On 3 February 2011, the European Union Advocate General Juliane Kokott handed down her eagerly awaited opinion and said that under European Union law pubs should not be stopped from broadcasting live football matches using foreign decoder cards. She explained that the present system of exclusive license agreements is “tantamount to profiting from the elimination of the internal market.”
The Football Association Premier League Ltd (the FAPL) licenses the right to broadcast and exploit Premier League football matches. These license agreements are usually exclusive and require the licensee to prevent their broadcasts from being viewed outside of their assigned broadcasting area, usually a specific country through encryption. Subscribers view the country specific broadcast using a decoder card which decrypts the satellite transmission. As such, the exclusivity agreements often restrict the sale of these decoders outside of the licensed territory.
Companies import foreign decoder cards to sell to pubs to allow them to show live Premier League football matches at a considerably lower price than the FAPL’s official UK broadcaster. The FAPL argued that this was an infringement of its copyright and that it damaged its contracts with its authorised broadcasters. This issue was considered in two cases and the UK High Court referred several questions to the Court of Justice of the European Union (CJEU) for an interpretation of EU law.
Advocate General Kokott said that the exclusivity of these broadcasting rights restricts the freedom to provide services and partitions the internal market into separate national markets. The rights in live football matches are exploited by the price paid for the foreign decoder cards and, as such, these rights are not undermined by the use of foreign decoder cards. Moreover, whilst the charges are not as high as those charged in the UK, there is no right to charge different prices for a work in different territories and so there can be no breach. Instead, it is to be expected that price differences between Member States will be offset by trade.
The Advocate General also refused to accept that the restriction on using decoder cards in the origin territory for private and not commercial use was a ground for territorial restriction of the freedom to provide services.
As regards the question of whether the live broadcast of football matches infringes the exclusive right to communicate the protected works to the public, with reference to the Copyright in the Information Society Directive, the Advocate General explained that there are no comprehensive rights in EU law that protect the communication of a broadcast to the public where no entrance fee is charged.
Finally, the Advocate General said that the application of the principle of the freedom to provide services is in line with the Satellite and Cable Directive, the Conditional Access Directive and European Competition law.
Whilst the Advocate General’s opinion does not bind the CJEU, the proposal is nonetheless put to the Court as an independent legal solution. The opinion will be considered and the CJEU will then provide its interpretation of EU law. It is then for the UK Court to dispose of the case in accordance with the CJEU decision which will bind other national courts who face a similar issue.
If the Advocate General’s opinion is followed, it will have serious implications for the FAPL and broadcasters such as BSkyB whose current license agreement in England is worth around £1.78 billion. In the short term, UK broadcasters could lose subscribers to the cheaper foreign broadcasters and in the longer term, it may find that it receives less money when it auctions its UK broadcasting rights which could force it to abandon territorial licensing altogether.