Competition Commission slaps Rs 52-cr penalty on BCCI

The Competition Competition today imposed a fine of Rs 52.24 crore on the Board of Control for Cricket in India (BCCI) for anti-competitive practices with respect to the Indian Premier League.
Apart from directing the BCCI to "cease and desist" from unfair practices, the fair trade regulator asked it not to place blanket restriction on organisation of professional domestic cricket league by non-members.
The watchdog had penalised the cricket body for the same amount in February 2013 as well, but that penalty was set aside by the appellate tribunal after an appeal by the BCCI.
In its 44-page order, the Competition Commission of India (CCI) said the penalty of Rs 52.24 crore comes to nearly 4.48 per cent of the average of the BCCI's relevant turnover during the last three financial years.

The average turnover of Rs 1,164.7 crore is for three financial years -- 2013-14, 2014-15 and 2015-16.
"The assessment of the Commission clearly brings out that the impugned clause in the IPL (Indian Premier League) Media Rights Agreement has been pursued by BCCI consciously to protect the commercial interest of the bidders of broadcasting rights as well as the economic interest of BCCI," it said.

In February 2013, the watchdog had slapped a fine of Rs 52.24 crore on the BCCI.
Although at present, the average of the relevant turnover is slightly higher than the one which was considered by the CCI while passing the order in February 2013, the regulator said it prefers to maintain the penalty amount.

For the case, the CCI considered 'organisation of professional domestic cricket leagues/ events in India' as the relevant market.
According to the order, BCCI being a not-for-profit organisation and its revenue being ploughed back into cricket are general features of any sports federation and the same cannot be taken as mitigating factors as proposed by the cricket body.
"Similarly, the Commission does not find merit in the argument that there is no actual instance of refusal to any proposal for organisation of domestic leagues similar to IPL.
"After assuming monopoly of IPL for a sustained period of ten years by excluding all potential competition, there is no reason for BCCI or anyone to expect a proposal for organisation of a similar league," the regulator said.

The regulator noted that denial of market access is one of the severe forms of abuse of dominant position.
The BCCI has been directed not to put any blanket restriction on organisation of professional domestic cricket league or events by non-members.
"This shall, however, not preclude BCCI from stipulating conditions while framing/ modifying relevant rules for approval or while granting specific approvals, that are necessary to serve the interest of the sport.
"Such changes shall entail norms that underpin principles of non-discrimination and shall be applied in a fair, transparent and equitable manner," the order said.
Besides, the BCCI has been asked to issue appropriate clarification regarding the rules applicable for organisation of professional domestic cricket leagues/ events in India, either by members of BCCI or by third parties, as well as the parameters based on which applications can be made and would be considered.

"BCCI shall take all possible measure(s) to ensure that competition is not impeded while preserving the objective of development of cricket in the country," the CCI said.
Further, the cricket body has to file a report to the CCI on compliance with these directions within 60 days.
Following an appeal, erstwhile Competition Appellate Tribunal (Compat) had set aside the CCI's order passed in February 2013 and asked the regulator to look into the matter afresh.
The tribunal had set aside the order in February 2015.
Subsequently, the regulator had directed its investigation arm Director General (DG) to conduct further probe. The DG had filed its supplementary investigation report in March 2016.

After taking into consideration the supplementary report and submissions by the cricket body, the CCI has passed the latest order.