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The dispute

The background was straightforward in its basic outline and driven by obvious commercial incentives. The cases arose as a result of disputes concerning the marketing and use in the United Kingdom of decoding devices which gave access to satellite broadcasting services provided elsewhere. Football was the trigger— specifically, the lure of watching live broadcasts of matches played in the Football Association Premier League Ltd (FAPL), more commonly known simply as English Premier League. The League granted contractual licences to broadcast and exploit its matches. This was typically organized on a territorial basis, tied to a particular country, and it was typically a grant of exclusive rights for that territory—so, one broadcaster per territory, which in practice follows the national pattern according to which most broadcasters operate. Moreover, sale is on an exclusive basis, because such a model, which confers on the buyer a powerful position to attract consumers in the contract territory, maximizes income. The grant was time-limited—for three years at the material time, in line with the practice explained earlier.

In order to protect this territorial exclusivity, all broadcasters agreed as part of the licensing deal concluded with the FAPL to prevent viewers from receiving broadcasts outside the designated area. This was achieved by secure encryption of broadcasts capable of being received outside that territory (most notably at the material time by satellite) combined with a commitment by broadcasters to ensure that no decoding device apt to break the encryption be supplied to permit anyone to view their transmissions from outside the territory concerned. So supply of the decoding devices necessary to watch the matches was limited to persons resident in the Member State of broadcast. Viewers were provided with a decoding device. Restrictions included in the contracts forbade the circulation of authorized decoder cards outside the territory of each licensee.

This model of territorial exclusivity created a market in circumvention. The cost of watching English games in a market in continental Europe was typically much lower in price than that charged in the United Kingdom. This follows, because although the English Premier League is a hugely attractive product, in Europe it is England which is home to the most eager viewers. Anyone able to acquire a decoding device in a territory where the prices are relatively low—l ower than in the United Kingdom—is able to use it to watch matches in a territory where prices are relatively high—most pertinently in the United Kingdom itself. So enterprising individuals simply brought decoding devices from markets in continental Europe, where they had been bought lawfully, to the United Kingdom and enabled the [1]

watching of matches at a much lower cost than if they had bought directly from the licensee for the United Kingdom. This is what the Premier League and its authorized broadcaster for the United Kingdom, at the time BSkyB, which became SKY in 2014, was trying to stop in the several disputes that provoked litigation and reached Luxembourg as preliminary references. The devices at stake in the litigation had been acquired lawfully in Greece, where NetMed Helas was the owner of licensed rights, and brought to and used in the United Kingdom in breach of the terms of supply between NetMed Hellas and consumers. Naturally the size of the market and the relative level of demand meant that the prices charged by the Premier League to broadcasters and hence by broadcasters to viewers were far higher in England than in Greece. Dealers responded to demand and supplied the decoders. The most eager acquirers were restaurants and bars. But the individual consumer could benefit from this market in decoders by sitting at home to watch matches too.

Cases of both a civil and criminal nature were brought before the English courts against suppliers of equipment and satellite decoder cards that enable the reception of broadcasts, and also against licensees or operators of public houses that had screened live Premier League matches by using a foreign decoding device. Karen Murphy, the manager of a streetcorner pub called the Red, White and Blue in Southsea, fifteen minutes’ walk from Portsmouth FC’s cramped but much loved Fratton Park home, who had relied on a foreign decoder to pay only about a tenth of what she would have been require to pay to BSkyB directly, was faced by a criminal prosecution. She quickly became the media darling of the process, though she was not the only party involved in the sequence of litigation.

The matter was pursued before the English courts and a preliminary reference was made by the High Court in two separate cases, in which importation from Greece was the principal background issue. The cases were duly joined. Did such action, taken in protection of the commercial model of territorial segregation within the EU, comply with EU law? There was a free movement dimension and a competition law dimension: a commercial dimension and a sport-specific dimension.

This, then, led to the Grand Chamber ruling in the case in October 2011.

  • [1] Joined Cases C-403/08 and C-429/08 [2011] ECR I-9083 (Grand Chamber).
 
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