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Competition Law and Sports

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Competition Law and Sports VOLUME 2 ISSUE 3 MARCH 2019 ISSN: 2456-9666 COMPETITION LAW AND SPORTS - TEJASWINI1 & UTTAKARSH MATTIKOP2 ABSTRACT Sports right from ancient times has not been the same as it was before. In ancient times sports was played pleasure, then slowly it became a part of culture of a country and now in the present day it has become a business. Sports today is one of the biggest money-making industries with lots of money being spent. Cricket today has become a world-wide business, especially in a country like India cricket is not just a game but also a religion. Competition laws are framed so that unfair trade practices are prevented. Not only unfair trade practices but also prevent monopolistic trade activities, cartelization and other anti-competitive agreements. With Competition Act, 2002 substituting MRTP Act, the scope has now widened. With sports being now an industry there is now a need to include sports in the ambit of competition law. With BCCI misusing its position has given invitation to Competition Commission of India (CCI) to keep a check in the sports industry so that fair trade practice is followed. INTRODUCTION In India, sports is having its own 8000 years old history since early civilization, Atharvaveda also holds the traditional Olympic oath. And in this modern era, cricket, hockey, tennis etc. growing immensely and also the players have been recognised and appreciated internationally. But as we can see that, the government is neglecting the sports sector, as there are institutions like Ministry Of Youth Affairs And Sports that is, the apex body which provides planning and a good infrastructure to it3. The government made or passed many rules regarding sports, and also made rules regarding competition between the institutions. Sports is expanding remarkably that 1 Student, B.B.A LL.B 4th Year, New Law College Bhartiya Vidyapeeth Deemed University 2 Student, B.B.A LL.B 4th Year ,New Law College bhartiya Vidyapeeth Deemed University 3 Dr. Vijay Kumar Singh, a primer on „sports and competition law interface‟ in India https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2973042 JUSIMPERATOR www.jusimperator.org Page 1 VOLUME 2 ISSUE 3 MARCH 2019 ISSN: 2456-9666 some people make sports their business and making multi-millions from the billons of fans of sports and also enjoying the dominant position in the market as well. The scope of competition law in India is getting wider day by day, to remove the wrongful activities done by the huge organisation, like abuse of dominant position, unfair trade practices, restrictive trade practices, monopolistic trades, because nowadays sports is also falling into the same category of abuse of dominance in the market because there are various sports organisations who all are into this business. Sport‟s is becoming a global business and yet there are multiple ways for the sports organisations to significantly getting different from the other organisations and also maintaining competitive balance between the organisation. APPLICABILITY OF COMPETITION LAW INTO SPORTS In India cricket is on the peak level and other sports like football, basketball, tennis are also gaining popularity with the large corporate who all are interested in investing in it and also in the sponsorship of it as well, which is attracting huge young audience towards it. Basically for every sport there is a body which lays down the rules, regulations, criteria, eligibility of that sport. International federation with various national sports federations, which governs all the regulatory aspect of it. A sport basically follows the pyramid structures of it because of the multiple federations of sports have been recognized internationally. The European commission‟s Helsinki report was about the integrity, uniformity and control over the non-discriminatory rules applied to the sports globally and also encourage the immense growth of it worldwide. The International federation of sports is having their own set of regulations for restricting rival tournaments, but in country like India where sports is unique because it follows the pyramid structure of sports that ensures monopoly to maintain the unity and integrity in sports but there are many industrial thrives as well who just want to earn by unfair use of it. And for these kind of industries there is anti-competitive agreements to stop their dominance in the market by unfair means, therefore the competitive environment in the market of sports gave birth to competition law for sports industries as well. That is the reason why European Court created an exception, JUSIMPERATOR www.jusimperator.org Page 2 VOLUME 2 ISSUE 3 MARCH 2019 ISSN: 2456-9666 and that is divided into two parts, that is first being pure sporting function and second being activities