification of ‘Be My Royal’
was unlawful under the Civil Procedure Rules at rule 54.1. However, the Administrative
Court answered in the negative, holding that the Court of Appeal’s decision in R v.
Disciplinary Committee of the Jockey Club, was binding and determinative of the
inapplicability of the judicial review jurisdiction of the Administrative Court.

Moreover, in the decision in R (Mullins) v. Appeal Board of the Jockey Club, the claimant
suggested the Court of Appeal in R v. Disciplinary Committee of the Jockey Club had
overlooked a relevant factor because the Jockey Club receives substantial sums from the
government derived from the betting levy, and this went towards demonstrating that sport
occupies a more substantial, and necessarily public, place in society

Arguably the most important authority in this field is now R v. Jockey Club ex p Aga Khan.58
Effectively the Court of Appeal in Aga Khan refined the ratio in Law to a single question:
Whether the domestic tribunals in question are ‘sufficiently governmental in operation and
nature to be susceptible to judicial review.’ There was ample debate on the matter by the
judges in the case. The judgements of Lord Hoffmann in R v. Disciplinary Committee of the
Jockey Club, ex p. Aga Khan and Justice Burton in R (Mullins) v. Appeal Board of the Jockey
Club also betray a frustration with the academic criticism that accompanies the reluctance to
view the decisions of sports bodies as amenable to judicial review. Typical of that criticism is
Beloff’s view that, if there is an ‘organic link’ between decisions of public bodies and those
of private tribunals, the justification for separate procedural treatment ‘appears to vanish’.

One final consideration also relates to the distinction between a decision reached by a
sporting governing body itself, as opposed to one reached by a disciplinary body, which has
been constituted by the sporting body, but it is independent from it. Although the former
situation may not create a problem in terms of the contractual claim, the latter situation is not
so clear. Clients seeking advice, may need to focus on this distinction, as the final claim may
be affected in terms of jurisdictional and remedial considerations. Basically, this area of
regulation and governance continues to develop rapidly and it emphasises the importance of
the dichotomy of public/private law and its connection with sports law.

• Preference for the Resolution of Disputes through Alternate Dispute Resolution

58 (1993) 1 WLR 909

For centuries, the standard avenue for resolving a civil dispute has been to file a lawsuit in the
public court system. Even lawyers, however, realize that lawsuits are not always the most
practical method for reaching a settlement. Alternative dispute resolution (ADR), sometimes
called arbitration or mediation, is a widely-accepted alternative to civil actions in public
courts. Alternative dispute resolution effectively sidesteps most or all of the institutional
uncertainty that attends litigation.

An increasing number of sports organizations are including mediation and arbitration as the
primary means for resolving disputes that arise on the field of play as well as commercial
business matters. As courts become more and more crowded and access become increasingly
tougher, the various participants in the sports industry will realise that arbitration and
mediation can be the easier way out in this situation, rather than engaging in the long haul.

The advantages of adopting ADR for sports disputes59 are –

1. A unitary system of dispute resolution –

Having a designated Sports Tribunal, e.g., Court of Arbitration for Sports (CAS), has helped
in maintaining uniformity and consistency of decisions worldwide. CAS has clearly laid
down rules and procedures to which it abides by. Similarly, CAS also has well documented
Mediation rules and procedures.

2. Speed –

Litigation in India can be arduous and lengthy process and at times takes years to achieve
finality. Settling disputes through ADR insures alternative and speedy resolution. Swift
resolution of sports disputes are necessary because the careers of sports persons are generally
short, so lengthy periods of litigation could have a very significant detrimental impact on the
sports persons career. Time is likely to be of essence, especially for a person or a team
seeking to take part in an upcoming event. Some of the speedy techniques adopted by ADR
in sports are -

3. CAS Ad Hoc Division –

59 Mukul Mudgal and Vidushpat Singhania, “Law and Sports in India”, (2016), [367-370].

It is an arbitration and conciliation body that is active only for the duration of a specific event
like the Olympics, FIFA World Cups, and the Commonwealth Games. A panel of arbitrators
is appointed by International Council for Arbitration in Sports (ICAS) which is readily
available throughout the course of the event for the resolution of any legal issue with may
arise. However, certain untoward stipulations stating that an arbitrator, to be eligible for an
arbitration in Europe, needs to be present in Europe during FIFA World Cup in Germany
2010, whereas for CAS Ad hoc Arbitration in other continents particular arbitrators are
appointed irrespective of their lack of objectivity.

