Barelli Turns To Swiss Federal Court After CAS Dismisses Appeal & Upholds World Aquatics Ban Over Conflict Of Interest

2023-09-20 Reading Time: 6 minutes
Paolo Barelli LEN president at the opening of the Nyon offices - Photo courtesy of Giorgio Scala/Deepbluemedia

The Court of Arbitration for Sport (CAS) has ruled in favour of FINA (now rebranded World Aquatics) and against Paolo Barelli, former FINA Bureau member and president of LEN (now rebranded European Aquatics) and FIN, the Italian federation.

The CAS decision is not yet published but official documents seen by SOS show that a one-year ban imposed on Barelli by FINA, starting last November, on a specific point of FINA rules, will stand.

Scrutiny of Barelli has been a complex affair, one in which the Italian senator has lost some battles, won others. The war, if you like, is not over.

Having lost his appeal at the CAS, the Italian Senator, suspended president of FIN and a former Olympic swimmer, has announced in Italy that he will appeal the CAS decision at the Swiss Federal Court, which cannot judge the merit of the rules of sport but can assess whether all aspects of cases have complied with Swiss law.

One part of the suspension, discounted for one year and reduced for the other, will expire on November 8 but another part of the penalty and appeal case involves a second disqualification until 2025 relating to reimbursements to FINA of 297,000 euros: that case will resume on September 23, next Wednesday, in Lausanne.

Investigations into Barelli first arose when fellow LEN and FINA figure, Bartolo Consolo, head of the Swiss Swimming Federation, lodged complaints about Barelli’s alleged management irregularities.

On 21 January 2022 the Morges (Svi) Prosecutor’s Office closed the criminal case, while on March 9, 2023, FINA increased the suspension of Barelli to three over “undue payments”. The WA Ethics Panel stated at the time that the one-year ban imposed on Barelli “will remain in force even after its expiry if the amount of 297,000 euros is not fully reimbursed”. On 9 May, the CONI (Italian Olympic Committee) Sport Attorney General, Ugo Taucer, closed the three investigation procedures that had been underway.

A Case Of ‘Conflict of Interest’

Barelli was investigated by the FINA Ethics Panel on allegations of multiple rule violations of the FINA Constitution and the FINA Code of Ethics including that at the heart of the CAS case, noted by FINA at the time it imposed a ban on the Italian, as: 

  • the unilateral signing of an addendum to a contract between LEN and FIN, that would benefit the latter by between €500,000 and €1.5 million.

Neither side come out of the CAS argument bathed in glory but Barelli, while winning some points of argument, has lost his appeal against suspension. In that key regard, FINA wins on the basis that the Italian is now judged to have broken article V. F. 14 of the FINA Ethics Code when he signed agreements between two organisations he presided over at the same time.

The CAS Panel (see image) asked itself five key questions (see below) before concluding:

“On balance, and in the light of the fact that the one-year suspension is not grossly disproportionate to the offense when taking into account the totality of the circumstances above, the Panel refrains from further reassessment of the sanction, a one-year ban from taking part in any Aquatic-related activities under the auspices of FINA or its members.”

CAS, September 2023

Here they are, with a note on ‘who won the point’.

The balance of argument: Barelli (Appellant) and FINA (Respondent)

Question 1. Can the alleged violation of the Appellant’s (Barelli’s) right to be heard be the sole prerequisite for repealing the third referral decision?

Who wins the point? The CAS, in favour of FINA

The Panel notes in Point 63 that “even assuming that the appellant right to be heard was violated in the proceedings before the Fina ethics panel, it cannot be the sole prerequisite for repealing the third referral decision.”

In short, backed up by points 64-67, even if FINA were deemed to have erred in failing to give Barelli due hearing, such a mistake would not in itself justify throwing out the decision made nor would it prevent a hearing at CAS on matters in the jurisdiction of the tribunal.

Question 2: Did signing the addendum breach any rules of the LEN Constitution and, if so, which ones?

Who wins the point? Barelli.

The panel questions whether Fina has a jurisdiction to sanction a violation of line rules but decides that it will review the land Constitution to evaluate whether Barelli could be accused of violating any of those LEN rules cited.

In short Point 75 of the ruling notes where the balance a favour falls: “The panel finds it difficult to discern a breach by the appellant … “. It notes the generalities at the heart of the articles of the land Constitution cited by Fina as problematic and concludes in Point 78: “the panel finds that neither article, no article of the LEN constitution are sufficiently unambiguous to be the sole grounds for holding the appellant accountable for signing the addendum.”

