Free movement—justifying the restrictions

Two main bases were advanced in order to justify the legislation: that there was justification provided by the public interest in the protection of intellectual property rights and that there was justification rooted in the objective of encouraging the public to attend football stadiums. Neither claim was fully successful, but neither was rejected out of hand. Sport is special but, in an echo of Bosman, it was not reckoned to be special enough to justify the challenged model.

The Court concluded that the prohibition on using foreign decoding devices is capable of being justified by the public interest in the protection of intellectual property rights.132 But in the particular circumstances it was not justified. In this sense the ruling prioritized the interest in free movement and consumer choice in the internal market ahead of the interest of the right holder in maximizing income from sales within the internal market. But the Court’s reasoning was nuanced and left space for some degree of protection—just not to the full extent attempted at the time of the dispute by the Premier League and BSkyB. And it did not at all neglect the character of sport, as promoted by Article 165 TFEU. The Court, helped by a thoughtful and lengthy Opinion provided by Advocate General Kokott, with which it mostly agreed, deserves credit for an assiduous attempt to do justice to the complexities of the matter under examination.

Sporting events cannot be regarded as intellectual creations: football matches are subject to rules of the game, leaving no room for creative freedom, and so such events cannot be protected under copyright.133 However, the Court proceeded to find that ‘sporting events, as such, have a unique and, to that extent, original character which can transform them into subject-matter that is worthy of protection’.^4 This is an observation that has something in common with the Court’s supple readiness in Bosman and Meca-Medina to find something distinctive and special about [1]

133 Karen Murphy (n 125) paras 98—99. 134 ibid para 100.

sport even in the absence of any mention of sport in the Treaty; but here, given that the reforms of the Lisbon Treaty effective from 2009 had finally brought sport within the explicit terms of the Treaty, the Court was able to supplement such general observations with an explicit anchoring of the argument that ‘sport is special’ in the Treaty itself. So it immediately cited Article 165(1) TFEU’s direction that the EU is to contribute to the promotion of European sporting issues, while taking account of the specific nature of sport, its structures based on voluntary activity, and its social and educational function.[2]^ This was only the second judgment in which the Court had cited Article 165: the first was Bernard}36 Reliance on Article 165 as a basis for recognizing the legitimacy of national protection of sporting events is significant, though there is nothing new about the Court’s basic structural approach, which is to take a creative and broad approach to the scope of justification under free movement law, nor indeed is the admission that sport is special new either. So, as in Bernard, Article 165 seems here to be treated as a packaging of existing assumptions that were developed in advance of the entry into force of the Lisbon Treaty in 2009, the moment from which Article 165 became part of EU law. The Court then noted too that Directive 97/36 already recognized events organized by an undertaking legally entitled to sell the rights pertaining to that eventd37 So the Court found that national legislation conferring protection on sporting events is capable of being treated as justified even where it acts as a restriction on the free movement of services.

But the Court immediately supplemented this by asserting that such a restriction must not go beyond what is necessary in order to attain the objective in view. This is orthodox: free movement law is built on an assumption, frequently visible in the Court’s case law, that both the end in view and also the means used must be justified. So this allowed the Court to determine just how far EU law goes in leaving space to protect the commercial value of the intellectual property concerned.138 The grant of the licence to broadcast is the obvious starting point in making money out of the sporting event. This may involve territorial exclusivity. But the Court drew a line. It would not accept arrangements that guaranteed absolute territorial exclusivity. This went beyond what a right holder could expect.

Admittedly, in Coditel the Court had, as long ago as 1980, found no breach of EU free movement law where an assignee of the performing right in a film relied on that right to exclude the film from being shown on cable television in Belgium, where it had been transmitted after being broadcast in another Member State, Germany, by a third party with the consent of the original right holder.139 The key point about Coditel was that there were two distinct rights being exploited: allocation of television rights on a territorial basis was justified and so too was action taken to restrain cross-border retransmission which would damage the exploitation of [3] [4] [5]

the rights to show the films in the cinema. But the situation now before the Court was different because there was no question of an attempt to prevent broadcasting of matches in order to protect a different means to exploit the right to show the match. Instead what was occurring was the partitioning of the EU internal market on national lines in order to maximize income.[6] [7] [8] [9] [10] [11] [12] [13] The Court refused to sanction the partitioning of national markets, which would lead to artificial price differences. This, it found, was ‘irreconcilable with the fundamental aim of the Treaty, which is completion of the internal market’.^ As Advocate General Kokott put it: ‘This impairment of freedom to provide services is particularly intensive as the rights in question not only render the exercise of freedom to provide services more difficult, but also have the effect of partitioning the internal market into quite separate national markets’.^