At first, these proceedings were conducted only for Olympic games (every two-year) and
more recently for other international competitions. However, the caseload of the ad-hoc
tribunals remains modest, the peak was reached at the Sydney Olympic in 2000 with 15
cases, since then Ad-hoc tribunals have been in the shadow of the prominent place taken by
the Appeal Procedure. According to the Ad hoc rules for the Olympics and Commonwealth
games, arbitral award should be issued within 24 hours of lodging of the application for
arbitration and equivalent time limit for football's European championships and the World
Cup is 48 hours.

4. Expedited Proceedings –

Onus is enjoined upon CAS to have a speedy arbitration process due to the fact that event
organizers and sports federations usually wish to safeguard the integrity of a sports
competition’s final results, quite often all parties are willing to agree to highly expedited
arbitration procedure in order to conclude on legal issues in advance of the competition. In
such instances the usual time limit or shortened and disputes may be arbitrated in a matter of
days if not hours.

5. Provisional Measures –

Another characteristic of sports arbitration which facilitates the speedy resolution of sports
dispute is effective provisional and conservatory measures, prior to commencement of the
substantive arbitration and arbitral tribunal's constitution. When considering an application
for provisional measures, sports arbitration tribunals generally consider -

a. Whether the relief is necessary to protect the applicant from a irreparable

b. The likelihood of success on the merits.

c. Whether the interests of the applicant outweigh those of the other parties
(whose interest in the dispute tends to be larger than other commercial

6. Time limits –

In sports arbitration, procedural rules are generally stringent and relatively short periods are
prescribed. For example, under CAS Appeals Arbitration, according to the Code of Sports-
related Arbitration (prescribed by CAS) a statement of appeal must be filed with the CAS
within 21 days from the communication of the decisions under appeal. Unless the applicable
regulations provide for a different time limit (either shorter or longer), this time limit cannot
be extended and any delay leads to the dismissal of the appeal. Once the statement of appeal
has been filed, the appellant has a further 10 days to file an appeal brief stating the facts and
legal arguments giving rise to the appeal and to produce the evidence been relied upon. The
respondent must then file his complete answer within a time limit of 20 days. Finally, the
arbitration panel must issue its final award within 3 months of having received the case file.

Even the Indian Super League's Rules, though not defining a time period recognize the intent
behind speedy disposal of sports disputes and prescribe a summary procedure as well as a
procedure for quick resolution of disputes. The National Anti-Doping Agency of India's Code
of 2015 in conformity with the earlier code, also prescribes a period of 3 months for
adjudication of an anti-doping infraction. Even the Indian Premier League operational rules
set up a disciplinary committee and prescribe procedures, which has speedy disposal as an
intent, for preliminary and final hearings.

7. Expertise –

Resolving sports dispute assumes an essential characteristic when the dispute is contingent on
interpretation of the rules and conventions associated with the game. A person who has been
associated with this sport and commands respect from his colleagues, is better suited to
resolve the sporting dispute, that a judge in an ordinary Court of law who will probably not
have the same level of expertise. Having a sports industry expert also provides an opportunity
to the parties to concentrate on the key factors rather than spending time and money on the

preliminary issues, which are avoidable in the case of judges/panel heads who are not well
versed with sporting laws like anti-doping.

