BACKGROUND

4 times Indian Premier League (IPL) champions and one of the highest valued Indian Sports entity Chennai Super Kings Limited (CSKL), the owners of Chennai Super Kings (CSK) in the Indian Premier League (IPL), have made their entry into Cricket South Africa’s upcoming T20 League. The league is set to take place in January-February 2023, and consists of six teams, all owned by Indian Premier League franchises. Ever since the news about CSKL bought the Johannesburg Super Kings, there were rumors that CSK skipper MS Dhoni would be the mentor for the Johannesburg Super Kings team (JSK), however no official announcement was made by any stakeholder involved. However getting the wind of these news/rumor, BCCI was fast to react stating that it will not allow any Indian player, contracted or retired and playing in IPL, to be a part of the upcoming T20 leagues in South Africa or UAE and added that no player will be allowed to take up mentorship roles with any teams.

This blog will discuss the restriction from the point of view of the following references:

1. Practical Scenario and General Indian laws
2. Indian Premier League Player Contract 2021, on the assumption that the 2022 version of the contract did not have any substantial change in the provisions relevant to this blog. (“Player Contract”)
3. IPL 2022 Player Auction Agreement(“Auction Contract”)

ANALYSIS

1. Practical Scenario and General Indian laws

Any agreement which restrains a person from exercising a lawful profession, trade or business of any kind is, to that extent, void under Indian Contract Act 1872 (ICA).[i] BCCI Vice-President Rajeev Shukla stated that the BCCI does not have a policy that enables Indian players to compete in overseas cricket tournaments. “We do not send our players to any other cricket league in the world. In this regard, we have a clear policy. He further added that IPL is a massive league in and of itself, and they cannot allow any of our players to be associated in any way with any international league. The fact that there exist no policy that enables Indian players to compete in overseas tournament, cannot be considered to be a legal restriction on the engage in foreign tournaments, as such restriction would have questionable enforceability due to the fact that these will prove to be violation of principle of law. Moreover if any such restrictive policy does exist, it would be considered equal to a restrictive covenant as stated in a normal employment contract.

Indian courts have consistently held that while restrictive covenants operating during the term of the employment contract are valid, any clauses restricting an employee’s activities post-employment would be in restraint of trade.[ii] There is, however case law recognizing an exception to the rule covering restrictions aimed at protecting the employer’s legitimate business interests, such as its business connections and trade secrets. Therefore, clauses relating to post-employment non-solicitation of employees or customers and protection of confidentiality with respect to trade secrets are not caught by the ICA and have been enforced by the courts, albeit on a case by case basis, however an application of a restrictive covenant. Restrictive covenants are strictly scrutinized and only enforced when they are “reasonable ‘in view of the totality of the circumstances, including the scope of geographical, temporal, and competitive activity restrictions.”[iii] Moreover for imposing any restriction there needs to be reasoning behind such restriction. However in the case of BCCI’s “restrictive policy” one cannot determine the reasoning behind such policy except for protecting the Indian player’s fitness and keeping them fresh for their commitments at the international level.

Going by this understanding MS Dhoni should not be restricted as not only does he not falls under the central contract of BCCI nor needs to be available to render international services for BCCI, under normal circumstances. Given that BCCI is not an “employer” in case of MS Dhoni, section 27 of the ICA makes a restrictive provision void, such as ‘non-compete’ in an employment contract, between an employer and its employee, after the termination of an employment contract/employee engagement. Moreover, MS Dhoni will not be employed by Cricket South Africa (CSA), and will be offering services to CSKL as mentor for its franchise from Johannesburg. Moreover under the purview of the Competition Act, Section 3 deals with anti-competitive agreements prohibited among enterprises engaged in identical or similar trade of goods or provision of services (in this case BCCI and CSA). In another case Delhi High Court observed that it is this attempt to protect themselves from the competition which clashes with the right of the employees to seek employment where so ever they choose and in a clash like this, it is clear that the right of livelihood of the latter must prevail.[iv]

1. Player Contract and Auction Contract

All restriction imposed on players under the Player Contract are under Clause 8, where it deals with the restrictions imposed on players during the term of the Agreement. Before dealing with the clauses one should understand the terms governing the duration of enforceability which are the “Season” and the “Term”.

