Football Governance Bill: What do lawyers think about changes?

On Thursday the government reintroduced the Football Governance Bill, in what they describe as a “strengthening” of the previous attempt.

Among the changes was a drop of the requirement to take note of UK foreign policy, and a development to include fans in plans to hike ticket prices and relocate stadiums.

But what do top City lawyers think about the Bill, and what has caught their eye?

Here we’ve taken a view from Udo Onwere of Bray & Krais, and former Fulham footballer and JJ Shaw of Lewis Silkin.

Football Governance Bill deserves critics

“The proposed Football Governance Bill is not without its critics – and for fair reason,” Bray & Krais partner Onwere told City AM.

“Namely, the introduction of an independent Football regulator could throw a spanner into the already strained machinery of English football as these unprecedented powers over club revenue and governance will likely set the stage for litigation by clubs who feel they are unjustly hampered as a result of this legislation.

“In particular, the distribution of parachute payments to relegated clubs will now fall under the regulator’s remit and will likely be a point of contention. Over the past year, relegated clubs have taken action against the league over financial concerns. This is likely to continue under these new proposals, as debates rage on over what fair redistribution looks like between the Premier League and EFL.

“While larger clubs would feel the strain, the overall distribution of wealth throughout the football pyramid would improve under these proposals. This would ensure that clubs in the lower tiers of English football are more afforded greater financial stability – even if it comes at the expense of the sport’s biggest earners.

“Fans will also likely welcome this bill, which would introduce tighter controls around the transparency of ticket pricing – preventing the unfair gouging of match goers who have seen a steep increase in ticket prices across the football pyramid over the past few years.”

Coalition of legal chaos?

“Whilst it’s clear the UK government is committed to strengthening governance within English football, it will be crucial to see how the regulator’s new enforcement powers are framed to avoid conflicts with Uefa’s governance structure, especially considering the recent Uefa threats to suspend England from future Uefa competitions,” Shaw, managing associate in the digital commerce and creative team at Lewis Silkin, said.

“The Uefa Statutes specifically state that “a Member Association may in particular be suspended if state authorities interfere in its affairs in such a significant way that … it may no longer be considered as fully responsible for the organisation of football-related matters in its territory” – so the success of the Independent Football Regulator (IFR) will likely turn on its remit and whether Uefa perceives this to stray into footballing matters.

“The UK government has been keen to stress it does not intend to regulate matters relating to “football” as a sport, but rather to oversee the long-term financial sustainability of clubs they perceive as heritage assets of the United Kingdom. However, senior Uefa executives and stakeholders have expressed deep concerns over the IFR’s potential for ‘scope-creep’ that could impinge on the FA’s autonomy and thereby breach the Uefa regulations.

Challenges?

“There is a possibility down the line that the FA or disgruntled UK clubs might themselves challenge the establishment of the IFR if they believe that the regulator is overstepping its legal authority or imposing measures that go beyond what is permitted by the enabling legislation – for example the Football Governance Bill – essentially arguing that the regulator is acting unlawfully.

“Clubs could in theory form coalitions, particularly clubs at the top of the pyramid, to argue that such regulatory overreach threatens their commercial success and autonomy. Legal challenges could also be brought if they argue that the regulatory provisions unfairly penalise certain business models or create an uncompetitive environment.

“Equally, if the new regulator introduces licensing or financial penalties that clubs view as unjust or misapplied, they may be able to challenge these through appropriate dispute resolution mechanisms likely to be built into the framework of the regulator.”

Football Governance Bill conclusion 

It is clear the Bill goes beyond the original one introduced by the former government.

And the government claims that their changes have narrowed the remit that the Bill has over football to just financial sustainability.

They suggest their changes will decrease the chances of legal action, in contrast to the comments from the above experts, and any legal fines will go into a pot to help fund future disputes.

So the reality is that the devil is in the details, and we’re probably going to see a few teething issues in the coming years.