La Liga Giants Confront Article 19: Real Madrid Bests Atletico Off the Field

Last week, the Court of Arbitration for Sport rejected Atletico Madrid’s appeal of FIFA’s sanctions against the club for signing underage foreign players. The rejection was almost total, as the CAS panel upheld Atletico’s two-window transfer ban and only reduced its fine of 900,000 Swiss francs (CHF) to 550,000.

Atletico fared worse before the CAS than local rival Real Madrid, which appealed similar sanctions last year. Like Atletico, FIFA slapped Madrid with a two-window transfer ban and a fine (CHF 360,000) for violating rules on signing underage foreign players. But unlike Atletico, the CAS reduced Madrid’s transfer ban to one window and knocked its fine down to CHF 240,000. As a result, the CAS left Madrid with roughly half of Aletico’s punishment.

So why did Madrid succeed where Atletico failed? While the answer is not entirely clear (the full Atletico decision won’t be released for a few months), it probably says more about Madrid’s (relative) innocence than Atletico’s guilt. That is, Madrid succeeded because its conduct was not particularly egregious.

When determining the appropriate sanction for breaching FIFA rules, the CAS must account for “all relevant factors…and the degree of the offender’s guilt.” In Madrid’s case, there were several factors that reduced the “degree of the offender’s guilt.” Notably, the sole arbitrator reviewing the case found that the club had not committed many of the rules violations FIFA alleged. And in some of the instances where Madrid had broken rules, there was legitimate confusion about how those rules were supposed to be enforced. Further still, when confusion did arise, Madrid reached out to FIFA to verify whether its proposed actions were acceptable. In short, Madrid’s case was soaked in mitigating factors, giving the panel little choice but to soften the club’s punishment.

From what we know about the Atletico decision, one can probably infer that the club did not have as many mitigating factors as Madrid. This is evident from the level of punishments imposed — again, Madrid got roughly half of Atletico’s punishment. While this could be explained by the fact that different people rendered each decision, the CAS does not typically work that way. Arbitrators are careful to maintain consistency, which would be especially true in this instance, where the decisions were close in time and the need to prevent favoritism was heightened. So unless the Atletico panel departed from these standards, its more complete validation of FIFA’s punishment likely means that Atletico did not demonstrate the same level of innocence as Madrid.

Random Observations Unleashed

1. In 2015, FIFA also imposed a two-window transfer ban on Atletico and Madrid’s league rival, Barcelona. On appeal, the CAS left Barca’s punishment untouched. When compared to the decisions that followed, this makes sense. Barca had zero mitigating factors. For example, the panel reviewing its case ruled that Barca committed all of the rules violations FIFA alleged. And Barca’s violations were brazen, with the club signing over 30 youth players from countries as far away as the United States, South Korea, Japan and Cameroon. So unlike Madrid, which had multiple mitigating factors on its side, or Atletico, which at least had some, Barca gave the panel no reason to show any mercy.
2. Two of the arbitrators on Barca’s 3-person panel also served on Atletico’s panel: Efraim Barak from Israel and Prof. Urlich Haas from Germany.
3. From these three cases, all against major clubs, this much is clear: outside of those mentioned in FIFA’s Article 19, the rules contain no significant loopholes that would allow clubs to sign foreign youth players. Madrid had the most success before the CAS, but it was only able to reduce its punishment. None of these cases held that the clubs could continue using the underage foreigners they signed.
4. Atletico began serving its two-window ban last winter, before the CAS decided its case. So going forward, it will only be prevented from signing new players during the summer 2017 transfer window.