• LATEST NEWS & INSIGHTS 19 January 2024

    Posted on: 19/1/2024


     

     

    THE CJEU JUDGEMENT IN CASE C- 333/2021, EUROPEAN SUPERLEAGUE VS. UEFA AND FIFA.

     

    Most press reports claimed that the CJEU Superleague judgement represented an utter defeat for FIFA and UEFA. This article reconsiders such conclusions in the light of a more attentive exam of the grounds of the Judgment.

     

    On 21st December 2023, the Court of Justice of the European Union (“CJEU”) issued its very long-awaited judgement in case C-333/21. The Judgement was released following a request for a referral coming from the Commercial Court of Madrid, pursuant to article 267 of the TFUE. This provision sets out a system of cooperation between the Court of Justice and the national courts, according to which – to solve a pending dispute at national level – the CJEU provides the national Court an interpretation of the Treaty’s provisions the national Court needs.

     

    The questions concerned the compatibility of certain UEFA and FIFA statutory rules according to which the two sporting federations had reserved for themselves the right to approve any competing inter-club competitions which would take place in Europe. Such statutory rules provided for the imposition of severe sanctions vis-à-vis clubs and football players who would participate in any non-authorized competitions, i.e. a ban from all UEFA and FIFA tournaments as well as from the national tournaments organized by the national federations and leagues (such as Serie A, Bundesliga, La Liga, Premier League) who are in turn members of UEFA.

     

    As many would recall, on April 2021, on the basis of these statutory provisions, UEFA publicly refused to approve the Superleague: a project for a new international football competition to which a number of top ranked European clubs had adhered. As a consequence, many clubs, discouraged by the threatened sanctions as well as by the opposition to the Superleague project by national governments, withdrew from the Superleague, and the project was set aside. Nevertheless, ESLC, the company running the project, brought the case to the Commercial Court of Madrid claiming, on the basis of EU competition Law grounds, the illegality of said provisions and, more broadly, the illegal behaviour adopted by UEFA.

     

    The Spanish Court issued a prima facie order in favor of the Superleague and referred to the CJEU a number of questions which concerned the compatibility, with Articles 101 and 102 TFUE, of the FIFA and UEFA statutory rules on prior approval of competing tournaments.

     

    In its judgment, the Great Chamber of the CJEU, in partial disagreement with the conclusions of the Advocate General Athanasios Rantos, delivered 15th December 2022, declared that UEFA and FIFA statutory provisions on prior approval, as they stood, contravened the EU antitrust rules on abuse of dominant position (Article 102 TFEU) and constituted a “decision of an association of undertakings” which was anticompetitive by object, thus contrary to Article 101 TFUE.

     

    It is here submitted that the judgement is very articulated and complex and – according to the author – must be considered in its entirety in order to draw some conclusions on its possible implications.

     

    The CJEU remarked that FIFA and UEFA, are responsible for football at world and European levels and, at the same time, pursue various economic activities related to the organisation of competitions. The statutory rules in issue subject to the approval of FIFA and UEFA the setting up, on the EU territory, of new interclub competitions. However, the CJEU noted that such rules were adopted “in the absence of a framework of rules providing for substantive criteria and detailed procedural rules which were transparent, objective precise, non- discriminatory and proportionate”. Lacking such a framework, it is impossible to verify, on a case-by-case basis, “whether their implementation is justified and proportionate in view of the specific characteristics of the international interclub project concerned”. As a matter of fact, UEFA and FIFA enjoyed a total discretion in controlling and denying access to the market to any third party, making thus impossible for any potential competitor to set up viably an ecosystem outside their organisation. The CJEU, therefore, considered that UEFA and FIFA had abused their dominant position on the market for the organisation of interclub competitions in Europe, and had put in place a restriction on competition by object, infringing both Articles 102 and 101 TFUE.

     

    At the same time, the Court made it clear that the mere presence of a set of provisions regulating prior approval of competing competitions is not, as such, contrary to the antitrust provisions and that neither their adoption nor their implementation can be characterized, in terms of principle, as an abuse of dominant position. The same is true for sanctions which guarantee the effectiveness of those rules.