8. Cost –

Methods of ADR like Mediation involve significantly lesser cost than litigation. Even
comparative ADR techniques like arbitration are less costly than litigation in court. More
than often one party to a sports dispute is a federation or club which is financially a giant,
whereas the other party is an individual athlete who struggles to meet the expenses or afford a
costly resolution process. Thus, reasonableness of cost involved in ADR is also a perceived

Rule 64 of the CAS Code states that the panel has discretion to grant the prevailing party a
contribution towards its legal fees and other expenses. In cases where parties come forward in
appeal against decisions issued by international federations, in disciplinary matters and
doping issues, Rule 65 of the CAS code provides that no arbitration cost shall be paid by the
parties. Even for cases wherein the parties are required to pay the arbitration cost, CAS
arbitrators work on an hourly rate that is generally lesser than the usual commercial rate.

Also, there exists a provision within the CAS Code according to which the ICAS may create
a legal aid fund to facilitate access to its arbitration for individuals without sufficient financial
means. CAS has drafted legal aid guidelines for the operation of the fund and CAS has
established a list of Pro Bono counsels to assist parties before the CAS. Indian athletes like
Nirupama Devi have been beneficiaries of this legal aid granted by CAS in their appeal
before it.

9. Finality –

Finality is an important factor in some ADR techniques. Both traditional litigation decisions
and arbitration awards can be challenged - however other ADR techniques like Mediation in
Reconciliation effectively provide a final outcome in the first instance itself.

10. Enforceability –

Sports bodies have been known to comply with awards achieved through ADR techniques.
The New York Convention provides for necessary legal pathway for enforcement of an

arbitral award. The domestic laws of various countries, modeled on the UNCITRAL law,
help facilitate this process.

11. Confidentiality –

Confidentiality is a key tenet of ADR techniques. Sports disputes often contain elements
which can hamper large commercial prospects, for example, if a multinational brand or an
athlete with global recognition is involved - remarks made during the proceedings or
judgement in public, might hamper their brand value. The CAS Code provides that the CAS
arbitrators are bound by a duty of confidentiality and are barred from disclosing to a third
party any fact or information relating to the proceedings before CAS.

Under R43 of the 2013 edition of the CAS Code, in ordinary chambers, the awards are not
made public unless all parties agree or the Division President so decides. In the appeals
chamber, the award/summary/press release setting forth the results of the proceedings can be
made public by CAS unless both parties agree that they should remain confidential.

Preservation of goodwill - Sports disputes involve preservation of goodwill as the conflicting
parties may have to continue in a subsisting relationship for mutual benefit. Litigation can
turn rather nasty, whereas conciliation and mediation ensure that all the disputing parties
leave on a common consensus and everyone is satisfied.

Consistency and Transparency - The emergence of CAS for sports dispute resolution has
provided greater consistency in decisions around the world and that has led to the creation of
Lex Sportiva, or a body of case laws. Awards issued by CAS are regarded as authoritative
precedents, by subsequent arbitral tribunals if facts are similar. Otherwise previous awards
are regarded as being of highly persuasive value even if they are not considered fully binding
legal precedents.

Standards of Arbitration Proceedings

• Types of Cases

Although any disputes directly or indirectly linked to sport may be submitted to the Court of
Arbitration for Sports, there are generally two kinds which are referred. These may be
disputes of a commercial nature relating to the execution of contracts e.g. a sponsorship
contract, TV rights, transfer of players from one club to another, etc. Disputes relating to civil

liability issues also come under this category (e.g. an accident to an athlete during a sports
competition). These so-called commercial disputes are handled by the CAS acting as a court
of sole instance.

Or, they can be of a disciplinary nature following a decision by a sports organization e.g. a
doping case, violence on field, match fixing and so on. Such disciplinary cases are generally
dealt with in the first instance by the competent sports authorities, and subsequently become
the subject of an appeal to the CAS, which then acts as a court of last instance.

