TAS - CAS 5745 de 2017

Tribunal Arbitral du Sport Court of Arbitration for Sport Arbitration CAS 2018/A/5745 Pan-American Team Handball Federation (PATHF) v. International Handball Federation (IHF), award of 26 October 2018 (operative part of 13 September 2018) Panel: Prof. Martin Schimke (Germany), President; Mr Diego Ferrari (Argentina); Mr Pierre Muller (Switzerland) Handball Governance Discretion of a CAS panel to exclude evidence under Article R57.3 CAS Code “Proper notice” in the meaning of Article 67(3) Swiss Civil Code Consequences of defect convening notice/agenda Prerequisites for voting on amended agenda item/motion New motions under Article 12.3.9 IHF Statutes Delegation by general assembly of its competences Nullity of resolutions No reallocation by CAS of costs of previous instances

1. It is clear from the language of Article R57.3 CAS Code that while a CAS panel may exclude evidence presented by the parties which had been available to them or could reasonably have been discovered by them before the challenged decision was rendered, it is not bound to do so. The practice of CAS is restrictive, i.e. exclusion of evidence should be the exception rather than the rule, and should generally be applied only in exceptional circumstances of abusive or inappropriate conduct by the parties submitting new evidence. Provided the other party(ies) is/are granted the opportunity to address the new evidence, such an approach is in keeping with CAS’ de novo power of review under Article R57 CAS Code, and with the parties’ right to be heard.

2. Article 67(3) Swiss Civil Code (SCC), according to which “Resolutions may be taken on matters for which proper notice has not been given only where this is expressly permitted by the articles of association”, does not only comprise formal aspects but also material aspects. As a general rule, it is necessary that the items on which the general assembly is requested to rule are placed on the agenda and duly announced. Whether

or not this requirement is fulfilled is decided in each case/situation, based on the specific circumstances: an item is duly placed on the agenda when, on the basis of the agenda and the statutes, the members know on which points it will be necessary to deliberate and, if necessary, to take a decision.

3. In case a convening notice does not include a full agenda, or where the description of a subject on the agenda is imprecise, unclear or misleading, there is a defect that could lead to the annulment of the underlying decisions. Whether or not the decision should be set aside depends, however, on the assessment of the concept of defect and the CAS 2018/A/5745 2

PATHF v. IHF, award of 26 October 2018 (operative part of 13 September 2018) gravity of the violation. It is therefore essential to determine whether or not the alleged defect could have an influence on the decision.

4. In case an initial motion – duly included as item on the general assembly agenda – is later on changed into a fundamentally different motion finally presented and voted on during the general assembly, proper notice of the amended motion i.e. of the content of the amended motion has to be officially communicated to the delegates asked to vote on the motion prior to the vote, allowing them to prepare themselves to deliberate and vote on the amended motion, and potentially discuss the motion within their respective

National Federations.

5. While under Article 12.3.9 IHF Statutes it is possible to submit new motions even during the IHF Congress, such motions may not concern amendments to the IHF Statutes. A motion to delegate the IHF Congress’ authority to “discuss, evaluate and take a decision on the motion regarding the IHF Statutes related to the Pan-American continent and consequently on the relevant IHF Statutes changes” to the IHF Council clearly concerns a potential amendment to the IHF Statutes.

6. Some of the competences of a general assembly can be delegated to other organs, while

others cannot. In order to delegate competences, a statutory basis is required, without which the general assembly would ultimately have to decide on a modification of the statutes adopted by another body.

7. A resolution of the general assembly is null and void if it is afflicted with a severe deficiency. Put differently, nullity is given in cases where a resolution suffers from manifest defects, whether those be procedural or substantive. Whether a decision is challengeable or null and void must, in each case, be dealt with based on the specific circumstances of each individual case. If it cannot be determined with sufficient clarity whether a decision is challengeable or null and void, it is commonly acknowledged that it is challengeable for reasons of legal certainty.

8. It is not for the CAS to reallocate the costs of the proceedings before the previous instances.

I. PARTIES

1. The Pan-American Team Handball Federation (the “Appellant” or the “PATHF”) is the continental confederation responsible for governing the sport of handball in Pan-America and is affiliated to the International Handball Federation. The PATHF has its registered office in

Buenos Aires, Argentina.

