A look at two interesting orders by the CCI in the world of sport. The Competition Commission of India ("CCI") has played a significant role in checking anti-competitive business practices and imposing high penalties on some corporates. During the course of this year, there have been some interesting orders from the CCI specific to sports bodies and their conduct. Two key orders ...
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A look at two interesting orders by the CCI in the world of sport.
The Competition Commission of India ("CCI") has played a significant role in checking anti-competitive business practices and imposing high penalties on some corporates. During the course of this year, there have been some interesting orders from the CCI specific to sports bodies and their conduct. Two key orders have been the order against the Board of Cricket Control in India ("BCCI") and the order in case of Hockey India ("HI"). While BCCI burnt its fingers in the process, HI escaped by a narrow margin. The object of this article is to bring out similarities and at the same time some crucial differences between these orders.
A common element in sports bodies in India as well as several such bodies worldwide is the existence of a "pyramid structure". A pyramid structure comprises a global organization, containing single member (i.e. organization) from each country. These members in turn, often act as the governing body of the sport in their respective countries.
The above structure is common to both, the BCCI and HI. Whilst the core issue in both cases was whether there is an abuse of dominant position by the governing bodies, the conclusion drawn is starkly different. We deal with the facts of each case and the conclusion drawn, here -
Both the above cases test different aspects of the abuse of dominant position under Section 4 of the Competition Act, 2002 ("Act"). The dominant position of an enterprise means a position in which an enterprise is insulated from market forces. A dominant enterprise is said to be abusing its dominance if it indulges in activities like limiting production or supply, denying market access to others, entering into abusive contractual terms or using its dominant position in one market to enter another. In order to determine abuse of dominant position the CCI is required to examine factors like relevant market and dominance of an enterprise in such relevant market. Some of the important points leading to the findings of CCI are analysed below -
Under the Act, relevant market is defined as a market determined by the CCI with reference to the relevant product market or relevant geographic market or both. There are three key components to determine a market i.e. producer on the supply side, consumer on the demand side and the underlying product/service.
A common factor in both orders is the reliance placed on the constitution documents, bye-laws and internal rules laid for governance and regulation, of each BCCI and HI. The MoA of the BCCI provided for "control" of the game of cricket in India while the same was absent in the HI's documents. In our opinion, this could have formed one of the key causes for the difference in the orders given by the CCI.
These orders have added another dimension to the sports laws in India by examining the role of the sports bodies from competition aspects. The latest controversy in the pyramidal structured world of sport is the Indian Badminton League which concluded earlier this year. The core issue of dispute related to cancellation of the slot of women's doubles and the introduction of an extra round for men's singles into the league. While presently, this does not appear to be a competition issue, given the rules and the league structure of the game, the looming of a controversy cannot be ruled out.
Disclaimer - The views expressed in this article are the personal views of the authors and are purely informative in nature.