France.

• Author: Verheyden, Delphine

1 Introduction

Sports agents continue to hit the headlines. Whether in the role of agent, manager, intermediary or negotiator, they appear to be an increasingly indispensable accompaniment to the negotiation of sports contracts. Intervening with players, clubs and sometimes coaches as well, the agents, even when they are not being accused of rigging the market or receiving commissions from all sides, are invariably suspected of making easy money.

French sport is growing ever more professional and professional leagues are now responsible for organising championships in disciplines such as football, rugby, handball, volleyball and basketball. It is against this background that the profession of sports agent in France has been made subject to precise regulation since Law No. 2000-627 of 6 July 2000. Though it was argued at the time that it would be impossible to bring in such a law as the problems are different from one discipline to another, the regulations are gradually being applied by the French sports federations.

2 Emergence of the applicable regulations

It was with the designation "sports intermediary" that the profession of sports agent was regulated in France for the first time. Article 15-2, concerning sports intermediaries, was added to Law No. 84-610 of 16 July 1984 by Law No. 92-652 of 13 July 1992:

"No natural person or legal entity may carry on the activity consisting in bringing together, whether occasionally or regularly, for valuable consideration, parties interested in concluding a contract whereby one or more sportsmen agree, for valuable consideration, to take part in one or more sports events, unless such person or entity has first been declared to the administrative authority." (1)

With this text, the legislator sought not only to establish ethical standards in the profession but also to derogate from the ordinary law texts under which placement activity was a state monopoly run by the Agence Nationale Pour 1$$Emploi (ANPE).

Though this system proved relatively ineffective because the controls and requirements were insufficient to put the profession on a solid basis, it represented, nonetheless, a first step.

Meanwhile, certain sports disciplines were introducing their own regulations to govern the activity of agent. For example, the FIFA regulations of 11 December 1995, applicable with effect from 1 January 1996, made it compulsory for players' agents to hold an agent's licence, which was awarded only after an examination to check the technical competence of candidates. In addition, agents were required to satisfy ethical conditions and to satisfy the financial guarantees laid down in the FIFA regulations.

In view of the inadequacy of the system established by the law of 1992 and faced with the growing number of transactions and the amounts at stake, the French legislator intervened again on 6 July 2000 (2) to amend Article 15-2 and thus set in place the arrangements which remain applicable to this day. However, the questions raised by the new legal text resulted in the drawing up of an inquiry report (3), which should be followed during the course of 2006 by a partial amendment of the texts presently applicable.

3 What is a sports agent?

French law currently defines the position of the sports agent as follows:

"Any person carrying on, occasionally or regularly, for valuable consideration, the activity of bringing together parties interested in the conclusion of a contract relating to the carrying on of a remunerated sports activity must hold a sports agent licence." (4)

We see that, between 1992 and 2000, there has been a change in the way the profession is defined. Instead of "sportsmen" and "sporting events", we now have "a contract relating to the remunerated carrying on of a sports activity". So, what exactly does this new definition cover?

3.1 "Any person carrying on": The licence is compulsory not only for a professional agent, but also for a father or brother who might act as agent for a sportsman. There is no exception to the obligation to hold a licence on the basis of the capacity of the person concerned.

What is the situation with regard to lawyers? Is it possible for them to act as a sports agent and, at the same, remain in the legal profession? The main task of a lawyer is to give legal advice, to draw up documents and to represent clients before the courts. Though the courts have held that, in addition to these functions, he can also conduct negotiationsi, this does not in any way mean that he can act as a broker, bringing people together with a view to concluding a contract.

It must be recalled that Article 115 of Decree No. 91-1197 of 27 November 1991 regulating the legal profession provides that, subject to any special provisions of the laws or regulations, the profession of lawyer is incompatible with the exercise of any other profession. No such legislative or regulatory provisions exist for sports agents.

Furthermore, Article 111 of the same decree provides that the profession of lawyer is not compatible with any activity of a commercial nature, whether carried on directly or through intermediaries, or with the functions of an active partner in a simple partnership or partnership limited by shares, or of a manager of a limited liability company, or of a chairman of the board of directors or member of the management board or general manager of a company limited by shares or the manager of a civil company, save where their corporate purpose is the management of family or professional interests, subject to the control of the bar association, which may demand any additional information necessary.

In this context, the profession of sports agent would appear to be of a commercial character, preventing a lawyer from adding it to his functions. The fact is that the profession of sports agent is very close to that of artists agent, a profession which the legislator has expressly stated to be of a commercial character within the meaning of the provisions of the Commercial Code (Article L.762-4 of the Employment Code). Accordingly, it is difficult to see how the two activities could be combined. Only in the case of football could there be a certain ambiguity, as the FIFA regulations provide that an agent's licence is not necessary for a lawyer.

However, in such an eventuality, the French lawyer would intervene in the capacity of lawyer and not in the capacity of agent. In other words, though he could take part, where applicable, in drawing up a contract, his code of professional ethics would prevent him from "bringing together parties interested in the conclusion of a contract relating to carrying on a remunerated sports activity" (Article 15-2 of Law No. 84-610, as amended). He could not be mandated by a club, a coach or a player to find another club, coach or player corresponding to an expressed wish. This example applies not only to football, but also to all other disciplines.

From the foregoing, it is clear that the issue of a licence by a French federation to a French lawyer wishing to carry on the activity of sports agent would be contrary to the fundamental principles of the legal profession.

3.2 "occasionally or regularly": The frequency of the interventions is not a criterion. Even a single intervention brings the activity under the regulations.

3.3 "for valuable consideration": Only agents who wish to be paid for their intervention require a licence.

3.4 "bringing together interested parties: The wording of the law of 1992 specified that the parties were sportsmen on the one hand and sporting events on the other. The new law does not specify the capacity of the parties. Is the agent the person who intervenes for the player, the club, the coach?

The answer to this question is to be found in the regulations of each sports federation. For example, the regulations of the French Rugby Federation provide that any person mandated by a player, a coach or a club must hold a licence.

3.5 "contract relating to the remunerated exercise of a sports activity": What are the contracts referred to by the law? Are they contracts between player and club, between player and sponsor, between club and coach? The contracts concerned are employment contracts concluded between professional sportsmen and their club. This excludes contracts under which a sportsman exploits only his image and which have no connection with his sporting activity.

Looking further, each federation must determine case by case whether or not the activity submitted to its scrutiny comes under the regulations. Take, for example, arranging for the registration of an athlete at a meeting, managing a professional project for a skipper, organising a boxing match. Should these be deemed interventions to permit the conclusion of contracts relating to carrying on a remunerated sporting activity?

The answer to this question becomes all the more complicated when we take into consideration the obligation that the law imposes on the federations to organise an examination permitting the issue of a licence when they receive an application to this end. Who is responsible at this point for checking whether the application is well founded? This is just one of the questions now being debated.

4 Regulations have been established in France to govern the activity of sports agent. Who do these regulations apply to?

4.1 It is perfectly clear that the French legal requirements apply to situations in which the parties to the contract are French nationals and the contract concluded will permit the sporting activity to be carried on in France. On the other hand, what is the situation where some or all of the elements of the transaction are connected with foreign jurisdictions?

4.2 In the case of an agent who is an EU national, but not French, two principles have been laid down in the legal texts. These principles ensure compliance with the twin constraints of freedom of services and freedom of establishment.

On the one hand, "the...