EDITORIAL Sports Law & Taxation 14.4 December 2023
It is with much pleasure that we welcome readers to the December 2023 edition (citation: SLT 2023/4) of our ground-breaking journal Sports Law and Taxation (SLT) and online database www.sportslawandtaxation.com.
For this issue, we invited Prof. Dr. Steve Cornelius of the Centre for Sports Law at the University of Pretoria, South Africa, one of our regular contributors, to reflect on some world and major sporting events during the past year. He reacted as follows.
“The more things change, the more they stay the same!
Introduction
The past few months saw three major world championship events: the World Athletics Championships in Hungary; the Rugby World Cup in France; and the Cricket World Cup in India. There was a lot to take from these three events. The most important conclusion that one can take from these and other recent sports events, is how far some emerging nations have come in the various events, how far some have fallen, but, ultimately, how little has truly changed in the world of sports.
Post-COVID
The second half of 2023 saw the hosting of the first truly global events in the post-COVID-19 world. In fact, for those attending the events or following them live on television or the internet, it was hard to even imagine that, barely one year earlier, the world had still been gripped in the fears and restrictions of the COVID-19 pandemic. Fans and participants travelled freely and were not even asked to show proof of vaccination to travel from their home countries to the host countries. At the events, there were fan zones and fans could come and go without much limitation. In and around the stadia, there were no face masks and no obvious dispensers with hand sanitiser. In fact, there was simply no indication that the world had reeled from one of the worst medical disasters since the Spanish “flu” almost one hundred years earlier.
It was wonderful to see that the world had moved on from COVID-19 and that the process of recovery was well on the way. It was certainly sad to see sports events during the pandemic take place in empty stadia. Sports are just not sport without spectators – especially at the highest international levels. Even where fans were eventually allowed, the required distancing and the wearing of face masks seemed to dampen the mood. It was wonderful to see fans being able to embrace each other when their teams won against all odds. And it was heartwarming to see disappointed fans console each other when their teams lost. In short, the atmosphere, which made sport, at the highest level, such a special aspect of our modern human society, was back and had survived COVID-19.
However, there were still some other old issues, which had a significant impact on these events, whether directly or indirectly. The “cold war” against Russian athletes continued. Before COVID-19, Russian athletes were unable to participate in their national colours under the Russian flag, as a result of the doping scandal that involved Russian anti-doping laboratories. Post-COVID-19, the war in Ukraine meant that, even those Russian athletes who had escaped the stigma of the doping scandal, could no longer participate either. There simply was no Russia at any international events. Whilst one can perhaps debate the prudence of punishing Russian athletes for decisions taken by their national government, with which they may not necessarily agree and over which they have almost no control, the security risk of including Russian athletes at international events and attracting non-violent and potentially violent protesters to those events, was certainly not a risk that any of the organisers could take. One can only hope that some measure of normality in international politics returns soon. The absence of Russia from major events reminds one a lot of the Olympic boycotts of the 1970s and 1980s. In particular, track and field athletics is just not the same without Russian athletes. Sadly, if the Israeli-Palestinian conflict and the rhetoric from the United States, Europe, Russia and China is anything to go by, there will be no de-escalation soon.
The big losers
World Athletics, World Rugby and the International Cricket Council were the big losers. Do not get me wrong. The various world championship events were hosted in the most excellent fashion, and they were all excellent showcases for the excitement that these sports could offer. But, in the end, the familiarity of the final results just left one with a sense of emptiness. If there is one thing global sport really needs today, it is variety. What is the fun of watching Formula 1 motor racing if the same drivers and the same teams keep on winning? And as far as track and field athletics is concerned, it becomes dull when the US athletes keep winning and the African athletes dominate the middle- and long-distance events. However, the biggest disappointment of the World Athletics Championships was the lack of medal ceremonies. Athletes, who were still struggling to catch their breath after a race, were unceremoniously hung a medal around their necks. I sincerely hope this was the result of planning at a time when COVID-19 still posed a lot of uncertainties to organisers. I hope it is not a sign of things to come! Athletes work extremely hard to achieve success and athletes, as well as their coaching and support staff and relatives, make enormous sacrifices to become world champions. There is something special about a proper medal ceremony, with national flags and the national anthems of the winners. It is a reward, not only for the athlete, but everybody who supports and enables the athlete to succeed. To simply dump a medal around the neck of an exhausted athlete is almost disrespectful.
