Court of Justice FIFA and UEFA Rulings: Super League ban and ‘home grown’ rules

 

 

Court of Justice FIFA and UEFA Rulings: Super League ban and ‘home grown’ rules  

The European Court of Justice has delivered a series of much awaited rulings on the compatibility with EU competition law of rules imposed by football associations FIFA and UFEA.

The Court issued a preliminary ruling stating that rules imposed by FIFA and UEFA forcing any new interclub football project to seek their approval lacked a framework to ensure they are transparent, objective, non-discriminatory and proportionate.  The Court therefore held that the associations were abusing their dominant position when they arbitrarily banned clubs from forming a European Super League.  The associations' rules on approval, control and sanctions also constitute "by object" infringements of Article 101(1) of the TFEU, as well as unjustified restrictions on the freedom to provide services.

In a separate ruling on UEFA rules, the Court found that a rule requiring football teams to include a least eight locally-trained or “home-grown” players could restrict competition. However, it will be for the national court to determine whether those rules restrict competition as a result of their very object or because of their actual or potential effects.  The Court also considered that the rules in question may give rise to indirect discrimination, based on nationality, against players coming from other member states.  In both scenarios, it remains possible for UEFA and the URBSFA to demonstrate that those rules nevertheless encourage recruitment and training, and that they are proportionate to that objective.

European Superleague Company SL v Unión de Federaciones Europeas de Fútbol (UEFA) and Fédération internationale de football association (FIFA) (Case C-333/21) ECLI:EU:C:2023:101

UL, SA Royal Antwerp Football Club v Union royale belge des sociétés de football association (URBSFA) ASBL (C-680/21) ECLI:EU:C:2023:1010

CMA invites comments on Microsoft AI partnership

 

The Competition and Markets Authority (CMA) has published an invitation to comment on a partnership arrangement between Microsoft Corporation (Microsoft) and OpenAI, Inc (OpenAI).

Microsoft has a long-term, multi-billion partnership with OpenAI.  As part of the arrangement Microsoft and OpenAI can independently commercialise resulting AI technologies and Microsoft is the exclusive provider of cloud services to OpenAI.

In the wake of a chaotic week for OpenAI between Sam Altman’s firing and re-hiring as CEO, the CMA notes that there have recently been developments in the governance of OpenAI, some of which involved Microsoft.

It is, therefore, considering whether it is or may be the case that the Microsoft/OpenAI partnership, or any changes to that partnership, have resulted in the creation of a relevant merger situation under the merger provisions of the Enterprise Act 2002.

If the CMA finds that as relevant merger situation exists, it will examine whether the creation of that situation may be expected to result in a substantial lessening of competition within any market or markets in the UK for goods or services.

The CMA invites comments by 3 January 2024, in advance of launching a potential formal Phase 1 merger investigation.

M&A involving generative AI could lead competition authorities to investigate these transactions. In a dynamic market, markets may be more difficult to define and effects more challenging to anticipate.

The development is timely following my appearance yesterday at a ThoughtLeaders4 Disputes | TL4D webinar on the intersection of generative AI, law, and education! OpenAI's ChatGPT is stirring discussions among legal professionals.

https://www.gov.uk/government/news/cma-seeks-views-on-microsofts-partnership-with-openai

CAT rules in CMA warrant application

 

The Competition Appeal Tribunal has granted the Competition and Markets Authority a warrant to enter and search business premises for the purposes of an investigation under section 25 of the Competition Act 1998.  The CAT refused to grant the warrant in relation to domestic premises.

This was the first time that the CMA made an ex parte and without notice for a UK-wide warrant.  The CAT also refused an application by the CMA that the judgment should not be published.

The CAT was satisfied that the CMA had reasonable grounds to suspect an infringement, for the purposes of section 25 of the Competition Act.

The CAT was further satisfied that there were reasonable grounds for suspecting that there were on the premises identified by the CMA documents falling within the CMA’s powers under section 26 of the Competition Act.

In relation to the business premises, the CAT was satisfied that that there was a risk that the documents would not be produced but would be concealed, removed, tampered with or destroyed, such that the requirements of section 28 of the Competition Act were met. However, in relation to the domestic premises of an individual, the CAT concluded that this was not the case. 

Cases: 1611/13/12/2023 (W), 1612/13/12/2023 (W), 1613/13/12/2023 (W) and 1614/13/12/2023 (W).

Competition and Markets Authority v Another (Judgment (Application for Warrants) [2023] CAT 62

Court of Appeal reinstates CMA’s market investigation into Google and Apple’s mobile ecosystems

 

Court of Appeal reinstates CMA’s market investigation into Google and Apple’s mobile ecosystems

The Court of Appeal has upheld an appeal by the Competition and Markets Authority against a Competition Appeal Tribunal (CAT) ruling which quashed the decision of the CMA to make a market investigation reference into the supply of mobile browsers and the distribution of cloud gaming services in the UK.

The case has its origins in the CMA’s final report on a market study in June 2022, where the CMA consulted on making the market investigation reference. The market investigation reference was made on 22 November 2022.

The Court of Appeal held that the CAT had erred in its interpretation of the Enterprise Act in quashing the decision to make a market reference. The section 131B time limits apply to the consultation process within a market study and do not limit the CMA's standalone power to make a market investigation reference under section 131 of the Enterprise Act.

The Court of Appeal rejected the CAT’s interpretation of the CMA’s jurisdiction to make a reference, stating that this could have “serious consequences”, entailing that the CMA does not have jurisdiction to investigate Apple or Google for similar conduct in later years following a market study. The Court of Appeal said that there is “no overarching principle that an undertaking is entitled to be investigated once, and once only”.

Competition and Markets Authority v Apple Inc and others [2023] EWCA Civ 144