ECJ: Portuguese football no-poaching agreement could meet EU law

An exterior view of the Court of Justice of the European Union (Cour de justice de l'Union europeenne) in Luxembourg. Arne Immanuel Bänsch/dpa

A no-poach agreement by Portuguese first and second division football clubs during the coronavirus pandemic "can potentially be compatible" with European Union law, the European Court of Justice (ECJ) said on Thursday.

The Luxembourg-based ECJ said that "whilst pursuing an objectively anticompetitive aim in recruitment, the agreement at issue also pursued an aim objectively favourable to competition: that of ensuring stability of player rosters playing in the First
and Second Divisions."

The 2019-20 season was suspended in March 2020 and completed from June onwards behind closed doors.

In April 2020, the Portuguese league and the top flight and second division clubs reached an agreement not to sign players who had unilaterally terminated their contracts due to exceptional circumstances in connection with the pandemic.

The Portuguese competition body rated this a violation of competition law in 2022 to which the clubs objected. The case went to Portugal's Competition, Regulation and Supervision Court which referred questions on the matter to the ECJ.

The ECJ judges said that the agreement "constitutes a manifest restriction of a competitive parameter which plays an essential role in high-level sport." and may also have "an indirect, potential impact on the ‘purchase price’ of players, who are the clubs’ human resources."

But they also said that "the agreement at issue occurred in the very specific context brought on by the COVID-19 pandemic, which had a fundamental impact on the functioning of the professional football sector, where the competitive functioning presents numerous specific characteristics.

"Although the occurrence of the pandemic is not per se such as to justify making an exception to the prohibition of anticompetitive conduct, even in the field of sport, the Portuguese court will have to take account of those circumstances for the purpose of determining whether that agreement has as its object the prevention, restriction or distortion of competition.

It said that the agreement was designed to help ensure "the regularity of sporting competitions" which was "a legitimate objective in the public interest which holds particular importance in the case of football and which may justify, in principle and without prejudice to their actual content, the rules implemented by the agreement at issue.