     

    In its decision, the CJEU made express reference to the specific characteristics of football, to its social and cultural importance in the European Union, and to the great media interest originated from it. Football is in fact organized at European and national level through competitions to which many clubs and football players participate and which are based on matches between teams with gradual elimination of those teams, according to the criterion of merit. The sporting merits on which competitions are based can be in turn guaranteed only if “all the participating teams face each other in homogeneous regulatory and technical conditions thereby ensuring a certain level of equal opportunity”.

     

    The CJEU expressly recognizes in the Superleague judgment that it is legitimate for UEFA to subject the organisation and the conduct of international professional football competitions to common rules intended to guarantee the homogeneity and coordination of those competitions within an overall match calendar and to ensure compliance with those common rules through rules set forth by FIFA and UEFA on prior approval of those competitions and the participation of clubs and players therein (see para 144 of the Judgement).

     

    In this respect, it must be recalled, as indicated by the Advocate General in its conclusions, that the Superleague relied on a model of governance that did not contemplate sporting merits but was based on the predetermined participation of a number of clubs who would pay an entrance fee, in accordance with a “North American” system of closed competitions or leagues. The Advocate General had also noted that the founders of the Superleague intended to set up a competitor tournament in the most lucrative segment of the market, that of the well- established UEFA Champions League, and continue to be part of the UEFA ecosystem by participating to some UEFA competitions, including the national championships. In other words, they wanted “on the one hand to benefit from the rights and advantages linked to membership of UEFA, without however being bound by UEFA’s rules and obligations”. Such a system of free riding or dual membership could affect and weaken the UEFA economic model based on solidarity, and ultimately the enforcement of the values of the European model of sport in the organisation of football in Europe.

     

    Based on this synthetic analysis, it can be concluded that UEFA and FIFA may still legitimately perform their role as regulator of European football and take those action – within the limits of EU Law – aimed at pursuing the objectives and values enshrined in the so-called European sports model set out in Article 165 TFUE. In particular, they shall “promote in a suitable and effective manner the holding of sporting competitions based on equal opportunities and on merit”. The two organisations could, also, take appropriate regulatory measures – including rules on the pre-approval of competitions – in order to protect such values if there is a risk that the European model is threatened or weakened.

     

    The Judgement, however, clarifies that the two organisations governing football at worldwide and European level shall not enjoy unlimited discretionary power in the exercise of their regulatory power and, in particular may not deny market access to competitors in the absence of objective grounds. UEFA and FIFA will be bound to create a framework of transparent and pre-defined rules, consistently with the principles of transparency, non-discrimination and proportionality, which must govern any economic activity in the EU including professional sport.

     

    Indeed, UEFA has recently updated their rules on the pre-authorisation of new tournaments, although such rules have not been implemented in a “real case” so far.

     

     

    s.lamarca@macchi-gangemi.com

     

     

     

    “THE YEAR TO COME”: THE PROPOSED CORPORATE SUSTAINABILITY DUE DILIGENCE DIRECTIVE (CSDD), A “COPERNICAN REVOLUTION” IN CORPORATE GOVERNANCE.

     

    On 14 December 2023, the Council and the European Parliament reached a provisional agreement on the directive on companies’ due diligence obligations for sustainability of their activities. The obligations are a result of the negative impact (effective and potential) of business activities on the environment and human rights. Pending final approval, can companies start preparing?

     

    On 23 February 2022, the Commission submitted a proposal to the European Parliament and the Council for a directive on companies’ obligations for the sustainability of their activities. Almost two years later, on 14 December 2023, Parliament and Council reached a provisional agreement on the text. If, as seems likely, this text will be approved and formally adopted, the directive will require companies to responsibly manage the human rights and environmental consequences originating from the activities of companies, their subsidiaries and, more generally, their partners and those in their supply chains.

     

    In fact, one of the main objectives of the proposed directive is “to address the concerns of consumers who do not want to buy products made with the use of forced labor or that destroy the environment” (Věra Jourová, Vice-President of the European Commission).

