European Super League's Impact on Football Governance: A Call for a Strong and Balanced Framework

Hello! Welcome back to PITCHSIDE MONITOR, your one stop guide to club management. This week we will:

- An independent and impartial view of the Court of Justice of the European Union case from the #PitchSideMonitor team

- An interview with jordi bertomeu , former CEO of the Euroleague Basketball

- Analysis of the background and the current challenge European football will face in the next few years

- Ahead of the transfer window, find out how the best clubs structure their decision-making by forming collaborative teams that include the sport director, head coach, scouting personnel, and financial analysts, to ensure a holistic approach to player acquisitions, balancing technical needs, financial viability, and long-term strategic goals.

First up, is our section on club management.

After the storm... comes the calm? Or maybe another period of unsettled weather? Just as the climate patterns seem to be changing around us and making the old sayings somewhat irrelevant to the disruptive weather we are experiencing, in the sport industry we might also be facing a period of unknown effects and patterns following a major pronouncement by the Court of Justice of the European Union in the week leading up to Christmas. The first emergence of the European football Superleague as a real structure rather than just a concept to generate better revenues from the football governing bodies, back in 2021, went very much in line with the ‘first pancake’ theory. However, the second appearance was certainly stronger –being in position to make all the victory noises following a logical but nevertheless unexpected pronouncement of the court that rowed quite far back on the equally unexpected opinion of the Advocate General, issued back in 2022 and which effectively said to the sport governing bodies that they are free to do whatever they want under the protection of the “specificity of sport” argument. There are many far more qualified people than us to dissect the legal side of the decision, some of whom have already been on the case (pardon the pun), so here we wanted to focus on providing a more generalised overview of what we believe the judgement means for the short and long-term future of the sport industry in Europe, highlighting some of the important aspects (in our opinion, of course) and possible ramifications. So here goes our brief summary:

1) The decision has been widely presented as a win for the Superleague and its backers, but in truth the court was very clear in saying that they were not asked to rule on the validity or admissibility of this specific project. This has been left to the Spanish court, which was the one originally referring its questions to the CJEU and will now be armed with their ruling.

2) At the same time, it was also a major rebuttal to the opinion of Advocate General Rantos, which was not even mentioned in the court’s decision, despite the fact that normally a significant majority of CJEU pronouncements go in the line of their respective Advocate General’s opinions. In as much as Rantos’ opinion was an apology of the “specificity of sport” argument, the decision went the other way and (quite logically, in our opinion) made it clear that football at this level is really an economic activity first and foremost.

3) Of course, the mere fact that UEFA and FIFA were judged to have abused their dominant position is a major new input, but it seems a more theoretical than practical outcomethat does not create a new set of rules but merely reinforces existing tests previously offered by the EU authorities.

4) The judgement also reinforces some aspects of the European sport model such as the pyramidal structure of competitions, meaning that closed competitions within European sport might become fully beyond the pale (with whatever intended and unintended consequences this may bring).

5) The possibility of third party entrants organising their own competitions is also tantalising, but the mechanism of how this should be connected with existing football regulations and structures, particularly within the European Model of Sport, is yet to be determined and tested.

6) There is still the possibility for UEFA and FIFA to adapt their regulations in such a way as to become eligible for the specificity of sport defence, if they demonstrate their new approach will be transparent, equitative and proportional, and beneficial not only to themselves but also to the wider society at large. Can they do it, though?