• Procedure

To set the dispute in motion, the party wishing to submit a dispute to the CAS must send the
CAS Court Office a request for arbitration (ordinary procedure) or a statement of appeal
(appeals procedure), the contents of which are specified by the Code of Sports-related
Arbitration. In the case of the appeals procedure, a party may lodge an appeal only if it has
exhausted all the internal remedies of the sports organization concerned. The parties may
appear alone or be represented or assisted at CAS hearings by a person of their choice, not
necessarily a lawyer.

When it comes to choosing an arbitrator, the arbitration is submitted to a panel of three
arbitrators. Under the ordinary procedure, each party chooses one arbitrator from the CAS
list, then the two designated arbitrators agree on who will be the president of the panel.
Failing such agreement, the President of the Ordinary Arbitration Division makes this
selection instead of the two arbitrators. Under the appeals procedure, each party chooses an
arbitrator, and the president of the panel is selected by the President of the Appeals
Arbitration Division.

If the parties agree, or if the CAS deems this appropriate, a sole arbitrator may be appointed,
depending on the nature and importance of the case. The arbitrators must be independent, that
is to say have no particular connection with any of the parties, and must not have played any
role in the case in question.

Once the arbitration request or statement of appeal is filed, the respondent submits a reply to
the CAS. After any additional exchange of statements of case, the parties are summoned to a
hearing to be heard, produce evidence and argue their case. The final award is communicated

to the parties some weeks later, unless it is pronounced the same day (under the appeals

With regard to confidentiality, the ordinary arbitration procedure is confidential. The parties,
arbitrators and CAS staff are obliged not to disclose any information connected with the
dispute. In principle, awards are not published.

The appeals arbitration procedure does not specify particular rules of confidentiality, but the
arbitrators and CAS staff have a similar duty of confidentiality during the proceedings.
Generally speaking, unless the parties agree otherwise, the award may be published by the

• Speed

The need for speed is no more evident than in resolving sports disputes. As mentioned above,
Panels sitting at the ad hoc Division during the Olympic Games or other major sports event
have 24 hours from the time an appeal is filed to render its decision. For cases administered
by the CAS Appeals Arbitration Division, time is also often of the essence and the CAS Code
contains relatively short time limits for the filing of written submissions and the conduct of
the procedure. As a general rule, a prospective Appellant has 21 days from receipt of the
decision he wishes to challenge to file a statement of appeal at the CAS. The Appellant has a
further 10 days to file his appeal brief, and the Respondent gets 20 days for his reply to the
appeal brief.

The ordinary procedure lasts between 6 and 12 months. For the appeals procedure, an award
must be pronounced within three months after the transfer of the file to the Panel. In urgent
cases and upon request, the CAS may, within a very short time, order interim measures or
suspend the execution of a decision appealed against.

The time limits fixed in the CAS Code may be shortened if the parties so agree. One example
of an expedited procedure was the case of Ryan Napoleon, an Australian swimmer, who on
20 August 2010, was sanctioned with a three-month period of ineligibility for an anti-doping
rule violation. The Panel deliberated by video-conference and issued the operative part of its
award on 13 September 2010 - 11 days after the appeal was filed.

• Costs

As for the cost, one of the purposes of the CAS is to provide access to justice for athletes who
might not otherwise have the financial means to pursue a claim. Although the media regularly
carry reports detailing multi-million dollar contracts and lucrative endorsement deals entered
into by high-profile athletes, the reality is that for every David Beckham or Tiger Woods
there are hundreds of professional athletes who barely earn enough to subsist. In recognition
of this, the ICAS President may decide to grant legal aid to natural persons without sufficient
financial means, which will cover the costs of arbitration and may include a contribution
towards legal fees. Therefore, the ordinary procedure involves paying the relatively modest
costs and fees of the arbitrators, calculated on the basis of a fixed scale of charges, plus a
share of the costs of the CAS. The disciplinary cases of an international nature ruled in appeal
are free, except for an initial Court Office fee of CHF 1000.

