The case involves Arsenal FC appealing a decision by FIFA’s Disciplinary Committee, which found the club in violation of Article 18bis of the FIFA Regulations on the Status and Transfer of Players (RSTP) and Article 4(3) of Annex 3 of the same regulations. The dispute arose from two transfer agreements Arsenal entered into in 2018 with FC PAOK Thessaloniki and Frosinone Calcio S.R.L. for the permanent transfers of two players. Both agreements included clauses stipulating higher sell-on fees if the players were later transferred to clubs in the UK compared to clubs outside the UK. FIFA argued these clauses could influence the independence of the clubs in transfer-related matters, thus violating Article 18bis, which aims to preserve competition integrity by preventing prohibited influence on clubs.
The Court of Arbitration for Sport (CAS) panel examined the case under Swiss law principles, including contractual freedom and autonomy of will. The panel emphasized that contractual freedom allows parties to determine terms within legal limits, provided they do not violate law or public morals. The interpretation of Article 18bis required assessing its purpose—protecting competition integrity—and applying a restrictive interpretation due to its disciplinary nature. The CAS panel concluded that not every potential influence constitutes a violation; the influence must be material and threaten competition integrity. In Arsenal’s case, the sell-on clauses did not meet this threshold, as they were freely negotiated and did not substantively restrict the clubs’ autonomy. The panel found FIFA’s disciplinary action unjustified, overturning the fine and warning issued to Arsenal.
FIFA’s Disciplinary Committee had initially fined Arsenal CHF 40,000 and issued a warning, citing breaches of Article 18bis and Article 4(3) of Annex 3, which requires declaration of third-party influence in the Transfer Matching System (TMS). The FIFA Appeal Committee upheld this decision, arguing that the mere inclusion of clauses granting potential influence over another club’s transfer decisions constituted a breach, regardless of whether influence was actually exerted. Arsenal appealed to CAS, contending that the clauses did not grant them real influence over other clubs’ independence and that FIFA’s interpretation was unclear and inconsistent with industry practice.
The CAS panel, composed of legal experts, held a hearing via videoconference and ultimately ruled in Arsenal’s favor. The panel found that the sell-on clauses were modest and unlikely to significantly deter transfers, especially given the financial capacity of Premier League clubs. It also noted that players retain agency in transfer decisions. The panel concluded that Arsenal did not acquire material influence over other clubs through these clauses and that any potential influence did not unduly limit club independence. The CAS upheld Arsenal’s appeal, setting aside FIFA’s decision and lifting the imposed sanctions.
The ruling reinforced the principle that clubs should retain freedom in fair business transactions unless they conflict with protected regulatory principles. It clarified the scope of Article 18bis, emphasizing that only material influences undermining club autonomy or competition integrity warrant disciplinary action. The case underscores the balance between regulatory oversight and contractual freedom in football transfers, highlighting the importance of assessing the practical impact of contractual terms rather than assuming anti-competitive effects based solely on their structure. The decision also reaffirmed the need for transparency in player transfers and compliance with FIFA’s regulations, while ensuring that clubs are not unfairly penalized for standard contractual practices.