The Court of Justice of the European Union has ruled that a no-poach agreement between Portuguese football clubs during the Covid-19 pandemic may, in certain circumstances, be compatible with EU competition law, depending on its justification and proportionality.
The case concerns an April 2020 agreement between clubs in Portugal’s top two football divisions, coordinated through the Portuguese Professional Football League, under which clubs agreed not to sign players who had unilaterally terminated their contracts because of the pandemic. The arrangement was adopted after Portuguese authorities suspended sporting competitions amid the Covid-19 outbreak.
In 2022, the Portuguese Competition Authority concluded that the agreement unlawfully restricted competition in the market for recruiting professional football players. The league and several clubs challenged that decision, leading a Portuguese court to seek guidance from the EU’s top court.
The Court said agreements of this kind can resemble “no-poach” arrangements and may amount to a restriction of competition by object because they limit a key competitive parameter in professional sport: clubs’ ability to recruit talent. Such restrictions can also affect the transfer value of players, who are effectively the clubs’ human resources.
However, the Court stopped short of declaring the agreement automatically unlawful. It stressed that the Portuguese court must assess the specific circumstances, including the exceptional context of the Covid-19 pandemic, before deciding whether the arrangement was sufficiently harmful to competition to breach EU law.
Importantly, the Court noted that while the agreement may have restricted recruitment, it also pursued a potentially pro-competitive objective by seeking to preserve squad stability and maintain the integrity of the football season if competitions resumed.
The judges added that ensuring the regularity of sporting competitions is a legitimate public-interest objective that can, in principle, justify certain restrictions in football. But any such restriction must still be proportionate, necessary, and no broader than required to achieve that aim.
The ruling does not decide whether the Portuguese clubs ultimately broke the law. Instead, it sends the matter back to the Portuguese court, which must now determine whether the pandemic-era agreement was justified under the specific facts of the case.
The judgment could have broader implications for how EU competition law applies to emergency coordination measures in sport and other sectors during periods of exceptional disruption.