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2. The International Handball Federation (the “Respondent” or the “IHF”) is the international sports federation responsible for governing the sport of handball worldwide. The IHF has its registered office in Basel, Switzerland.

II. INTRODUCTION

3. The present proceedings relate to the legality of a motion (the “Motion”) presented by the IHF President to divide the PATHF into two confederations, namely a “North America and the Caribbean Handball Confederation” and a “South and Central America Handball Confederation”, the alleged amendment of this Motion shortly before the IHF Congress, and the decision issued by the IHF Congress ensuing from this allegedly amended motion.

III. FACTUAL BACKGROUND1

4. Below is a summary of the main relevant facts, as established on the basis of the parties’ written submissions and the evidence examined in the course of the present appeals arbitration proceedings and at the hearing. This background is made for the sole purpose of providing a synopsis of the matter in dispute. Additional facts may be set out, where relevant, in connection with the legal analysis.

5. On 9 June 2017, in preparation for the IHF Congress to be held in Antalya, Turkey, on 11

November 2017, the IHF President submitted his Motion to divide the PATHF into two confederations to the IHF Head Office.

A. The Tbilisi Council Meeting

6. On 18 July 2017, the IHF invited the PATHF to the IHF Council Meeting to be held on 18

August 2017 in Tbilisi, Georgia (the “Tbilisi Council Meeting”). Whereas the PATHF maintains that the agenda included motions from the IHF Executive Committee, the Norwegian Handball Federation, and the Handball Federation of Montenegro, but notably no Motion from the IHF President in relation to splitting the PATHF, the IHF maintains that the agenda accessible through the Dropbox link indicated, under para. 4.3.2, that a “Motion from IHF President” was to be discussed. The Panel concludes that there were two different agendas distributed while only one of them contained a “Motion from IHF President”. Since the validity of the latter agenda was not disputed, the Panel is satisfied to accept that a “Motion from the IHF President” was duly announced. 1 The factual background is set up in chronological order. The events described therefore do not always coincide with the heading, the Panel nevertheless deemed it useful to add such headings for ease of reference as they roughly reflect the factual circumstances described thereunder.

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award of 26 October 2018 (operative part of 13 September 2018)

7. On 12 August 2017, the IHF sent additional documents to the PATHF in relation to the Tbilisi Council Meeting, but according to the PATHF no reference was made to a Motion from the IHF President in relation to splitting the PATHF.

8. On 18 August 2017, during the Tbilisi Council Meeting, the Motion to divide the PATHF into two confederations was presented by the IHF President. As reflected in the Tbilisi Council Meeting Minutes, “[w]ith four abstentions the Council was in favour of the motion submitted by the IHF President. The motion shall be submitted to the XXXVI Ordinary IHF Congress to be held in Antalya, TUR on 11/12 November 2017”.

9. After the Tbilisi Council Meeting, the representatives of the PATHF on the IHF Council requested to discuss the Motion with the IHF President, but the PATHF President did not attend such meeting.

10. On 18 September 2017, the Tbilisi Council Meeting Minutes were sent to all IHF Member Federations and Confederations, setting out the following justification for the Motion: “- An increase in the handball activity in all areas – resulting from financial advantages due to shorter distances and reduced travel costs; the remaining money will increase the handball activity in all areas. - Especially the North American market is decisive for the development of handball worldwide and for the position of handball worldwide. North America is the key market for receiving status and income related to the Olympic Games. A development in North America will strengthen the position of handball in the IOC and at the Olympic Games and will guarantee that handball stays on the Olympic Programme and that Beach Handball can be added as a discipline. - Organisational advantages such as shorter distances. Due to the shorter travel distances, more tournaments can be staged on a regular basis in all categories and even on club level resulting in increased

handball activity on continental level. The IHF can hereby provide support in several matters and provide assistance in the kick-off phase. - Providing the opportunity to focus on the Caribbean zone with tailor-made projects for Beach Handball. This would give these countries a realistic chance to take part in IHF events, as they would then belong to the North America and the Caribbean Handball Confederation, avoiding the traditionally strong Beach Handball nations from the south. - Increase motivation from teams from North and South which usually don’t qualify for IHF events to qualify for a major event as there is then a realistic pathway. While earning a qualification to IHF events and with the experience gained at international events, these teams will have the chance to close the gap to the dominant teams and also the currently dominant teams will benefit from stronger opponents. - Smaller qualification tournaments, group stages similar to football or handball in Europe would be possible in a second step; finishing the qualification for IHF events earlier would be beneficial for the planning on a long-term basis and for setting up the IHF calendar of events.

