Competition Law & The European Super League

20 Apr 2021

The proposal to set up a new European Super League has done what so many have failed to do in recent years: unite the country – albeit in opposition to the plan.

Here, Partner Pete Bowyer and former Brunswick and Weber Shandwick Partner Jon McLeod consider whether competition law may be used to block the move.

Could competition law really stop the proposed European Super League?

Among the splutterings of outrage over the recently announced European Super League of top football clubs has come the suggestion that competition law could stop the proposal in its tracks. But is that really a possibility?

There’s no doubt that the competition authorities both domestically and in Europe take an active interest in football and football competition. DG Competition previously put the English Premier League all the way through the competition ringer back in 2006. Then, Brussels challenged the fairly fundamental question of whether it was anti-competitive for a group of football clubs to form a cartel – in this case the Premier League – to the exclusion of others and then trade valuable rights off the back of such a collective arrangement.

Since then, of course, the power of the leagues has waned.  Meantime, the power of the clubs has waxed in part due to the rise of streaming rights and the increased parcelling up by clubs themselves of the IP that flows from being part of an elite, attractive and organised sporting competition with a global reputation.

CMA – the consumer champion?

But can the shoe be put on the other foot? The competent authority in the UK is the Competition and Markets Authority, which has a brief to promote competition but is also there to protect consumers. The two objectives can sometimes subtly be in conflict with one another.

It is true that the CMA has dialled-up its focus on protecting consumers (especially vulnerable ones) in recent years. Some have said that it was the over-focus on consumer protection, to the detriment of other statutory considerations, that resulted in the ejection of its vocal Chair, Andrew (Lord) Tyrie in September 2020.

In its latest annual plan, which is itself influenced by what is curiously referred to as a ‘strategic steer’ from Government, the CMA makes clear:

“In line with the Government’s latest Strategic Steer, the CMA will play a prominent role in promoting the interests of consumers, particularly the most vulnerable, by championing good outcomes for consumers and by addressing new and emerging forms of detriment.

“Where the consumer interest can be secured through the promotion of competition, we will use our competition tools accordingly. But, where that is not the case, we will not hesitate to use other means to promote the consumer interest.”

A delicate balance

In other words, this is not a pure competition-doctrinal regulator, but one which steers a course between international anti-trust principles (all of which have separate forms of political and judicial articulation in each jurisdiction) and a quasi-political role in pursuing what may be the latest cause in consumer protection. Most recently that has been a focus on funerals, care homes and fertility clinics, while competition enforcement is particularly sharp-eyed in the pharmaceutical sector.

While the CMA would of course wish to defend its independence, in reality the Government of the day (through the ‘strategic steer’, interventions, appointments and more subtle political channels) can influence the focus of the regulator. Already, the Government has indicated its willingness to deploy competition law tools to stop the formation of the ESL.

So, could the perceived harms to the consumer interest from the ESL proposal really be amenable to the exercise of the CMA’s power? Potentially, albeit in a slightly politicised deployment of the tools and powers at its disposal.

At first sight, there is no apparent transaction in the ESL and there is nothing inherently illegal in establishing closed-door sports tournaments.

All to play for?

At first sight, there is no apparent transaction in the ESL and there is nothing inherently illegal in establishing closed-door sports tournaments. However, who knows what lies ahead as the proposal unfolds. Moments of crystallisation will be required to bring the league about in short order, including rights deals, contractual agreements and potential merging of entities. Therefore, while the ESL as a whole could not be brought down with a single regulatory blow, it could be stayed in some ways or suffer some form of death by a thousand (political, legal or other) cuts.

Equally, the CMA’s powers to conduct market inquiries and investigations are wide and can easily clog up organisational workings, in a way that shows it is not too concerned if its actions have extra-territorial effects.

So, stymying the ESL is not an open goal for the CMA, but it certainly presents the opportunity for public policy actors and stakeholders to stir up what could prove to be a long and particularly aggravating use of VAR for the ESL’s proponents. Watch this space.

Image Source: Barca News