• Applicable Law

The arbitral seat for all CAS procedures is Lausanne, Switzerland, regardless of where the
Panel holds hearings or meetings. The same provision applies to CAS cases heard by an ad
hoc Division during the Olympic Games or any other sports event for which an ad hoc
Division is set up. CAS arbitrations are governed by Chapter 12 of the Swiss Act on Private
International Law (PILA) if, at the time of the conclusion of the arbitration agreement, at
least one of the parties had neither its domicile nor its habitual residence in Switzerland. The
application of PILA to CAS cases helps to ensure procedural consistency and predictability.
The most significant source of substantive law applicable to the merits of the parties' dispute
for appeal cases is the rules and regulations of the relevant sport organization which issued
the challenged decision.

In the context of ordinary arbitration, the parties are free to agree on the law applicable to the
merits of the dispute. Failing such agreement, Swiss law applies.

In the context of the appeals procedure, the arbitrators rule on the basis of the regulations of
the body concerned by the appeal and, subsidiarily, the law of the country in which the body
is domiciled. The procedure itself is governed by the Code of Sports-related Arbitration.

• Enforcement of CAS Awards

As a result of the transnational nature of international sports organizations, sports law has
developed and consolidated over the years a lex sportiva or general principles to be applied to

sporting disputes. CAS publishes its awards issued in appeal proceedings and these decisions
are available on the CAS website. The public availability of CAS jurisprudence adds to the
development of a lex sportiva and although CAS awards are not binding on subsequent
Panels, they are of persuasive authority and Panels will take care to distinguish earlier cases if
their decision is going in a different direction.

A CAS award is final and binding on the parties from the moment it is communicated. It may
be enforced in accordance with the New York Convention on the recognition and
enforcement of arbitral awards, which more than 125 countries have signed. It is very
difficult to appeal successfully against a CAS ruling. Under Article 190(2) of the Swiss
Federal Code on Private International Law, a decision of the CAS is treated as an arbitral
award under the Swiss Law and can be challenged only in the following circumstances –

1. If a sole arbitrator was designated irregularly or the arbitral tribunal was constituted

2. If the arbitral tribunal erroneously held that it had or did not have jurisdiction;

3. If the arbitral tribunal ruled on matters beyond the claims submitted to it or if it failed
to rule on one of the claims;

4. If the equality of the parties or their right to be heard in an adversarial proceeding was
not respected;

5. If the award is incompatible with Swiss public policy (ordre public).

• The Court of Arbitration for Sport - the World’s Premier Institute for Sports

The Court of Arbitration for Sports (CAS), also known as Tribunal arbitral du sport (TAS) in
French, is an international quasi-judicial body established for the resolution of disputes
related to sport through the process of arbitration. To make it simpler, it can be thought of as
the Supreme Court of Sports. The CAS head office is in Lausanne, Switzerland and two
decentralized offices are also available to the parties: one in Sydney, Australia, the other in
New York, United States. It was established in the year 1984, with the ratification of the
statutes by the IOC in 1983.

• Origin

Till the 1980s, there was no mechanism for sports dispute resolution. The intricacies involved
in settling sports disputes coupled with the lack of an autonomous authority to produce
binding decisions on the plethora of sports problems led organizations to consider the
establishment of a forum for that specific purpose. Therefore, in the year 1981, the newly
elected president of the IOC, H.E. Juan Antonio Samaranch, conceptualized the idea of a
jurisdiction created specifically for sports. The very next year, at the IOC Session held in
Rome, he in conjunction with IOC member H.E. Judge Kéba Mbaye, who was then a judge at
the International Court of Justice in The Hague, created the first draft of the statutes of what
was soon to become the “Court of Arbitration for Sport”.

