Notice published pursuant to Article 19(3) of Council Regulation No 17 in Case COMP/C.2/37.214 — Joint selling of the media rights to the German Bundesliga (Text with EEA relevance)
Date: 2003-10-30
Institutions: European Commission
Subjects: broadcasting, commercial law, exclusive distribution agreement, sporting event, sports body

30.10.2003

EN

Official Journal of the European Union

C 261/13

Notice published pursuant to Article 19(3) of Council Regulation No 17 in Case COMP/C.2/37.214
— Joint selling of the media rights to the German Bundesliga

(2003/C 261/07)

(Text with EEA relevance)

1. THE NOTIFICATION

applied

Fußballbund

1. On 25 August 1998 the German Football Federation
(Deutsche
for negative
(DFB))
clearance or, failing this, an individual exemption under
Article 81(3) of the EC Treaty in respect of the joint selling
(or central marketing) of television and radio broadcasting
forms of exploi-
rights and rights to other
technical
tation (1)
for matches in the first and second national
football
Bundesliga’
divisions
respectively).

(‘Bundesliga’

and

‘2.

2. DFB is the German national

football association. The
the
is a member of
League Association (‘Ligaverband’)
DFB. The members of
the League Association are the
professional clubs and companies in the first and second
divisions (‘the clubs’). The DFL (German Football League)
conducts the operational business of its only shareholder,
the League Association. Following the original notification,
the DFB's application has been amended several times on
account of internal structural reform and the setting-up of
the League Association in 2001. The League Association
adopted the DFB's amended notification as its own on 19
February 2003.

incorporation,

3. According to the DFB's articles of

the
League Association is entitled to organise the professional
league football competitions leased by the DFB and to
them exclusively in its own name (2). This
exploit
prevents the clubs, which are at least coowners of the
broadcasting rights, from making independent commercial
use of those rights.

4. The firm Infront Buli GmbH (Infront), still trading as BULI
Vermarktungs GmbH (BULI), acquired almost all of the
signed on 28 June
centrally sold rights by contract
2002. At the time, BULI was a subsidiary of KirchMedia
GmbH and Co. KGaA. It is no longer part of the Kirch
shares are now held by independent
group and its

(1) The joint selling right covers all types of broadcasting right: free-TV,
pay-TV and pay-per-view TV terrestrial broadcasting, cable or
satellite broadcasting;
live or deferred broadcasting; showing of
the entire event, of extracts or of compiled highlights; and radio.
It also covers rights for all kinds of existing and future technical
facilities such as UMTS, the internet or business-TV.

(2) The marketing of international club competitions is not covered.
The selling of rights to UEFA Champions League games is thus
covered by the decision of 23 July 2003 on the joint selling of
the media rights of the UEFA Champions League on an exclusive
basis (IP/03/1105).

investors. As owner of
grants
sublicences for television and other types of coverage of
league matches.

Infront

rights,

the

5. The notified arrangement

is permissible under German

domestic law (3).

parties.

took the

view that

The German

6. After the originally notified arrangement was published,
the Commission received comments from a number of
and United Kingdom
third
competition authorities
central
marketing constituted a restriction of competition and
was not essential for club solidarity. Some of the larger
clubs shared this view. However, the associations argued
that only the notified arrangement allowed overall repre-
sentation of the sports competition, its effective marketing
and the necessary solidarity between clubs. Television
broadcasters essentially agreed,
they as
users were interested in acquiring broadcasting rights for
all matches, and that this would be more difficult if the
rights were sold individually. A similar view was taken by
there was no
sports-rights agents, which also felt
that
distortion of competition on the other
the
market and no appreciable effect on trade within the
meaning of Article 81(1) of the EC Treaty.

stressing that

side of

7. In the Commission's view, the central marketing system in
place to date is incompatible with Article 81. It restricts
competition on the upstream market for the acquisition of
television rights for football matches played regularly and
the corresponding rights for mobile telecommunications
and internet broadcasting. It also restricts competition on
the downstream television markets for free-TV and pay-TV
and on the downstream markets where mobile telecom-
munications and internet providers compete for customers.
Under the existing system, the first- and second-division
clubs have no right to exploit their German football league
games or
to act as independent suppliers. Moreover,
central marketing, together with the exclusive selling of
all rights to one broadcaster, means that only a few broad-
casters, or other content users have a chance of partici-
pating in the market.

