Drawing on the wide expertise of its members, Sport&EU initiated a series of posts to analyse in depth different dimensions of the ruling of the Court of Justice of the European Union (CJEU) on the joined cases of QC Leisure and Karen Murphy. The Head of Salford Law School (UK), Mark James, opened this series, which was then continued with an audiovisual contribution by Daniel Geey, of Field Fisher Waterhouse LLP’s Competition and EU Regulatory Law Group. We present now a contribution from Dr. Ben Van Rompuy, another long-standing member of Sport&EU. Ben Van Rompuy is a Visiting Fellow at Georgetown University Law Center (U.S.) and a Senior Associate Researcher at the Institute for European Studies, Free University of Brussels (Belgium). His work on EU competition law issues relating to the marketing and exploitation of sports media rights has been published in various peer-reviewed journals and monographs. In his intervention, Ben Van Rompuy reflects on the Murphy case with a focus on the CJEU’s consideration of the sporting arguments invoked by the Premier League (PL) and, particularly, the effects of the judgment on the current Saturday afternoon blackout period. The opinions included in this post are solely the author’s and, as such, do not necessarily reflect Sport&EU’s.
Protecting stadium attendance: an objective justification?
The PL argued inter alia that the territorial allocation of transmission rights is objectively justified to guarantee compliance with the blackout rule, which prevents UK-based broadcasters from showing live football matches on Saturday afternoon (3-5 pm). The stated purpose of this “blackout” is to ensure that spectators are not deterred from attending local football matches or from participating in amateur sport because of the contemporaneous broadcasting of football. The Premier League currently sells live rights to its matches during the blackout period only outside the UK.
The PL argued that the importation of decoder cards would make it difficult, or even impossible, to enforce the blackout rule. The window protected in the country of origin of the card may differ from the blackout period in the UK – times vary from country to country depending on local scheduling customs – or there may even be no such protection. Indeed, this loophole enabled Karen Murphy and others, through the use of a foreign decoder card, to show live Premier League football on Saturday afternoon.
The opinion of the Advocate General
In her opinion, Advocate General Kokott acknowledged that safeguarding participation in football and its character as a direct spectator sport is primarily a sporting interest, which is in principle to be recognized by EU law. She stressed, however, that there are good reasons to believe that the use of a blackout period is also based on commercial motivations. Kokott made three critical observations: (1) it cannot be ruled out that the blackout period safeguards the economic interests of the most important PL members in partitioning the market; (2) the PL has not adequately demonstrated to the Court that the blackout period actually encourages attendance at and participation in matches; and (3) there is evidence to refute this claim. Consequently, Kokott concluded that, in the subsequent proceedings before the High Court in London, ‘a particular strict test’ should be applied to the demonstration of the need of the blackout period to safeguard stadium attendance or participation in amateur sport.
The CJEU judgment
In its judgment, the CJEU similarly acknowledged that the specific characteristics of sport must be taken into account when applying EU law. For the second time since the Lisbon Treaty introduced a Treaty article on sport (Article 165 TFEU), the Court explicitly made reference to this provision:
‘it is to be noted that, in the second paragraph of Article 165(1) TFEU, the European Union is to contribute to the promotion of European sporting issues, while taking account of the specific nature of sport, its structure based on voluntary activity and its social and educational function’ (para 102)
Contrary to the Advocate General, the CJEU did not scrutinize whether the 3 pm blackout rule effectively contributes to its stated, non-economic purpose.[1] Yet the Court unequivocally held that the objective of encouraging the public to attend football stadiums could not justify the prohibition on the use of foreign decoding cards. According to the Court, ensuring compliance with the blackout rule could be achieved by less restrictive means. In its license agreements with broadcasters, the PL could incorporate the contractual limitation not to broadcast Premier League matches during the blackout period.
The end of the PL’s blackout rule?
The CJEU’s reference to Article 165(1) TFEU is noteworthy. Contrary to cross-sectional clauses in the Treaty (e.g. relating to environmental protection, public health, and cultural diversity), this provision does not materially affect other Treaty provisions. It merely constrains legislative or administrative action by the EU institutions on the basis of Article 165 TFEU. The Court’s reference to Article 165(1) TFEU suggests, however, that account must be taken of the specific characteristics of sport and its societal function in the general application of EU law to sport. While this is not a true innovation in the case law, the mention of these interests in Article 165(1) TFEU does appear to provide further support to the legitimacy of taking sporting interests into account.[2]
The CJEU did not preclude the possibility of the objective of protecting stadium attendance outbalancing certain restrictions of the freedom to provide services. However, the present judgment does confirm that the scope of available derogations should be interpreted narrowly. It is settled case law that a restriction of the fundamental freedoms can only be justified on grounds related to the public interest if it is suitable and does not go beyond what is necessary to attain the legitimate objective. Prohibiting the import and use of foreign decoder cards was clearly considered to be disproportionate.[3]
In my opinion, it is unlikely that the PL could demonstrate that English football imperatively requires protection by means of a blackout period. I share the Advocate General’s scepticism about the blackout rule. Firstly, it is indeed difficult to delineate the claimed sporting concerns from commercial motivations. It should also be noted that UEFA enabled national football associations to block broadcasting hours at the end of the 1980s. At that time, ticket revenues were a crucial source of revenue for professional clubs. The growing demand for televised sports content, which significantly increased the airtime of football, was perceived as a threat to this volatile revenue stream. Secondly, there are appealing arguments in favour of the contrasting claim that live TV coverage complements, rather than endangers, stadium attendance. The empirical research on the impact of live broadcasting on stadium attendance is far from conclusive. Furthermore, for the season 2011-2012 the number of football associations in the EU exercising the right to block broadcasting hours has decreased to six (only three outside the UK). Why is it that only a minority of UEFA members sees virtue in defining blackout periods?
What is clear at this point is that, for the duration of the existing Premier League broadcasting contract, EU law allows at least individuals to use foreign broadcasting services to watch live Premier League football during the blackout period. For those that get their hands on foreign decoder cards, the blackout rule thus becomes obsolete. For future EU tenders, the PL might still consider not to market any live rights to 3 pm kick-offs. This would ensure that they cannot be shown within the UK, but it would also mean that European consumers would get to see fewer live games. The time is now, if not long overdue, to fundamentally rethink the true meaning and effectiveness of the blackout rule.
[1] The legitimate aim of a restrictive measure is something to be determined ‘objectively’ by the national court. See e.g. Joined Cases C-49/98 etc. Finalarte and others [2001] ECR I-7831, paras 40-41.
[2] See also Case C-352/08 Olympique Lyonnais [2010] ECR I-2177, para 40.
[3] For examples of the CJEU’s rigorous application of the proportionality principle, see, by analogy, Case C-353/89 Commission v. Netherlands [1991] ECR I-4069; Case C-288/89 Stichting Collectieve Antennevoorziening Gouda v. Commissariaat voor de Media [1991] ECR I-4007; Case C-352/85 Bond van Adverteerders and others v. The Netherlands State [1988] ECR 2085 (justifications based on cultural policy grounds found to be disproportional to the restriction on the free movement of services) and Case C-438/00 Deutscher Handballbund eV v. Maros Kolpak [2003] I-4135; Case C-176/96 Lehtonen and others v. FRBSB [2000] ECR I-2681; Case C-415/93 URBSFA v. Jean-Marc Bosman [1995] ECR I-4921 (justifications based on sporting interests found to be disproportional to the restriction on the free movement of workers).
