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CCI imposes fine of Rs 52 crore on BCCI for abuse of financial powers

CCI imposes fine of Rs 52 crore on BCCI for abuse of financial powers
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The Competition Commission of India, on Wednesday (November 29) imposed a fine of Rs 52 crore on the Board of Control for Cricket in India (BCCI) for misusing their dominant power in the market to monopolise the organisation of T20 leagues.

The fine is 4.48 percent of the average of BCCI’s turnover of the last three financial years— which is approximately Rs 1164.7 crore.

Responding to the fine imposed by CCI, chairman of Indian Premier League Rajiv Shukla said that, if needed, he will move court against the order. “We will legally understand it (the order), examine it and if need be, we will appeal against it in the court,” said Shukla.

The order directs the BCCI to “cease and desist” from indulging in abuse of its powers and not to put blanket restrictions on non-members organising professional domestic cricket leagues or events.

The BCCI had assured the broadcasters of the Indian Premier League that the board will not organise, sanction, support or even recognise any other professional domestic Indian T20 competition that would be competitive to IPL for a period of ten years. The IPL media rights were won by Star India on a bid of over Rs 16,000 crore.

The fair trade watchdog has ruled that the board’s decision to include a non-competent clause in its tender, which eliminated all the possibilities of anyone else organising a T20 league or event in the country, was an abuse of the board’s power. A non-compete clause or covenant not to compete is a clause under which a party agrees not to enter into a similar profession in competition against the other party. This very clause denied anyone else the access to organise a similar league other than the BCCI.

The Board was penalised with the same penalty amount—Rs 52.27 in February, 2013. However, the competition Appellate Tribunal had given BCCI relief after the board approached the tribunal. The Tribunal had then ruled that the “issue of abuse of dominance was legally unsustainable”. However, another investigation led by the Director General of CCI found the BCCI to be wrong again.

The CCI found out that the BCCI already has a dominant position to organise professional cricket leagues in the country and the non-compete clause was abusive of this dominance. According to the CCI, the BCCI’s self imposed restriction on blocking any T20 league apart from IPL, cannot be justified.

The CCI order says that the inclusion of the non-compete clause was in no way “connected to the interest of cricket”.

—India Legal Bureau

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