By Nandan Kamath
Introduction
2011 has been an eventful year in sports law, both internationally and in India, and 2012 promises to be no different. With an evolving sports industry and the growing commercial and spectator interest in international sports events, this rather young body of law is running hard to keep pace – most often lagging behind, but at other times blazing new trails. In this retrospective, we look back at the year that has been and the legal issues the sports ecosystem must consider in the exciting times that lie ahead.
ICC Cricket World Cup 2011.
Cricket frenzy hit a peak as the country hosted the ICC Cricket World Cup after 15 years. Co-hosted along with Sri Lanka and Bangladesh, the event was widely acclaimed as a great success, victory by India being the icing on the cake.
Hosting sporting events of such magnitude present the host country’s domestic legal system with several challenges. World over, the focus of major sporting events has been on legal reactions to ambush marketing; rights of broadcasters, sponsors and partners, as well as prevention of counterfeit merchandise and online piracy. The ICC’s objective was to safeguard the exclusive rights of its partners and sponsors by monitoring and prosecuting commercial abuse of broadcast rights, event marks and other intellectual property. In furtherance of these objectives, the ICC utilised a comprehensive rights protection programme which employed pre-emptive practical steps, spreading awareness and vigilant contractual drafting. For other legal breaches, redress was sought through the Trade Marks Act 1999, the Copyright Act 1957, as well as existing case law and general legal principles laid down by the Indian Courts. In a significant departure from practice during recent major sporting events (including the FIFA World Cup and immediately previous editions of the ICC Cricket World Cup) the country did not amend its law and/or enact anti-ambush marketing legislation. The tournament went off without major incident, although a few incidents relating to promotional use by non-sponsors of participating players in their team or similar colours and disagreements relating to the interpretation and enforcement of the tournament’s News Access Guidelines issued by the ICC were noteworthy. In conclusion, the tournament demonstrated that while general legal awareness of intellectual property rights among non-rights holders is low, the legal system and general principles of law are substantially capable of addressing the protection needs of a major sporting event such as the ICC Cricket World Cup.
Draft National Sports (Development) Bill, 2011.
In the realm of public law, the most significant legal development in relation to sport was the Ministry of Youth Affairs and Sports (MYAS) attempt to introduce and pass a central legislation to govern sports administration in India. The stated objective of the Draft National Sports (Development) Bill 2011 is to increase transparency in Indian sports administration, promote sporting excellence and indigenous sports, as well as to provide for the welfare of athletes and improve the organisation of sporting. The draft Bill sought to remain consistent with the ‘Basic Universal Principles of Good Governance’ as contained in the Olympic Charter and contemplated major changes to the administration of Indian sport. A National Sports Development Council was envisaged, which would be headed by an eminent athlete and consist of sportspersons, administrators, lawyers and scientists, and would advise the government on the promotion of sport. The draft Bill assigned roles and responsibilities for the Government, the Indian Olympic Association (IOA), and the National Sports Federations (NSFs) with the IOA responsible for the recognition of NSFs for both Olympic and Non-Olympic sports.
The IOA was also required to make commitments towards combating doping and preventing gender discrimination in sports. With regard to the NSFs, the Bill included provisions that required the government to recognize no more than one NSF for each sport, and also contained measures restricting the age and tenure of the office bearers of NSFs. While on paper the Bill appeared to be the panacea for some of the issues afflicting Indian sport, in reality it was criticized as an attempt to increase government interference in the administration and management of sport. The first draft of the Bill was rejected by the Union Cabinet, and the MYAS was advised to rework the Bill.
A revised Bill, released by the MYAS in October 2011, introduced certain changes in the previous preliminary draft but continued to retain provisions relating to term and tenure, accountability and transparency. Some of the alterations included the removal of the MYAS’ discretion in recognizing NSFs, exemptions to the application of the Right to Information Act to NSFs, and exclusion of the offices of the sports ombudsman and the National Sports Development Council in order to accommodate the formation of an Indian Court of Arbitration for Sport. However, prominent sports administrators and sports governing bodies remained steadfast in their opposition to the Bill.
While improved administration of sports federations (often run as personal fiefdoms with little or no accountability to anyone) is certainly a worthy objective, it remains to be seen whether the Sports Bill in its current form is truly capable of ushering in the necessary change. There is no assurance that government oversight cannot soon become government interference. Sport has been used in the past as a potent political tool. One needs to look no further than Hitler’s Berlin Olympics of 1936!
In addition, there is little assurance that athlete participation in administration or the age caps will per se bring us better or more able administrators. While transparency and public accountability are not only laudable but also necessary objectives to clean up Indian sport, there remains a serious risk that the cure may be as bad as (or even worse than) the disease. The status quo is certainly not acceptable, but perhaps change will come with enabling better educated and incentivised sports administrators, improved accessibility to public sports infrastructure, focus on sports in the school syllabus and early talent identification and development. As the economy of sport grows, better sports management talent will be attracted to opportunities and virtuous cycles are often self-sustaining. Devoid of a thriving economy of sport, it is difficult to break away from the cycle of fear-and-favour that characterises the relationship between the quintessential Indian athlete and sports administrator.