As far as athletes are concerned, the biggest loser was Femke Bol, the Dutch athlete who ran the anchor leg of the mixed 4 x 400 metres relay. Whilst leading the race, with a mere metre to go, she tripped over her own feet and fell, with the result that The Netherlands finished in last place.
World Athletics remains the biggest loser, particularly since its relatively new transgender policy clearly contradicts its regulations for eligibility of women with differences of sex development to participate in female events. On the one hand, World Athletics admits that its own research on the effect of endogenous testosterone is flawed and misleading and that hormone suppressing therapy will not affect the performance of transgender athletes. At the same time, they continue to defend the use of hormone suppression in women with differences of sex development.
The Rugby World Cup held so much promise of change. I often, rather unpatriotically said the best result for World Rugby and the sport of rugby union would be if the final was contested between France and Ireland. Before the start of the event, there was certainly a lot of talk that, for the first time ever, no southern hemisphere team could reach the semifinals. This was not mere idle talk. At the run-up to the event, Ireland was the number one ranked team in the world, with France in second place. Both Wales and Scotland were also playing very well and, whilst England was a bit off form, it was generally agreed that the England team has a history of exceeding expectations at World Cup events. England is still the only northern hemisphere team to win the World Cup. The pre-event hype was certainly confirmed when France beat the New Zealand All Blacks in the opening match – the first time ever that New Zealand had lost a round-robin match at the Rugby World Cup. That was followed up by Ireland beating South Africa and Wales beating Australia. It created the real possibility, if Scotland could raise its game to some of its best pre-tournament levels, that South Africa could not even reach the knock-out stages of the event, whilst Australia was already hanging on by the edge of their fingernails. But that was where it ended. When the dust settled on the quarter finals, the only northern hemisphere team left in the tournament, was the 2003 winner, England.
The biggest losers in this event were Australia, who lost to Wales and Fiji and were, for the first time ever, knocked out of the World Cup tournament at the round-robin phase. The dismal performance of Australia was not unforeseen and, in fact, was a long way coming. The demise of Australian rugby goes back more than ten years, and its roots can be found in the Australian rugby bosses’ attitude towards South Africa in the southern hemisphere Super Rugby tournament. During the early years of the Super 10 and Super 12, Australian teams were dominant, and the Australian Wallabies team were world beaters. With the expansion of the tournament to the Super 14, Australian rugby authorities became jealous and greedy – jealous that South African and New Zealand teams now began to dominate, but also greedy to have a bigger share of the spoils. As a result, South Africa and New Zealand were bullied into a changed format, which included more local derbies and an expansion of teams in Australia. The only problem was that Australia simply did not have the depth of player talent that South Africa and New Zealand had and the pool of world-class players in Australia were just spread too thinly. In addition, the revised format gave Australia a false sense of achievement as, at least one team from each country was guaranteed a place in the play-offs. The greater focus on local derbies also meant that the log points of Australian teams were inflated, allowing them into the play-offs and concealing the fact that Australian rugby was on the demise.
Eventually, the strained relationship with South Africa resulted in South Africa exiting the Super Rugby tournament and joining the northern hemisphere United Rugby Championships. The end result was that the tough conditions of playing in South Africa and the loss of much of their top-level competition, accelerated the demise of Australian rugby. The old veterans, battle hardened by regular visits to the harsh African conditions, were retiring and the new generation simply did not have the experience to succeed at the highest level.
Despite making the final, New Zealand were also big losers and, even before the final match, some former New Zealand players lamented the exit of South Africa from the Super Rugby tournament. Because of its large player pool and the relative strength of New Zealand domestic teams, the impact of South Africa’s exit was not as profound as in Australia. But certainly, one element that has become apparent since the South African exit, is the lapse of discipline on the field. Nowhere was this more evident than in the World Cup final. Being involved in a high-level competition with world class teams, where the margin of victory is often very small, meant that New Zealand’s teams were always very disciplined and avoided unnecessary penalties. However, since the exit of South Africa from Super Rugby and the inevitable dominance of New Zealand teams, discipline was no longer such a crucial element of their game. This has led to New Zealand, uncharacteristically, losing test matches at home to Ireland, Argentina, South Africa and, most significantly, the British and Irish Lions, leaving them unable to win the test series against the Lions.
