Executive Summary India today is at a stage of take off in the field of sport business.

Widely seen globally as the next boom market with immense potential this decade could well be seen as the decade of Indian Sport. With India emerging as a favorable host for various world class events including the Commonwealth games, ICC Cricket World Cup and a F1 race there is a need for creating an atmosphere for active promotion of sports. There is a need for structural changes in the way sport is governed in this country. Sporting structures like the IPL have redefined the way Sport is consumed and provide a fine blueprint for other sports to follow. On the other hand lack of strong governance norms have created bottlenecks.

This paper aims to identify opportunities in the sports sector and also point out possible changes to ensure better growth. The paper is divided into 3 parts, The first part looks at the commercial side of sport in India and provides an analysis of the various segments of revenue. The second part looks at the structural changes with respect to the governance of sport in this country. The third part is on sport law and why sport law is necessary in India.

It is imperative to provide this sector with an atmosphere which encourages innovations and promotes growth. Sport in addition to its commercial possibilities also provides a social platform which can be effectively used for various causes. This decade could well be the changing face of Indian sport to being a vibrant sector contributing to yhe Indian economy. Chapter 1

The business of Sport

The concept of Sport has undergone a sea change in the past century. The transition of sport from recreation to a professional activity and finally a commercial activity has been the hallmark of the past century. The 20th century also saw some key areas of sport revisited, fundamental models were improved, technology revamping the consumption pattern of sport and finally globalization of sport and hence economic models which were drastically changed during the course of the century. The turn of the century has thrown in newer challenges both at a macroeconomic and microeconomic level at the way sport is run, consumed and regulated. At the end of the first decade there are some patterns which define the landscape of sport and adoption and quickly adapting to changes in the environment would be the key to success for any sport or sporting body. This knowledge paper wishes to engage in identifying key areas of sport business and attempt to look at possibilities with respect to India in the near future. Some trends affecting the global market and hence the sport market are reflected below • There is a need for developing a strong local flavour to sport. • The consumption of sport especially in India and hence the biggest revenue driver is the media; television and other media • There is a need to identify structural, legal and economic issues governing the business of sport, Chapter 2 looks at the structural issues • Allied sport activites (sport apparel, merchandize etc) have a strong correlation with the growth of a sport. • Sport is a global industry.

The basic economic theory in sport points towards some key factors which determine the demand and hence success of a sport 1. Income of the average population 2. availability of alternate sources of entertainment 3. Team success 4. Level of competition India has in the last decade proved to be a nation with high levels of growth and hence a growing middle class with higher level of disposable income. Research across the world suggests that high levels of disposable income is proportional to the amount of money spent on sporting activities and related businesses. Its middle class is estimated at between 200 million and 300 million people and is projected to double by 2025. Almost 350 million of India ’s citizens are under age 15, which equates to 32 percent of the population. By comparison, it’s 28 percent for Brazil , 20 percent for the U.S. , 19 percent for China , 15 percent for Russia and 13 percent for Japan . As reported widely in the media by 2025 India could be the second largest economy globally. The Indian Story The economic trends surely indicate a robust future for the sport industry, but this needs to be supplemented with high quality content and infrastructure . A case in point is the metamorphosis of the film theatres over the past decade in the country. The cinema viewing experience today has undergone a sea change with multiplexes and malls. The urban movie buff of today has a lot of choices with respect to viewing experience and the industry has successfully modified itself in the changed economy of today. The consumer looks for choice, comfort and a wonderful ambience and is willing to a pay a premium for the same. The industry has also ensured smart pricing and marketing strategies to ensure a viable economic model. The movie goer of today definitely has a far superior experience than a decade ago. This new economic model also ensured new content with specific target and segmentation strategies adopted by movies during their making and publicity ensuring a viable model and hence greater choice.