In the beginning, CAS was not supposed to impose its jurisdiction on athletes and
federations. Although CAS is essentially an arbitration body, it does provide consultation and
mediation services to its stakeholders, majorly the IOC, International Federations, National
Olympic Bodies, National Sports Bodies and the World Anti-Doping Agency. This advisory
procedure open to sports bodies as well as individuals allows CAS to give an opinion on a
legal question with reference to any sports activity.

• The Gundel Case

The 1993 case of Gundel v. FEI60, or the Gundel case as it is popularly known, changed the

course of sports dispute history and CAS, as it is today is the result of this very ruling. Prior

to the 1994 reforms, the CAS was financially and administratively dependent on the IOC,

whereby the IOC was responsible for the appointment of CAS arbitrators. Elmar Gundel, a

German Equestrian competitor filed an appeal with CAS challenging a decision of the

International Equestrian Federation (FEI), based

on an arbitration clause in the FEI statute which DID YOU KNOW?

allowed him to challenge the decision of the Gundel was a horse-rider. He won Grand
FEI. The decision was disciplinary in nature and Prixs in The Netherlands and Germany
involved the imposition of a suspension and fine

on the competitor as a result of his horse testing

positive for a prohibited substance.

60 CAS 92/A/63.

Challenging the FEI’s decision, the CAS held that based on the evidence, it was ‘irrefutable’
that the banned substance, isoxsuprine, was present in the horse. Despite the presence of the
drug, the Gundel’s argument saying that the mere presence of the banned substance did not
establish that Gundel deliberately intended to obtain an unlawful advantage. CAS marginally
reduced the fine and brought down the suspension from three months to one, however it also
dismissed the substance of the appeal.

Not satisfied with this ruling by CAS, Gundel challenged the CAS decision and filed a public
law appeal at the First Civil Division of the Swiss Federal Tribunal on the grounds that CAS
lacked the impartiality and independence required by Swiss law. In a nutshell, the appellant
primarily disputed the validity of the award, which he claimed was rendered by a court which
did not meet the conditions of impartiality and independence needed to be considered as a
proper arbitration court. Rejecting Gundel’s claim, the Swiss Supreme Court held that the
CAS was a true independent arbitral tribunal. The Supreme Court noted, inter alia, that the
CAS was not an organ of the FEI and that it did not receive instructions from this federation
and retained sufficient personal autonomy with regard to it, in that it placed at the disposal of
the CAS only three arbitrators out of the maximum of 60 members of which the CAS was

The Court did draw attention to the the numerous links between the CAS and the IOC, and
questioned the independence of CAS with reference to IOC being a party to its proceedings.
The Court’s message was thus perfectly clear: the CAS had to be made more independent of
the IOC both organizationally and financially. Hence, the decision of the SFST in Gundel v.
FEI in its day had a considerable impact upon the future organization and governance of the
CAS and repercussions of the decision, which concerns the legal status of the CAS as an
independent arbitral tribunal under Swiss Law, are still being felt today.

• The Paris Agreement

The aftermath of the Gundel case was that that were a drastic change of structure – resulting
in the creation of the International Council of Arbitration (ICAS). On 22 June 1994, the
creation of the ICAS and the modifications to the governance of the CAS were approved by
the signing of the Agreement Related to the Constitution of the International Council of
Arbitration for Sport (‘Paris Agreement’). This was signed by the highest authorities
representing the sports world, viz. the presidents of the IOC, the Association of Summer

Olympic International Federations (ASOIF), the Association of International Winter Sports
Federations (AIWF) and the Association of National Olympic Committees (ANOC).

ICAS was established as an independent body, and it assumes full control over the
administration and financing of the CAS to make it independent from IOC (IOC had
sponsored CAS since its inception). Today, the rules governing arbitrator selection play an
important role in the assessment of the CAS’s independence. According to Section 16 of the
CAS Code, there must be representation from all continents and judicial cultures whenever
possible, in the matter of appointment of arbitrators. There are a few prerequisites for
arbitrators, before appointment, ICAS takes into consideration their legal training recognized
competence in sports law and/or international arbitration, knowledge of sports and general,
and good command over at least one of the CAS languages (English and French).

