The economic sustainability and good governance of sport are also ensured through the publication of rules and regulations to discipline transparently sports clubs' management and the election processes of the Italian federations' Presidents.
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In order to promote and guarantee the economic sustainability of the sports sector in Italy and the creation of a stable and transparent governance, also in view of the elections of the Presidents of the 45 national sports federations recognised by CONI (hereinafter, the “Federations”), some relevant and urgent provisions on sports were published on 31 May as part of the Decree Law no. 71/2024 (hereinafter, the “Decree”).
In particular, in the sports regulatory framework, the Decree provided for: (i) urgent provisions for the functioning of sports bodies; (ii) the introduction of an independent Commission to verify the economic and financial equilibrium of professional sports clubs; (iii) urgent measures concerning sports work; and (iv) urgent provisions for the organization of national and international sports events.
In addition to all of the above, the Decree extends by one year - from 1 July 2024 to 1 July 2025 - the deadline for professional sports clubs to provide for the establishment of the advisory body referred to in Article 13(7) of Legislative Decree no. 36/2021 (hereinafter, the “Sport Reform”), which will provide, with mandatory but non-binding opinions, for the protection of fans.
For the purposes of this article, it is intended to provide an overview of the provisions concerning the first three issues of the above list.
Sport governance
Sport governance refers to the overall functioning and direction of the sporting organisation and is a necessary and institutionalised component within all sporting actors, from clubs to national bodies.
The concept of “good sports governance” is also often referred to. The latter expresses a shared responsibility upon the different actors within the sport ecosystem (the so-called ‘stakeholders') and is the result of their actions and choices.
The concept of good governance also includes the responsibility of sports organisations to guarantee the role and rights of their stakeholders, through the definition of principles of transparency and openness. A system of good governance is such if it allows for the multiplicity of interests that converge in an organisation to be considered an ordered and organised set of accountability mechanisms that allow for an increased level of legitimacy.
In this logic, good sports governance is not only limited to sound economic and financial management, but it also depends on a regulatory framework that is clear, transparent and precise with reference to the modalities and procedures governing the top positions of the main sports organisations.
Provisions on the functioning of the sports bodies in view of the federal elections
The presidential offices of the Federations have a duration of four years following the four Olympic years. This means that elections for federal presidents will be held after the Paris 2024 Olympic Games.
Federal Election Regulations
Federations are governed by statutory and regulatory rules on the basis of the principle of internal democracy, as well as the principle of participation in sporting activity by everyone on equal terms and in harmony with the national and international sporting order.
The procedures for the elections of the president and the members of the governing bodies are governed by Legislative Decree no. 242/1999 and, in particular, by Article 16, entitled “Statutes of national sports federations and associated sports disciplines.”
This rule has been the subject of several regulatory interventions. First in 2018, with Law no. 8/2018, which repealed the impossibility for those who had held the office of President for two consecutive terms of office to be immediately re-eligible for the same office - making the possibility of a third consecutive term of office if one of the two previous terms of office had lasted less than two years and one day, for reasons other than voluntary resignation.
Lastly, Law Decree 75/2023, converted with amendments by Law 112/2023, amended Article 16, Section 2, of Legislative Decree no. 242/1999, eliminating the prohibition on holding more than three mandates.
The text of Article 16, Section 2, before the Decree's intervention, was thus as follows: ‘The statutes of the national sports federations and associated sports disciplines provide for the procedures for electing the president and the members of the governing bodies, promoting equal opportunities between women and men. The president and the members of the governing bodies remain in office for four years and may serve more than one term. The persons referred to in the second sentence, in the event of their candidature after the third consecutive term of office, shall be elected on condition that they obtain a number of votes equal to at least two thirds of the total number of validly cast votes. [...]'.
The correct interpretation of the rule
It should be pointed out that the rule, both before and after the publication of Law Decree 75/2023, had been the subject of extensive debate both before the CONI Sports Guarantee Board and before the Constitutional Court.
