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TOM BURROWS is a sports lawyer and an associate in the Sports Group at Sheridans. He advises on all areas of commercial matters related to the sports industry, including the sale and acquisition of media rights to sports properties, sponsorship programmes and licensing agreements. He has experience acting for international governing bodies, broadcasters, sports teams and agencies. In the latest in a series of new columns by Sheridans lawyers for Sportingintelligence, Burrows explains the legal reasons for certain sports events remaining live on free-to-air to television – and how a challenge by Fifa and Uefa appears to have failed to change the current regime.
By Tom Burrows
10 May 2013
On 12 December 2012, Advocate General Jääskinen recommended that the Court of Justice of the European Union (CJEU) dismiss claims from FIFA and UEFA against inclusion of all Fifa World Cup and UEFA European Championship games on lists of events reserved for free television in certain markets.
In laymen’s terms, he concluded that the UK Government was free to include many of those tournament matches on its ‘crown jewels’ list, thereby ensuring that such matches would be available on free-to-air television.
However, it is not just the FIFA World Cup and UEFA European Championships that are affected by this ruling, with many other events – including the Wimbledon tennis championships, which begin in a fortnight – forming part of the UK’s list.
That is why the CJEU ruling has been eagerly anticipated by sports rights holders, particularly with the UK Government due to release its proposals for the listed events regime later this year.
Although we are still awaiting the final CJEU decision, with FIFA having carved out the territory of the UK from its tender of the European rights to the 2018 and 2022 FIFA World Cups until this time, it would be highly unusual for CJEU to go against the Advocate General’s findings.
Therefore, we are likely to continue to see Sue Barker and the BBC at Centre Court for many years to come.
Listed Events: the legal framework
Article 14 (1) of the Audiovisual Media Services Directive (AVMS – formerly contained within Article 3a (1) of Directive 89/552 as amended) allows Member States to draw up a list of events of major importance for society that cannot be broadcast on an exclusive basis ‘in such a way as to deprive a substantial proportion of the public … of the possibility of following such events via live coverage or deferred coverage on free television’.
Article 14 (2) of the AVMS requires each Member State to notify its list to the European Commission and for the Commission to ‘verify that such measures are compatible with’ EU law within three months.
In drawing up this list, the Member State must determine whether the events should be available via whole or partial live coverage, or – where appropriate – whole or partial deferred coverage.
In the United Kingdom, protected events are split into two categories: ‘Group A’ events and ‘Group B’ events (detailed in Annex 1 of the PDF available here).
For ‘Group A’ events, full live coverage must be offered to generally available free-to-air channels which are accessible by at least 95 per cent of the population (i.e. currently BBC, ITV, Channel Four or Channel 5, aka a ‘qualifying channel’) whilst ‘Group B’ events may be broadcast live on pay-TV channels provided that highlights are offered to a qualifying channel.
At the time of writing, ‘Group A’ events include the Olympic Games, Wimbledon tennis finals, FIFA World Cup finals tournaments (in their entirety) and the UEFA European Championship finals tournaments (ditto).
‘Group B’ events include Six Nations rugby union matches involving home countries, cricket Test matches played in England, the Ryder Cup and the Open Golf Championship.
It is the designation of all matches played as part of the UEFA European Championships Finals and FIFA World Cup Finals as ‘Group A’ events that led to a challenge by both FIFA and UEFA.
UEFA and FIFA’s challenge – the history of the proceedings
Both UEFA and FIFA commenced proceedings appealing decisions by the European Commission to approve the designation of the whole of the UEFA European Championships Finals and FIFA World Cup Finals as protected events under the Broadcasting Act 1996.
FIFA and UEFA argued that there was an unfair restriction on competition, as the rules effectively prevent pay-TV broadcasters from competing with free-to-air broadcasters such as the BBC and ITV for the rights to broadcast these events, thereby driving down the value of such rights.
It was further argued that it should be just those matches involving the relevant Member State’s own national team along with the semi-finals and finals of the FIFA World Cup finals and UEFA European Championships finals, rather than the entirety of those competitions that could be considered to be of major importance to society, a position adopted by other Member States, and to extend the protection beyond such matches would be contrary to the intention of Directive 89/552, as amended.