Schedule 3 defines Season as a period of time “which occur during the Term: (i) the period from the 7^th  day prior to the first match of the League (whether involving the Team or otherwise) until the end of the 1^st day following the last Match of the League Season involving the Team unless either BCCI or the Franchisee has requested the Player to remain for any closing ceremony or other such event which takes place on or before the day after the Final irrespective of whether the Team participates in such Final”

Article 2.2. of the Contract defines the Term. Since we are referencing to the 2021 Contract, we can assume the equal amount of term, which will extend up to 4 months after the IPL final, which in the case of 2022 season would be the end of September 2022.

For the purpose of clarity, CSA in its tentative schedule has stated that the CSA T20 League will be held in the first quarter of 2023, which is clearly post the end of the 2022 Season and the Term.

Now coming back to the restrictive actions under the Contract, under clause 8.1 of the Contract (Restriction 1), the player is during the period of the Season, restricted from playing cricket or engaging in any other sport or sporting activities for any other team, club or organization whether in India or elsewhere in the world nor take up any other employment or be engaged or involved in any trade, business or occupation or participate professionally in any other sporting or athletic activity anywhere in the world, without the prior written consent of the Franchisee, provided that this shall not prevent the Player from making any investment in any business so long as it does not conflict or interfere with his obligations hereunder.

Further, section 8.2 of the Contract, a player is restricted during the Term(Restriction 2), from participating in India in any competition or league which is the same as or similar to the League without an express no objection certificate from BCCI; or from participating in any Twenty20 cricket competition anywhere in the world which is: (i) not officially recognized by the official national governing body for cricket in the country where such competition takes place, such governing body being a full member of the ICC; or (ii) not organized by the ICC.

Under Restriction 1, MS Dhoni will not be restricted from mentoring the JSK, because firstly it is not during the season and secondly since it in relation to CSKL which is the common owner of both the owners, there would be no repercussions from CSKL as well, as they themselves are rooting for the appointment of MS Dhoni as the mentor. Further under Restriction 2 as well, there cannot be any restriction over MS Dhoni for being appointed as the mentor, as the league is not been held in India nor is being organized by a non-recognized member of the International Cricket Council (ICC).

Therefore the restrictive covenants in the Contract are irrelevant in the current scenario.

The other potential obstruction would be an instance of conflict of interest. Schedule 5 of the Contract states the BCCI Conflict of Interest Rules (Conflict Rules). The Conflict Rules states 5 possible scenario of a conflict of interest which are:

1. Direct or Indirect Interest;
2. Roles compromised;
3. Commercial conflicts;
4. Prior relationship; and
5. Position of influence.

Based on the definitions of these categories, there lies no potential case of conflict of interest for restricting MS Dhoni’s appointment.

Since there exist no clear restriction over Dhoni for his appointment, the only other Agreement to which BCCI is party with MS Dhoni and is available in public domain applicable here would be the Auction Agreement. Upon a perusal of the Auction Agreement, it does not entail any restriction relevant in the current scenario.

CONCLUSION

Based on the discussion above it is unclear why BCCI requires MS to retire prior to being appointed as a mentor for JSK. MS Dhoni has no central contract with BCCI, nor does the Player contract imposes any restriction over him (hopefully, fingers crossed). Although all the stakeholders involved have their own justified reason, to their version of the justification, in the long run, the interpretation of the contracts and the laws will be the key factor in determining the final verdict. There has been backlash from the international players and boards, regarding such stringent practices adopted by BCCI, but it seems that being the richest cricket club has its own perks, when it comes to governance.

This blog is no way a definite interpretation as there is an absence of literature and documents to determine the final standing of relevant documents and laws, but is rather a personal understanding of the author regarding the situation.

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[i] Section 27, Indian Contract Act 1872

[ii] (Percept D’Mark (India) Ltd v Zaheer Khan [(2006) 4 SCC 227])

[iii] Protecting Employer Secrets and the “Doctrine of Inevitable Disclosure,” 600 PRAC. L. INST./LITIG. 367, 392 (1999))

[iv] Desiccant Rotors International Pvt. Ltd. v. Bappaditya Sarkar and Another.