     

    The proposed CSDD requires companies, in compliance with the duty of company due diligence imposed therein (see Art. 4), to:

     

    (i) identify the negative impacts (actual and potential) of their business activities on human rights and the environment (see Art. 6);

     

    (ii) adapt business strategies to prevent, eliminate or mitigate possible negative impacts (see Art. 7);

     

    (iii) minimize or, where possible, cease business activities that have adverse impacts (see Art. 8);

     

    (iv) establish a non-judicial notification and grievance mechanism (see Art. 9). More specifically, member states will have to ensure that each company is equipped with a sort of in-house complaints desk;

     

    (v) monitor and review the effectiveness of measures taken to fulfil their obligations under the Directive (see Art. 10);

     

    (vi) disclose to the public, information on their due diligence activities and consult affected stakeholders throughout the proceedings (see Art. 11).

     

    (vii) adopt business models compatible with the goal of limiting global warming to 1.5 °C (see Art. 15), in line with the provisions of the Paris Agreement on Climate Change.

     

    To make these obligations effective, the draft directive provides for individual member states to identify both the applicable sanctions in the event of violation of the national provisions to be adopted in implementation of the directive, and the authority responsible for ensuring the effective implementation of the provisions in question (see Art. 18).

     

    The proposal also provides for a civil liability regime for the companies covered by the rules. Member States will have to ensure that injured parties can obtain compensation for any damage caused by a failure to comply with the above-mentioned due diligence obligations (see Art. 8(3)(a)).

     

    For the purpose of intercepting possible circumvention phenomena in supply chains characterized by chains of contractors, the proposal for a directive also pays particular attention to the relationship between purchasing companies and business partners.

     

    Indeed, under the CSDD, companies will have to integrate the aforementioned sustainability obligations in all their company policies and at all operational levels, and to this end draw up a code of conduct, compliance with which will also have to extend to existing business relationships. In other words, the code of conduct will have to be applied to all relevant corporate functions and activities, including, therefore, procurement decisions (see Recital 28). In particular, the contractor will be required to comply with the contracting company’s code of conduct and, if necessary, to have an operational plan in place to prevent possible breaches thereof. That is not all: the contractor may in turn be required to impose equivalent guarantees on its business partners to the extent that the latter’s activities are part of the value chain of the ordering company (so-called contractual cascade system, see Art. 7, paragraph 2, letter b).

     

    In the event of breach of the obligations referred to above, the draft directive provides for suspension or, in the most serious cases, termination of the relationship (see Art. 7(5)). It should be specified that, where the compliance verification measures are implemented with respect to an SME, the costs of the independent third-party verification will be borne by the contracting company (falling within the scope of the CSDD).

     

    In particular, the scope of the proposed directive includes large companies. Three years after its entry into force, the directive will also apply to third-country companies with a net turnover above certain thresholds generated in the EU. However, even smaller companies, apparently not affected by the directive directly, could v be involved in the above procedures where they are part of the supply chain of larger client companies or suppliers.

     

    In conclusion, pending the final approval of the proposed CSDD, companies can start preparing themselves by implementing certain actions. These include, for instance, risk mapping, tracing the supply chain in which they participate, identifying their direct and indirect business partners and, finally, identifying any new current or potential risks to the environment and/or human rights.

     

    Starting from this information, companies could, already at this stage, identify gaps and assess possible changes to be implemented in their organizational structures. In this way, companies could reduce the complexity of compliance when it will be actually required.

     

     

    s.dellatti@macchi-gangemi.com
    m.furio@macchi-gangemi.com

     

     

     

    THE DELICATE DANCE BETWEEN ARTIFICIAL INTELLIGENCE AND PRIVACY: ITALIAN DPA’s INVESTIGATION INTO WEBSCRAPING

     

    The Privacy Authority launches an investigation of websites on protection from the so called webscraping: the technique of automatically extracting data from web pages. All websites will be subjected to the authority’s scrutiny.

     

    In the ever-evolving world of artificial intelligence (AI), the Data Protection Authority is working to preserve the sensitivity of personal information in an increasingly complex digital environment. A recent development led the Authority to launch an in-depth investigation into the practice of webscraping, focusing on the massive collection of personal data online for the training of AI algorithms by third parties.

     

    But what is webscraping? Webscraping is a technique of automatically extracting data from web pages. In other words, it consists of using scripts or software to analyze the HTML code of a page and extract specific information, such as text, images, or links. This process can be used to collect data from websites in an efficient and automated way. However, it is critical to comply with data use policies and privacy regulations when webscraping, as these activities can raise ethical and legal issues regarding unauthorized collection of information.

