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International Dispute Resolution within FIBA [World Sports Update (Third Quarter 2014)]

Author: Claire Zovko, Esquire (Of-Counsel)

As the international governing body for the sport of basketball, Federation Internationale de Basketball (“FIBA”) is responsible for the integrity of basketball at the global level. FIBA is recognized by the International Olympic Committee as the sole competent authority in basketball. In May 2007, FIBA created its own dispute resolution mechanism designed for efficient and effective resolution of disputes related to basketball and its participants (i.e. clubs, players and agents).  Originally, named the FIBA Arbitral Tribunal (“FAT”), the FAT heard two cases in the inaugural year. To emphasize that this arbitral tribunal operates independently of FIBA, FAT was renamed the Basketball Arbitral Tribunal (“BAT”). Most disputes heard before the BAT relate to unpaid wages and commissions of players or agents. Almost seven years after creation, the BAT has heard around 400 cases.

The seat of the BAT is located in Geneva, Switzerland.  The only means of coming before the BAT is by voluntary agreement of the parties by means of the BAT Standard Arbitration Clause in a disputed contract. [See Note 1 at the end of the article.] Interestingly, a handful of BAT disputes involved a player and club having signed two contracts for the same period with the first contract having the BAT standard arbitration clause and the subsequent contract excluding the arbitration provision and referencing domestic law as the means of dispute resolution.  In these cases, the BAT frequently found in favor of the BAT Standard Arbitration Clause in the first contract and accepted jurisdiction to hear the dispute.

Disputes are “heard” by a single arbitrator with legal training and sports knowledge appointed by the BAT president.  The profiles of the BAT arbitrators can be found on the FIBA website.  [See Note 2 at the end of the article.]   A unique feature of the BAT is that the arbitration procedure is conducted in writing and 99 percent of cases are handled entirely through an online system.  In-person hearings can be held upon request, though they rarely are.  A BAT arbitral award is delivered within six weeks of the arbitral proceedings.  The disputes before the BAT are decided not on the basis of a national legal system, but on the principle of ex aequo et bono, which applies general considerations of justice and fairness without reference to any particular national or international law.  Further, BAT arbitrations are governed by Chapter 12 of the Swiss Act on Private International Law, irrespective of the parties’ domicile.

To file a claim before the BAT, one must follow the BAT procedural rules, including paying the requisite costs and submitting briefs in the proper manner.  A non-reimbursable handling fee is required to commence a BAT proceeding.  The handling fees start at €1,500 and increase up to €7,000, depending on the total sum in dispute.  Additionally, both parties must advance a percentage of the arbitration costs, and the specific amount is decided by the BAT Secretariat.  Disputes that come before the BAT are heard in English.  However, documents can be provided to the BAT in any other language as long as they are accompanied by a certified English translation.  One interesting aspect of a BAT filing is that parties may be assisted by legal counsel, or, by any other person of their choice.  It is not uncommon that a FIBA agent will file a BAT proceeding on behalf of a player the agent represents.

The BAT hearings are private although most BAT decisions are public and available to view on the FIBA website. [See Note 3 at the end of the article.]  At the conclusion of a BAT proceeding, the arbitrator will provide a written award with reasons.  However, when the amount in dispute does not exceed €30,000, the arbitrator will issue an award without reasons.  In the event that a BAT arbitration party fails to honor an award, sanctions can be imposed by FIBA.  A monetary fine of up to CHF 150,000 (approximately $167,000 USD) can be applied more than once to any party.  If the losing party is a club, FIBA can prohibit registration of new players and/or ban the club from participation in international competitions.  If the party is a player, FIBA can prevent the player from transferring to any other international team.  If the party against whom the decision is rendered is an agent, FIBA can withdraw the agent’s license.  As of July 10, 2014, there are forty-five clubs currently banned from the registration of new players, one club banned from participation in international competitions, and four players banned from international transfers.  For a list of the most up-to-date BAT sanctions enforced by FIBA, please refer to the FIBA Sanctions webpage. [See Note 4 at the end of the article.]

Note 1: The BAT Standard Arbitration Clause specifically states: “Any dispute arising from or related to the present contract shall be submitted to the Basketball Arbitral Tribunal (BAT) in Geneva, Switzerland and shall be resolved in accordance with the BAT Arbitration Rules by a single arbitrator appointed by the BAT President. The seat of the arbitration shall be Geneva, Switzerland. The arbitration shall be governed by Chapter 12 of the Swiss Act on Private International Law, irrespective of the parties' domicile. The language of the arbitration shall be English. The arbitrator shall decide the dispute ex aequo et bono.”

Note 2: http://www.fiba.com/downloads/v3_expe/bat/Composition_BAT_2011.PDF.

Note 3: http://www.fiba.com/pages/eng/fc/expe/fat/p/openNodeIDs/16810/selNodeID/16810/fat-awards.html.

Note 4: http://www.fiba.com/pages/eng/fc/expe/fat/p/openNodeIDs/19681/selNodeID/19681/sanctions.html.