It comprises of a group of twenty high-level jurists appointed for a renewable four-year term
in the following manner (as given in Section 4 of the CAS Statute) –

1. four members are appointed by the International Federations (IFs), viz. three by the
Association of Summer Olympic IFs (ASOIF) and one by the Association of the
Winter Olympic IFs (AIOWF), chosen from within or outside their membership;

2. four members are appointed by the Association of the National Olympic Committees
(ANOC), chosen from within or outside its membership;

3. four members are appointed by the International Olympic Committee (IOC), chosen
from within or outside its membership;

4. four members are appointed by the twelve members of ICAS listed above, after
appropriate consultation with a view to safeguarding the interests of the athletes;

5. four members are appointed by the sixteen members of ICAS listed above, chosen
from among personalities independent of the bodies designating the other members of
the ICAS.

This list is reviewed by the ICAS every 4 years, and a new list is delivered on1st January
every year. Further, the CAS Code requires that when selecting arbitrators, ICAS must
respect, in principle, the following distribution –

1. one-fifth from persons proposed by the IOC;

2. one-fifth from persons proposed by the IFs;

3. one-fifth from persons proposed by the NOCs;

4. one-fifth chosen after consultation, with a view to safeguarding the interests of the
athletes; and

5. one-fifth from persons independent of the bodies responsible for proposing arbitrators
in conformity with the above requirements.

Since the Paris Agreement was signed, all Olympic International Federations and many
National Olympic Committees have recognized the jurisdiction of the Court of Arbitration for
Sport and included in their statutes an arbitration clause referring disputes to the CAS.

• Structure and Organization

The Code of Sports-related Arbitration governs the CAS, since November 22, 1994. The
Code is divide in two parts – the first part deals with the Statutes of bodies working for the
settlement of sports-related disputes (articles S1 to S26), whereas the second part contains the
Procedural Rules (articles R27 to R70). It thus establishes rules for four distinct procedures:

1. the ordinary arbitration procedure;
2. the appeals arbitration procedure;
3. the advisory procedure, which is non-contentious and allows certain sports bodies to

seek advisory opinions from the CAS;
4. the mediation procedure.

Although CAS was set up as an independent arbitral institution, in the early 1990's there was
some concern that CAS might not be seen as truly independent vis a’ vis the IOC in light of
the organizational and financial links between the two bodies. These concerns were voiced
obiter in a judgment of the Swiss Federal Tribunal (the Swiss Supreme Court) in a case
involving a German horse rider and the International Equestrian Federation, which was
discussed previously. As a result of the case, the ICAS came into existence. The ICAS is the
supreme organ of the CAS and was set up to provide independence to CAS from the IOC
pursuant the Paris Agreement and to safeguard the rights of the parties. To this end, it looks

after the administration and financing of the CAS. It comprises of 20 high level jurists well-
versed with the issues of arbitration and sports law. Once appointed, CAS arbitrators must
provide a written declaration that they will ‘exercise their functions personally with total
objectivity and independence and in conformity with the provisions of the Code’. Basically,
in no circumstances can a member play a part in proceedings before the CAS, either as an
arbitrator or as counsel to a party.

On the other hand, CAS consists of an intermediary of arbitrators¸ at least 150 in number.
The formation of ICAS also led to a diversification in terms of jurisdiction of the CAS with
the conception of an Original Arbitration Division that deals with disputes submitted to CAS
directly and an Appeals Arbitration Division for appeals arising out of decisions taken by
sports organizations. Each division has its own president, and the role of the division
presidents is to take charge of the first arbitration operations once the procedure is under way
and before the panels of arbitrators are appointed. The presidents are often called upon to
issue orders on requests for interim relief or for suspensive effect, and intervene in the
framework of constituting the panels of arbitrators. Once nominated, the arbitrators
subsequently take charge of the procedure.

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