Introduction
The world of sports is not just about going on the field or court and doing your best, rather every step is governed by the laws, rules, and regulations that every sportsperson has to abide by. From getting sponsorship to complying with the rules of the game, everything comes under the purview of the Contract Law. The sports industries are managed by the well-developed regulatory framework that protects the basic rights of the players and the teams. Such types of regulations focus on ensuring Contractual Stability. The term Contractual Stability has now become a base for the sports. It highlights the rules and regulations as per the sports and then imposes this regulation on the movement of athletes or the sportsperson(s) from one team to another to ensure integrity and competition. The relation of the sportsperson to the team and further to the sports is bound by the contractual agreement between them. Such contracts have tremendous pros and cons in the field of sports and the life of the sportsperson. The bonanzas of high priced contracts are just like a coin. When our side is up, then it produces no harm, rather causes value addition in the sports-life. But, if not, then it can seriously guide the career of the athlete downhill and can cause harmful side effects. The most appropriate illustration here would be of Oscar dos Santos Emboaba Junior (Oscar), the Brazilian footballer who went to the Chinese club due to a high priced contract. In the year 2017, he agreed to a contract for playing from a Chinese club Shanghai SIPG for a total transfer amount of $76.5 Million. Before agreeing to the contract he used to play for the Premier League giants known as Chelsea and was considered as the future of football in the midfield. Perhaps due to low competitiveness in the Chinese league, the performance of Oscar deteriorated and now he is even not selected to play for his Brazil national team. So, Contracts can either lead to the best gate or would rather drop you to the valley of darkness.
In today’s digital and advanced world, sports are progressively more commercial in nature and because of that the athletes/sportspersons demand to be equally treated like professionals of other disciplines. With such professionalism, the sports industry demands the laws and regulations to be followed. The art of making or negotiating a contract for the sportsperson is way similar when the negotiation is done between two parties or the businesses. One of the intellectual scholars Robert P. Garbarino expressed as “Sports law, with its wide variety of legal aspects, probably encompasses more areas of the law than any other legal discipline.”[1]. The contractual Law in sports basically aims at providing perpetual success in order to reduce the marginal dispute between privy parties and the sportspersons. India has seen and has experienced issues related to the contractual relationship with the broadcasters and issues related to broadcasting rights and arbitrary actions of the sports authorities related to such relationship and violation.[2]
Essentials for a Sports Contract.
The making of a sports contract in India is no different from a usual contract that is made as per the Indian Contract Act, 1872 (hereafter, referred to as the Act). It is basically a consensual relationship between the two parties for consideration. When two parties mainly the party-one, who here is either the sportsperson himself or his team enter into a contractual agreement, party-one agrees to do the act or fulfill the clauses in exchange for something reasonable from the other party.
According to section 2(a) of the Act, the contract should contain an offer forwarded by a party to the other. Such an offer or the proposal should be communicated from one party to the other either in the oral or the written form. Various sports personnel are of the view that the written form of communication is better than the oral form as such written contracts contain all the necessary clauses and essentials that would be much easier for both the parties to understand and implement accordingly. The offer should be in such a form that it creates a legal relationship between the parties. Once the offer is made it is up to the sportsperson or the team, whether to accept the offer or not. If the sportsperson accepts the offer made or complies with the terms and conditions of the offer put forward before him/her, the offer is said to be accepted, as per section 2(b) of the Act. Every offer for a contractual relationship contains the clause of consideration which has to be followed by the party in order to maintain the legal relationship. Consideration is basically on the concept of “bargained-for exchange”, which means that both the parties are getting something in return that they’ve agreed to in the contract. This is usually something of value given in exchange for something else of value. This means that the contract is for the benefit of both the parties and such benefit should be legally bound. Such consideration is the benefit that both the parties receive or would receive in the future because of the contract so formed.
Each of these elements viz. an offer, acceptance, and consideration are important for the sports contract to be valid.
Sports Agents are one of the most valuable people when it comes to Sports Contracts. May it be an offer or securing and negotiating contracts for the Sports Professionals. These agents, along with the legal representatives or the lawyers of the Sports Professional are also very crucial in the implementation of the contract. Both professionals are trained according to the rules and laws of the sport governing it. The fundamentals of the sports contract are made up of the by-laws, the market values of their clients, and the dates for terminology. The consent of the sportsperson plays the most vital role when an offer is made to them. The offer made should not be forced on the Sportsperson either by the other party or even by the agent or the lawyer.
