Antitrust Aspect of Sports Broadcasting Rights

4th August, 2022 - 10:07 am Categories: Sports Law 0 Comments

Antitrust law thrives to protect market from any kind of distortions occurring due to corrupt business practices. It also promotes competition between different players in the market in order to benefit the consumers and also economy as a whole by keeping monopoly at bay. Today the sports have become a global phenomenon, with the advent of broadcasting technologies sports broadcasting has been turned into a lucrative business option, thanks to advertisements of deep pocketed multinational corporations. All this has turned sporting events into a big business activity, and big business activities bring along anti-trust issues.

In European Union, sporting events are dominated by Football, similar to like cricket is a dominating sport in India, and all the major decisions on antitrust aspects related to sports are based on cases of broadcasting rights related to Football. One of the major issues in EU is collective or joint selling of media rights, meaning the broadcasting rights of participating teams in the league or tournament are sold by association organising the event, which sells the collective right to a single broadcaster, raising competition law issues. In such scenarios, individual teams are deprived of their right to sell the broadcasting rights, restraining the scope of competition. However, the European Commission, on certain conditions, has allowed the joint selling of sports broadcasting rights in the decisions of UEFA Champions League, the FA Premier League and Bundesliga decisions.

In the US, the Sports Broadcasting Act of 1961 labels all the professional leagues of the country as ‘single entity’, enabling them to sell collective broadcasting rights. The Act came in the aftermath of the decision of United States v. NFL passed by a federal court, wherein, an exclusive broadcasting contract by NFL was held to be against the Sherman Act. The Act ultimately nullified the decision.

In India, just like broadcasting business, Sports broadcasting is also highly competitive with cricket broadcasting rights at its epicentre. In a recent development, Star India bought Indian cricket rights for a whopping 944 million US dollars for the period of 2018-2023, and for the same period, the company paid 2.55 billion US dollar for acquiring IPL rights.

India, unlike USA or EU does not have much of a popular professional sports leagues and the only popular league is the Indian Premier League (IPL) that too is marred by various legal issues. Recently, the antitrust regulator of the country, the Competition Commission of India, imposed a penalty of Rs. 52.22 Crores on BCCI in the case of Surinder Singh Barmi v BCCI  for its abuse of dominant position in organising the domestic cricket league i.e., Indian Premier League as the cricket regulator assured the broadcasters that it will not support or recognize any other competitive league similar to IPL. This was adjudged an abuse of the dominant position, as BCCI gave the sole importance to IPL only. The same penalty was also imposed back in 2013, but the appellate authority set the same aside. From these cases it can be inferred that the Competition Commission is closely observing the sports broadcasting scenario which is expanding each year, with the advent of new leagues other than cricketing ones, like Indian Super League (Football), Pro Kabaddi League and Hockey India League. Moreover, with these, the tumult of Competition watchdogs will be on a surge unless a comprehensive policy, as discussed above, is implemented to regulate the SBI in cohesion with the other related laws.

A Case Study: Union of India v. BCCI and Ors.

Recently, the Apex Court infamously settled down the long drawn battle between Prasar Bharti and BCCI and its licensees, regarding the broadcasting and retransmission of the live telecast of cricket matches of India. Basically, as per Section 3 of the Sports Broadcasting Signals (Mandatory Sharing with Prasar Bharti) Act, 2007 read with Section 8 of the Cable Act, 1995, it is mandatory for the content right owners to share their live feed with the Prasar Bharti for it to further retransmit the same through its own terrestrial and DTH networks for the fulfilment of its expropriatory nature. However, in the case, the extent of retransmission was discussed, so as, to not hamper the prospects of private content right owners, without the presence of any monopolistic element.

The dispute was initiated by the BCCI, as its thriving multi-billionaire market generated by the advertisements in the live telecast by private broadcasters was suffering and there was a need to balance the competing interests of maximising the private profits and of providing the access to public. The Apex Court held that the retransmission by the Prasar Bharti could only be done via its own terrestrial or DTH networks and not through any private cable or DTH operators. The rationale provided by the Hon’ble Court was that if the revenues are shared between Prasar Bharti and private broadcaster, even then, the expropriatory nature of the law would not be defeated and the intent of the Parliament would not fail. Moreover, the condition stipulated u/s 8 of the Cable Act, 1995, to retransmit Doordarshan by the cable operators is not provided u/s 3 of the Sports Act, 2007 and Section 3, in the absence of any such express condition, must be read independently. This led the Court to hold that Prasar Bharti cannot retransmit live telecast to the Private broadcasters and DTH and cable operators and these operators must be able to reach the consumers who have subscribed to them independently. This judgment also disabled any whimsical construction of statutes unless there is an express legislative intent. This also explored the antitrust aspect, and the Apex Court, though nowhere expressly provided, but it can be implied that through this judgment, it reduced the anti-competitive practice of Prasar Bharti and allowed the private operators to reach consumers directly. The impact this decision will have on public access to sports is going to be staggering. The industry is suffering from a stir of controversies now; however, this judgment gave a dual pronged approach to the industry, as the Apex Court upheld the supremacy of Antitrust Law, the State monopoly and the aura of Doordarshan in the live space has been reduced significantly.

Conclusion

Howsoever a law is developed; there is always a scope for its expropriatory interpretation. In this matter though, the legislators or the judiciary have not touched much upon the Law, and it is for them to carry forwards the positive legacy of the Hero Cup and Prasar Bharti, for developing an eclectic framework on the issue. A comprehensive law on the issue of Sports Broadcasting is imperative, in order to save its tussle with the issues of either Competition or IP Law.

Author: Rishab Pillai – a  Student from Dharmashastra National Law University (Jabalpur), in case of any queries please contact/write back to us via email chhavi@khuranaandkhurana.com or at Khurana & Khurana, Advocates and IP Attorney.