Breaking news: Belgians, Brits can carry on watching World Cup footie for free

Two and a quarter years after the European Commission ruled that soccer fans should be able to carry on watching World Cup and European Championship matches on their TVs free of charge, the General Court upheld the Commission's stance and ruled that the sport's governing bodies can t strike exclusive pay-TV deals for these competitions in the UK and Belgium.  This morning, in Cases T-385/07, T-55/08 and T-68/08 FIFA and UEFA v Commission, the General Court dismissed the actions by FIFA and UEFA, on the basis that the law justifies a restriction of their freedom to strike lucrative deals with TV broadcasters on account of the high degree of public interest in the tournaments: recent statistics show that the current free-to-view system has attracted many watchers who are not normally interested in football.

According to the Curia press release:

"A Member State may, in certain circumstances, prohibit the exclusive broadcast of all World Cup and EURO football matches on pay television, in order to allow the general public to follow those events on free television  

When those competitions are, in their entirety, of major importance for society, the restriction on freedom to provide services and freedom of establishment is justified by the right to information and by the need to ensure wide public access to television broadcasts of those events 

The directive on the pursuit of television broadcasting activities [Council Directive 89/552 on the coordination of certain provisions laid down by law, regulation or administrative action in Member States  concerning the pursuit of television  broadcasting activities  (OJ 1989 L 298, p. 23), as amended by Directive 97/36/EC of the European Parliament and of the Council of 30 June 1997 (OJ 1997 L202, p. 60)] allows Member States to prohibit the exclusive broadcasting of events they judge to be of major importance for society where such broadcasting would deprive a substantial proportion of the public of the possibility of following those events on free television. 

The Fédération Internationale de Football Association (FIFA) organises the football World Cup finals (‘the World Cup’), whilst the Union des associations européennes de football (UEFA) organises the European Football Championship finals (‘the EURO’). The sale of the television broadcasting rights for those competitions constitutes a major source of their income. 

Belgium and the United Kingdom each drew up a list of events they considered to be of major importance for their respective societies. Those lists contained, inter alia, in the case of Belgium,
all matches of the World Cup and, in the case of the United Kingdom, all matches of the World Cup and the EURO. Those lists were sent to the Commission, which found that they were compatible with European Union law.

FIFA and UEFA challenged those decisions before the General Court, however, disputing that all such matches can be regarded as events of major importance for the public of those States. 

In its judgments delivered today, the Court examines, first of all, certain features of the organisation of the World Cup and the EURO and their impact on television broadcasts of those competitions. Next, it looks at the legal rules in place in the European Union and the Member States relating to the broadcasting of those sporting events. Lastly, the Court examines the issue whether limitations may be placed on FIFA’s and UEFA’s television broadcasting rights for the World Cup and the EURO due to overriding reasons in the public interest. 

The Court finds that the reference to the World Cup and the EURO in recital 18 in the preamble to Directive 97/36 means that, when a Member State includes matches from those competitions in the list it has decided to draw up, it does not need to include in its notification to the Commission specific grounds concerning their nature as an event of major importance for society. However, any finding by the Commission that the inclusion of the entire World Cup or EURO in a list of events of major importance for the society of a Member State is compatible with European Union law, on the ground that those competitions are, by their nature, regarded as single events, may be called into question on the basis of specific factors showing that the ‘non-prime’ matches of the World Cup and/or ‘non-gala’ matches of the EURO are not of such importance for the society of that Member State.

In that context, the Court states that the ‘prime’ and ‘gala’ matches and, in the case of the EURO, matches involving a relevant national team are accepted to be of major importance for the public of a given Member State and may, therefore, be included in a national list specifying the events to which the public should be able to have access on free television. 

As regards the other matches of the World Cup and the EURO, the Court holds first that those competitions may be regarded as single events rather than as a series of individual events divided into ‘prime’ and ‘non-prime’ matches or into ‘gala’ and ‘non-gala’ matches. Thus, the participation of the teams in ‘prime’ and ‘gala’ matches may depend on the results of ‘non-prime’ and ‘non-gala’ matches, which may therefore generate a particular interest for the public to follow those matches.  

In that regard, the Court also observes that it cannot be specified in advance – at the time when the national lists are drawn up or broadcasting rights acquired – which matches will actually be decisive for the subsequent stages of those competitions or which ones may affect the fate of a given national team. For that reason, the Court holds that the fact that certain ‘non-prime’ or ‘non-gala’ matches may affect whether a team advances to the ‘prime’ or ‘gala’ matches may justify a Member State’s decision to consider that all of the matches of those competitions are of major importance for society. 

Regarding the statistics relied on by the applicants in order to show that the ‘non-prime’ and/or ‘non-gala’ matches are not of major importance for Belgian or United Kingdom society, the Court finds that the viewing figures relating to those categories of matches from the most recent World Cup and EURO tournaments show that they have in fact drawn large numbers of viewers, a significant proportion of whom are not usually interested in football. 

Next, the Court holds that, in the absence of harmonisation in the European Union of specific events which Member States may consider to be of major importance for society, a number of
different approaches concerning the inclusion of the World Cup and EURO matches in a national list may be equally compatible with the directive. It is therefore possible that certain Member States may consider that only ‘prime’ and ‘gala’ matches and, in the case of the EURO, matches involving the relevant national team(s) are of major importance for society, whilst others may legitimately consider that ‘non-prime’ and ‘non-gala’ matches should also be included in the national list. 

The Court further holds that, although the categorisation of the World Cup and the EURO as events of major importance for society is liable to affect the price which FIFA and UEFA will obtain for the grant of the rights to broadcast those competitions, this does not destroy the commercial value of those rights because it does not oblige FIFA and UEFA to sell them on whatever conditions they can obtain. Similarly, although such a categorisation restricts freedom to provide services and freedom of establishment, that restriction may be justified, since it is intended to protect the right to information and to ensure wide public access to television broadcasts of events of major importance for society. 