In dismissing both appeals, the General Court held that the Commission had not erred in finding that the United Kingdom’s categorisation of all matches in the FIFA World Cup Finals and UEFA European Championship Finals as events of major importance was compatible with EU law.
UEFA and FIFA’s challenge: Opinion of the AG
Following the dismissal of their appeals, FIFA and UEFA appealed the decision of the General Court to the Court of Justice of the European Union (CJEU).
On 12 December 2012, Advocate General Jääskinen delivered his Opinion advising the CJEU to dismiss the appeals in their entirety.
Advocate General Jääskinen considered the appeals to consist of two principal legal issues:
• the extent of the Commission’s power to check the list drawn up by a Member State; and
• whether there was an infringement of UEFA and FIFA’s right to property.
Commission’s check under Article 3a of Directive 89/552 as amended
The Advocate General determined that each Member State alone is capable of determining what events to include on its national list and that the power of the Commission to review such decisions should be restricted to objectively ‘ascertaining whether there is a manifest error of assessment’.
In the view of the Advocate General, such a review should lead the Commission to:
• verify the process for drawing up such national lists on the basis of transparency and clarity;
• consider the lists in light of general principles, such as non-discrimination on grounds of nationality; and
• check whether the national lists provide for a derogation from fundamental freedoms greater than that already accepted by the EU legislature.
Whilst there was clearly a restriction on the freedom to provide services, this restriction was considered by the Advocate General to be ‘an inherent consequence of the power conferred on Member States to draw up national lists’.
Further, it was a consequence that the European legislature had considered, when adopting Article 3a of Directive 89/552 as amended, to be justified and proportionate for the ‘purposes of ensuring access by a large audience to events of major importance for society’.
The right to property
The Advocate General recognised the importance of the relationship between the sport sector and the media, as media rights income has become the lifeblood of sports.
Whilst the ability of a governing body to maximise the revenue achieved through its media rights is critical, the attempt by FIFA and UEFA to claim an infringement of a right to property was destined for failure on the basis that English law does not recognise a proprietary right in a sporting event.
The courts have also rejected attempts by rights holders to have sporting events considered as intellectual creations and to be protected as such.
The case of Premier League Limited & others v QC Leisure & others provided that football matches cannot be protected under copyright, as they ‘are subject to the rules of the game [which] leave no room for creative freedom’ and therefore cannot be considered as ‘works’.
Instead, event organisers such as FIFA and UEFA are forced to rely on a combination of contract and property law.
Despite rejecting FIFA and UEFA’s claims to a proprietary right under national law, the Advocate General did however conclude that FIFA and UEFA’s position ‘could be equated with a right to property for the purpose of Protocol No.1,’ (which protects against the State’s interference with a person’s peaceful enjoyment of their possessions) and that a ‘limitation by the State of the exercise of their rights constitutes an interference with the enjoyment of their possessions by a public authority’.
However, the Advocate General considered such interference to be justified, ‘either on the basis of the fundamental rights of others, such as the right to information, or on the basis of the public interest’ and, therefore, it did not constitute ‘an obstacle to the peaceful enjoyment of possessions or an unlawful control of their use within the meaning of Protocol No.1’.
Conclusion
Whilst the Advocate General’s Opinion is not binding on the CJEU, who will make a final ruling during the next few months, it would be highly unusual for his recommendations not to be followed. This Opinion is therefore a significant setback for both FIFA and UEFA in respect of the value of their media rights going forward.
According to TV Sports Markets, the value of the media rights for the 2012 UEFA European Championships within the United Kingdom was considerably lower than that in the other main European markets such as Germany, Italy, France and Spain.
It is reported that jointly, ITV and BBC paid €62 million compared to €110 million paid by ARD and ZDF in Germany.
Whilst this case is clearly unwelcome news for FIFA and UEFA, there may be worse to come if the government adopts the recommendations of the 2009 review, which includes a proposal that all qualifying matches of the UEFA European Championships and FIFA World Cup featuring the relevant Home Nation be added to the list of protected events.
Tom Burrows is an associate in the sports group at Sheridans. He advises on all areas of commercial matters related to the sports industry, including the sale and acquisition of media rights to sports properties, sponsorship programmes and licensing agreements. He has experience acting for international governing bodies, broadcasters, sports teams and agencies. On Twitter, follow Sheridans
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