(3) Under Section 31 of

the German Law against Restraints of
Competition, Section 1 of the same Law, which prohibits anticom-
petitive agreements, does not apply to the central marketing of
rights to television broadcasting of sports competitions organised
according to by-laws, by sports associations which,
in the
performance of their socio-political responsibilities, are committed
also to promoting youth and amateur sports activities and which
fulfil
the
this commitment by allocating an adequate share of
income from the central marketing of these television rights.

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EN

Official Journal of the European Union

30.10.2003

8. The total exclusion of

the clubs from marketing their
matches is not necessary to achieve efficiency gains for
content providers and clubs or other benefits of
joint
selling on media markets. Moreover,
the duration and
the exclusive rights granted to date by the
extent of
DFB/League Association to a single broadcaster cancel
out any possible benefits. They strengthen the tendencies
towards
industry. The
arrangement as originally notified also acts as a barrier
football coverage via the new
to the development of
media, such as the internet and mobile telecommuni-
television rights
cations. Bundling together the sale of
the new media
and the sale of rights in respect of
discourages broadcasters
the
markets in the new media because they wish to protect
their traditional branch of business.

concentration in the media

from fully developing

9. In these circumstances, the League Association and the
DFL presented the Commission on 10 June 2003 with a
new plan which significantly amends the originally notified
arrangement. In future, the League Association will market
centrally packages of broadcasting rights under established
and transparent rules. In addition, clubs will be able to sell
certain rights individually. The Commission has come to
the provisional conclusion that the new arrangement allays
its concerns.

2. NEW MARKETING MODEL PROPOSED BY THE PARTIES

2.1. Central marketing

2.1.1. Award procedures

10. The rights will be offered in several packages via a trans-
parent and non-discriminatory procedure. The public invi-
tation to tender will be published four weeks before the
start of the procedure. Tenderers will then have a further
four weeks within which to bid for one or more packages.
The rights will be awarded by the League Association or
an authorised independent agent. An arbitration panel will
be set up to handle disputes over the award procedure.
The contracts to be concluded with the agent and the
sublicence holders may not cover more than three seasons.

12. A third package comprises live broadcasting rights to at
least
two first-division matches and to deferred first-
highlights coverage on free-TV. A fourth package covers
live second-division matches as well as deferred first-
highlights coverage on free-TV. Secondary and tertiary
exploitation rights
fifth package.
Packages 3 to 5 can be awarded to several operators.

are offered in a

2.1.3. Internet, mobile communications and other

first- and second-division matches,

13. Package 6 covers live and/or deferred internet broadcasting
in the form of
of
to deferred exploitation
extracts or in full. The right
(without priority)
is also included. This package will be
specified in more detail by the League Association in the
tender procedure and can be awarded to several operators.
A seventh package comprises deferred highlights coverage
and can also be awarded to several operators.

for

first-

rights

14. Package 8 comprises live and/or near-live and/or deferred
second-division
broadcasting
and/or
in the form of
matches via mobile phones, whether
extracts or in full. This package will be specified in more
detail by the League Association in the tender procedure
and can be awarded to several mobile communications
operators.
the League Association can
ensure that the offers are mutually consistent as regards
content. Package 9 comprises deferred mobile phone
broadcasting rights in respect of extracts of first- and/or
second-division matches.

In this case,

15. All other media rights not covered by packages 1 to 9 or
by the exploitation rights of the clubs are combined in a
further package that includes audio and moving picture
rights for public productions, advertising and production
of picture/sound carriers for end consumers (video, CD,
DVD) and for computer-aided game and player analysis.
This package can be awarded to several operators with
variations in content.

2.1.2. Television

11. Live broadcasts of first- and second-division matches will
be offered in two packages. Package 1 includes the main
match days of the two leagues (Saturday and Sunday),
which can be broadcast in parallel and in full. Package 2
covers the other match days for both leagues (Sunday and
Friday) with possible parallel broadcasting in full. Both
packages also entitle the successful bidder to broadcast
matches on the other days through a conference channel
and can,
include the right to deferred first-
in addition,
highlights coverage on pay-TV.

2.2. Rights marketed by the clubs

Under the new system, the clubs have the following exploi-
tation rights.

2.2.1. Television

16. Every club can sell its home games to a free-TV broad-
caster 24 hours after the match for one-off free-TV broad-
casting of the full match.

