Football Governance Collides With Sanctions Law as FIFA Payment Orders Create Compliance Tension

European football has been pulled into an extraordinary compliance conflict after a series of FIFA rulings — compounded by the existence of the FIFA Clearing House as a centralised payment system — placed clubs under pressure that closely resembled the dynamics typically associated with sanctions-evasion exposure. These decisions arrived while EU, UK, and US sanctions regimes barred payments to a range of Russian clubs and their banking partners, shutting down all lawful payment routes. Banks across Europe had already confirmed that transfers could not be executed, yet FIFA continued to enforce payment deadlines backed by the threat of sporting penalties. Because the cases were publicly documented, clubs were never going to risk illicit transactions, but the pressure created by the decisions mirrored patterns normally linked to attempts to bypass sanctions. The situation exposed how private governance rules can crash into binding financial law and demonstrated the AML risks that arise when a sports authority issues directives incompatible with national sanctions frameworks.

Sanctions-evasion pressure became evident when FIFA instructed West Ham United to settle a transfer instalment with CSKA Moscow at a time when British sanctions prohibited payments to entities connected to the club’s ownership and banking network. West Ham’s bank rejected the transfer outright, confirming that the payment was blocked and could not be processed under UK law. The club advised FIFA that no legal channel existed to complete the transaction. FIFA nevertheless insisted that the debt remained due, creating the sort of structural pressure compliance officers recognise from sanctions-evasion typologies: an environment in which an entity is pushed toward exploring alternative pathways precisely because legitimate routes have been sealed off. Although West Ham did not consider any workaround, the logic of the ruling placed the club in a position where only theoretically available methods involved using third-party or non-sanctioned intermediaries. When the matter reached the Court of Arbitration for Sport, the tribunal confirmed that any such alternative would constitute circumvention, establishing that any attempt to satisfy the payment outside standard channels would breach sanctions law.

This pattern repeated across multiple jurisdictions, including Italy, Switzerland, the Netherlands and Israel. Atalanta informed FIFA that it was legally unable to send an instalment to Lokomotiv Moscow because both the club owner and its bank were under EU sanctions. FC Basel submitted letters from its bank stating that payments to CSKA Moscow could not be executed under current restrictions. PSV Eindhoven and Norwich City found their transfers blocked even though their Russian counterparties were not individually designated; the banking prohibitions affecting Russia broadly meant that no payment could be processed. Clubs presented documentary evidence to FIFA showing that sanctions law rendered the transactions impossible, yet the governing body consistently reaffirmed the obligation to pay.

The conflict escalated further with cases like Udinese’s transfer from CSKA Moscow, completed after sanctions were already in force. When payments later became impossible, FIFA ruled that the club should have anticipated the sanctions environment and maintained that the debt stood. Compliance officers interpreted the situation as a textbook example of a transaction stranded by legal reality: no payment path existed, and any attempt to fulfil the obligation would require behaviour prohibited under sanctions legislation. Clubs also rejected proposals from Russian teams to use alternative banks or intermediary channels, noting that these methods mirrored well-established signs of sanctions circumvention. Under European law, any structure designed to achieve a prohibited outcome via indirect means qualifies as circumvention. Yet by continuing to require payment, FIFA rulings repeatedly created a scenario in which compliance with sporting rules was only achievable through conduct inconsistent with sanctions obligations.

A more obscure but increasingly relevant dimension is the existence of the FIFA Clearing House, the centralised mechanism designed to process certain eligible transfer payments worldwide. Although it does not apply to every type of transaction, its presence raises questions when viewed alongside rulings that demand payments to Russian clubs that cannot legally receive funds. The system was built to improve transparency, enhance traceability, and reduce fraud — all objectives that align with global AML standards. There is no public indication that the Clearing House has been used to circumvent restrictions, and its framework includes compliance checks consistent with international best practices. The concern instead relates to structure: the combination of mandatory FIFA decisions and a centralised global payment infrastructure invites scrutiny about whether such a system could theoretically be pressured to process transfers that commercial banks are barred from executing.

Analysts evaluating sanctions-evasion typologies commonly examine alternative routing mechanisms, nested structures, or unconventional conduits that allow funds to move around blocked corridors. The Clearing House is not intended for any of these purposes and is designed to operate within established compliance frameworks. But the structural question persists: when a private body continues to enforce payment obligations that national governments explicitly prohibit, any connected payment mechanism must be assessed to ensure it cannot inadvertently become a pathway for restricted transfers. The issue concerns risk design, not misconduct — ensuring that a centralised system cannot, even unintentionally, facilitate payments that fall foul of sanctions regimes.

Across Europe, the substance of the problem has remained constant. FIFA has upheld contractual obligations that clubs cannot legally meet. Clubs have consistently adhered to sanctions requirements and refused any attempt at workaround solutions. Banks have documented the illegality of the transfers and blocked each attempted transaction. Nevertheless, the decisions have continued, generating a recurring pattern in which sporting governance pressures clubs toward exposure to sanctions-evasion risk, even though none have engaged in prohibited activity.

The CAS ruling in favour of West Ham created a critical legal benchmark, affirming that national sanctions legislation overrides private sporting directives and that any attempted rerouting of payments would constitute illegal circumvention. The wider situation now exposes a conspicuous gap between global football governance and the realities of sanctions compliance. The presence of the FIFA Clearing House adds another layer requiring careful oversight to ensure it cannot inadvertently act as a conduit for prohibited transfers. As sanctions remain in force, European clubs must operate within the legal reality that payments to Russian institutions cannot be conducted under current frameworks. FIFA’s decisions, however, have produced an ongoing compliance strain, underscoring the necessity for sporting structures to align with binding public law — particularly when sanctions-evasion risks emerge not through intentional wrongdoing but through structural pressure created by governance decisions.

By fLEXI tEAM