City law firm RPC comments on Saracens fine
Yesterday, the Premiership Rubgy fined UK Rugby champions Saracens with a 35 point deduction and £5.36 million for breaching salary cap rules.Commenting on the Premiership Rugby's decision and its wider impact on the sports industry, Jeremy Drew, Head of the Commercial Practice at the City law firm RPC said:
"The biggest surprise from a legal perspective is the severity of the sanction – simply because it is unprecedented for the Premiership. Saracens will no doubt have technical arguments around possible precedents for co-investments in relation to the cap, but as is the case with rules in a number of sports, the regulations are purposefully written to preserve the spirit of the rules not just the letter. A good example is Leeds United's sanction for Spygate which focussed on a breach of the duty to act in good faith to other clubs, rather than an express obligation not to spy.
The case is a timely reminder that the objectives of the regulations are of critical importance, as is clear by the express obligation on the Salary Cap Manager to notify Premiership Rugby of any potential loopholes / lacunae and the clear references to the general principles of the regulations.
The big hurdle for the club now is its challenge of the Disciplinary Panel's decision which will not take place as an appeal, but will challenge the decision in a form consistent with a Judicial Review (as is standard in many sports related arbitrations). Consequently the bar that Saracens has to reach to overturn the decision is a challenging one"
If you would like to speak to Jeremy or another partner of our sports team to discuss sports issues, I would be happy to set this up for you.
Our sports team have been issuing regular updates on the key sports issues, see the most recent perspectives: Sheffield United, or divided? Implying duties of good faith and Sporting compromise – tips for settling sports disputes.