A Federation Internationale de Basketball (“FIBA”) agent once mentioned the alarming statistic that 40% of international basketball player contracts are breached, primarily by the clubs. FIBA is the international governing body of basketball worldwide and responsible to establish and enforce the rules concerning the practice of basketball. FIBA created the Basketball Arbitral Tribunal in 2007 to remedy this massive breach of contract issue. This post will focus on the arbitration systems within FIBA and the NBA. To understand, how the FIBA Basketball Arbitral Tribunal (BAT) arbitration system works, see my previous blog post: A Primer to International Basketball Arbitration.
International basketball clubs tend to not respect the contracts they make. Thus, the invention of the Basketball Arbitral Tribunal was necessary for the integrity of the international basketball landscape. Interestingly, there is no mandate that the FIBA Standard Arbitration Clause be included in player contracts. However, since the inception of BAT, essentially all contracts contain this clause:
Any dispute arising from or related to the present contract shall be submitted to the Basketball Arbitral Tribunal (BAT) in Geneva, Switzerland, and shall be resolved in accordance with the BAT Arbitration Rules by a single arbitrator appointed by the BAT President. The seat of the arbitration shall be Geneva, Switzerland. The arbitration shall be governed by Chapter 12 of the Swiss Act on Private International Law, irrespective of the parties’ domicile. The language of the arbitration shall be English. The arbitrator shall decide the dispute ex aequo et bono.
On the other hand, the National Basketball Association (“NBA”) deals with arbitration in a different manner. There are three types of arbitration structures in American professional basketball, and all function differently. Players in the NBA are subject to the Collective Bargaining Agreement negotiated by the players union – The National Basketball Players Association (“NBPA”) – and the NBA, which provides for grievance arbitration under Article XXXI. For example, a NBA grievance arbitrator can hear disputes involving the interpretation or application of a Player Contract. Or, if a player disagrees with a fine, suspension, or action taken by the commissioner, the dispute can be handled through grievance arbitration. Additionally, there is system arbitration, as laid out in Article XXXII. This is used primarily for league-team-union disputes that relate to the overall economic system in place under the CBA. For example, the systems arbitrator would settle disagreements about the meaning of a certain player contract term.
Unlike at the international level, in the NBA, disputes over a club not paying a player are extremely rare. More commonly there are disputes between agents and players over unpaid commissions. As a result, player and agent disputes are handled by the NBPA Agent Resolution Department, which was created in 1986 to address and prevent the mistreatment occurring in relationships between agents and players. The NBPA helps resolve these disputes via the assistance of NBPA in-house counsel and the retention of an independent arbitrator.
International basketball leagues and the NBA have entirely different issues with the resultant need for entirely different dispute resolution systems. Since clubs not paying athletes in the NBA is a non-issue, a BAT system is unnecessary. Yet, the efficiency and neutrality of BAT is a great model that well might start to bleed into the NBA dispute resolution procedures.
Useful links:
NBPA Security & Agent Administration
Claire Zovko is a rising attorney with a passion for sports law, which stems from her love of sports in general. Zovko is a member of the Sports Lawyers Association, Florida Bar Entertainment and Sports Law section, and the Miami-Dade Sports Commission. She also serves on the advisory board to the University of Miami Entertainment and Sports Law Society. Click ZOVKO BIO to read her more.