     

    The fact-finding investigation initiated by the Data Protection Authority aims to assess the effectiveness of security measures taken by public and private websites to prevent webscraping of personal data. The focus is on entities operating in Italy or offering services in the Italian territory, paying particular attention to those providing freely accessible data, including those captured by the “spiders” of AI algorithm producers.

     

    The current context sees numerous AI platforms engaged in the massive collection of data through webscraping. These platforms, for a variety of purposes, capture huge amounts of personal data available on websites operated by public and private entities. The information, originally published for specific purposes such as news reporting or administrative transparency, becomes the object of interest for algorithm training.

     

    The Data Protection Authority invites trade associations, consumers, experts, and academic representatives to share their comments and input on the security measures taken and potentially adoptable to counter the massive collection of personal data through webscraping. Opinions can be sent to webscraping@gpdp.it within 60 days of the publication of the consultation notice on the Authority’s website.

     

    The Authority’s survey highlights the importance of implementing adequate security measures to protect personal data. Possible countermeasures include the use of advanced encryption techniques, strengthening firewalls and promoting more stringent security standards for sites handling sensitive data.

     

    In conclusion, the Authority’s investigation is a significant step toward balancing innovation in AI with safeguarding individual privacy. Cooperation among authorities, industry, and academics is essential to establish standards and protocols that ensure a harmonious coexistence between the growing power of AI and respect for privacy. The Authority, following the investigation, stands ready to take the necessary measures, including emergency action, to ensure the protection of personal data in an increasingly interconnected world.

     

     

    f.montanari@macchi-gangemi.com
    l.caprio@macchi-gangemi.com

     

     

     

    IL DECRETO IN MATERIA DI FISCALITÀ INTERNAZIONALE MODIFICA LA DISCIPLINA CFC E INTRODUCE UN REGIME OPZIONALE DI IMPOSIZIONE SOSTITUTIVA AL 15%.

     

    Con il Decreto Legislativo n. 209 del 27 dicembre 2023, il Governo italiano ha finalmente apportato delle modifiche alla disciplina sulle c.d. Controlled Foreign Companies con riferimento al calcolo del livello di imposizione effettiva estero, coordinandola con le nuove disposizioni in tema di Pillar Two e Global Minimum Tax.

     

    La disciplina Controlled Foreign Companies (“CFC”) di cui all’art. 167 del d.P.R. n. 917/1986 (TUIR) era stata inizialmente concepita con la ratio di rendere imponibili in capo alla società controllante italiana gli utili delle società controllate estere che congiuntamente:

     

    (i) erano localizzate in uno Stato a tassazione effettiva (“ETR”) inferiore al 50% di quella italiana (ovvero, un Paese a fiscalità privilegiata);

     

    (ii) erano titolari di almeno 1/3 dei proventi come passive income (interesse, canoni, redditi da attività finanziarie, etc.); e

     

    (iii) non esercitavano un’attività economica effettiva.

     

    Il regime CFC è stato recentemente emendato dal nostro legislatore per essere allineato con la Direttiva UE n. 2022/2353, che ha recepito a livello europeo la Global Minimum Tax introdotta a livello OCSE nell’ambito del c.d. “Pillar 2”.

     

    In tal senso, l’art. 3 del DLgs. n. 209/2023 (“Decreto in materia di Fiscalità Internazionale”) ha introdotto, a partire dal 1° gennaio 2024, significative modifiche all’attuale disciplina ed in particolar modo con riferimento alla definizione di Paesi a fiscalità privilegiata.

     

    Novità: la norma considera oggi residenti in un Paese a fiscalità privilegiata le controllate estere assoggettate ad un ETR inferiore al 15%, sulla base del rapporto tra:

     

    (i) la somma delle imposte correnti, anticipate e differite iscritte nel bilancio d’esercizio della controllata;

     

    (ii) l’utile ante imposte del bilancio.

     

    Vi sarà, dunque, una semplificazione dell’ETR, il cui calcolo viene forfettizzato.

     

    Inoltre: viene previsto un regime opzionale mediante il quale la capogruppo italiana di una multinazionale può optare per un’imposta sostitutiva del 15% al fine di disapplicare il regime CFC.