In terms of the ramifications and future outlook, one could not help when reading the court decision to notice that it seemed an open invitation for the participants in this process to get together and come to some sort of agreement over this, instead of further descending into a negative spiral and litigating over every single issue for the next decade. Outright blocking of new entrants has been ruled inadmissible for sport bodies, but at the same time any new competition organiser on the market, unless they are prepared for a complete schism with the rest of the football ecosystem, will need to find some sort of consensus with the traditional pyramid to remain connected to it and be fed from its collective natural resources. For this, instead of the classic power relations prevalent in the sport world until now, the “live and let live” approach seems more productive for the future. New competition organisers, if they are prepared to be just that, have the capacity to bring new ideas, directions, solutions, audiences resources for the professional game, whilst recognising that the traditional governing bodies also fulfil very important functions. Discussing these functions and roles, and setting adequate recognition and compensation mechanisms in place for these, might lead to constructive solutions rather than the absolutist, clientelist and vitriol-driven positioning that is not going to benefit the football industry within the eyes of wider society. The governing bodies will also need to find a new way of thinking and making decisions that is based on them being one among equals and consistently and objectively measuring (and demonstrating) the value of their decisions to sport and society at large. Such a new reality, should the constructive approach be followed, could only bode well for the sport industry as a whole, which could end up being reinvigorated by new relations, discussions, competitions and participants. Stakeholder bodies will likely have even more of an influence in the overall process, whilst regional competitions based on strong market awareness and resource availability could also offer solutions to the existing structural challenges of European football, taking it beyond the territorial limitations.If the existing actors are unable to reach this consensus promptly and set adequate engagement rules for the next decades amongst each other, there is no doubt that the EU authorities might consider additional regulation of such a troublesome sector that can’t seem to rule itself. Whether such a Solomonic solution would end up being palatable to these existing actors is anyone’s guess.

In our Football Talks section this week, we caught up with Jordi Bertomeu after the CJEU case. As the former CEO and President of Euroleague Basketball , he played a crucial role in modernizing the league and expanding its global reach. His leadership significantly transformed EuroLeague, enhancing its competitiveness and commercial appeal. Bertomeu's impact has been pivotal in elevating European basketball on the international stage.

Following the CJEU decision last week, which, according to Jean-Louis Dupont , the lawyer who participated in both the Bosman and the Superleague cases over the last 30 years, “liberated clubs, like Bosman liberated players”, with your extensive basketball experience, do you believe that professional sport clubs generally appreciate having this freedom, or do they somehow prefer to be “led” by the established conventions and governing bodies rather than have to take responsibility for themselves?

My experience is that yes, they do. Normally when they happen to be led it is because they are under some kind of pressure. The model of sport in Europe that we know today was created and built after WW2; in the meantime, most industries, including entertainment, have changed a lot, whereas sport has remained fundamentally the same.

If you talk about freedom to act, you have to realise that sport is the only sector of commercial activity where the two crucial business concepts of decisions and risk are split. Decisions critical to the running of the business in football are taken by a third party, i.e. the governing bodies, whilst risk for them is taken on by others. If business goes badly, then the risk is never taken by those who decide on the governance: the losses are suffered and have to be covered by clubs. No other business has this, even though some are also regulated – but in their case objectively. This is the reason why we developed the Euroleague concept in basketball back in the early 2000s, to bridge the gap between those two business concepts.

Of course, this approach requires a lot of previous work and understanding by the people managing the clubs. They really need to understand very clearly that they are both competitors and business associates simultaneously. This takes time, culture and discipline to build. And once clubs have won this freedom, they have to realise that when they sit at the table together, they have the responsibility of thinking about the competition and the global issues that impact everyone, too. And then the next day they play against each other and fight to win in the normal way, giving their best on the field, complaining against referee decisions, being as partisan as necessary! Those two aspects really need to be combined for it to work.

At international level in my experience this has been the most difficult to achieve, because they (clubs) come from different backgrounds. Spanish or Italian teams had an understanding of it from working collectively as a league and clubs together even before the Euroleague happened, whereas an Israeli, Turkish or Russian club had more difficulty to adapt in the beginning as they were used to a different environment, but in the end it all worked quite well and we had a very good mix of clubs from all backgrounds and traditions.

In the case of the Euroleague and its evolution of the last decades, who were the key stakeholders of the process, and what have been their roles in it?

Naturally, clubs were the original stakeholders, and in the beginning, when it all started, the departure point for them was to support themselves in existing structures – the national leagues. I was delegated by the Spanish league to build this project, as they needed someone who knew how to build professional competitions. At that time the four biggest European leagues and the main clubs went as far as signing a joint venture contract, which shows the level of collaboration and understanding of the vision by them.

