## Facts

- Olympique Lyonnais trained Olivier Bernard under a three-year *joueur espoir* (youth trainee) contract governed by the French “Charter for Elite Football,” a national collective agreement.
- At the end of the trainee period, Lyon offered Bernard a one-year professional contract; Bernard refused and signed a professional contract with Newcastle United FC in England.
- Under the Charter, a trainee who did not sign his first professional contract with the training club could be sued for damages.
- Lyon sued Bernard and Newcastle in France, seeking damages equal to the salary Bernard would have earned under Lyon’s offered one-year contract.
- The damages formula was not tied to the club’s actual training costs.
- The French Cour de cassation referred questions to the Court of Justice of the European Union concerning compatibility of the scheme with Article 39 EC (free movement of workers).

## Issues

1. Whether Article 39 EC applies to collectively agreed rules (a professional football charter) regulating employment relationships in professional sport.
2. Whether a rule requiring a trained player to sign his first professional contract with the training club under threat of damages constitutes a restriction on free movement of workers.
3. If it is a restriction, whether it can be justified by the objective of encouraging recruitment and training of young players, and whether a damages calculation unrelated to actual training costs is proportionate.

## Decision

- The Court held that Article 39 EC applies to rules, including collective agreements, that regulate gainful employment in a collective manner, and thus covers the Charter.
- The Court held the Charter’s damages mechanism restricted free movement because it was likely to discourage a player from signing with a club in another Member State.
- The Court recognized that encouraging recruitment and training of young players can be a legitimate objective capable of justifying a restriction in principle.
- The Court held the particular French scheme was disproportionate because damages were calculated in a way unrelated to actual training costs, and therefore Article 39 EC precluded such a scheme.
- The Court provided an interpretive ruling and left application and final disposition of the damages claim to the referring French court.

## Legal Principles

- EU free-movement rules apply to private or collective regulatory measures that collectively govern access to and conditions of employment, including professional sports rules with collective-agreement status.
- A measure constitutes a restriction on free movement if it is likely to deter or make less attractive the exercise of a worker’s right to move to another Member State, even without formally prohibiting movement.
- A restriction may be justified by a legitimate objective (including encouraging recruitment and training of young players) only if it is suitable to achieve that objective and does not exceed what is necessary.
- Training-compensation mechanisms are not excluded in principle, but any financial obligation imposed on a moving player must be proportionate and linked to actual training costs; lump-sum damages pegged to proposed salary rather than training costs are impermissible.

## Conclusion

The Court required that any training-compensation system affecting player mobility be justified by a legitimate training objective and satisfy proportionality by tying compensation to actual training costs, invalidating damages rules that effectively deter cross-border employment through cost-unrelated liability.


Olympique Lyonnais SASP v. Bernard, Case C-325/08 (C.J.E.U. 2010)