In the World Cup Final, the lack of discipline was ultimately the difference between the teams. No team can expect to win a final if they concede a yellow card in the second minute and add a red card within the first half hour. In my honest view, the yellow card given to Shannon Frizell for falling on top of Bongi Mbonambi should have been a red card. In hindsight, looking at replays, it appears to be a wilful attempt – successfully at that – to aggravate an old injury and remove Mbonambi from the game to expose South Africa for not having a recognised replacement hooker on the bench. And similarly, the shoulder charge which saw New Zealand captain Sam Cane receive the first-ever red card in a World Cup final, looked, decidedly, like a deliberate attempt to injure Jesse Kriel and expose the lack of backline players on the South African reserve bench.
As far as the Cricket World Cup is concerned, India were the biggest losers. To say the Indian fans are obsessed with cricket is, arguably, as much of an understatement as the commentator that called the space shuttle Challenger disaster a “malfunction”. For the number one ranked team in the world to go undefeated through the round-robin stage of the competition, just to crumble on home turf in the final in front of 90,000 fanatical fans, is just inexplicable.
South Africa still cannot seem to get things together at the Cricket World Cup. After an excellent start, the wheels came off against The Netherlands and India and, although they recovered to make the semifinals, the performance of some of their star players in the semifinal was just dismal. One has to wonder what it would take for South African cricket to lose their perennial “chokers” tag. Similarly, the performance of defending champions England, was well below par and one would not have expected them to end a lowly seventh.
The big winners
The various host countries for the major events, Hungary, France and India were certainly the big winners. In each instance, it was a showcase of excellence and achievement and the hosts should all be congratulated for hosting successful events.
The biggest winner at the World Athletics Championships was Femke Bol, who ran the most astonishing race to bring The Netherlands home to the gold medal in the women’s 4 × 400 metres final. Bol took the baton almost 20 metres behind the leaders and made up the deficit to beat the United Kingdom and Jamaica on the line.
Arguably the biggest winners of 2023 must be the Springbok rugby team from South Africa. Despite being one of the pre-tournament favourites, particularly after beating New Zealand by a record margin of 35-6 in their last pre-tournament warm up match at Twickenham, in the UK, one cannot help but think that this is the World Cup that South Africa just should not have won. But somehow, they did. No team has the right to win each of the play-off games by the narrowest of margins and keep on winning. To win the quarter final, semifinal and final with one point each and each time having to defend that slim margin for what seemed like an eternity at the time, is just not… rugby. But perhaps this one of those wins that was written in the stars since the time of the creation or the big bang. You don’t believe that, then ponder this. South Africa won the three knock-out matches by 1 point each. That is 111. If you add the total scores of the three matches together (Springboks v. France) 29+28+ (Springboks v. England) 16+15+ (Springboks v. All Blacks) 12+11) the total equals 111!
The people of South Africa were also big winners. In 1995, when Nelson Mandela famously handed the Webb Ellis trophy to Springbok captain Francois Pienaar, the country was barely free from Apartheid and most of the Black population hated rugby as the sport of the white Afrikaner minority that defied the international sports boycott against Apartheid South Africa. But Nelson Mandela understood that rugby could become a major unifying factor in South Africa. When Siya Kolisi lifted the Webb Ellis trophy for the second time, the South African team was one of the most diverse sports teams around and the support, for the once-hated Springboks in South Africa, was overwhelming.
In beating Australia and reaching the quarter finals, Fiji were also big winners and for Portugal to win their first ever match at the Rugby World Cup, was a special moment their players will cherish forever.
As far as cricket is concerned, the biggest winner was Afghanistan. For a country that has gone through many decades of war, oppression and chaos, their team performed well above their means. At one stage, they threatened to reach the semi-finals and finish level on log points with Pakistan and above England, which is quite an achievement. Of course, Australia are also big winners at cricket. They were written off by many commentators before the tournament and made an unconvincing start to their campaign. But when the important matches came along, they rose to the occasion, giving Australia at least something to celebrate after the dismal performance of their rugby team.
In some ways, the Springbok rugby team and Australian cricket team have much in common. They may seem down and out, but when the really important matches come along, they tend to dig deep and produce something exceptionally special to win. But the one thing that makes the Springbok rugby team stand out a bit more, is the fact that they are arguably the only team, in the history of any sport, that has made multiple World Cup finals and never lost.
Conclusion
The major sports events had their fair share of exciting moments and disappointments. Probably the biggest disappointment is that things just never seem to change. It would have been nice to see Afghanistan reach the semi-final of the cricket, or to see France, Ireland or Fiji make the final of the rugby. But alas, it was not to be. Perhaps in four years’ time?”