In our project we also need to highlight the role of Telefónica , who was a major stakeholder as they invested heavily in sport at that moment in time, providing resources that were very important, crucial for the project to become operational.

On the other side there was FIBA and the national associations, who tried to take their grievances to Brussels, and in Brussels the situation was more muddled, because this is when it became more politics than sport or business. We had to go to the European Parliament , have intense meetings with sport ministers; those were a couple of years when politics and politicians were also an important stakeholder of this process.

Is it possible to operate successful sports competitions in a fractured environment, or do you need to come to some sort of consensus for that to happen? And what are the key factors in being able to reach it, considering that many issues in sport end up being personal?

This is a very complex question. First you need to define what “fracture” is. In basketball there never was such a clear pyramid as there is in football, especially as we have such a major player as the National Basketball Association (NBA) to contend with. They are the ones who are providing a leading voice in basketball in terms of ideas and resources, but they are not subordinate to FIBA – they have their own structure, rules etc.

So for us this was a situation where there was a disagreement with governance bodies, but not with the competitions or the sporting logic. In fact, it was only in the first year when we had a bit of a split, when some clubs were in one competition and the rest in another; otherwise the best clubs were always in the Euroleague, so it was to all extents and purposes the pinnacle of European basketball without a shadow of a doubt.

At the top level of competition, division is not really advisable because if we are talking about the top level, the highest quality – it is not great to have them split, otherwise things become very unclear on the sporting side.

Now, looking for consensus takes a big effort, but looking for it has to be done differently than in traditional sport governance behaviour models, which are based on relations and manifestations of power. If you try to look for consensus based on projecting power, it is not conducive to finding a solution. Positive consensus needs to be based on the sharing out of responsibilities resulting from the needs and specificities of each organisation.

If you start by saying you want to have power, say, over referees or setting the calendar – it’s not going to be a good starting point. Constructive discussions start when the parties know what are the the sensitive positions of everyone, where they are prepared to compromise and cooperate etc.

So what happens if relations are broken and there are egos at play, how do we find the consensus then?

Personalisation of conflict is an approach that has probably been used to simplify things for the outside world, make them primitive and reduce them to an individual war instead of looking at the really important issues and finding solutions. It is easy to portray it this way in the public domain, through the media, because conflict sells.

But of course, if sometimes the leaders are a small group of people and they are always present in the public eye and in conversations, it can lead to fatigue. In that case, the solution must be to refocus individuals on the really important matters and constructive solutions rather than individual gripes, and it can definitely be done!

If you see what a federation and a league is, they are two very different organisations. A league is a business, an enterprise. A federation is a political body, where the members are voting their leaders every certain time, and every vote is the same, so it becomes politically driven to keep the numbers, maintain power and protect individual interests.

In a league, the only thing that matters at the end of the season is what are the business figures: more fans, more revenue etc. And this is objective, it can be measured. So the tension can happen when the outcome is not good, when league executives can’t deliver what is expected, but there are fewer politics at play. Of course, this is not meant as a criticism of federations or saying that leagues are better – both organisation types are part of the sport industry structure, and they need to work together, recognising their different functions and spheres of activity, and not trying to impose power over the other because it has always been the case for the past 100 years.

European basketball is 20 years ahead of European football on this road, what would be your advice to the key stakeholders in the football industry to avoid some of the challenges that you faced, and end up with a win-win for everyone in the short to medium term?

I am not sure I am the right person to give a lot of advice. For one, I am not in favour of thinking that models can be replicated across different sports. Funnily enough, we always seem to have had the fresh ideas in basketball because we’ve just not had the level of resources that football enjoys, so we had to be inventive. But even if we are 20 years ahead in basketball, our reality is very different, not only economically but also in other matters, such as the relative size and significance of at least some domestic European leagues in football. In basketball this is not really the case, except for the Spanish ACB league, which means that even other major countries like ?Germany, Italy or France, let alone England, don’t necessarily generate the same size of competition in our sport as they do in football.

The football Superleague may take the Euroleague as a reference point, also because the president of Real Madrid has a leading basketball team and so has first-hand experience of our approach to things and our trajectory, but they are still two different ecosystems that can’t be easily mirrored against each other due to the major specificities in each case.