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Official Journal of the European Union

C 261/15

2.2.2. Internet, mobile telecommunications and other

17. Every club can show a summary (not more than 30
minutes) of
its home and away matches on its own
internet website two hours after the end of the match.
After 24 hours, the entire match can be shown. In the
case of audio reporting via the internet, clubs can provide
live, full coverage of home and away matches. Internet
exploitation can also be assigned exclusively to a third
the presentation of
‘outsourcing’, but
party by way of
the matches must be recognisably linked to the club.

18. Every club can sell to a mobile communications provider
the rights to coverage of its home matches on mobile
networks within the EEA. During a match, an unlimited
number of one-minute deferred clips are allowed. Up to
two hours after the end of the match, two-minute clips
may be transmitted. After two hours, the entire match can
be broadcast via mobile phone.

19. Every club can sell unlimited rights to freely receivable
radio coverage of its home matches after the end of the
game. Live coverage may not exceed ten minutes per half.

20. Clubs are also entitled to show limited moving picture
coverage of their own matches (the match in progress or
past matches) in the stadium (ten seconds of pre-goal play
per goal during the match; three minutes of past play from
the match in progress; three minutes from other matches
in the current season). In addition, they are entitled to use
moving picture material for advertising (30 seconds per
match, where this does not interfere with the rights of
other clubs or players), club-related picture/sound carriers
(video, CD, DVD)
for end-consumers or for their own
computer-aided game and player analysis.

2.2.3. Rules for individual selling

21. The above rights may not be sold in such a way as to
allow a user to produce a product which runs counter to
the interests of the DFB and the League Association or of
the holders of rights packages 1 to 9 in a uniform product
or which undermines the benefits of branding and central
marketing (one-stop shop). Where clubs individually sell
exploitation rights,
they may not bundle
together more than two matches. For the same reason,
coverage of a league match based on rights sold by the
clubs may not exceed 30 % of the total coverage of a
if the coverage is broadcast via a
programme. However,
club's broadcasting platform (‘club-TV’), 100 % of
the
If club matches are
programme can be league-related.
broadcast via the platform of a third party (e.g.
‘Club-TV
Magazine’ or ‘Club-Radio Show’), league coverage can take
up 50 % of the programme.

therefore,

2.3. No unused rights

22. According to the parties' amended proposal, unused rights
the league

may be exploited by the clubs. However,

association remains entitled to parallel, non-exclusive
marketing of the corresponding package.

— This applies when the League Association has failed to sell
certain rights covered by the joint selling procedure. If, on
completion of
the season, no
the fourth fixture of
agreement has been concluded with a user for one of the
above packages as defined, the clubs themselves, from the
fifth fixture until the end of the season, may exploit the
rights from the unused package in respect of their home
games. The conditions outlined in Section 2.2.3 must be
met.

— Clubs are also entitled to sell rights where the holder of
those rights, for no objective reason, fails to use them, i.e.
where on more than two match days in a season he does
not exploit the number of matches allocated to him or does
not do so in the form (live, near live, deferred) or to the
immediately
extent
inform the League Association so that the clubs can be
informed and use their rights.

laid down. The rights holder must

2.4. Transitional phase

23. The amendments relating to television will enter into force
on 1 July 2006. All other amendments will apply from 1
July 2004. These transitional phases will allow successive
to be taken of competition concerns, without
account
interfering with the smooth operation of the first and
second divisions of the Bundesliga.

24. The licensing agreements to be concluded are not covered
by the marketing model outlined above. The Commission
reserves the rights to scrutinise them separately in the light
of Community law, especially if several of the centrally
marketed packages
are
comprising
acquired in combination by a single operator.

exclusive

rights

3. THE COMMISSION'S INTENTIONS

25. The amended arrangement is likely to bring benefits for
consumers which outweigh the competition concerns. The
Commission therefore intends to take a favourable view of
the amended arrangement notified. However, before doing
their
so,
comments within one month of the publication of this
notice to the following address, quoting the reference
‘Case No 37.214 — Joint selling of the media rights to
the German Bundesliga’:

interested third parties

to submit

invites

it

European Commission
Directorate-General for Competition
Directorate C-2
B-1049 Brussels
Fax (32-2) 296 98 04
E-Mail: Stefan.WILBERT@cec.eu.int