Arbitration in sports law

09th October 2022

Author/s:
Attorney-at-law and tax consultant Dr. Dr. Bernd Josef Fehn

The Federal Constitutional Court (BVerfG) rules in its decision of 03.06.2022 - 1 BvR 2103/16 in the case of speed skater Claudia Pechstein that the Federal Supreme Court (BGH) wrongly classified the International Sports Tribunal (CAS), which had sentenced Ms. Pechstein to a two-year doping ban in 2009, as an arbitration court in view of structural deficiencies in the rule of law. As a result, this case is entering the next round in legal terms. The proceedings for damages and compensation for pain and suffering amounting to 4 million euros will be continued before the Munich Higher Regional Court (OLG).

The BVerfG states that the BGH should have considered the arbitration agreement signed by Claudia Pechstein (compulsorily, as otherwise she would not have been allowed to participate in competitions) as null and void. According to the statutes applicable to the CAS, Claudia Pechstein had had no right to publicity of the hearing and her request to establish publicity had been rejected as well as the request directed against the ban, because she had allegedly not proven that the blood abnormality found in her was not due to doping.

Claudia Pechstein was unsuccessful in the Swiss courts. The European Court of Human Rights (ECHR) partially upheld her claim. Thus, the ECHR reprimanded the lack of publicity before the CAS. On the other hand, the argument that the CAS is not an independent and impartial court of arbitration did not prevail there. The BGH took the same view. According to him, the procedural rules of the CAS guaranteed the protection of the rights of the athletes.

The constitutional complaint lodged against this was successful. According to the BVerfG, the contested judgement violates the right to the granting of justice protected by the Constitution and the European Convention on Human Rights. This will limit arbitration agreements, if the athletes have no chance of rejecting the arbitration agreement without having to forego their participation in competitions. Thus, the organizing federation is in a superior position and effective legal protection as well as minimum requirements under the rule of law must be guaranteed. This includes the principle of the publicity of oral proceedings as an essential component of the rule of law. In addition, the judicial activity must be carried out by an uninvolved third party. The minimum requirements for this under the rule of law are neutrality and distance from the parties to the proceedings.

Thus, the current selection and appointment of arbitrators is likely to be subject to constitutional concerns due to the violation of the neutrality requirement. Arbitrators can only be appointed, if they are on a list, and the athletes have no influence on the appointment. This must change after the decision of the BVerfG.

In an obiter dictum, the highest German court states that the neutrality and distance of a judge from the parties to the proceedings must also be guaranteed in the design of national or international arbitration proceedings in order to be able to effectively exclude legal protection before the national civil courts. Admittedly, the CAS in Lausanne is not bound by the case law of the BVerfG in Karlsruhe. As things stand, however, the CAS risks no longer being recognized as an arbitration court by German civil courts in the future because they have to comply with the ruling from Karlsruhe.

The case of Ms. Pechstein also shows us that there had been a lack of regulation to reopen the arbitration proceedings in favor of the athlete, even though new facts removing the suspicion of doping had become known. In fact, it is a hereditary disease being the reason for the elevated levels of her reticulocytes. That loophole had already prevented the CAS from lifting the ban.

This case is one of a whole series of strange decisions by the CAS. At this point, reference is only made to the cross-country skier Evi Sachenbacher-Stehle. The CAS had dismissed a complaint filed by the German Ski Association (DSV) against a protective ban of five days imposed by the Fédération Internationale de Ski (FIS) on the athlete for the 2006 Winter Olympics in Turin, although it had been proven that her hemoglobin level is already genetically borderline and had been too high due to long stays at altitude. As a result Ms. Sachenbacher-Stehle had missed the 15 km chase race and, thus, another medal chance.

These two CAS decisions already remind me of the famous three monkeys. Those who suffered from it were the athletes with medical anomalies. To close one's eyes, ears and mouth to this is simply unfair. Isn't fairness a fundamental rule of sports? The BVerfG restores it.

Although the procedural rules of the CAS were changed regarding the publicity of the hearing after the Pechstein case, the relevance of the decision of the BVerfG is not limited. The list selection of the arbitrators was not changed by the CAS Rules of Procedure. The Federal Constitutional Court explicitly criticizes the neutrality of the arbitrators in an obiter dictum. It therefore remains the case that the CAS does not meet the minimum requirements of the rule of law. I am aware that this is not undisputed. However, the wording of the BVerfG decision is not open to interpretation, but contains clear requirements.