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PATHF v. IHF, award of 26 October 2018 (operative part of 13 September 2018) - With realistic chances of success on competitive level, also the chances for raising funds from different sources (sponsors, NOC, governmental institutions) increase significantly. - More professional administrative bodies could be established, and better service to the Member Federations is expected, since the respective body will take care of a smaller number of federations. This could contribute to enhancing the work quality (more focused and specialised). - Through having more handball activity on continental level, more human resources such as coaches, referees, delegates, handball managers, etc. could be identified and promoted/educated accordingly. - Giving the IHF the possibility to further develop the IHF Trophy tournament in order to include this tournament in the qualification pathway for Junior World Championships”.

11. The Tbilisi Council Meeting Minutes further reflect that the following discussions took place in respect of the Motion: “President Moustafa emphasised the importance of having handball activities throughout the Pan-American continent, stressing that all handball stakeholders, including players, teams, coaches, referees, etc., should be active.

The Competitions Director explained that at the last qualification, only 7 men’s teams and 6 women’s teams from Pan-America participated in the junior qualification system, while minimum 25 men’s teams and minimum 22 women’s teams from Pan-America (total North and South) would participate in the junior qualification system with the change of the qualification pathway and the option of using the IHF Trophy as a qualification pathway. As Europe’s Vice-President asked about the consequences for IHF World Championships, the Competitions Director explained that for senior events the IHF plans to keep the three compulsory places for the North America and the Caribbean Handball Confederation and the South and Central America Handball Confederation, considering that the winner of the North zone shall play against team no. 3 of the South zone in a play-off match for direct qualification to the WCh, adding that the level of quality shall remain the same. The qualification process for the Olympic Games shall be discussed later. As for youth and junior events, the Competitions Director presented the following amended distribution of compulsory and performance places: […]. Europe’s Vice-President remarked that he is in favour of the above-mentioned motion, as it would help to strengthen handball in the economically important country of USA”.

12. On 29 September 2017, the IHF sent the IHF Congress Agenda to, inter alia, the IHF Member Federations and Confederations. The agenda included the following point: “12.1 Motion from the

IHF President”.

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B. The PATHF Extraordinary Assembly

13. On 7 October 2017, a PATHF Extraordinary Assembly was held in Bogotá, Colombia, to discuss, inter alia, the Motion to split the PATHF.

14. The IHF maintains that, on 11 October 2017, the IHF addressed the working documents for the IHF Congress to, inter alia, the IHF Member Federations and Confederations. The cover letter included a Dropbox link, which provided access to the IHF Congress Agenda and working documents. Amongst those was the IHF President’s motion document, which explained the Motion in detail to the IHF Congress. However, the PATHF initially submitted that, prior to the IHF Congress, the IHF Head Office had submitted working documents to the Congress delegates, but no information was provided relating to the Motion to divide PATHF into two confederations, nor had this issue been listed in the IHF Congress Agenda.

