Hockey India Order - Sports and Competition Law

It was reported in the press a few days back that Hockey India would be found guilty of anticompetitive practices by the CCI. An information was filed in 2011 by former Indian Hockey Team Captain, Sri Dhanraj Pillai, in the backdrop of the World Series Hockey League and the sanctions imposed by National Hockey Federation - Hockey India - on the players affiliated with it. However, it seems that in majority order passed on May 31, 2013 the CCI has not found any violation of Section 3 or 4 by Hockey India. I have not read the complete order but intend to do so shortly to analyse the order.

On a preliminary reading of the findings of the order, the CCI has in exercise of its powers under Section 18 of the Competition Act, 2002 observed that a conflict of interest may arise for Hockey India in the capacity of a National Sports Federation (regulator of a sport) and as an organiser of events (as an commercial enterprise). Further CCI observed that Hockey India should put in place an 'effective internal control mechanism' to ensure that its regulatory powers are not used in any way in the process of considering and deciding on any matters relating to the commercial activities of Hockey India. This is an interesting development as in the earlier BCCI Case, the CCI had found the cricket board to have indulged in anticompetitive conduct. The area of sports and competition law have always been different from the other sectors as there is more at play than merely 'commerce'. The manner in which sports is governed is an important function and the extent to which Competition Authorities can intervene has been an issue in other jurisdictions as well. In this background, this author will try to analyse the Hockey India order and also try to compare the treatment of sports and competition law in this order and the BCCI order.

Furthermore, the author will also throw some light on the powers exercised by the Hon'ble CCI under Section 18 of the Competition Act, 2002. The CCI has in the past too exercised its powers under the said section in the form of an advisory / recommendatory jurisdiction to outline its recommendation. More will follow on this order shortly.  

Jindal Steel & Power & Arshiya Judgments - Appellate Jurisdiction of the COMPAT

In an earlier post, we had brought to the attention of the readers the issue pertaining to the jurisdiction of Hon'ble COMPAT pending in certain appeals before the Hon'ble COMPAT. The said issue has now been settled by Hon'ble COMPAT in two separate judgments available here and here. As discussed in the earlier posts, the observations crucial to the determination of the issue was the judgment of the Hon'ble Supreme Court in the SAIL Judgment.

In the first appeal, it was argued by the appellants who were appealing against an order passed by the CCI under Section 26 (8) of the Competition Act that the observations in the SAIL Judgment were an obiter and, therefore, not binding. However, the Hon'ble COMPAT was not impressed with such a line of argument and instead felt that the observations recorded by the Hon'ble SC were binding and applicable even in the case at hand. The Hon'ble COMPAT after quoting the law as laid down by the Hon'ble Supreme Court in the SAIL Judgment went on to hold that in the light of the negative language used in the text of the SAIL Judgment, it was clear that only those decisions, directions or orders referred to in Section 53A (1) (a) of the Competition Act were appealable and no other orders etc were appealable. Hence, an order under Section 26 (8) not being an order referred to in Section 53A (1) (a) was held to be not appealable. Furthermore, the Hon'ble COMPAT held that the Hon'ble Supreme Court had clearly interpreted the contours of Sections 53A and 53B of the Competition Act, 2002 and had clearly declared the law. Therefore, it cannot be considered to be an obiter [or in other words only pertaining to orders passed under Section 26 (1) which was the factual matrix in the SAIL Judgment] and was binding on the Hon'ble Tribunal.

The Hon'ble Tribunal also pointed out that since the question of law had already been decided by the Hon'ble SC there was no occasion for the Hon'ble COMPAT to take any different view. The Hon'ble COMPAT also observed that since the Apex Court had already decided the question of law, it was not permissible for the Hon'ble Tribunal to supply any other meaning through the application of the doctrine of casus omissus.

In the second appeal, in addition to the aforementioned arguments, it was advanced that the Section 53A (1) (a) only contained orders or directions and not decisions and that the impugned order was a decision. Since the term decision was different from an order or a decision the impugned decision was appealable. However, the Hon'ble COMPAT held that this would effectively render the term 'decisions' different from the terms directions and orders under Section 53A and lead to a contrary interpretation as advanced by the Hon'ble Supreme Court. Hence, it was not found to be acceptable. Furthermore, the Hon'ble COMPAT also held that the arguments on the applicability of the provisions of the Civil Procedure Code would not be applicable in the light of the specific statutory scheme set up through Section 53A of the Act. Also, the Hon'ble COMPAT held that sub clause (g) of Section 27 cannot be read independently with out the main provision where under a contravention of Section 3 or 4 has to be found by the CCI. Hence, on these grounds the appeals were dismissed.

Therefore, the law as it stands now has been firmly laid down to hold that Section 26 (8) orders are not appealable to COMPAT under Section 53A. It appears that the parties will have to approach the doors of the Hon'ble Supreme Court in the event they wish to advance a different interpretation to Section 53A (which interestingly was the view voiced by the Hon'ble COMPAT during the hearings too since the law was clearly laid down in the SAIL Judgment). In the meanwhile, parties can also look forward to an amendment in the law to fill this vacuum in the Appellate Jurisdiction of the Hon'ble COMPAT. At the same time, it would also be interesting to see if the parties who face a Section 26 (8) order in the meanwhile would approach a Writ Court or directly approach the Hon'ble SC under its discretionary special leave jurisdiction under Article 136 of the Constitution of India. It remains to be seen for this may not be the last of the Section 26 (8) orders.