What’s wrong with the Premier League’s statement? Have drugs got anything to do with it?

by Carl Gardner on October 4, 2011

Apologies for going on about football. I’ve got a bee in my bonnet about the suggestion that today’s ECJ ruling leaves room for the FA Premier League to use copyright law to continue preventing pubs from using foreign decoders to broadcast matches.

In its carefully-worded statement on the ruling, the Premier League makes much of what it calls the complexity of the case. It’s a skilful attempt to persuade the world that the ruling’s less of a defeat than it is. I’m particularly interested in this paragraph:

We are pleased that the judgment makes it clear that the screening in a pub of football-match broadcasts containing protected works requires the Premier League’s authorisation. Currently only Sky and ESPN are authorised by the Premier League to make such broadcasts.

Actually the judgment doesn’t make clear that pub screenings of football matches containing copyright-protected works requires the Premier League’s authorisation at all. It simply says such screenings involve communication to the public of those works within the meaning of article 3 of the Copyright Directive. Not the same thing.

Even more interesting is the clever way in which the second sentence of the paragraph appears to be connected logically to the first. Actually the connection is more tenuous. The first sentence includes the claim that screening matches in pubs requires authorisation. If this is true, it must be as true for pubs showing matches broadcast by Sky as it is for pubs showing matches broadcast by anyone else.

The second is not about screening matches in pubs, but about making broadcasts of matches to pubs and homes. Unless all other exclusive deals within the EU have now expired, I don’t think it can be true that only Sky and ESPN are authorised to do make such broadcasts. When Karen Murphy showed NOVA matches, NOVA was also authorised to make broadcasts. What the Premier League must mean is that only these firms have been authorised to make broadcasts in Britain. That they’ve omitted that qualification is, I suspect, deliberate and legally revealing.

If the Premier League is trying to claim that pubs screening Sky matches in the UK (including copyright material) are implicitly authorised to do so by “piggy-backing” on Sky’s authorisation to broadcast them, fair enough; but it must follow that pubs screening NOVA matches are similarly authorised to do so on the basis of NOVA’s authorisation. Unless you think the EU market can simply be partitioned nationally, Karen Murphy must be in the same position, with regard to copyright, as “Sky pubs”. In other words, the Premier League’s resort to copyright is just a rearguard attempt to partition the market all over again, and falls down on exactly the same legal grounds as its attempt to stop the sale and use of foreign decoders.

I’ve referred to drugs because the more I think about it, the more I think the legal issues here are analogous to those with which the ECJ has considered many times over the years in cases involving “parallel trading” in licensed medicines. Parallel trading occurs where a drug manufacturer sells its drugs in one market – say the UK – at a high price, while selling the same drugs in another market – say, Greece – at a much lower one. Parallel traders try to take advantage of the differential by re-importing the drugs from Greece to the UK, perhaps undercutting the manufacturer’s desired UK price. This is all quite similar, if you think about it, to the way in which the Premier League is trying to partition the live football market and the way Karen Murphy and the suppliers of her decoder in effect “reimported” live football from Greece.

It’s well established in the drugs cases that the right of a manufacturer to use intellectual property law – in that case, trademarks – to inhibit parallel imports is very limited. Paragraph 23 of case C-207/10 Orifarm makes the point:

the trade mark proprietor’s opposition to the repackaging of products bearing the mark, in that it constitutes a derogation from free movement of goods, cannot be accepted if the proprietor’s exercise of that right constitutes a disguised restriction on trade between Member States …

The drug parallel import cases show clearly that intellectual property rights do not simply “trump” internal market law, enabling rights holders to partition the EU market. The reverse is true: where there’s a conflict, internal free market rights can effectively limit the scope of intellectual property rights.

There’s no reason to think the Premier League’s in a stronger position than drug manufacturers. On the contrary, they’re in a weaker position because pub landlords don’t even have to “repackage” football matches. They simply give viewers access to the exact same service the Premier League has authorised to be shown within the EU, without the slightest interference with anthems, logos or any other copyright material.

{ 8 comments… read them below or add one }

1 Kelvyn Gardner October 5, 2011 at 10:47

Is this ultimately about free movement of goods and services or ultimately about competition? If the former, it’s hard to see how Sky can win the argument. If the latter, you have to look a bit more deeply. One way around this ‘Greek’ situation would be for the FAPL to license just one broadcaster for the whole of the EU. However, this strategy looks anti-competitive, as only a few broadcasters would have the finance or structure capable of making a pan-Euro deal work. You could argue that this restricts competition, as smaller, more localised companies ( like the Greek one in question here ) would effectively be unable to tender for national rights any longer.