Based on the documents provided by the IHF (in particular exhibit R-5 and R-7), and as finally conceded by the PATHF during the hearing, the Panel is satisfied to accept that the IHF President’s Motion was included in the IHF Congress Agenda distributed to the delegates on 29 September 2017 and that a working document regarding this Motion was distributed to the delegates on 11 October 2017 (accessible through the Dropbox link provided (in folder 12 “Treatment of election-related Statutes motions”). This working document explained that Article 10.2.2 of the IHF Statutes would be amended by splitting the PATHF into two confederations, and providing the following justification for this suggestion: “The IHF created tailored projects to support the Member Federations and develop handball in the emerging nations in order to achieve universality and ensure that handball is practised in all 207 Member Federations. During the realisation of the projects the huge distance between the countries in Pan-America was a big challenge and imposed a financial burden on the projects concerned in addition to huge technical level varieties in the

continent. Over the past years, the IHF has studied the obstacles hindering the optimal realisation of the IHF projects in the Pan-American continent. Aiming to classify the Pan-American countries, close the gap between the different NFs and assign a group of the islands for beach handball, the IHF worked on the next proposal. In addition to the aforementioned, the establishment of subcontinents in Pan-America is not acceptable by the IHF, as the IHF is the body that bestows recognition. The IHF received a copy of the communication related to the establishment of the Central and Caribbean federation (a group of Pan-American countries agreed to establish a subcontinent), which is considered to be a violation of the IHF Statutes. On the one hand, to understand the motivation behind the establishment of branches in Pan-America, this may be a result of many reasons such as the long distances, levels of competition, financial obstacles and communication. The motion is to divide the continent of PATHF into two as follows: - North America and the Caribbean: Full members: ANT, BAH, BAR, CAN, CAY, CUB, DMA, DOM, GRL, GRN, HAI, IVB, LCA, MEX, PUR, SKN, TRI, USA – total of 18 countries plus two regional members: GLP, MTQ CAS 2018/A/5745 7 PATHF v. IHF, award of 26 October 2018 (operative part of 13 September 2018) - South and Central America: Full members: ARG, BIZ, BOL, BRA, CHI, COL, CRC, ECU, ESA, GUA, GUY, HON, NCA, PAN, PAR, PER, URU, VEN – total of 18 countries plus one regional member: GUF”.

15. On 23 October 2017, after it was made aware of the fact that the PATHF Extraordinary Assembly was held, the IHF President wrote to the PATHF alleging that it had not followed

the stipulations in Article 10.2.3.1 IHF Statutes, by not inviting the IHF President. The IHF President requested the PATHF to “urgently provide us with complete information on the formal convocation procedures of the PATHF Extraordinary Congress in order to file the case with the IHF Arbitration Commission, aiming to receive necessary guidelines for further proceedings”. The IHF President also requested “supporting administrative and financial documents which prove the correct spending of the awarded sponsorship” in the amount of USD 1,000,000 awarded by the IHF to the PATHF in 2014.

16. On 26 October 2017, the PATHF President replied to the IHF’s letter dated 23 October 2017, maintaining that the convocation procedure of the PATHF Extraordinary Assembly was correct and that “we see no injury that may entail the intervention of the Arbitration Commission”. Finally, the PATHF President indicated that the accounting for the sponsorship money was made during the PATHF Congress held in Buenos Aires on 30 July 2016, which financial statements were unanimously approved by the members present.

17. On 3 November 2017, the IHF President replied to the PATHF’s letter dated 26 October 2017, reiterating that the PATHF Extraordinary Assembly was not convened in compliance with Article 10.2.3.1 IHF Statutes, and that the PATHF auditing report which was confirmed by the PATHF Extraordinary Assembly was not on the agenda, as a consequence of which the corresponding decision is not valid either. The IHF President reiterated his request for supporting administrative and financial documents proving the correct spending of the awarded sponsorship.

C. The Antalya Council Meeting

18. On 9 November 2017, the IHF Council decided during the IHF Council Meeting in Antalya, Turkey, (the “Antalya Council Meeting”) that it would submit the PATHF’s alleged violation of the IHF Statutes to the IHF Arbitration Commission in order to obtain their recommendation

for further treatment by the IHF Executive Committee and the IHF Council. In addition, the IHF Council agreed with the IHF President’s proposal to ask the IHF Congress to authorise the IHF Council to evaluate and take a decision on the Motion related to the Pan-American continent.