If I could formulate some useful principles: first of all, it is critical to understand what are the tasks and responsibilities that each stakeholder has. A federation has to be concerned about development, referees, coaches etc; growing the sport organically as a whole in their territory. Whereas a league has to maximise fan interest in the product of the league, which leads to more resources coming into the clubs and the wider game as a result.

For example, if I am a federation but I want to control the league’s calendar – that’s not a great idea, because a league has to be able to manage it themselves, since it is their business, their product, effectively choosing when their open and close the shop, which then obviously impacts directly on the revenues they can achieve.

For me, when these sorts of things are clear, you then get to a point when you can establish borderline areas and touch points, where the two entities need to collaborate. There is an interest from a league in development, because this is where their new stars are going to come from, so there is an onus to collaborate. There has to be coordination. Also in managing the progression of teams from one competition to another based on sporting merit, so that the jump in quality and demands is not so huge. These matters need to be worked on jointly, and then on other items it is important to split responsibilities in an effective way so that there is no temptation to impinge, and then the parties work individually on their dossiers as best as possible, for the combined good of the sport.

With FIBA and Euroleague it was clear between 2001 and 2016, and then the issue of power projection raised its head again, which led to tensions over calendar, release windows etc that were previously sorted. So then we came back to talking about issues that generate friction.

And the end result of that is that since then, for example, national team matches for qualifiers to Olympics or basketball world cups are now played without NBA and Euroleague players, but this is not good for the game, because the best players are not there. Or the best referees, who are also naturally working at the highest club level. And this happened because there was a desire to put new national team match windows into the calendar, which obviously impacts on the clubs, both in NBA and Euroleague.

Trying to project power, forcing others under your will, is not a great way to do these things. If you don’t focus on power and instead concentrate on sharing out responsibilities, finding solutions and collaborating - then it will work.

So, all in all, my advice would be to make sure that when time comes for talking, the topics for this discussion are constructive and focused on distributing and acknowledging each other’s responsibilities and contributions rather than engaging in power games.

In April 2021, the football world witnessed the seismic launch and subsequent swift collapse of the ESL, a breakaway concept proposing an elite-tier competition that would stand at the top of the pyramid within the football landscape of today. Despite its short-lived attempt due to overwhelming backlash, the ESL's spectre lingers, highlighting the power dynamics and centralized governance within European football's ecosystem. What ensued was a pivotal shift, triggering discussions about the effectiveness of the current European Sports Model (ESM) and sparking a compelling quest for football's evolution.

This Football Insights delves into the aftershocks of the ESL, examining its lasting impact on the ESM at the club competition level. Through the eyes of key stakeholders, this analysis navigates the complex landscape of football governance, unravelling the profound implications of the ESL and probing the evolution of ambitions stirring within the sport. Join us on a revealing journey as we explore the transformative influence of recent events, shedding light on the intricate dynamics shaping modern football governance.

This week we will explore the following:

• The current state of the game
• The perspectives of football stakeholders on the ESL
• The mitigation efforts towards the presence of the ESL in the market

Power Dynamics within the game

At the core of the football structure lies a struggle for control, chiefly orchestrated by top-tier stakeholders within a rigid pyramid structure. To what extent can a single governing body wearing three hats; organiser, regulator and judiciary, remain impartial? While autonomy in governance remains a buzzword for independent decisions, centralized control sparks worries about impartiality and innovation hindrances. This centralised control, dominated by elite clubs, tilts the reform focus, sidelining the interests of smaller clubs and prompting concerns about fair representation.

Polarisation, a prevailing issue, benefits the clubs involved in decision-making, leading to competitive imbalance. The current club competitions contribute to this, contradicting governing bodies’ claim to safeguard competitive balance. Financial sustainability hangs by a thread, marked by forecasting complexities, varied club financial motivations, and top-level revenue concentration, hindering solidarity and threatening long-term viability. Disparity in ownership structures and resources further exacerbates the problem, creating an imbalance between continental and national markets.