All said and done, the Sports Bill has brought important issues to the forefront of public awareness. To that extent, the process of back-and-forth has been valuable. However, in the year ahead, it is time to take a long, hard look at whether all solutions to maladministration are indeed legislative or instead, a focus on the most basic needs of a growing sports population might be a sufficient catalyst to spur our long overdue sports revolution. Ultimately, whether or not the Sports Bill passes, nothing succeeds like success and a primary focus on identifying, nurturing and developing our best national sporting talent would be a worthwhile starting point.
Indian Hockey Federation, Hockey India and World Series of Hockey.
The ongoing dispute between the Indian Hockey Federation (“IHF”) and Hockey India (“HI”), both claiming to be the sole official hockey federation in the country, characterises the sorry state of our sports governance. The dispute, with no end in sight, is a poster child for a larger government role in sports oversight.
The IHF was the official governing body for hockey in India, but in 2008, it was de-recognized and disbanded by the IOA on grounds of corruption. The IOA then established HI to govern hockey in the country, and HI began to engage with the International Hockey Federation (“FIH”), the international governing body for the sport. However, a Delhi High Court judgement in 2010 ruled in favour of the IHF by pronouncing that the IOA had no power to de-recognize the IHF. The case is presently pending before the Supreme Court but could sufficiently jeopardise the nation’s chances of hosting high profile hockey events.
The dispute between the IHF and HI also spilled over into the conduct of World Series of Hockey (WSH), a domestic Indian tournament which is a joint venture between the IHF and Nimbus Sport. The FIH, which acknowledges HI as the sole body for the governance of hockey in India, has stated that it does not recognize the WSH and has sent a communication to all its affiliated National Associations (NAs) that players and NAs participating in WSH may render themselves ineligible to participate in FIH events, Olympic qualifiers, and the Olympic Games. HI took the position that the IHF did not have the authority to organise such a league, and has warned players that involvement in the WSH may lead to non-selection for national camps or tournaments.
The event, which was scheduled to be held from December 2011 to January 2012, faces further uncertainty with HI scheduling a national camp for the Olympic Qualifiers in December, thereby making the current national team players unavailable. To make matters interesting, a former player and coach filed public interest litigation against HI in the Delhi High Court stating that HI was forcing players to opt out of the WSH. The event organisers subsequently agreed to postpone the event subject to HI releasing players at the later date. The organisers have also filed a plea in the Competition Commission of India (CCI), contending that by changing schedules of the national team’s camp, HI is stopping competition unduly posed by the WSH, which it cannot do under the Competition (Amendment) Act, 2007
While there remains a strong case for a single governing body, the treatment of players, threats of bans to national players for participation in a ‘rival’ or ‘unofficial’ league and the role that the government and adjudicative agencies will play will be watched from the sidelines with great interest.
The doping scandal involving eight top Indian athletes earlier this year shocked the sporting fraternity as well as the rest of the nation. While credible measures have been taken over the past decade to regulate doping in sport, India is still in the process of measuring up to global standards of anti-doping. The World Anti-Doping Agency (WADA) was established in 1999 and released an anti-doping Code in 2003. The Code was implemented through the UNESCO International Convention against Doping in Sport, and India, in pursuance of these commitments, established a National Anti-Doping Agency (NADA) in 2006. NADA came out with its own Code conforming to the substantive provisions of WADA Code, and binds athletes to its rules as a condition of participation.
NADA is responsible for the dope testing programme in India, and conducts two kinds of tests, in-competition tests, and out-of-competition tests. It was in an out-of-competition test that the athletes tested positive and were subsequently suspended. While the athletes pleaded ignorance, investigations are still going on and the issues of concern continue to be the lack of awareness among sportspersons, callousness of administrators and lack of infrastructure. Recently, the Mukul Mudgal committee, appointed by the MYAS, has given a clean chit to the eight athletes involved, according to reports. The committee concluded that these were ‘accidental’ and not ‘deliberate’ acts of doping. However, the athletes will have to wait for the verdict from NADA’s disciplinary panel to decide their participation at next year’s London Olympic Games.
Player Management.
s professional leagues grow in India (and in sports in which Indian talent is world class), conflict between players’ national and club obligations becomes inevitable. It is also just a matter of time before players’ associations and collective bargaining make their presence felt. Players’ associations, properly structured, could prove to be pivotal in educating athletes on issues such as doping, engagements with player representatives, the use of social media and sponsorship and commercial agreements. The regulation of sports agents would control activities which run contrary to the ethics of sport and the interests of stakeholders in the sport concerned, which could thereby affect the functioning of sport. Currently, no legislation or code guiding regulation of agents exists in India. Player representatives often provide improper advice to players and expose them to new risks. As the rules governing a player and his/her commercial relationships increase in complexity and quantity, the need for mentorship, group action, professional legal advice and commercial representation become important pillars of an athlete’s professional environment.