19. The Antalya Council Meeting Minutes reflect that the following discussions took place in respect of the amended motion: “President Moustafa referred to the motion related to the Pan-American continent (dividing the continent into two, namely North America and the Caribbean Handball Confederation and South and Central America CAS 2018/A/5745 8

PATHF v. IHF, award of 26 October 2018 (operative part of 13 September 2018) Handball Confederation) which was presented to the Council in its last meeting in Tbilisi, Georgia on 18 August 2017, stating that the Council was in favour of the motion with four abstentions. He briefly reiterated that the key intention of the motion is to develop handball throughout the Pan-American continent and preserve the position of handball at the Olympic Games. […] Referring to the motion which shall be submitted to the 2017 Ordinary IHF Congress, President Moustafa proposed to ask the Congress to authorise the Council to evaluate and take a decision on the motion. Europe’s Vice-President expressed difficulties to speak about another Continental Confederation. He was in favour of President Moustafa’s proposal as it gives the possibility to take a decision on the matter after clarification and careful evaluation of all related facts. […]”.

20. On 10 November 2017, the PATHF President informed the IHF that “it is my intention to apologize from PATHF for the formal omission of an IHF invitation to said Extraordinary Assembly. It was an involuntary omission, that in no way aimed at injuring IHF regulations; simply an administrative error”.

21. Also on 10 November 2017, the IHF President addressed the IHF Congress delegates of the

PATHF regarding the Motion.

D. The IHF Congress

22. On 11 November 2017, the IHF Congress took place in Antalya, Turkey.

23. On the occasion of the IHF Congress, the IHF Congress, by a purported two-thirds majority

(the minutes reflect the following votes: Yes: 102; No: 26; Abstain: 24) that is disputed by the PATHF, decided to “delegate its authority to the IHF Council to discuss, evaluate and take a decision on the motion regarding the IHF Statutes related to the Pan-American continent and consequently on the relevant IHF Statutes changes” (the “Congress Decision”).

24. After presenting the content and purpose of the amended motion, the IHF President proceeded immediately with the voting. No discussion took place on such amended motion prior to the vote. In particular, the PATHF President was only given the floor after the vote. He requested a vote by secret ballot, which was neither addressed by the IHF President, nor submitted for approval or disapproval by the Congress members.

25. The IHF Congress Minutes reflect that the following discussions took place in respect of the Motion: “Mr Brihault informed the Congress that one election-related Statutes motion had been submitted to the Congress and gave the floor to President Moustafa who addressed the Congress delegates, stating that the presentation of the motion related to the Pan-American continent would take a long time, therefore he will CAS 2018/A/5745 9

PATHF v. IHF, award of 26 October 2018 (operative part of 13 September 2018) explain the main concept of the motion. In addition, he referred to the meeting of the Pan-American Team Handball Federation in the evening prior to the Congress, during which he made a detailed presentation of the motion. President Moustafa informed the Congress that the motion concerned had been presented to the IHF Council in its meeting in Tbilisi, Georgia on 18 August 2017, stating that the Council (with four abstentions) was in

favour of the content of the motion and agreed to submit the motion to the Congress as per Article 13.3, point 11 of the IHF Statutes. […] President Moustafa expressed his dissatisfaction with the development of handball in Pan-America due to a lack of activities. He outlined that at the beginning of his presidency in 2000 the IHF had 19 Member Federations from Pan-America whereas the IHF currently has 40 Member Federations from Pan-America thanks to the efforts of the IHF President; nevertheless only a small number of federations are actually active. He pointed out that the intention of the IHF is to develop handball in the continent and preserve the position of handball at the Olympic Games, taking into consideration that the development of handball in Pan-America resulting from the current system is not comparable with the development happening in the other continents in all fields. He stressed that the IHF is not against or in favour of any persons or entities. President Moustafa informed the Congress that the IHF Council decided in its meeting in Antalya, Turkey on 9 November 2017 to ask the Congress to authorise the Council to discuss, evaluate and take a decision on the motion regarding the IHF Statutes related to the Pan-American continent. President Moustafa then asked the Congress delegates if they agree on authorising the IHF Council to discuss, evaluate and take a decision on the motion regarding the IHF Statutes related to the Pan-American continent and consequently on the relevant IHF Statutes changes. The delegates cast their votes by raising their voting cards. The election officer and tellers counted the following votes (counting of votes was repeated to guarantee the correct result of the voting):

Yes: 102

No: 26

Abstain: 24

President Moustafa thanked the Congress delegates for authorising the IHF Council to discuss, evaluate and take a decision on the motion regarding the IHF Statutes related to the Pan-American continent and consequently on the relevant IHF Statutes changes.