Stakeholders' Take on the ESL

The ESL encountered widespread opposition due to bypassing numerous stakeholders in the football landscape of today. Fear stemming from a culture of change adversity rooted within the game. The new model would imply financial and structural challenges for stakeholders who wish to maintain the status quo of the current European football model. Exclusionary practices as well, due to the presence of guaranteed slots, conflict with fairness values upheld in European football. While some saw it as a means for clubs to gain control and innovate, others viewed it as a move for self-preservation among the so-called elite clubs. Motivations ranged from club autonomy to enhancing marketability and global ambitions. Concerns lingered about the potential polarization and imbalance the ESL might intensify, despite its intention to revitalize the competition format and recalibrate governance structures to balance power within European football. The viability of the ESL outside the existing structure heavily relies on fan and player support, significantly impacting revenue streams.

ESL Mitigation Strategies

The ESL controversy has prompted debates about preserving football tradition and the role of governing bodies. Efforts toward stakeholder unification, adaptive model changes such as competition formats and financial fair play updates, and attempts to counter ESL's influence have arisen. Yet, concerns linger about short-term fixes ignoring underlying issues. The ESL's challenge to UEFA's authority has spurred unity among stakeholders, strengthening relations and involving stakeholders more in governance structures, albeit uncertainties persist about their tangible impact over time. While adaptations in response to ESL pressures aim at financial refinement, worries loom that these changes may address short-term concerns at the expense of long-term issues, risking European football's vitality. Political entanglements further hamper dialogue, and changes within the industry, underscoring the ESL's political nature and its consequent standing in the industry. Political pressures and government involvement have thus limited the viability of concepts like the ESL, impacting marketability and commercialisation.

Football's Evolutionary Trajectory

In the wake of rejected proposals, football stakeholders push for continuous improvements, stressing the need to tackle polarisation, bolster equality, and foster transparency and solidarity. Democratisation surfaces as a pivotal focus, empowering diverse stakeholders and advocating for shared ownership while deliberations on club competition ownership and regulatory frameworks intensify in the quest for a fair balance between commercialization and equity. There is a need for involvement and clarity from European institutions, coupled with evolving territorial and distribution systems for a balanced market. There's a call for evolution to prevent stagnation and a reminder that football's attractiveness and competitiveness need correction to avoid losing appeal among future generations.

Following the groundbreaking ruling by the Court of Justice of the European Union (CJEU) on the 21st of December 2023, the landscape of football witnessed a potential turning point, triggering discussions about the sport's future. The delicate balance shaping football’s destiny involves power dynamics, evolving structures, and adapting to changing fan behaviour and consumption patterns. With the CJEU judging UEFA and FIFA as having abused their dominant position back in 2021 under EU competition law, a window of opportunity emerges for new European club competitions to make their entrance into the market. The challenges today pave the way for a footballing future advocating inclusivity, fairness, and sustainability, steering the game towards a more balanced and dynamic trajectory. The revamped ESL concept reflects a response to stakeholders' opposition back in 2021, indicating a shift toward listening to football’s key players. Presently, clubs are continuing to outwardly oppose the ESL, yet doubts persist about the genuineness of their stance. The question remains whether these clubs will stand firm against an ESL even if it materializes. Current opposition might be politically motivated, but with time for assessment, the monumental significance of this footballing juncture could lead clubs to reconsider. Fear of lagging both domestically and internationally could drive shifts in club allegiances as they reevaluate their positions. As an organisation working with clubs, we will continue to observe, advise and we recognising the importance to think about a domestic, regional and global. Judges took a decision on the highest level, it is up to knowledgeable experts from the industry us provide solutions for the best of football at our levels.

Assembling a winning team is both crucial and challenging for a football club's short-term success. It involves meticulous human resource selection and development, with an eye on sustained performance and future planning. This task demands a comprehensive understanding of the player market, including current team talent, upcoming youth prospects, and external recruitment. A robust player recruitment system, integral to a club's medium-term strategy, requires significant investment and careful execution. Key processes include information gathering, target identification, negotiation, and effective communication within the club's management structure. Typically, the club's strategy leader (such as the owner or CEO) collaborates with the sport director and others involved in coaching and scouting to drive this vital aspect of club management. Want to know best practices?

