The case involves Fotbal Club CFR 1907 Cluj S.A. (the Club) appealing against sanctions imposed by the Romanian Football Federation (RFF) for violating the RFF Licensing Regulations due to overdue payables to other clubs and employees. The RFF imposed a deduction of 24 points from the Club’s league ranking and a transfer ban. The Club argued that its financial difficulties, including entering insolvency proceedings, should excuse the overdue payments. However, the Court of Arbitration for Sport (CAS) upheld the RFF’s sanctions, ruling that insolvency does not automatically defer payment obligations unless a restructuring plan is approved by the court. The CAS emphasized that football clubs must meet licensing requirements, including financial obligations, to participate in competitions, and lack of funds is not a valid excuse for non-payment. The decision clarified that the RFF’s distinction between an "observation period" and a post-restructuring period in its regulations is legitimate and non-discriminatory, aiming to ensure financial stability in Romanian football. The CAS also noted that the Club’s insolvency status did not nullify its debts, as creditors remained entitled to their claims despite the insolvency proceedings. The ruling reaffirmed the RFF’s authority to impose sporting sanctions for non-compliance with licensing rules, provided they align with national law. The case underscores the strict financial accountability required of football clubs and the limited leniency granted even in cases of financial distress. The CAS ultimately dismissed the Club’s appeal, upholding the RFF’s sanctions as justified under its regulatory framework.
The Club initially appealed six decisions issued by the RFF Appeal Committee on February 19, 2015, to the CAS, requesting provisional measures to stay the execution of these decisions. CAS initially dismissed the request on March 13, 2015, but later granted a renewed application on March 27, 2015. The Club then applied for a license to participate in the Liga 1 National Championship for the 2015/2016 season. On May 15, 2015, the RFF Licensing Committee granted the license but imposed sanctions, including deducting six points from the Club’s classification for violating financial criteria under articles 46 and 47 of the RFF Licensing Regulations and mandating financial monitoring. The Club appealed this decision to the RFF Board of Appeal, which upheld the Licensing Committee’s decision on May 22, 2015, rejecting the Club’s arguments.
The Club argued that its debts were not due because it was under insolvency protection, which "froze" the maturity of receivables until a restructuring plan was approved. However, the Board of Appeal ruled that insolvency proceedings alone do not freeze due dates; only a confirmed restructuring plan or bankruptcy distribution plan could modify them. Since no such plan existed, the debts remained due as per their original terms. The Board also dismissed the Club’s claim that the licensing regulations conflicted with insolvency law, stating that the National Licensing System had already incorporated provisions from Law 85/2014 to avoid discrimination against clubs in insolvency. The Club’s further arguments, including alleged discrimination and the suspension of debt collection under insolvency law, were rejected as irrelevant to the licensing procedure, which only assessed whether debts were outstanding, not their enforcement.
Meanwhile, on May 22, 2015, CAS ruled in favor of the Club in a separate appeal, setting aside the six disciplinary decisions from February 19, 2015, and adjourning further disciplinary proceedings until the conclusion of the Club’s insolvency case. The case highlights the tension between football licensing regulations and insolvency law, with the RFF maintaining that clubs must comply with financial criteria regardless of insolvency status unless a restructuring plan is formally approved. The Club’s attempts to leverage insolvency protections to avoid sanctions were unsuccessful, as the licensing bodies emphasized adherence to regulatory requirements. The dispute underscores the complexities of balancing financial regulations with legal protections for insolvent entities in sports governance.
The Sole Arbitrator examined the distinction between the primary objectives and secondary effects of sporting sanctions, particularly in the context of football clubs' financial compliance. Sporting sanctions, such as withholding licenses or deducting points, primarily aim to maintain the integrity of competitions and ensure a level playing field. However, they also have secondary effects, such as pressuring clubs to settle overdue payments to players, employees, or other clubs. The Arbitrator disagreed