In fact, with reference to the assessment of the duration of terms of office for the purposes of the correct interpretation of the normative reference, in Opinion No. 6 of 2018, the CONI Sports Guarantee Board had ruled on a case in which it had been requested to specify whether the limit to terms of office only applied to those ‘whole' terms of office, or whether appointments during terms of office should also be considered for the purposes of the calculation. The Constitutional Court had specified that ‘mandates that have lasted less than four Olympic years must be considered for the purposes of calculating the attainment of the three-year threshold'.
On the other hand, the Constitutional Court, in its ruling 184 of 2023, ruled on the regulatory provision by declaring the constitutional illegitimacy of Article 16, Section 2, last sentence, of Legislative Decree no. 242/1999, with reference to the clause “as well as to the presidents and members of the governing bodies of the territorial structures of the national sports federations and associated sports disciplines” in the part in which it extended to the territorial bodies the prohibition set forth in Article 16, Section 2, second sentence, of Legislative Decree no. 242 of 1999, in the text in force prior to the amendments provided by Article 39-bis of Law Decree no. 75/2023.
The changes introduced by the Decree
The Decree intervened on the text of Legislative Decree no. 242/1999 and Legislative Decree no. 43/2017 - concerning the reorganisation of public administrations, concerning the Italian Paralympic Committee - providing some important integrations and specifications especially on the subject of electoral procedures and re-elections.
Firstly, the Decree took up the regulatory provision introduced with Decree Law no. 75/2023, providing that: “Presidents, in the event of candidacy subsequent to their third consecutive term of office, shall be elected on condition that they obtain on the first ballot a number of votes equal to at least two-thirds of the total number of votes validly cast', supplementing the rule with the precision that “in the event of non-election, they shall not be eligible to stand for the subsequent ballots for the same term of office.”
On the subject of multiple candidacies, the legislature provides that “In the case of multiple candidacies, no ballot shall be held between the other candidates and new elected assemblies shall be held for members of the governing bodies as well.”
The consecutiveness of mandates
Furthermore, the legislator - acknowledging the doubts that have arisen in practice in relation to the correct counting of the number of mandates required to trigger the so-called qualified majority - has specified that: “The term of office which has lasted more than two years and one day as well as the term of office of a shorter duration in the event of termination due to voluntary resignation or receivership shall be considered as completed and relevant for the purposes of the calculation. A term of office of less than two years and one day, terminated due to voluntary resignation or receivership, does not interrupt the consecutiveness of the terms of office of the President who served the previous term. In any case, in case of subjection to external administration (in Italian “commissariamento”) the consecutiveness of terms of office is not interrupted.”
Which means that, for example, in the event that between several terms of office of the same President there is a commissionership, the consecutiveness of those terms of office, for the purposes of assessing the majority required for his election, shall not be considered interrupted.
Finally, still on the subject of elections, the Decree specifies that the aforementioned rules also apply to the Paralympic Sports Promotion Bodies as well as to the Presidents of the regional territorial structures of the FSPs and DSPs and of the Paralympic Sports Promotion Bodies.
The Independent Commission for the Verification of the Economic and Financial Balance of Professional Sports Clubs
The Decree then intervened on the Sport Reform by inserting the new Article 13-bis, entitled “Independent Commission for the verification of the economic and financial equilibrium of professional sports clubs”.
The declared objective of the new regulation is to periodically verify the respect of the principles of correct management by sports clubs and the maintenance of the economic and financial balance and the functioning of the internal controls of the Federations.
In light of such aim, the new regulation established an independent Commission for the verification of the economic and financial equilibrium of professional sports clubs, endowed with regulatory, organisational, administrative, patrimonial, accounting and financial autonomy (hereinafter, the ”Commission”).
Seat and composition of the Commission
The Commission has its headquarters in Rome and is the competent body entitled to carry out the controls required by the statutes of the national sports federations. In particular, the Commission certifies the regularity of the economic and financial management of professional sports clubs, by means of compulsory opinions forwarded to the Federations for the adoption of measures concerning the admission to, participation in and/or exclusion from professional competitions, and any other related measure.
