An eagerly-awaited opinion of European Union Advocate General Juliane Kokott has been recently given in two legal battles between FA Premier League on the one hand and Karen Murphy, a publican and a decoder supplier QC Leisure on the other.
Premier League is the governing body of the top division in English football. Each Premier League match is filmed and packaged in order that the broadcast rights can be licensed by Premier League to foreign broadcasters. Premier League then licenses these broadcasting rights by virtue of exclusive licence agreements, requiring the licensees to prevent their broadcasts from being viewed outside their assigned broadcasting area.
These two landmark cases concerned action taken by Premier League to prevent publicans and companies in the UK from showing matches via foreign satellite services. Karen Murphy cancelled her commercial subscription with BSkyB, the UK licensee of Premier League rights and instead opted to purchase a satellite dish, decoder and smart card which enabled her to receive broadcasts of live Premier League matches from Premier League’s licensee in Greece, paying significantly less. Similarly, QC Leisure imported decoder cards from Greece into the UK and offered them to pubs at more favourable prices than the UK licensed broadcaster.
Premier League argued that this was an infringement of its copyright and that it damaged its licence agreements with its authorised broadcasters. Defendants disagreed and claimed that the territorial restriction placed upon licensees, limiting exports, was contrary to EU competition rules and incompatible with the common market. The UK High Court referred the issues of EU law arising in the case to the European Court of Justice which as usual subjected the case first to an opinion from its Advocate General, acting as legal expert.
Although non-binding, the salient conclusions in Advocate General Kokott’s opinion are striking. For starters, the Advocate General reckoned that the nature of the subject matter at hand, namely football, did not exempt agreements from review of their compliance with EU law. She therefore examined the matter from an EU law compliance perspective. She held that decoders lawfully manu-factured and marketed in Greece, although specifically designed to allow access to the Greek’s broadcaster’s services, did not become illicit by virtue of their importation into the UK.
More importantly she found that the exclusivity agreements containing territorial restrictions, albeit a means to control access, were anticompetitive since they frustrated the objective of the creation of an internal market, prevented parallel trade, and went against the freedom of the provision and reception of services. In addition, charging prices at differential rates across Europe was not justified by the right of commercial exploitation of broadcasts.
If the CJEU’s judgement follows the Advocate General’s Opinion, which it does in the majority of cases, rightsholders may lose the ability to license their content on an exclusive basis by individual European territory, charging different rates for each individual market. Furthermore, rights holders and broadcasters may no longer be able to prevent consumers gaining access to overseas sports channels. This could result in customers gravitating to subscriptions of foreign broadcasters and using their decoder cards to buy rights to content, which could in turn lead to reduced prices to consumers. The opinion, if followed by the CJEU, may therefore fundamentally change the European setting for licensing and broadcasting sports media rights.
The judgement of the European Court of Justice is expected to be delivered later this year.
jgrech@demarcoassociates.com
Dr Grech is an associate with Guido de Marco & Associates and heads its European law division.