Sport today is mostly consumed on television but a strong potential exists for this consumption at venues.6 m Deccan Chargers Deccan Chronicle (Gayatri Reddy) $ 107. In fact the total fee for the 9th and 10th franchise was more than the other 8 put together. The second important element of the IPL has been the packaging and structuring of the league with a mixture of sport and entertainment it is a fine example of sportainment. The IPL has been able to create a sense of city based rivalry which is key to the success of any league. Depicted alongside in fig 1 is the revenue distribution of Manchester United and Real Madrid and a significant portion of the revenue is Match day revenue. In terms of content the league system is a globally successful model which has been attempted successfully by the IPL in India. Developed sport economies have a strong economic gain through match day sales.9 m Royal Challengers Bangalore Vijay Mallya (UB Group) $ 111.Sport is also entertainment and unlike most developed sport economies in this country has a formidable rival in movies and other forms of entertainment.0 m . Team Owners Price paid (for 10 years) Mumbai Indians Mukesh Ambani (Owner ofReliance Industries) $ 112. It is a clear indicator that a city with lower business potential like Pune or Kochi paid nearly 3 times the cost for the Mumbai Franchise. A similar change is required in the sports sector wherein there is a change in content and delivery patterns. The success of the IPL can be simply gauged by the immense increase in values of the 10 franchisees paid for the franchise fee.

Preity Zinta. Global Scenario PWC estimates that the total spends on sport would increase from US $ 114 bn in 2009 to US$ 133bn in 2013. Mohit Burman .90 m Delhi Daredevils GMR Group $ 84.R Jha $ 67. Although IPL has had its fair share of problems. Gauri Khan. A. Raj Kundra. Suresh and Kavita Chellaram Pune Warriors Sahara $ 370. The slump caused due to the recessionary economic climate seems to have subsided and the economy is coming back to normal.0 m Kochi Rendezvous Sports Limited $ 333. Karan Paul (Apeejay Surendera Group).Srinivasan) $ 91. It is imperative for the Government to also recognize the power of sport both at the economic and social level and promote and encourage these initiatives.0 m Kings XI Punjab Ness Wadia. Juhi Chawla and Jai Mehta) $ 75.).0 m What the IPL has done is provided a route map for the future of sport in this country. . Gaurav Burman (Dabur). a league based on the best economic principles coupled with structural prudence shall pave the way for sports growth in the next decade. The concept of the league has been accepted by the public at large and more team sports shall follow this structure.Chennai Super Kings India Cements (N.0 m Kolkata Knight Riders Red Chillies Entertainment(Shahrukh Khan.Shilpa Shetty.0 m and co. Aditya and Arvind Khanna $ 76.1 m Rajasthan Royals Emerging Media (Lachlan Murdoch.

The regionwise growth between 2010-2013 is projected below The Asia pacific region is projected to grow at 3. The interesting factor is that across regions of the world the CAGR is not very different. PWC in its report also projected sponsorship growth across . an indicator of the globalized nature of sport. The global scenario suggests an active growth pattern with sport sponsorship having the highest CAGR of 4.9% .4% till 2013.

Greater spending power for the average Indian Today as product differentiation is minimal. It is clear that a lot of brands and corporates look at Sport as an effective medium to promote their interests. 2011 ICC World Cup and Formula -1 Races from 2011. Campaigns like Aircel save the tiger and emergence of cause based sponsorships would accentuate this trend There is a need for brands to look beyond basic media • • • • . The addition of 2 IPL teams and end of the period of the current title sponsor should augur in significant revenues. Corporates investing in newer sports. In the case of India. Brands look at opportunities to enhance their image and personality and also appeal to the globalised aspirational Indian consumer at the emotional level who is aware and sensitized of issues and stands by them.regions given below. the sponsorship growth rates should be higher than that of the Asian average for the following reasons • India becoming a major host for sporting competions with the 2010 commonwealth games. Corporates today are engaging in higher sponsorships and events in India. Mass mobilizing events like the India Cyclothon and golf would see an upswing.

