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2019 (8) TMI 1778 - Commission - Indian LawsRight to give necessary permissions and rights for organisation of volleyball leagues - Agreement executed between VFI and Baseline, is anti-competitive or not - penalty for entering into anti-competitive agreement - HELD THAT:- In the present case, the allegations concern restrictions placed on organisation of volleyball league by any enterprise other than Baseline in India or abroad and on volleyball players who are part of the Volleyball League to participate in any other league or other national/international events for the next 10 years. In DHANRAJ PILLAY AND OTHERS VERSUS HOCKEY INDIA [2013 (5) TMI 962 - COMPETITION COMMISSION OF INDIA], the Commission noted that the sports sector comprises multitude of relationships. For example, a sports federation may be a seller of various rights such as media rights, sponsorship rights, and franchise rights associated with sports event(s) under its purview and there would be a separate set of consumers for each such right. However, the ultimate viewers of sport events are the end consumers, who influence the popularity of the sport. Also, a sports federation requires services of players, officials, etc. for staging an event which makes sports federations themselves as consumers. In this multitude of relationships, defining the relevant consumer would enable defining the relevant market. The Commission notes that as per the decisional practice of Commission, there is an inherent conflict of interest when an entity is acting as a regulator as well as an organiser. The restraints imposed by the regulator would be justified if the restraint on competition is a necessary requirement to serve the development of sport or preserve its integrity. Furthermore, the proportionality of the regulations can only be decided by considering the manner in which regulations are applied - it requires to be analysed whether VFI, which is a regulator of volleyball as well as the organiser of volleyball tournaments, was justified to enter into agreement with Baseline giving it exclusive rights for a period of 10 years to conduct and organise Volleyball League in India to the exclusion of other enterprises and consequently affecting the free movement of players, who are part of the Volleyball League, by not letting them participate in other tournaments. The Commission at this stage is of the prima facie opinion that certain clauses of the agreement dated 21.02.2018 as it existed prior to amendment between VFI and Baseline had placed a prohibition on the players who are participating in Baseline's Volleyball League from participation in other similar tournaments for a period of ten years. The restrictions may be extended by more than ten years in case the said Agreement is renewed or extended. Furthermore, the players who would participate in Baseline's Volleyball League are/were not allowed to participate in any national or international event if its dates clashed with Baseline's Volleyball League. Such restrictions appear to be prejudicial to the players participating in Baseline's volleyball league as these players may have to forgo international events like, Olympics, Asian Games, etc. Such restrictions also appear to have the effect of restricting free movement of participating volleyball players and would have put them at a disadvantage - The Commission cannot be oblivious to the fact that VFI has entered into an arrangement with Baseline, thereby granting some exclusive rights to the said company to hold a Volleyball League and simultaneously placing restrictions on the players participating in the Volleyball League. This conduct of VFI, in the prima-facie opinion of the Commission, needs to be examined through an investigation by the DG, to determine whether the same resulted in violation of provisions of the Act including that of Section 4. The Director General (the DG) is directed to investigate into the matter and submit its report within a period of 150 days from receipt of this order - Application disposed off.
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