The Commission is a collegial body, composed of a president and six members, appointed by decree of the President of the Council of Ministers or of the delegated political authority in matters of sport, in agreement with the Minister of Economy and Finance. The President of the Italian National Institute for Social Security (in Italian “INPS”) and the Director of the Italian tax authority (“Agenzia delle Entrate”) are members by right. The President and the remaining four members are chosen among accounting magistrates, university professors in economic, legal and financial subjects, lawyers qualified to plead before the higher courts or chartered accountants who have also been on the list of auditors for at least 15 years and have proven experience in the field of company auditing.
Powers of the Commission
The powers of the Commission is without prejudice to CONSOB's powers over Italian companies admitted to trading on regulated markets - with which it is proposed to initiate an active form of cooperation - and provides for a whole series of powers attributed to the Commission, including, purely by way of example: powers to verify the correctness and congruity of corporate documents; powers to verify the documentation required by federal regulations for the purposes of issuing national licences for participation in competitions; powers to request accounting and corporate data and documents; powers to ask professional sports clubs and Federations for clarifications, information and documentation, including with regard to the individuals and legal entities that directly or indirectly control the clubs; the power to summon the heads of the relevant Federations and Leagues, as well as the members of the clubs' administrative and control bodies, in order to acquire information and useful elements for its own assessments.
Another power attributed to the Commission concerns the possibility of indicating corrective and remedial measures to sports clubs, providing, in the most urgent cases, for adjustments to be made, in order to neutralise the possible economic and financial effects of specific ordinary or extraordinary transactions that do not comply with the rules laid down by rules and regulations, including sports ones.
In addition, the Commission provides opinions on matters within its competence, ex officio or at the request of administrations, interested bodies or professional sports clubs.
Finally, the Commission submits, by 30 September of each year, a report to the Parliament and to the President of the Council of Ministers or to the delegated political authority in charge of sport on the results of the activity carried out in the previous year and on the economic-financial equilibrium of professional sports clubs.
The Urgent Measures Concerning Sports Labour
The Decree not only intervenes on the subject of federal elections and the control of the economicfinancial management of sports clubs, but also provides, in Article 3, some amendments to the discipline of sports volunteers, which were introduced for the first time with the Sport Reform.
The Decree intervenes on Article 29 of the Sports Reform, entitled “Sporting activities of volunteers”, by introducing the possibility of recognising lump-sum reimbursements.
Section 2 of the article provided that for the services of sports volunteers, only documented expenses related to food, lodging, travel and transport incurred during services performed outside the municipality of residence of the recipient may be reimbursed. It was also envisaged that the expenses incurred by the volunteer could also be reimbursed against self-certification, provided that they did not exceed the amount of € 150 per month.
The new text of the rule provides instead for the possibility that “Sports volunteers may be granted lump-sum reimbursements for expenses incurred for activities also carried out in their municipality of residence, up to an overall limit of 400 euros per month, on the occasion of sporting events and demonstrations recognised by the National Sports Federations, the Associated Sports Disciplines, the Sports Promotion Bodies, including Paralympic ones, CONI, CIP and the company Sport e salute S.p.a., provided that they deliberate on the types of expenses and voluntary activities for which this reimbursement method is allowed.”
It is further stipulated that the entities are required to communicate through the National Register of Amateur Sports Activities the names of the sports volunteers who receive lump-sum reimbursements and the amount received by the end of the month following the quarter in which the sports volunteer's sporting services were performed.
Finally, it is specified that “The reimbursements referred to in this paragraph do not contribute to forming the percipient's income. These reimbursements, if paid in the area of amateurism, contribute to exceeding the limits of non-taxability provided for in Article 35, Section 8-bis, and Article 36, Section 6”.
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The Decree reveals an intention to intervene in advance on the rules governing the functioning of the sports bodies, also in view of the federal elections that will follow the XXXIII Olympic Games. At the same time, the Decree has intervened on a very delicate issue that has been widely discussed in recent months: the need to provide for an independent body to verify the economic and financial equilibrium of professional sports clubs.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.