The IPL provided an opportunity for the same. The expansion of the English Premier League has been so profound that there was a proposal to add a 39th game to be played in Asia. wherein global channels . The emergence of the state level cricket leagues across states is an example of this. It would be necessary for domestic sports to create a market for themselves. Sponsorship provides the platform in a cluttered market to stand out. • There would also be a need for regional and smaller brands to get an opportunity to enter this space. The IPL also successfully conducted an edition in South Africa. There would be two key aspects of this globalization. Growth of regional sport. Even in the case of sports with regional strongholds brands are looking at riding the bandwagon. Television Industry and Sport in India Sport also was a key driver in promoting the growth of television at the household level with the telecast of events including the Los Angeles Olympics in 1984. There have been regional brands supporting local and regional events as in the case of the KPL. There is a need to accept this phenomenon and understand to exploit the economic benefits which occur as a part of globalization. The American sports have also expanded and the NFL and NBA host regular games in the UK. The next phase on television in India was from 1991 with the advent of Satellite television. • Sport as a global phenomenon The last decade has globally seen expansion of regional sports to global sports. Indian sport in the International arena akin the IPL and entry of foreign sports in India like the EPL.advertising and avail possibilities through other activities. Wimbledon and the fourth ICC World Cup (called the Reliance Cup) in 1987.

Today the penetration of satellite and terrestrial television has been unparalleled and television has moved to being the prime entertainment option for the average Indian. No 1 2 3 4 5 6 7 Channel ESPN Star Sports Star Cricket Ten Sports Zee Sports DD Sports Neo Cricket Parent ESPN Star Sports ESPN Star Sports ESPN Star Sports Taj Television and Zee Television Zee Television Prasar Bharati Nimbus Communications .2 2008 135 98 Table 1: Growth in India’s TV subscriber base It is estimated that the current size of the market is 112mn homes which is expected to touch 200mn soon. (Naukri Web 2010) S.9 1. the first sports channel covering India.2 1995 52.3 15 1998 69. today there are 7 dedicated sports channels and a couple of partial sports channels. From one satellite channel in 1992.1 29 2000 40 33 2002 79 40 2004 100 55 2006 108 73. which exposed Indian audiences t o global sport television both with respect to content as well as quality. Table1provides a comparison of growth of TV broadcasting in India (Khandekar 2010) and Table 2 provides a list of channels operating in India today.Star TV launched Prime Sports. Year Total number of TV homes Total No of C & S homes (Cable (million) and Satellite) (million) 1992 34.

8 Neo Sports Nimbus Communications 9 SET MAX Multi Screen Media 10 Ten cricket Taj Television and Zee Television Table 2: Channels with Sports content in India The growth of television in India has also over the last decade fuelled increase in Sport broadcast rights across sports.in 2008) S. Figure 1 indicates this growth pattern . Cricket being the number 1 sport in India is the primary revenue driver for sports channels. Table 3 illustrates the growth in rights fee for the FIFA world Cup broadcast over India (Fifaworldcup.No 1 2 3 Table Year Value Channel 2002 $ 3 million Ten Sports 2006 $ 9 million ESPN Star 2010 $ 40 million ESPN Star 3: Value of TV rights for the FIFA football world cup for India Similarly the rights for broadcast for India Cricket has seen phenomenal growth over the last decade.

Based on the model of closed American Sports league the IPL has in just 3 years reached valuations of Rs 18000 crore. The greatest innovation in the Indian sports scenario was the advent of leagues. A significant event has been the telecast of the Karnataka Premier League in 2010 by a local channel. This potentially is a step wherein local channels would pick up and exploit events of regional importance. The reason the IPL is extremely important for sport television in India is the fact that.Fig 1: Growth in broadcast rights for cricket played in India The period 2010-2014shows a lower value as the FTP (Future Tours programme of the ICC) is not ready post 2013 It is clear that sports television is catching up in India. Initially sold at $1. (Wikipedia 2009). Although the Premier Hockey League and the Indian Cricket League were launched earlier.6 bn for 9 years an increase of 100% just after the first edition of the event. This is made even more important by the vast potential held at the . The Indian Premier league launched in 2008 with the shorter t20 format has changed the landscape of Indian sport.042 billion for 10 years it was renegotiated to approximately $1. Like International patterns the value for rights has been growing and even events not centric to the Indian audience like the English Premier League football have reported an increase in broadcast rights value. the revenue model of the league was built squarely on television rights revenue.