     

    L’opzione esercitata dalla società madre italiana rimane obbligatoria per un periodo di tre esercizi e coinvolge tutte le controllate con più di un terzo di passive income. Inoltre, se non esplicitamente revocata, l’opzione si rinnoverà automaticamente.

     

    Il bilancio della controllata estera deve, per espressa disposizione di legge, essere sottoposto a revisione contabile e certificato da professionisti abilitati nello Stato estero di ubicazione delle entità controllate non residenti.

     

     

    a.salvatore@macchi-gangemi.com
    f.dicesare@macchi-gangemi.com
    d.michalopoulos@macchi-gangemi.com

     

     

     

    ITALIAN AND FOREIGN COMPANIES WITH A PERMANENT ESTABLISHMENT IN ITALY ARE OBLIGED TO INSURE THEMSELVES AGAINST DAMAGE CAUSED ON ITALIAN TERRITORY BY NATURAL DISASTERS AND CATASTROPHIC EVENTS.

     

    Insurance policies must be executed by December 31, 2024, and events to be insured include earthquakes, floods, landslides, floods, and overflows. This regulation applies to companies that indicate in their balance sheet real estate (land and buildings), plant and machinery, industrial and commercial equipment on the Italian territory (assets and goods that shall be covered by the insurance) and does not apply to farms.

     

    With Law no. 213 of 30 December 2023, companies with a registered office in Italy or abroad but with a permanent establishment (branches) in Italy compelled to register in the Register of Enterprises, are required to stipulate – by 31 December 2024 – insurance contracts to cover damage to real estate (land and buildings), plant and machinery, industrial and commercial equipment (the obligation is triggered for companies that indicate the assets in their balance sheet pursuant to art. 2424 of the Italian Civil Code, paragraph 1, Assets section, item B-II, 1), 2) and 3) directly caused by natural disasters and catastrophic events occurring on the national territory which include earthquakes, floods, landslides, and overflows.

     

    Such obligation does not apply to companies carrying out agricultural activities (farms) pursuant to Art. 2135 of the Italian Civil Code and for which the provisions of the National Mutual Fund continue to apply for the coverage of catastrophic weather and climate damage to agricultural production caused by flood, ice or frost and drought, managed by ISMEA – Institute of Services for the Agricultural and Food Market.

     

    This obligation is also relevant for the purposes of the allocation of contributions, subsidies or facilities of a financial nature from public resources, also with reference to those provided for in the event of natural disasters and catastrophes (Article 1, paragraph 102 provides, in fact, that the fulfillment must be taken into account during their allocation).

     

    Insurers can decide to take on the entire risk directly, or to assume it in co-insurance form, either in consortium form through a number of insurers (provided that the consortium is registered and approved, in terms of stability, by IVASS – the Institute for the Supervision of Insurances. In any case, any overdraft or deductible may not exceed 15 per cent of the damage and must provide for the application of premiums proportional to the risk (Article 1, paragraphs 103 and 104).

     

    By means of a decree, the MEF (Ministry of Economy and Finance) and MIMI (Ministry of Enterprise and Made in Italy), may establish further implementation and operational methods, insurance schemes, methods for the identification of calamitous events and catastrophes that are susceptible to compensation, as well as to determine and periodically adjust premiums. They will also take into account the principle of mutuality and, having consulted IVASS, the methods of coordination with respect to the current acts of regulation and prudential supervision in the field of insurance, also with reference to the limits of risk-taking capacity of companies or the consortium , as well as updating the values of the overdraft/deductible.

     

    The obligation to insure does not apply to companies whose immovable property is encumbered by building abuse or built without the required permits, or encumbered by abuse arising after the date of construction.

     

    Refusal or circumvention of the obligation to contract by insurers, even at the time of renewal, is punished with an administrative fine ranging from € 100,000 to € 500,000 imposed by Ivass.

     

    Finally, the law provides that SACE S.p.A. – an insurance and financial company controlled by the MEF – is authorised to grant private market insurers and reinsurers, at market conditions, by means of a special agreement approved by the MEF and MIMI with the aforementioned decree, coverage of up to 50 per cent of the indemnities to which they are required in the event of the occurrence of the damage events deducted in the contract (up to a limit of €5 billion per year, in 2024, 2025 and 2026) with a State guarantee on first demand and without recourse. The State guarantee is explicit, unconditional and irrevocable.

