Nonprofit Associations in Sports: Encounters and Disagreements of Dominican Legislation.
March 22, 2021
By: Sebastian Linera | Associate
The year 2005 was, from the legislative point of view, an important year in the Dominican Republic. It is in that year that our Congress approved two laws that, unintentionally, would have various points of convergence.
The year 2005 was, from the legislative point of view, an important year in the Dominican Republic. It is in that year that our Congress approved two laws that, unintentionally, would have various points of convergence: Law No. 122-05, which regulates and encourages non-profit organizations (“Law No. 122-05), and Law No 356-05 which regulates sports in the Dominican Republic ("Sports Law"). And it is that, with the passing of the years, especially in practice, more than mere points of convergence, these laws have had real points of disagreement that have been an obstacle to the incorporation and good development of sports organizations that seek either to establish themselves or regularize.
Before delving into this matter, it is necessary to put the reader in context about the environment in which the submission and subsequent promulgation of both laws originated.
Let us start with the Sports Law. At the time of its enactment, sport at the associative level had already been practiced in our country on a frequent basis. However, there was no law that really and effectively safeguarded the rights of athletes and sport’s governing associations at the national level. The only related legislation, as far as sports are concerned, was Law No. 97-74, of December 20, 1974, which created the Secretary of State for Sports, Physical Education and Recreation. However, it is not until 2010, with the proclamation of our Magna Carta at that time, that it is given constitutional status and sports are recognized as a fundamental right.
Regarding non-profit associations, Law No. 122-05 comes into our legal system to replace Executive Order No. 520 of July 26, 1920 and its amendments. At that time, freedom of association was enshrined at the constitutional level, within the catalog of individual and social rights. This law establishes that "non-profit institutions are of great importance for the strengthening and development of a plural, democratic and participatory civil society, by favoring the achievement of objectives of public interest or of benefit to the whole of society."
Historically, sport has been considered an activity that promotes social and economic development, to the point that, as we mentioned earlier, today in our country it is a fundamental right. For their part, non-profit associations, through the mechanisms provided by the law, are also oriented to promote the development of society, being in this way that both laws begin to meet and connect with each other; for this reason, the importance of sports institutions being duly regulated and organized both legally and in practical reality.
Having made the previous preamble, we can go on to address the question of where and in what way the Sports Law and the Non-Profit Associations Law have disagreements, let us see:
On the one hand, we have a Sports Law that obliges sports institutions to be regulated through non-profit organizations and, on the other hand, a Non-profit Organizations Law that regulates this type of institutions in a general way. Both laws with dissimilar procedures.
In good law, and from the perspective of what should be, both laws, developed by our Legislative Branch in not distant times (April and August of the same year), should be able to coexist in our legal system without any problem. However, there are several practical conflicts that make it difficult for to be applied effectively. We could devote many hours of study to these questions. However, we have decided to address only one of them in this installment: the requirements for creating a legal entity with a sports nature.
Law 122-05, in its Article 2, defines as a non-profit association “the agreement between five or more natural or legal persons, in order to develop or carry out activities of social good or public interest for lawful purposes and that do not have as a purpose or object to obtain pecuniary or appreciable benefits in money to distribute among its associates”. An accurate definition if we look at it alone. Now, if we do a combined reading of said legal text and current sports legislation, we will see the crux of the matter.
First, we know that the organization chart of associative sports is configured as follows: i) Sports Federation (for example, Softball Federation of the Dominican Republic); (ii) Provincial Sports Association (for example, Bahoruco Province Softball Association); iii) Clubs, leagues, schools and / or academies. Each of these is hierarchically superior to the previous one.
When detailing the requirements to be able to operate as a sports organization under the framework of the General Sports Law, we see the following: to incorporate a sports federation, it must be formed by a minimum of five provincial associations that will represent clubs, leagues, schools, and academies. In turn, the provincial sports associations must be made up of a minimum of three (3) clubs, leagues, schools and / or academies, in the interior of the country, and a minimum of five (5) in the National District, in both cases, under special conditions, they could be constituted with a minimum of fifty athletes. However, our Sports Law does not provide for these special conditions and there are no regulations in this regard, despite the reservation of regulatory development provided in the same law.
On the other hand, Article 52 of our Sports Law establishes that the statutes of sports organizations must establish that they are a non-profit entity, that is, they must be incorporated under this modality.
Here the problem arises that we are interested in highlighting. If according to the Sports Law (special law and subsequent to Law No. 122-05), the minimum to incorporate a provincial association is three (3) clubs, leagues, schools and / or academies, the authorities should not require the provincial associations the same requirements that are demanded to incorporate an association under Law No. 122-05, since as previously mentioned, this law requires that there be five (5) members, natural or legal persons, which translates into a violation of the principle of legality.
Given this situation, the only possible alternative in the face of the Sports Law is to register the association with the minimum of 50 athletes that the Sports Law provides (which only applies under special conditions and is not feasible for any type of sport, for example, football). An additional ingredient to all this is that, despite this legal provision, most sports federations require that their provincial associations contain natural persons as members of these.
Let us look at the example of the Dominican Football Federation (FEDOFUTBOL), which in paragraph II, of its article 17, of its current statutes, establishes the following:
“The Provincial Soccer Associations will have their own statutes that must be in accordance with the statutes of FEDOFUTBOL, incorporated only one in each province of the Dominican Republic and that group at least three (3) entities with legal personality in the form of clubs that formally participate in soccer competitions in at least two (2) categories with a minimum of forty-five (45) players registered on the official FIFA platform for player registration, at least two (2) years of existence and that can demonstrate the right to use or property of the field where their activities are carried out promoting the development of soccer. In the case of the National District, the minimum will be five (5) entities”.
These statutes, like countless others of the same nature that have been made in accordance with the law that governs the sports sector, serve to illustrate the current problem and on which we want to draw the attention of the authorities, since, despite complying with the requirements of the (sports) law, in practice they cannot be registered for the incorporation or adaptation of a provincial association as a non-profit organization before the corresponding institutions, for allegedly not complying with the requirements of Law No. 122-05.
We place so much emphasis on the fact that this is a more practical than legal problem, since, ideally, we should be applying fundamental principles of law, such as the application of the law in time and special laws versus general laws. If these are used, it would not be necessary to even have to think about loading legislative work with a reform to expressly define this issue.
Finally, after analyzing all these aspects, we can conclude that the problem addressed here is an issue that must necessarily be resolved with political will. This in the understanding that it is not enough just to recognize sport as a fundamental right, but that the State must guide its efforts to guarantee access and full exercise of it. The fact that requirements are required beyond those established by the Sports Law, constitutes an obstacle in the exercise, not only of the right to sport, but also other rights such as freedom of association and even the free development of personality, if we wanted to approach it from the perspective of human dignity, which, as in sport, is essential for the construction of a society that functions in the terms that our Constitution aspires.
By: Sebastian Linera | Associate
The PELLERANO NADAL team is available to clarify any questions you may have in relation to this and other measures implemented by our authorities.