The main or the most essential part of the contract is that it should be made for a lawful objective that has been enshrined in Section 23 of the Indian Contract Act, 1872. The Sports contract should not be such that it violates the rules and regulations of the games or even violates public policy. If any contact is made that violates any laws related to the sports or not, then that particular contract would be void or illegal and neither the Sportsperson nor the other party would be able to seek compensation from the court if damage has occurred. The interpretations of such contracts are very essential. It should not be such that the party understands a clause in a way different from what the other party has put forward. The intent of the party should be reasonable and not contrary in nature. If at any time conflict arises between the sportsperson and the contractual party regarding the interpretation, then the court would reconcile the provisions or the clause and would eliminate the conflict. If the court finds it necessary that the contact or its clause is unreasonable, then the contract between the sportsperson and the party can be terminated.
Anti-Trust Agreements In Sports.
Competition law and Sports law have gathered a lot of camera and vision in this modern era. The antitrust laws have played a role in shaping the financial operations of the professional sports industry. Antitrust Law is basically the law that intends to promote & regulate competition and make the competitive-sports economy work. Antitrust interventions that regulate practices are violative to the competition & consumer rights, such becomes essential in the commercialization of the monopolistic governing bodies since cases have been piling up of exploitive commercial terms being included in the contract of the sports. Competition Commission of India (CCI) has played a vital role in safeguarding such competitive contractual movement in the field of sports.[3]
The imposition of unfair and unreasonable conditions or clauses in the agreement on players has been one of the most highlighting areas in the Antitrust Competitive Issues. In the case of Dhanraj Pillay v. Hockey India, Case no. 73/2011, it was held that the authority or the Federation governing the sports can\’t make any abuse of the dominance or its dominant position making unreasonable restrictive conditions on the player through the medium of the contractual relationship. No contract or agreement forwarded by the authorities should raise concern regarding anti-competition at any stage of the sports.
The anti-Trust agreement should be such that it concerns the revenue approach in the sports and the broadcasting channels. A single broadcaster or a joint broadcasting channel should not get the whole right as per the agreement formed to broadcast that particular sport. Such contracts would result in the monopoly in the hand of the broadcasting channel and the authorities giving rise to anti-competition issues. In one of the most famous cases of The Union of European Football Associations (UEFA) that provided exclusivity broadcasting (television) rights to a single channel for broadcasting the UEFA Champions League.[4] This gave the only right to the channel making it a monopoly and was against the competition and sports law agreement. The other channels had to buy it, which was comparatively pricier than the usual causing both the authorities and the broadcasting channels a huge amount of money. Though as per the Anti-Trust Agreement and the Competition law in sports it was held to be unreasonable and restricting competition in the form of sports broadcasting. Antitrust Agreement has not been restricted to just the sports persons but has now widened the scope to the hierarchy of the authoritarian channels, the broadcasters, and even the sponsorships. The main aim is to protect the essence of sports by not eliminating the competition at any stage possible.
Conclusion
The nature of sports has now, in the era of modern days, been so advanced that at every step consent, competition and evidence are essential. From the sportsperson to his team, to the authorities and then to the sponsorships and broadcasting channels, the link is unstoppable in terms of contractual relationships. Contracts are now the most essential feature in the sports industry as same as what training is for the sportspersons. The signature on the contract is the basis for acceptance of the clauses for the party. From the monetary terms, adherence to rules and regulations and penalizing for failure to comply with the same is mentioned in the contract that would serve as evidence for both the parties. Contracts are an important medium for the smooth flow of competition in the Sports Industry. The Anti-Trust Agreement in the Sports Industry restricts the monopolization of any type of competition related to sports. Prevention is done through such contracts causing a wide variety of competition and equal benefit to all the parties interested.
It is perfect to say that without any contract in the industry of sports and related entertainment, the standard for such competition would not be at a bar leading to unequal and unreasonable gamble of rights.
-Areeb Ahsan
KIIT School of LawReferences
[2] Ministry of Information and Broadcasting v. Cricket Association of Bengal, AIR 1995 SC 1236.
[3] Surinder Singh Barmi v.BCCI, Case no. 61/2010
[4] Commission Statement IP/01/1043, (2001)
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