German Monopolies Commission calls for level competitive playing field in sports sector

On July 29, 2020, the German Monopolies Commission published its 2020 biennial Report on Competition (Hauptgutachten XXIII: Wettbewerb 2020) under Section 44(1) Act against Restraints of Competition (“GWB”). 

In its report, the Monopolies Commission – a permanent, independent advisory body which advises the German Federal Government, the legislative bodies and the public in the fields of competition policy, competition law and regulation¹ – also commented on the abuse of dominance investigation and commitment decision by the German Federal Cartel Office (Bundeskartellamt – “FCO”) against the International Olympic Committee (“IOC”) and the German National Olympic Committee (Deutscher Olympischer Sportbund, “DOSB”).

The case was concluded in mid-2019, when the FCO accepted commitments from the IOC and DOSB, lifting certain advertising restrictions on German athletes and their sponsors during the Olympic Games. With these commitments, the IOC and DOSB resolved the FCO’s concern that they – as part of the Olympic Movement – enjoyed a dominant position on the global market for the organization and marketing of the Olympic Games, which they abused by way of restricting athletes, coaches, trainers and officials participating in the Olympic Games from using/advertising with their person, name, image or athletic performances without the IOC’s prior approval. Welcoming how the decision allowed German athletes to better advertise themselves, the Monopolies Commission at the same time calls for national competition authorities to ensure a competitive level playing field for athletes across the EU. Picking up on this topic, the Monopolies Commission suggests that the European Commission (“EC”) consider issuing guidelines specifically addressing the application of EU competition law in the (competitive) sports sector. In the Monopolies Commission’s view, such guidelines – albeit only legally binding on the EC – would enhance a uniform application of EU competition law in the sports sector across all Member States.

Addressing a 2007 EC working document², according to which the sport sector was too broad and complex to assess all relevant conduct under Article 101 and 102 TFEU, the Monopolies Commission proposes to limit the guidelines to address provisions in which sports associations define the conditions under which they grant access to the relevant events – in most cases, individual sports associations have a monopoly resulting from the so-called one-seat principle (one global and one national federation per sport).

The Monopolies Commission’s comments and proposals highlight the importance of competition law in the sports sector, as demonstrated by a series of cases over the last few years in the EU and elsewhere.

A recurring theme is the question to which extent “dominant” sports associations may regulate the freedom of action of athletes when participation in competitions, be it in the context of advertising (IOC/DOSB case), doping (Pechstein case) or attending “non-authorized” counter events (Commission vs International Skating Union; Euroleague vs. FIBA). 

Any form of EC guidance, in particular by issuing guidelines as per the Monopolies Commission’s suggestion, would likely improve legal certainty and transparency in an area that is increasingly commercialized and economically important also in Europe.

_{1 According to the GWB, the Monopolies Commission is to prepare an expert opinion every two years, assessing the level and the foreseeable development of business concentration in Germany, evaluating the application of the provisions concerning the control of concentrations and commenting on other relevant issues of competition policy.
2 The EU and Sport: Background and Context, Accompanying document to the White paper on Sport, SEC (2007) 935, July 11, 2007, page. 69.}

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