EC OKs joint negotiations for sports leagues

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BRUSSELS -- Sports federations should have the right to negotiate television deals jointly rather than allowing clubs to strike individual pacts, the European Commission said Wednesday as it unveiled a white paper on sports.

The European Union's antitrust authority warned that federations and clubs could not be given a blanket exemption from EU regulations despite the unique nature of sports. Nonetheless, it said federations should have the right to negotiate TV deals jointly, if they ensure that the money gained filters down to smaller clubs.

"While joint selling of media rights raises competition concerns, the commission has accepted it under certain conditions," the white paper says. These conditions include efforts to set up "robust solidarity" links between professional and amateur grass-roots sports to ensure that the cash is shared between big and small clubs.

The paper cites a study that estimates that sports generated almost €407 billion ($550 billion) in 2004, accounting for 3.7% of the EU economy and employing 15 million people. Much of that income is generated by the sale of broadcast rights.

The commission recognized the difficulties in regulating the sports sector, which has long argued that its unique nature merits special reprieves from the usual EU competition rules. The white paper says sports cannot hide from the law, but was prepared to offer limited immunity in certain cases.

"Competition law and internal market provisions apply to sports in so far as it constitutes an economic activity," the paper says. "However, the assessment whether a certain sporting rule is compatible with EU competition law can only be made on a case-by-case basis."

The move disappointed sports federations, including the International Olympic Committee and European soccer's ruling body, UEFA, which sought exemptions from EU rules. The commission also was attacked by a Belgian member of the European Parliament, Ivo Belet, who said the paper should have done more to encourage the collective selling of broadcasting rights, especially for soccer.

"The financial race that increases the gap between the large, rich clubs and smaller, not so wealthy ones needs to stop," he said. "This can only be done by opting for the collective selling of TV rights."

The EU currently has no powers to regulate sports, except in regard to its business activities. It notably intervened in the sale of the Premier League's media arrangements and, last year, forced English soccer clubs to agree to a deal that effectively ended satcaster British Sky Broadcasting's monopoly on covering matches.

However, the mandate for a new EU treaty agreed on at a summit here last month, would increase the commission's competence in the area.
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