Regulator and deduction in football
Football continues to dominate the sporting headlines and worthy of particular mention is the forthcoming appointment of an independent regulator for English football, which was announced in the King’s Speech at the State Opening of the new Session of the UK Parliament on 7 November 2023.
The regulator is intended to prevent English football clubs from joining “breakaway” leagues, such as the proposed European Super League; force clubs to seek approval for any sale or relocation of their stadia; and introduce stronger tests for owners and directors of clubs.
There is also a commitment to “protect the long-term sustainability of clubs for the benefit of their fans and communities and helping to prevent the collapse of clubs.”
The appointment of such a regulator follows the recommendations made in the fan-led review of English football by the former UK Sports Minister, Tracey Crouch, who, welcoming the news, stated that she was “delighted”.
It is hoped that the regulator will be in place by the time of the next General Election, due to be held in 2024, although it may take longer. It will be interesting to see who is appointed and when!
Another football matter worth highlighting is the deduction by the English Premier League on 17 November 2023 of 10 points (a record) from Everton Football Club (“The Toffees”) for their breach of financial rules. They are now near the bottom of the League in 19th place! A fuller report and comment on this matter appeared on the SLT website on 22 November 2023.
In this issue
As you will see from the Table of Contents of this issue of SLT, we include, in addition to the two articles highlighted below, a wide range of topical sports law and sports tax articles, which will engage our readers attention and provide them with much “food for thought”.
On the sports law side, we would draw your particular attention to the article by Marco Floreale, Head of the Sports Law Division of Wollens, Solicitors, in the United Kingdom, on the continuing controversial topic of the status of women in sport in relation to their male counterparts. In his introduction, he writes as follows:
“The rise in the popularity of women’s sport is finally showing signs of closing the gap on men both in terms of parity of pay and sponsorship opportunities. However, there is still a huge chasm in sports where women are a long way from the rewards and recognition received by their male counterparts […]. Many sportswomen are household names for their performances in their chosen sport. Some women are heralded as sporting icons. Pay and sponsorship deals have increased. But the women are still a long way behind their male counterparts […]. This article will consider why men and women are still not financially rewarded equally from tournaments, sponsorships, and endorsements. It will also discuss the opportunities given to both genders and explain why the situation is changing. Additionally, it will highlight the positive and sustainable future ahead.”
And he concludes his article with the following comments, with which one would surely agree:
“The popularity and growth in women’s sport is on the rise and rise. At last, it looks like it is here to stay and be an increasing part of the mainstream sporting fixtures in our calendars. However, change is still needed. Investment is required at all levels, the model of the men’s sporting world needs to be embraced, adopted and changed where, as need be, to reflect the standing that women in sport have and the place they rightly take in society, in our classrooms, on our TV sets, in our social media platforms, and so on!”
On the sports tax side, particular mention may be made of the article by José Maria Montenegro and Francisco Vasconcelos Brandão of Morais Leitão, Galvão Teles, Soares da Silva & Associados, Lawyers in Lisbon, on the tax regime for sportspeople in Portugal. They set the scene for their article as follows:
“The tax regime applicable to sportspeople in terms of personal income tax in Portugal does not, in fact, exist as a specific regulation. In other words, there is no specific regime that covers only sports practitioners as an autonomous unit of the Portuguese tax system.
We will, therefore, have to analyse the general rules applicable to all cases in order to determine, given the particularities imposed by those activities, which tax rules apply to professional athletes.
We will also face how image rights of professional athletes are taxed in Portugal and their features, especially the Portuguese Tax Authority doctrine in relation to this income (or different incomes).
And, finally, we will also analyse one of the main issues relating to sportspeople as professionals, which is the high volatility of their tax residence and its change during the same tax period.”
As always, we would welcome and value your contributions in the form of articles and topical case notes and commentaries for our journal and also for posting on the SLT dedicated website www.sportslawandtaxation.com. So, now read on and enjoy the December 2023 edition of SLT.
Finally, we are taking this opportunity of wishing all of our contributors and readers the compliments of the season and all the best in the new year 2024, which promises to be an exciting one with the Summer Olympic and Paralympic Games taking place in Paris, and including four new sports, namely, breakdancing, sport climbing, surfing and skateboarding!
Dr. Rijkele Betten (Managing Editor)
Prof. Dr. Ian S. Blackshaw (Consulting Editor)
December 2023
