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Property Rights Associated with the Sale of Rights to Broadcast Sports Events

The rights associated with the sale of broadcasting rights are property rights. They initially fall to be determined and defined under national law. Article 345 TFEU is explicit on this point: ‘This Treaty shall in no way prejudice the rules in Member States governing the system of property ownership.’ There is no centralized EU property law, and it is accordingly plain that the relevant rights will differ state by state within the EU. The home club would typically enjoy a right to exclude a broadcaster from its stadium where it is the owner of the ground. Whether it enjoys such a right as a tenant would depend on the terms of the contract with the owner. It may also have a right of sorts over the product, the match. But the away team, though holding no property right in respect of the stadium, would commonly also have some claim to property in the match itself. It is not only the participating clubs that are implicated. The organizer of the competition—the League, typically—might also have a stake. Rules and practice vary across the Member States of the EU.29 What, however, is clear is that Article 345 TFEU does not immunize rules governing property ownership from the application of EU law. Where their exercise cuts across the objectives of the EU, they are subject to review. Therefore Article 345 is a lot less valuable as a defence of sporting autonomy in the matter of the sale of broadcasting rights than it might first appear to be. The Court first made this clear in cases in which it was urged that Article 345’s intent was that property rights could not be addressed pursuant to EU law even where they obstructed cross-border trade. For example, Alfredo Albore concerned the exemption of Italian nationals from the requirement to obtain an authorization to buy property in certain parts of the national territory.30 Article 345 provides a reason not to object to the existence in principle of such a requirement, but it does not permit the evasion of EU law’s fundamental resistance to discrimination against nationals of other Member States nor of its control of restrictions on capital movements between Member States. Article 345 protects the autonomy of the Member States to structure their own systems of property ownership, but the way in which those systems are operated is subject to review for compatibility with the basic expectations of EU internal market law.31 Put another way, there is neither centralized nor comprehensive EU property law, but there is an emerging influence of EU law on national property law which is bringing into focus a distinctive soft species of EU property law.32 This is [1] [2] [3] [4]

fully in line with the EU’s characteristic claim to assert a broad functionally-based review of national law and practice pursuant to the Treaty provisions underpinning the internal market.[5] [6] [7]

In the case of practices pertaining to broadcasting rights, it is primarily the Treaty competition rules which are at stake. The twin pillars of EU competition law, explained in Chapter 3, are Article 101 TFEU, which exercises control over bilateral and multilateral practices that harm the internal market, and Article 102 TFEU, which is aimed at prohibiting the abuse of a dominant position within the internal market by a single powerful undertaking. Here too the same analytical pattern applies: Article 345 TFEU ensures that the definition and scope of such rights belongs at national level, but it does not shelter the way in which the rights are exercised from examination in the light of Articles 101 and 102.

The Commission’s Champions League decision clearly demonstrates this pattern.34 The legal analysis proceeds on the plainly correct basis that there is no common concept in the Member States attached to ownership of the property rights associated with staging football matches, nor is there any EU concept. The Commission saw no need to make a final ruling on exactly what type of property right is at stake, except only to exclude that UEFA was the sole owner of the property rights involved. Had it treated the matter as one where UEFA was simply selling its own property, then Article 101 TFEU would not have been relevant—though Article 102 TFEU might have been. Instead it decided to proceed on the basis that there is co-ownership between the football clubs and UEFA for the individual matches, and that there are multiple owners of the media rights to the UEFA Champions League.35 So the collective selling arrangement fell to be scrutinized in the light of Article 101. Article 345 TFEU did not save it—though, as is explained later, in section 11.5, Article 101(3) did.

Article 102 TFEU may apply where a sports federation which enjoys monopoly power in making the rules that govern the sport makes decisions with direct commercial implications. This may apply in the case of the sale of broadcasting rights and is especially likely to arise where the governing body has a powerful central organizing role which goes beyond that held by UEFA in Champions League. In FIA (Formula One) part of the Commission’s objections related to rules that provided a financial disincentive for contracted broadcasters to show motor sports events that competed with Formula 1.36 The Commission was satisfied with a solution according to which the FIA curtailed its influence in order to permit broadcasters to make their own commercial choices about which events to show. The crucial legal point, however, was that even though the case concerned property rights, Article 345 TFEU guaranteed only that their existence shall remain intact: it did not protect their exercise from EU competition law. Article 102 TFEU subjects the practices of sports governing bodies that have an economic impact to control, and they are likely to be treated as abusive where their restrictive effects go beyond what is necessary for the functioning of the sport. This is applicable to the use to which governing bodies put their broadcasting rights as to any other asset at their disposal.

The Commission’s rising interest in sport in recent years is primarily motivated by its concern to oversee the development of the broadcasting market to which professional sport has become commercially so intimately linked. It is, in short, less exercised by potential anti-competitive activity in sport than it is by pernicious practices in the deregulated and technologically dynamic broadcasting sector. Most of the relevant activity has focused on control of the selling of rights pursuant to Article 101 TFEU. The straightforward sale of rights is a purely contractual matter and in a market characterized by several competing buyers and sellers there is unlikely to be any problem of a type that would generate interest under competition law. But whether there really are adequate competitive influences depends on the particular market in which rights are being traded. In particular exclusivity, territorial restrictions, and collective selling all raise awkward competition law questions. In part they are questions that invite the application of EU competition law to sport in an orthodox manner. But—in line with the theme pursued diligently throughout this book—there may also be issues regarding the extent to which sport is special and accordingly demands more sensitive treatment. The autonomy of sport under EU law is conditional, not absolute, and the regulation of the market for the sale of broadcasting rights offers another fascinating case study into how to determine the precise contours of those governing conditions.

  • [1] See T Margoni, ‘The Protection of Sports Events in the EU: Property, Intellectual Property,Unfair Competition and Special forms of Protection’ (2016) 47 International Review of IntellectualProperty and Competition Law 386.
  • [2] Case C-423/98 [2000] ECR I-5965.
  • [3] cf eg J Rutgers, ‘The Rule of Reason and Private Law or the Limits to Harmonization’ inA Schrauwen (ed), Rule of Reason: Rethinking Another Classic of European Legal Doctrine (Europa LawPublishing 2005) ch 9; U Drobnig, HJ Snijders, and E Zippro (eds), Divergences of Property Law, anObstacle to the Internal Market (Sellier 2006).
  • [4] See E Ramaekers, European Union Property Law: From Fragments to a System (Intersentia 2013).
  • [5] See S Weatherill, The Internal Market as a Legal Concept (OUP 2017).
  • [6] Dec 2003/778 Champions League [2003] OJ L291/25, para 122, considered more fully later.
  • [7] ibid paras 123, 124. 36 COMP 35.163, Notice published at [2001] OJ C169/5.
 
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