British Telecommunicatons Plc v Office of Communications & Ors
2014
COURT OF APPEAL (CRIMINAL DIVISION)
United Kingdom
CORAM
- LADY JUSTICE ARDEN
- LORD JUSTICE AIKENS
- LORD JUSTICE VOS
Areas of Law
- Commercial Law
- Administrative Law
2014
COURT OF APPEAL (CRIMINAL DIVISION)
United Kingdom
CORAM
AI Generated Summary
The case involved Sky challenging Ofcom's jurisdiction under section 316 of the Communications Act 2003 to impose conditions on their broadcasting licenses. Ofcom believed Sky's practices hindered fair competition. The CAT initially ruled in favor of Sky on the merits but upheld Ofcom’s jurisdiction. Both sides appealed. The Court of Appeal upheld Ofcom’s jurisdiction and remitted the case to the CAT to address Ofcom’s concerns about rate-card pricing and penetration discounts. The Court emphasized Ofcom's broad jurisdiction under section 316 and the necessity for CAT to address all competition concerns.
Judgment
Lord Justice Aikens :
I. Synopsis
There are two issues in this appeal, which concerns Pay TV. The first is whether the Office of Communications (“Ofcom”) has jurisdiction under section 316 of the Communications Act 2003 (“the CA 2003”) to impose conditions in broadcasting licences of British Sky Broadcasting Limited (“Sky”) if, as Ofcom found, “practices” of Sky relating to Pay TV made it appropriate to impose them to ensure “fair and effective competition”. The second is whether the Competition Appeal Tribunal (“the CAT”) erred in law in the way it disposed of some of the issues that were before it on an appeal from a Statement by Ofcom concerning “practices” of Sky which had led Ofcom to impose conditions in Sky’s broadcasting licences.
Live television broadcasting of major sporting events such as Premier League football matches is big business. Sky had (at the time with which we are concerned) obtained the right to broadcast live many of these attractive events. It broadcast them to consumers on what OFCOM defined as “core premium sports channels” or “CPSCs” through Sky’s own Pay TV network, which is a “digital satellite” broadcast system which now reaches nearly 10 million homes in the UK. There are other companies, such as British Telecommunications PLC (“BT”) and Virgin Media, who are competitors to Sky in the “retail” market to provide Pay TV to consumers. Their Pay TV services are available through “Digital Terrestrial Television” or DTT (the successor to the old terrestrial analogue TV), “Digital Cable” TV and by “Internet Protocol Television” (“IPTV”) which streams programmes to televisions using internet protocol. These competitors can be called “retailers” of Pay TV for the present purpose. Sky has always been prepared to retail (for a fee) the CPSCs on these competitors’ platforms (known as ‘self-retail’).
Ofcom regulates Pay TV broadcasting, including aspects of competition. From 2007 Ofcom undertook three rounds of consultation on the issue of whether Sky, which Ofcom concluded had “market power” in the supply of CPSCs, was restricting the wholesale supply of CPSCs to other Pay TV providers (ie those who retailed the channels to consumers) in a manner that was prejudicial to “fair and effective competition” in the Pay TV market.
Having concluded its investigation and consultations, Ofcom, as regulator, produced a “Pay TV Statement” (“the Statement”) of over 500 pages dated 31 March 2010. Ofcom’s principal conclusion was that S