     

     

    e.pucci@macchi-gangemi.com

     

     

     

    THE CONSTITUTIONAL COURT BROADENS THE APPLICATION OF THE PREVENTIVE COURT-APPOINTED TECHNICAL CONSULTANCY.

     

    Preventive Court-appointed technical consultancy, provided for in article 696-bis of the Code of Civil Procedure, is a simplified procedure designed to facilitate settlement agreements between the parties, at a stage preceding the contentious phase of ordinary proceedings, in cases where the dispute has technical aspects which must be clarified by an impartial expert in a contradictory procedure between the parties. More specifically, the procedure provides for the appointment of a technical expert by the competent Court to whom the Judge submits the appropriate questions to clarify the matter in dispute.

     

    This procedure is an effective instrument of procedural deflation, as it allows the parties to obtain technical advice characterised by objectivity and the status of a third party, without having to go through a full proceeding on the merits. The findings of the court-appointed technical consultancy are obviously a solid basis for an amicable agreement. If this fails and then the proceedings on the merits are initiated, they will be based on an already acquired basis, such as the report filed by the court-appointed expert.

     

    Now, the provision of article 696-bis of the Code of Civil Procedure provides that a preventive court-appointed technical consultancy may be requested “for the purpose of ascertaining and determining claims arising from the non-performance of contractual obligations or from a tort”.

     

    However, this provision must be read in coordination with art. 1173 of the Civil Code, according to which the sources of obligations are: (i) contracts, (ii) torts and (iii) “any other act or fact capable of giving rise to them under the law”. In this context, the question has been raised as to why art. 696-bis of the Civil Code on preventive court-appointed technical consultancy considers only obligations arising from contracts and tort but not those arising from other acts or facts capable of giving rise to them, as provided for in art. 1173 of the Civil Code. And whether this unequal treatment is compatible with constitutional principles and, in particular, with article 3 of the Constitution (principle of equality) and article 24 of the Constitution (right of defence).

     

    The Constitutional Court has now ruled on this point, with the very recent judgement No. 222 of 21 December 2023, published in the Official Gazette on December 27, 2023, which declared the unconstitutionality of article 696-bis, paragraph 1, first period of the Code of Civil Procedure, in the part in which it does not provide for its performance for the purposes of the assessment and determination of claims arising also “from any other act or fact capable of producing them in accordance with the legal system”. The Court pointed out that “by authorising preventive court-appointed technical consultancy only for claims arising from the non-performance or improper performance of contractual obligations or from a tort, and not also for all claims arising from any other act or fact capable of giving rise to them in accordance with the legal system, as indicated in article 1173 of the Civil Code, the provision censured leads to a differentiation without a reasonable justification and to a breach, to the detriment of the holders of excluded claims, of the guarantee provided for in article 24 of the Constitution, which is not precluded by the wide discretion of the legislature in matters of procedure, which has also been confirmed by this Court on several occasions”.

     

    In other words, the Court broadened the scope of application of the preventive court-appointed technical consultancy, since a limitation of the objective scope of its operation only to disputes relating to claims arising from contract or tort would generate, firstly, an unreasonable differentiation and unequal treatment between the holders of substantive positions of equal nature (art. 3 Const.) and, secondly, a violation of the right to defence (art. 24 Const.) to the detriment of the holders of credit rights arising from other sources provided for by the system. As the Court underlined, the latter would otherwise , “remain deprived of an alternative instrument to the ordinary judicial protection as well as possibly preordained to it”.

     

    The judgement at stake is certainly to be welcomed, with a view – increasingly felt – to providing valid, rapid and effective tools as an alternative to recourse to the proceeding on the merits.

     

     

    a.gangemi@macchi-gangemi.com
    c.gentile@macchi-gangemi.com

     

     

    DISCLAIMER: This newsletter merely provides general information and does not constitute legal advice of any kind from Macchi di Cellere Gangemi. The newsletter does not replace individual legal consultation. Macchi di Cellere Gangemi assumes no liability whatsoever for the content and correctness of the newsletter.

     

     

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