What is the legal framework for individual transfers? What restrictions can be placed on individuals moving between clubs?

In Austria, professional athletes in the field of team sports are to be qualified as employees. The legal framework between association and athlete is thus formed by an employment contract (section 1151 Austrian Civil Code (ABGB)). Under the employment contract the athlete as an employee does not owe any success besides the unrestricted provision of his or her labour. In doing so, he or she is working in personal dependence, the basis of which is the athlete’s strictly personal duty to work. Another important feature is the athlete’s obligation to follow instructions, as he or she is integrated into the organisational and hierarchical structure of the association.

In the field of individual sports, athletes are in most cases not considered as employees but as entrepreneurs and receive income from self-employment. There are no transfers in individual sports.

Before an individual transfer, the employment relationship between the former association and the athlete must first be terminated. Subsequently, the host association concludes a new employment contract with the sportsperson.

Restrictions for association changes can exist for athletes due to contractual and ‘Financial Fair Play’ rules as well as the ban on third-party ownership. In the context of third-party ownership, investors acquire transfer rights from football players in order to earn money if the player is transferred to another association for a large fee.

Ending contractual obligations

Can individuals buy their way out of their contractual obligations to professional sports clubs?

As in most cases an athlete concludes a (temporary) employment contract as defined in section 1151 ABGB with the association, he or she is considered an employee. The athlete is subject to contractual duties of loyalty, in particular the prohibition of competition, obligation to secrecy, obligation to train according to detailed specifications of a trainer, nutritional regulations, obligation to orient oneself towards strategic, tactical or even sports policy concepts as well as representation duties. As a result, the provisions of Austrian labour law apply and the athlete him or herself cannot buy his or her way out of his contract. Since the employment contract is a continuing obligation, a separate termination act (notice of termination, time limit) is required.

Many fixed-term employment contracts contain an exit clause, in most cases this contains a precisely defined transfer fee. If another professional association is interested in hiring the player, it can buy him or her back during the transfer period when the transfer fee is paid and a change of association is permitted.

Athletes who are active under contracts for work and services owe a success, so they cannot buy their way out of their contractual obligations.

Welfare obligations

What are the key athlete welfare obligations for employers?

With regard to the welfare of the athletes, the employer is bound by the duty of care and therefore has to protect important legal interests of the employee. Section 3 of the Employee Protection Act (ASchG) regulates the general obligations of employers. In particular, employers are obliged to ensure the safety and health of sportspeople with regard to all aspects relating to sport. They must take the necessary measures to protect life, health, integrity and dignity.

Young athletes

Are there restrictions on the employment and transfer of young athletes?

In principle, a young sportsperson in Austria can conclude a young professionals contract with an association from the age of 16 onwards. The provisions of the collective agreement apply. Within the limits of labour law, a young athlete can be transferred to a new association in Austria.

According to article 19 of the FIFA regulations, a player may only be transferred internationally if he or she is at least 18 years old. This provision does not apply in the following cases: (i) the player’s parents take up residence in the country of the new association for reasons other than football, or (ii) the transfer takes place within the European Union or EEA and the age of the player is between 16 and 18 years. In addition, the new association must fulfil certain minimum obligations and the player may live no more than 50km from the Austrian border and the association of the neighbouring federation to which the player wishes to be registered is also no more than 50km from the Austrian border.

What are the key child protection rules and safeguarding considerations?

The Austrian Youth Protection Acts apply to all young people up to the age of 18 and are within the competence of the federal states. In addition, the Child and Adolescent Employment Act 1987 (KJBG) is of great importance. This law contains protective regulations that also apply to young sportspeople. The protection considerations relate in particular to breaks, rest periods, night rest, weekly leisure time and health and morality protection.

There are no exceptions to these rules in Austrian sports law.

Club and country representation

What employment relationship issues arise when athletes represent both club and country?

Problems arise from the fact that there is usually an employment relationship between the athlete and the associations and that the athletes are subject to obligations under labour law.

Pursuant to article 1 of the FIFA Regulations on the Status and Transfer of Players, associations are obliged to assign their players to the federation team of the country of which they are nationals. Therefore, the associations undertake to release players for the periods stipulated by FIFA. Additionally, the association is obliged to continue to pay the player’s salary and pay accident and health insurance for the duration of the secondment.

Because of the dominant market position of FIFA and UEFA, such regulations are not entirely unproblematic, but they are indispensable for the organisation of international tournaments. However, FIFA and UEFA pay parking fees per day per player (ie, the associations’ share of revenues from broadcasting rights, commercial rights and ticket sales).

It could also be a problem if a player is injured during a national team match. In this case, however, the FIFA protection programme applies. It lays down the conditions under which an association is entitled to compensation if one of its players is injured in a match played by the national team.

Selection and eligibility

How are selection and eligibility disputes dealt with by national bodies?

According to section 19 of the articles of association of the Austrian Olympic Committee (ÖOC), the internal arbitration court is appointed to arbitrate all disputes arising in connection with the selection and suitability of members of the ÖOC. It is a ‘mediation board’ within the meaning of the Act on Associations (VerG) and not an arbitral tribunal according to section 577 ff of the Austrian Code of Civil Procedure (ZPO).

In most cases selection and suitability disputes are dealt with by senates specifically set up in sports associations within the framework of an internal instance within the association.

What are the key taxation issues for foreign athletes competing in your jurisdiction to be aware of?

Section 1 of the Austrian Income Tax Act (EStG) regulates the personal tax liability of natural persons. According to section 1 paragraph 2 EStG, all natural persons, including foreign athletes, are subject to unlimited tax liability if they have a domicile or habitual residence in Austria. Foreign athletes are subject to limited tax liability if they have domestic income as defined by section 98 EStG and neither a domicile nor a habitual residence in Austria. According to section 26 paragraph 1 of the Austrian Federal Tax Code, a person has a place of domicile where he or she has an apartment under circumstances that suggest he or she will retain the apartment. The habitual residence within the meaning of section 26 paragraph 2 BAO is where someone is in circumstances that show he or she is not only temporarily staying at this place or in this country. The duty is always payable if the stay in Austria lasts longer than six months.

In Austria there are seven different types of income, which are listed in section 2 Abs 3 EStG.

Foreign athletes who have neither a domicile nor a habitual residence in Austria are only subject to limited taxation on income earned in Austria.

Several double taxation agreements that Austria has concluded with other countries avoid a double taxation.