Osaka Rule.
Looking internationally, a decision which will have significant impact on the ability of athletes to resume their career following a doping ban was rendered by the Court of Arbitration for Sports (CAS) this October. The CAS ruled against the IOC’s ‘Osaka Rule’, lifting the ban imposed on athletes who have committed anti-doping violation thereby preventing their participation in the 2012 London Olympics. In brief, the Osaka Rule did not allow athletes who had been sanctioned with a suspension for more than six months for any doping related violation, to participate ‘in the next edition of the Games of the Olympiad and of the Olympic Winter Games after the expiry of such sanction.’ It was challenged by the US Olympic Committee at the Court of Arbitration for Sport, arguing that the Osaka Rule was a sanction and did not amount to an eligibility rule. The IOC on the other hand maintained that the athletes had no automatic right to participate in an Olympic event and that the rule did not violate principles of double jeopardy as it was not an anti-doping ineligibility sanction. As the IOC was bound by the WADA Code, and the Osaka Rule served to increase the period of ineligibility from the original doping violation (i.e., from between 6-24 months until the next Olympic Games), it was held to be invalid.
Spot –Fixing Trial.
In the spot-fixing cricket corruption trial, a London Court found Salman Butt and Mohammed Asif guilty of conspiracy to cheat and conspiracy to accept corrupt payments for fixing part of a Test match in England in 2010. Mohammed Amir, who was also involved in the conspiracy, pleaded guilty to the criminal offences for which he was charged. The three players were handed out jail terms by the court and have also been suspended by the International Cricket Council (ICC). The verdict represented the first time that cricketers have been sent to jail for corruption in the game. Earlier, guilty players were penalised by their respective boards and the ICC, essentially through internal probes.
UEFA Club Licensing and Financial Fair Play Regulations.
In a bid to level the playing field amongst professional football clubs in Europe, UEFA, the administrative and controlling body of European Association Football, issued the UEFA Club Licensing and Financial Fair Play Regulations, designed in order to enable debt laden clubs to break even over a three year transition period, starting from 2011-12. The regulations aim at preventing clubs from spending more than they can earn, ensuring their survival. The first monitoring period will be undertaken in 2013-14, taking collective cognizance of financial expenses carried out in 2011-12 & 2012-13. A club will be allowed to record a maximum loss of £ 39.5 million before 2014. Between 2014 & 2017, the overall permitted loss will come down to £ 26.3 million. By 2018, clubs have to ensure that their annual losses are below £ 8.8 million. The loss can be subsidized by an owner as long as the money is invested permanently in the form of shares. The newly created Club Financial Control Panel, a team of eight independent experts headed by former Belgium Prime Minister Jean-Luc Dehaene, will govern the club monitoring process. Clubs must meet the criteria’s prescribed by UEFA otherwise they may face a sustained period of exclusion from UEFA organised competitions. As franchise and club based sports grow in India during uncertain and volatile financial times, similar prudential norms may become appropriate in the Indian context.
NBA Lockout.
The NBA lockout, the fourth lock-out in the history of the National Basketball Association (NBA) was another major issue. The lockout lasted almost five months, becoming the second-longest in league history, as the sides failed to reach an agreement regarding the distribution of income and wages of players. The NBA lockout which began on 1st July, 2011, officially came to an end on 8th December, 2011, after the players and owners ratified a 10-year collective bargaining agreement, with both sides having the option to opt out after six years, by a 25-5 vote. The agreement also provides for a 50-50 split of basketball related income, although depending on the revenue, a player’s guarantee of basketball – related income won’t be higher than 51 per cent or less than 49 per cent, dropping from 57 per cent in the last collective bargaining agreement. The new agreement also provides for a higher luxury tax with progressive tax rates and retention of the soft salary cap system. The maximum length of player contract has been reduced from six to five years. A shortened 66-game NBA season is set to start on 25th December, 2011.
Looking Ahead
2011 has raised many pertinent questions with regard to the progress of the Indian sports industry and the important role to be played by the law in facilitating this progress. Encouragingly, the inaugural 2011 Formula 1 Airtel Grand Prix of India and the ICC Cricket World Cup 2011 signify India’s capability to host global sporting events successfully and of the legal systems to support events of this magnitude. At the same time, organising larger events such as the Summer Olympic Games and the FIFA World Cup require the establishment of an appropriate and efficient legal framework to develop talent, streamline administration, protect the integrity of sport and sportspersons and encourage commercial and other investments made in sport by various stakeholders.
Sport revels in the efforts and excellence of sportspersons as well as the adulation of common people who desire to be a part of something beyond the ordinary. The sporting experience celebrates the game as well as the people who support it, and the sports industry and its various stakeholders should recognise that the preservation of these ideals is indispensable to its sustainability. The evolution of a mature legal framework may go a long way in preserving the ideals and driving future growth.
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© The Law Offices of Nandan Kamath
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