In the realm of elite football #clubmanagement, our journey in 2023 has been one of discreet yet impactful strides. At LTT Sports, we always believe in the power of confidentiality and the magic of behind-the-scenes work. While our webpage remains a silent witness to our latest endeavors imagine a club, poised on the brink of transformation, ranked within the top 100 by UEFA. Here begins our tale, not just of advisory but of reinvention. We embarked on a mission, not just to support but to lead a takeover for an investor club management. This was a journey that demanded more than just strategic insight; it required a deep dive into the very soul of the club.

Our path was twofold: to advise on club governance and to draft a strategy that would resonate not just on paper, but in the dynamic, pulsating world of football business. Alongside the new management from diverse background, from the intricate development of a strategy based on UEFA coefficients to its tangible implementation in the daily business operations, always ensuring the CEO was not just a participant, but a leader in this transformation.

The story we tell is not just one of success in 2023, but of passion, precision, and partnership. At LTT Sports, we don't just offer services; we craft legacies. We invite you to be part of this journey, to write your chapter in 2024 and further and as our 33 PitchSide Monitor showed, things are changing. With us, your club is not just playing the game; it's changing it.

Transform your club's future and be on the wave!

LTT Sports - Crafting Legacies in Football Club Management

Bye Bye 2023! As the calendar turns a new leaf partners and future partners, all of us at LTT Sports extend our warmest New Year greetings to each of you from our Geneva, Edinburgh, Barcelona, Poznan, New Delhi and Jeddah offices. To the clubs and leagues we have had the pleasure of working with, and to those aspiring to join our network in 2024, we wish you a year filled with success, growth, and unparalleled achievements on and off the pitch.

Reflecting on the past year, we are filled with gratitude for the trust and collaboration we've shared. Your dedication and passion for the game have been the driving force behind our mutual accomplishments. As your club management partner, we've seen firsthand the resilience, innovation, and teamwork that makes each of your club unique and powerful.

Looking ahead, 2024 holds a series of possibilities. For our existing partners, we eagerly anticipate building on the strong foundations we've set, exploring new frontiers, and achieving even greater heights together. For clubs and leagues considering partnership with us, we're excited about the prospect of supporting your journey, bringing our expertise in club management to help you realize your goals and navigate the dynamic landscape of sports.

As we step into 2024, At LTT Sports, we remain committed to delivering excellence, fostering sustainable growth and let's embrace the challenges and opportunities that lie ahead. Together, we can continue to shape the future of sports, uplift each other, and celebrate the victories that await us. Small to big projects we are here for you. Team 2023

Olivier Jarosz , Konstantin Kornakov , Konrad Go?dzior , Eric Abidal , Charlotte Kenny , Fathi Abou El Gadaiel , Adam Metelski , Anne-Marie Itoua , Jan Chlapowski , Sebastian Bedekier , Ajay Abraham , Massarrah Fetyani , Jacob Meltzer , Javier Alejandro Kuan Ayala , Daniel Chira , Nick Filipov , Dr. Slaven Marasovi?, EMBA , Yannick Avognon #IsabelaVernier

That brings us to the end of this week’s newsletter. We hope you found eye-opening insights from our content this week. Each week, we will be curating exclusive content for you from the club management ecosystem. So, stay tuned for more and don’t forget to subscribe to our newsletter here!

LTT Sports is an advisory firm focused on connecting football strategy and operations based on experience, analysis and a strong network. At LTT Sports, we have created a set of services for football organisations, providing transversal solutions at any level of the professional football pyramid – to boost performance off the pitch, directly impacting on-pitch results.

*** Disclaimer: LTT Sports is an independent think tank aimed to be a platform of discussion amongst football stakeholders. The answers received for our interviews are personal views of the interviewee and/ or the organisation he or she may represent and strictly do not represent our views on the subject matter.

Contributors to this week's newsletter: Olivier Jarosz, Konstantin Kornakov, Konrad Go?dzior

Special thanks for the Football Insights contribution from Edoardo Cavo

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