having a substantial economic impact. COMPETITION ISSUES IN SPORTS SECTOR: The following five basic competition questions were identified during a Roundtable on sports organized by OECD24 in which various countries participated: (i) The nature of sports federations (should they be considered as normal commercial enterprises subject to competition law or as private non-profit making bodies which merely regulate the sports?) (ii) The relationship between sports federations or leagues and the constituent clubs (should the federations or leagues be viewed as cartels of clubs or as bodies independent of the clubs?) (iii) The nature of the product or service provided by the professional sports (should the matches be viewed as separate events or is there a positive externality in that a championship is more than a set of matches?) (iv) The nature of the relevant market (are different sports substitutable for one another or within the same sport are different competitions substitutable, particularly from the broadcasting perspective?)4 In India, there are cases of All India Chess federation and of BCCI and of Indian hockey Federation are some examples of it. These three cases decided by Competition Commission of India (CCI) are the important source of Competition law to be in the market of sports in India. Surrender Singh Barmi v BCCI (CCI, 61/2010) In this case, the competition commission of India passed an order under section 27 of the competition act, 2002 that the Board of control for cricket in India was found in contravention of the provision of section 4 of the Competition act, 2002. In this case the commission found that the BCCI at the dominant position in the market. It was given that 4 Dr. Vijay Kumar Singh, a primer on „sports and competition law interface‟ in India, https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2973042 JUSIMPERATOR www.jusimperator.org Page 3 VOLUME 2 ISSUE 3 MARCH 2019 ISSN: 2456-9666 the BCCI made an agreement with the broadcasters of the Indian Premier League (IPL) that they are not allowed to make this kind of agreement with any company in the market that is using the dominant position which is found to be in contravention of section 4(2)(c) of the Competition act, 2002. Afterwards CCI directed the Director General to carry out the investigation of 60 days, and it was found that it is the prima facia case of abuse of dominance under section 4 of the act5. The CCI imposed a penalty of Rs. 52.24 crores, being 6% of the average annual revenue of BCCI for the past three years6. Dhanraj pillay vs. M/s Hockey India (CCI, 73/2011) In this case, the competition commission of India charged Hockey India into anti- competitive practices and abuse of dominance in the market under section 3 and 4 of the act. It was found in the case that Indian Hockey federation (IHF) and Nimbus Sports with International Hockey Federation (FIH), and in that regulation it was notified related with to the events sanctioned and unsanctioned and also the same was communicated to all the National Associations, but afterwards the change in Code of Conduct agreement that participation in the unsanctioned events is against the disciplinary clause. After considering all the aspects of the case it was held that there is no contravention of section 3 and 4 of the Competition act 2002. Because there is no other competitor of Hockey India and they are having the economic power in their hands to regulate it accordingly7. Hemant sharma & others vs. All India Chess Federation (CCI, 79/2011) In this case, the complaint was filed against the All India chess federation, with the direction of Delhi High court in 2011 the writ petition was filed and in this petition it was asked that to direct All India Chess Federation and Ministry of Youth affairs and Sports 5 Competition Commission Of India, https://www.cci.gov.in/sites/default/files/61%20of%202010.pdf 6 SHRI Surinder Singh Barmi v. Board of Control of Cricket in India (BCCI) (case No. 61/2010), LEXOLOGY, February 28 2013 https://www.lexology.com/library/detail.aspx?g=ce867123-0993-4908-8cf0-1afc943f0ff2 7 Dollbonline, Dhanraj pillay v. M/s. Hockey India 2013 comp LR 543 (CCI), August 29, 2017 https://nujssitc.wordpress.com/2017/06/15/an-equal-ground-regulation-of-sports-governing-bodies-analysis- through-competition-law/amp/#referrer=https%3A%2F%2Fwww.google.com&amp_tf=From%20%251%24s JUSIMPERATOR www.jusimperator.org Page 4 VOLUME 2 ISSUE 3 MARCH 2019 ISSN: 2456-9666 not to ban certain players for the life time, who had associated with rival body. The All India chess federation also written to International governing body of chess to not to remove the players for the unauthorised participation. In the order of 2018, CCI concluded with that the AICF code of conduct is very harsh against the players, so there should not be the provision of ban from the game for life time.
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