The separate attempt to find justification in the objective of encouraging the public to attend football stadiums was rebuffed briskly and crisply.143 The ‘closed period’ rule, encountered earlier, in section 11.6,144 prohibits the broadcasting in the United Kingdom of football matches on Saturday afternoons. It aims to sustain a lively atmosphere inside grounds by encouraging spectators to attend matches ‘live’. This practice, which impeded the commercial freedom of broadcasters to show matches during the ‘blocked’ period, had been the subject of inspection by the Commission some ten years earlier. The Commission concluded that the rules fell outwith the scope of application of Article 81 EC, now Article 101 TFEU. This was routine competition law analysis: the rules did not appreciably restrict competition.145 It explicitly stated that it therefore did not need to assess the extent to which the televising of football exerts a negative impact on attendance at matches: it had, in short, no need to inquire into whether sport is specialTh6 In 2006 the Commission Decision on the collective selling of the media rights to the FAPL dealt exclusively with the horizontal aspects of selling and did not address the blocking rules. 147 In Karen Murphy the matter was addressed from the perspective of free movement law, but the outcome was the same: the Court, like the Commission previously, did not exclude the possibility that sport may have particular concerns associated with the need to encourage ‘live’ attendance but it was able to resolve the dispute under a conventional legal approach which did not require it to address or assess the significance of this sport-specific concern. It was pressed on the Court that the objective of ‘blocking’ broadcasts on Saturday afternoons would be thwarted if television viewers in the United Kingdom were able freely to watch Premier League matches which broadcasters transmit in other Member States. The Court pointed out that the claimed objective could be achieved by placing a limitation in the licence agreements so that broadcasters would be required not to broadcast those Premier League matches during closed periods. This would doubtless reduce the value of the rights. But it was not open to the Premier League to seek to justify restrictions that were not necessary to achieve the end in view by relying on their commercial interest in doing so. The Court therefore did not rule against the possibility to justify ‘blocking’ periods in principle, but it did rule against this method of achieving it. This aligns with EU internal market law more generally. A Member State which has a choice between various measures to attain the same objective is required to choose that which least restricts free movement. Otherwise the choice is disproportionately restrictive.148

Advocate General Kokott’s treatment of the matter was helpfully fuller than that of the Court, although she agreed with the Court that no special concession could be made in the circumstances. Given that she, unlike the Court, made explicit use of Article 165 TFEU in reaching this conclusion, a paragraph’s brief attention is warranted. She noted that the existence of ‘closed periods’ restricts output and reduces income, and this she accepted as ‘primarily a sporting interest which is in principle to be recognised in European Union law’, citing the Lisbon Treaty’s reference to the specific nature of sport and its structures based on voluntary activity.149 She conceded a broad margin of discretion to football authorities in fixing closed periods. But she then switched tone: since she could not rule out that the closed period was ‘also based at least in part on safeguarding the economic interest of the most important members of the association in partitioning the internal market for live football transmissions’ she insisted on the application of a ‘particularly strict test’ in appraising the need for closed periods.150 And she expressed doubt as to whether closed periods are even capable of encouraging attendance at matches and participation in matches, and added that the majority of football associations impose no closed period.151 So, in summary, she was not minded to interpret the Lisbon Treaty as granting a wider zone of autonomy to sport than previous practice had permitted. In this sense the Opinion has close associations with cases such as MOTOE,152 in which claims that ‘sport is special’ in truth mask commercially motivated attempts to evade the normal assumptions of EU law, as well as less egregious instances of over-ambitious appeals to protect sporting autonomy such as Bosman.153 The Court was less strident than its Advocate General, for it confined its rejection of the case for enforcing closed

  • 148 eg Case 261/81 Walter Rau [1982] ECR 3961; Case C-189/95 Harry Franzen [1997] ECR I- 2471; Case C-170/04 Klas Rosengren [2007] ECR I-4071; Case C-333/14 Scotch Whisky Association, judgment of 23 December 2015.
  • 149 Karen Murphy (n 125) para 207, Opinion of Kokott AG.
  • 150 ibid para 208, Opinion of Kokott AG. 151 ibid para 209, Opinion of Kokott AG.
  • 152 Case C-49/07 Motosykletistiki Omospondia Ellados NPID (MOTOE) v Elliniko Dimosio [2008] ECR I-4863. See Ch 10.
  • 153 Bosman (n 2).

periods through restrictions on cross-border trade in decoders to the observation that this could be achieved simply by doing so via the terms of the original licensing—by refusing to sell rights to broadcast matches played during the ‘closed period’ in any jurisdiction.

  • [1] 29 ibid paras 77—84. 130 Weatherill (n 33). 131 Karen Murphy (n 125) paras 84—89. 132 ibid para 94, citing Case 62/79 Coditel and others (Coditel I’) [1980] ECR 881; and JoinedCases 55/80 and 57/80 Musik-Vertrieb membran andK-telInternational [1981] ECR 147.
  • [2] 2 ibid para 101.
  • [3] Case C-325/08 Olympique Lyonnais v Olivier Bernard, Newcastle United [2010] ECR I-2177.See Ch 7.2.
  • [4] Karen Murphy (n 125) para 103. On protected events, see sect 11.9.
  • [5] ibid paras 106ff. 139 Coditel I (n 132).
  • [6] Karen Murphy (n 125) paras 117—20 of the Court’s ruling; more fully in Opinion of KokottAG, paras 193—200.
  • [7] ibid para 115. 142 ibid para 175, Opinion of Kokott AG.
  • [8] 143 ibid paras 122-24. 144 Comm Dec 2001/478 [2001] OJ L171/12.
  • [9] 145 UEFAS Broadcasting Regulations (n 109) paras 49-61 of the Decision. The Commission stated
  • [10] that it will monitor change in market structure, particularly in the wake of the ‘Internet revolution’,
  • [11] ibid para 56.
  • [12] ibid para 59. Regrettably the Press Release concerning this matter (IP/01/583, 20 April2001) claims that the decision ‘reflects the Commission’s respect of the specific characteristics of sportand of its cultural and social function’. As explained in Ch 6.4, this is a misleadingly inflated account. Itwould be accurate to say that the decision reflects the absence of a need to take account of such matters.
  • [13] See n 71.
 
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