The Panel, “much to its surprise”, notes an error in the FINA legal paperwork, which sites the wrong number for one of the articles at the heart of debate.

The most relevant points:

  1. On Article C. – “this norm does not define “fees”, no it does [it]. Hence, there is norm is not sufficiently unambiguous to be the sole grounds for holding [Barelli] accountable for signing the addendum.
  2. “Also, Barelli’s alleged violation of article C.11.5.2 is not justified”

Question 3: Did signing the Addendum breach any of the FINA rules, and if so – which ones?

Who wins the point? Barelli wins one point, FINA another but that FINA win means that CAS comes down on the side of FINA: Barelli is found to have breached the FINA Ethics Code.

The panel considers to Fina rules: C.12.1.3 (“bringing the aquatic sport into disrepute”; and, V.F.14 of the FINA ethics code.

C.12.1.3: Barelli wins

Point 88. “… the panel believes that any claims aimed at finding Barelli guilty of bringing the sport into disrepute in these cast proceedings are not justified”

Point 89. “the panel fails to see how the signing of the addendum might brought the acquits (sic) [Aquatics] sport “into disrepute” i.e., damage its reputation … It was not uncommon during the Covid-19 pandemic to modify contractual terms in most areas of business life – including sports – to reflect the changing market conditions and to adapt to the new regulatory frameworks.”

V.F.14 of the FINA Ethics Code. FINA wins

  1. The panel does, however, agree that [Barelli] breached the second rule… The panel finds that [Barelli]’s conduct exemplifies the existence of a conflict of interest. [Barelli] should have accused himself from signing [the] addendum on behalf of LEN.

It cites the rule:

Official shall not perform their duties in matters with an existing or potential conflict of interest. Should a conflict of interest, or the appearance of a conflict of interests (sic), arise or if there is a danger of such conflict arising, the individual concerned must refrain from taking any further part in the handling of the matter. If it is unclear whether such a conflict of interests (sic) exists in any given situation, the matter may be submitted to the Ethics Panel.”

Beyond argument that goes against Barelli’s, the panel concludes:

  1. “In the Panel’s view, [Barelli], as president of both LEN and FIN, should have refrained from participating in the decision whether a hosting fee reduction should have been granted to FIN or – at the very least – submitted the matter to the FINA Ethics Panel for consultation. Since [Barelli] failed to do both, the panel finds that [Barelli] violated article V.F.14 of the” FINA Ethics Code.

Question 4: Did the Third Referral decision correctly identify and indicate rules which have been allegedly breached by the appellant?

Who wins the point? FINA

The CAS Panel explanations are thorough and lead to the conclusion that FINA was correct to challenge and issue a ruling on the alleged rule violations, regardless of the nature of that ruling.

Question 5: If, having duly analysed the case material, the Panel fines the appellant had breached the conflict of interest rules, is the extent of the sanction commensurate?

Who wins the point? FINA

In the course of lengthy and thorough consideration of what the rules and Ethics Code have to say on conflicts of interest, through two revisions to the 2014 version, in 2017 and 2021, we find the following notes:

  1. The panel notes that the sanction meted out on the appellant, wall more significant than a warning or reprimand, was also not the most severe, considering that a one-year suspension is nowhere near a lifetime ban. This indicates a balanced (or, at least, non-arbitrary) approached by the ethics panel, who are apparently seeking to deter future misconduct with a meaningful, but not excessive, penalty.
  2. The panel notes what remains in Barelli’s favour, including LEN’s thanks and congratulations to him in relation to the Addendum on the contract relating to the reduction in fee between LEN and FIN; the fact that FINA had never before taken issue with Barelli’s conflict of interest related to him holding the presidencies of LEN and FIN at the same time (but the panel notes that even where there may have been previous conflicts on interest, any wilful or other form of blindness (my words, not their’s) “does not grant a ‘license’ for conflict of interest to provide in the future”; the fact that Budapest (Hungarian federation) also got a fee reduction of similar nature in 2021, so Rome and FIN were not the sole beneficiaries of the type of addendum in play; limited impact on public opinion; and the panel’s view that “damage caused to the image of Fina must have been small, if any”.

However, taking all things into c consideration, the Panel concludes: “On balance, and in the light of the fact that the one-year suspension is not grossly disproportionate to the offense when taking into account the totality of the circumstances above, the Panel refrains from further reassessment of the sanction, a one-year ban from taking part in any Aquatic-related activities under the auspices of FINA or its members.”

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