Lastly, the Court observes that the United Kingdom legislation does not grant special or exclusive rights to certain broadcasters. 

In those circumstances, the Court holds that the Commission did not err in finding that the
United Kingdom’s categorisation of all World Cup and EURO matches and Belgium’s
categorisation of all World Cup matches as ‘events of major importance’ for their societies
are compatible with European Union law. Consequently, FIFA’s and UEFA’s actions are
dismissed".

Says the IPKat, many British and Belgian footie fans are fast becoming fans of the Court of Justice too.  Since FIFA incurred the wrath of the Anglo-Belgian football fraternity by awarding the right to host the 2022 World Cup to Qatar, the Advocate General has advised the Court of Justice to rule that exclusivity agreements  relating to the transmission of football matches are contrary to European law -- and today's news is even better!  Watch out, says Merpel, FIFA and UEFA are bound to appeal: the amount of money at stake is potentially vast and the cost of appealing to the Court of Justice is relatively cheap.

Thanks to Stephanie Bodoni (Bloomberg) for alerting the Kat to this item.

Breaking news: competition trumps IP in footie decoder pub brawl

With so little time in which to make their oral submissions to the Court
of Justice, counsel had to resort to extreme measures to make their point

At the time of posting this item, there's no sign of the Advocate General's keenly-awaited Opinion in Cases C-403/08 and C-429/08 Football Association Premier League Ltd & Others v QC Leisure & Others, Karen Murphy v Media Protection Services Ltd. There is however this press release from the Curia. It reads as follows:

"In the view of Advocate General Kokott, territorial exclusivity agreements relating to the transmission of football matches are contrary to European Union law

European Union law does not make it possible to prohibit the live transmission of Premier League football matches in pubs by means of foreign decoder cards

The Football Association Premier League Ltd (the FAPL) is the marketing organisation for the top English football league. The FAPL essentially grants its licensees the exclusive right to broadcast matches and exploit them economically within their respective broadcasting areas, generally the country in question. In order to safeguard this exclusivity, licensees are obliged to prevent their broadcasts from being able to be viewed outside their respective broadcasting areas. To that end, each licensee is required to encrypt its satellite signal and to transmit it in encrypted form to subscribers within its assigned territory. Subscribers can decrypt the signal using a decoder, which requires a decoder card. The exclusivity agreement also imposes restrictions on the circulation of authorised decoder cards outside the territory of each licensee.

The main proceedings in the present references for preliminary rulings concern attempts to circumvent this exclusivity. Companies import decoder cards from abroad, in the present proceedings from Greece, into the United Kingdom and offer them to pubs at more favourable prices than the broadcaster in that State. This practice makes it possible for pubs in the UK to show the live transmission of Premier League football matches using a Greek decoder card. The FAPL is attempting to stop that practice by means of a judicial ruling. Case C 403/08 concerns civil-law actions brought by the FAPL against the use of foreign decoder cards. Case C 429/08 relates to criminal proceedings which have been brought against the landlady of a pub who used a Greek decoder card to show Premier League matches. The High Court has, in each set of proceedings, referred several questions to the Court of Justice on the interpretation of EU law.
Advocate General Juliane Kokott explains that the exclusivity rights in question have the effect of partitioning the internal market into quite separate national markets, something which constitutes a serious impairment of the freedom to provide services.

With regard to possible justification for the restriction of the freedom to provide services, the Advocate General examines the protection of industrial and commercial property and, in particular, addresses the question whether live satellite transmissions of football matches involve rights the specific subject-matter of which requires a partitioning of the internal market. In this connection she first states that the specific subject-matter of the rights in live football transmissions lies in their commercial exploitation. In the present cases, the live transmission of Premier League football matches is exploited, in particular, through the charge imposed for the decoder cards. Advocate General Kokott takes the view in this connection that the economic exploitation of the rights in question is not undermined by the use of foreign decoder cards, as the corresponding charges have been paid for those cards. Whilst those charges are not as high as the charges imposed in the United Kingdom, there is, according to the Advocate General, no specific right to charge different prices for a work in each Member State.

Rather, it forms part of the logic of the internal market that price differences between different Member States should be offset by trade. The marketing of broadcasting rights on the basis of territorial exclusivity is tantamount to profiting from the elimination of the internal market. Consequently, the specific subject-matter of the rights in the transmission of football matches does not justify a partitioning of the internal market, and thus also does not justify the resulting restriction of the freedom to provide services.

Advocate General Kokott further takes the view that the contractual restriction on using decoder cards in the State of origin only for domestic or private use, but not for commercial use – for which a higher subscription charge is payable – also cannot justify a territorial restriction of the freedom to provide services. The Member State concerned may, however, in principle make provision for rights which allow authors to object to the communication of their works in pubs.
So far as concerns the question whether the showing of live transmissions of football matches in pubs infringes the exclusive right of communication to the public of protected works within the terms of the Copyright in the Information Society Directive , the Advocate General explains that, as EU law stands at present, there are no comprehensive rights which protect the communication of a broadcast to the public where no entrance fee is charged.

Advocate General Kokott further expresses the view that the application of the principle of the freedom to provide services is also in line with the Satellite and Cable Directive and with European competition law. Equally, neither does the Conditional Access Directive constitute a barrier to the use of foreign decoder cards".

See also IPKat posts of 7 December 2007 here and 24 June 2008 here.

STOP PRESS: the AG's Opinion has now been posted on the Curia website here.  It's more than 250 paragraphs long ...