President Moustafa gave the floor to Mr Mario Moccia, President of Pan-American Team Handball Federation, who stated that he abstained from voting when the motion concerned was presented to the IHF Council meeting in Tbilisi, Georgia on 18 August 2017. He also referred to the autonomy of the Continental Confederations according to Article 12.3, point 10 of the IHF Statutes, stressing that a continent’s specific issue shall be decided by the continent concerned. Referring to the voting procedure, he remarked that the voting on changes to the IHF Statutes should be by secret ballot to ensure that delegates CAS 2018/A/5745 10 PATHF v. IHF, award of 26 October 2018 (operative part of 13 September 2018) can express themselves freely. He asked President Moustafa to reconsider the motion, adding that the Pan-American continent is united and wants to stay united. President Moustafa explained about the IHF financial support granted to the Pan-American continent. For instance, the IHF assisted the PATHF in 2014 through a sponsorship to get USD 1,000,000 to spend on PATHF handball activities and help the PATHF countries to develop handball. President Moustafa stated that PATHF has not submitted to IHF the supporting administrative and financial documents to prove the correct spending of the awarded sponsorship, aiming to further develop handball throughout the continent. He added that despite the financial assistance granted to the Pan-American continent by the IHF, no significant development has occurred in Pan-America. President Moustafa informed the Congress that all details related to the motion concerned, including the IHF future plan in Pan-America, will be sent to the IHF Member Federations to give them the possibility to have the full picture of the disadvantages of the current system and the benefits of the new system, which proves that the IHF is working in the best interest of handball”.

E. The Proceedings before the IHF Arbitration Commission (First Instance) regarding the

Congress Decision

26. On 7 December 2017, the PATHF filed an appeal with the IHF Arbitration Commission, requesting that it declare the Congress Decision null and void.

27. On 9 January 2018, the IHF President wrote to the IHF Member Federations and Continental Confederations to provide them with details related to the Motion concerned, including the IHF future plan in Pan-America.

F. The Zagreb Council Meeting

28. On 14 January 2018, the IHF Council met in Zagreb, Croatia (the “Zagreb Council Meeting”).

Without providing any prior information to the PATHF, the IHF President requested that the IHF Managing Director read-out the recommendation received on the same day (i.e. 14 January 2018) from the IHF Arbitration Commission regarding the PATHF’s alleged violation of the IHF Statutes. The following decisions were taken by the IHF Council (the “Zagreb Council Decision”): ➢ Following a legal opinion issued by the Arbitration Commission, which reads, inter alia, as follows as reflected in the Zagreb Council Meeting Minutes: “On October 7th, 2017, Pan-American Team Handball Federation held the Extraordinary Congress in Bogota, subject of which were motions to be presented in the Congress regarding the previously presented modification of the Pan-American Team Handball Federation structure. The agenda was obviously to gain member federations votes to oppose the announced reorganisation, for the President of the IHF was not invited to the Extraordinary Congress to articulate the reorganisation. This move by the Pan-American Team Handball Federation constitutes a direct violation of the Continental Confederations prescribed duties. […]. Therefore the recommendation of the Arbitration Commission is that the IHF Council should CAS 2018/A/5745 11 PATHF v. IHF, award of 26 October 2018 (operative part of 13 September 2018) suspend the Pan-American Team Handball Federation”. And following a discussion, the IHF

Council agreed (Votes in favour: 15; Votes against: 1; Abstentions: 0) to suspend the PATHF according to Article 10.2.3.2 IHF Statutes. ➢ Following a legal opinion issued by Dr François Carrard, concluding that “[a]ll Council members without any limitation shall be authorized to vote on the issue of the so-called “motion of the Pan-America” and that the Congress decision does not violate Swiss Law nor the IHF Statutes” and following a discussion, the IHF Council agreed (Votes in favour: 15; Votes against: 1; Abstentions: 0) “to divide the continent of Pan