Could this then be a case where the ECJ could rule that that the status quo is more encouraging of competition and therefore allow the FAPL to license country-by-country, complete with intra-EU single-territory restrictions?

2 Carl Gardner October 5, 2011 at 11:47

Maybe! I agree that a pan-EU (or pan-EEA) deal might run into the sort of problems that if I remember right the UK rights offer ran into.

But the ECJ has shown a clear way forward that complies with both internal market and competition law. They can keep selling national rights, but only if they allow “parallel broadcasting” and leave people like QC Leisure and Karen Murphy to arbitrage any price differentials in peace.

3 Richard Gadsden October 5, 2011 at 17:58

I wonder if there is an alternative strategy for the FAPL to adopt.

They separate the domestic and commercial (“public performance”) licences and sell national licences (allowing parallel importing) for the domestic rights, and an EU-wide license for the commercial rights.

They require in the domestic licensing that the commentary tracks be made available for a reasonable fee to the EU-wide commercial broadcaster.

The EU broadcaster then gets to have whatever complicated pricing scheme it likes for commercial premises, perhaps based on type (bar/pub vs restaurant vs office vs hotel) and turnover (which would mean that prices in poorer countries like Greece would be effectively lower than in richer ones like the UK). They then supply a satellite feed that has all the various language commentaries so the customer can choose which language to show (so you can have English-language commentary in a tourist bar in Spain or Greece).

That would do the trick quite neatly. If the “commercial premises” broadcaster aggregated all the major sports leagues, they might well be able to get similar prices right across the continent – Italian bars paying primarily for Serie A, British pubs for FAPL, German bars for the Bundesliga, but all getting the full set.

Would be very good news for sports bars, as they’d get a much better selection of non-UK sport.

4 Scott October 6, 2011 at 12:21

Carl, Good stuff. On the whole copyright and authorisation issue, it seems to me reading the judgment and the FAPL’s statements tec that the copyright straw they are grasping at – even if valid – can be circumvented easily.

The main bone of contention seems to rest on th fact that Karen Murphy purchased a personla subscription to Nova, not a commercial one, and this resulted in the potential copyright breach as the pub customers were ‘an additional public’ only covered by a commercial subscription – and not her personal one. So I would presume that if she now purchased a commercial subscription the FAPL couldn’t touch her?

5 Carl Gardner October 6, 2011 at 12:32

Thanks, Scott – good point. I hadn’t picked up the fact that she only had a personal subscription for Nova.

I think you’re right. I can imagine someone saying “Aha! They can change their contracts regarding foreign commercial subscriptions, so as to make clear showing of copyright materials to the public is only permitted within Greece!”. But again, this seems to me just to go round in a circle and run into precisely the same free movement problem. The contractual term preventing sales of decoders outside Greece was unlawful because it aimed at partitioning the market, stopping “parallel broadcasting” and restricting the provision and receipt of services across borders. A contractual term limiting use of copyright would have just the same object and effect, and would surely be unlawful in just the same way.

6 Kelvyn Gardner October 7, 2011 at 11:05

To Scott’s point, surely Sky would have the right to insist on higher payment levels from the likes of Nova for ‘commercial broadcast’? If not, how does this work in terms of sales of DVDs, which almost all carry a packaging disclaimer to the effect that the DVD is for personal, private use only, and may not be shown on a bus for instance or at any form of public event – presumably including in a pub?

7 scott October 7, 2011 at 11:31

Kelyn. Sky doesn’t (at least at the moment) licence the rights the Nova. Nova bid (as BskyB did in the UK) for the rights for their territory – Greece. Once paid for it is up to Nova to decide what price to charge for personal and commercial subscriptions.

On the DVD question – let’s stick with pubs – they’d need a public performance licence to show the DVD to the public. They’d need a PRS (Performing Rights Society) licence and would also probably need permission or addition licence from the film company that produced the film. Not sere there is a blanket licence for this in uk or not actually

When the like s of BskyB pay for the FAPL rights they are paying a premium to include authorisation to allow commerial businesses, such as pubs show games, without the pubs having to deal with the FAPL (altough they’d still need a PRS licence regardless).

8 Jonny Geek October 12, 2011 at 14:49

Fact is – anyone with a bit of net nous can watch more or less any broadcast sport free of charge. It’s ll out there with a bit of poking around. I have to say, I greatly enjoyed the test series against India, and am hugely enjoying the Rugby World Cup, and the Premiership. All free of charge

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