Figure 2 provides a comparison between revenue distribution across sports Fig 2 Sports revenue distribution across Indian television Figure 3 also provides a comparison on cricket and non cricket . Hockey. The interest of advertisers on sports other than cricket has also been rising with investments in football. India has more than 150 regional channels and hence the opportunity seems huge. F1 and Tennis in the recent years.regional market which could propel the sport television economy into a spiral of growth.

).revenues in sports television in India. (Andy.).d.d. The Impact of the IPL is clearly seen in the graph. (TAM 2010) Fig 3: Revenue of Cricket vs Non cricket Sports (TAM) The Indian economy is among the fastest growing in the world and is already the world’s third largest economy in terms of purchasing power parity. n. n. The number of TV households is forecast to grow at 16% and touch 130 million by 2011 (Andy. et al. et al. Armed with the predicted economic success of India along with global patterns of thought and demand for better entertainment sport television could be deemed to be in an era of . Research reports suggest that the Indian middle class would quadruple by 2025 and have disposable income which would be spent partially on entertainment.

India today is among the fastest growing mobile telephony markets with the lowest price points.growth. Broadband penetration also provides an alternate route for content distribution and rapid investments by Indian organizations to provide broadband connectivity . It is expected that growth of distribution media like DTH and other technological advances would definitely change the current scenario. Live Sport would be a key enabler in pushing data services over a 3G network. There are two major factors which could positively impact the growth of the Industry in India. It is also pertinent to mention that technologies like Pay per View have not caught on in India thus providing a potentially he market base. It is expected that by the end of 2010 3G services would be rolled out by multiple operators and the ICC world cup 2011 could be a test for live television on mobile. Lack of addressability and unstructured growth of the Indian cable Industry has heavily affected subscription revenues. The introduction of HD and 3D television technology would impact the way sport is consumed and the growth of LCD TV sales is a clear indicator to this trend The other key areas of growth include broadband television (Already introduced by a leading telecom operator) and mobile telephony on third generation and fourth generation networks. At the second level is innovation in television technology including LCD TVs and HDTV.

Majors like Nike and Reebok already see India as a major market while specialized brands like Callway golf have also entered the Indian market In a working paper by ICRIER in June 2010. it is football and water polo. in Canada. These sports have huge fan followings and this drives the market for sports products and accessories. certain sports dominate. For instance. In each country. it is soccer. The Report suggests that Peoples’ passion for sports. in Germany. and in Italy. Sport retail presents a fantastic opportunity in India due to the economic boom and the market potential it holds. in India. in the United States (US). cricket is the most popular sport. basketball and baseball. it is American football. it is ice hockey. their level of participation and their willingness to pay for sports products influences the sports retail market. Further global trends clearly point as Sport being among the major content being consumed on the smaller screen. It can safely be predicted that Sport television and sports beyond cricket would grow in the coming years and structural changes at the distribution level and technological advances would provide sport channels mechanisms to grow over the next decade Sport Retail One of the fastest growing sectors in the world.would simulate the Industry. The authors have done an in depth analysis of the sector and provided. The retail of sports products is closely related to the status and promotion of sports in a .

of late. Although sports are still treated as a recreational activity. However. In fact.17 Estimates of the sports goods/equipment manufacturing industry is available from SGEPC. Indians are spending more on sports goods. of which sports retail was around three per cent. It is projected to grow at the rate of 8. while developing country markets are small but growing. which shows that the industry has been growing at an average annual rate of around 10-12 per cent in the past five years.9 per cent per annum from $1 billion in 2005 to $6 billion in 2025 . due to pressure from foreign retailers. Over the years. its share in organised retail was around 10 per cent.particular country. Developed country markets are large but they are getting saturated. China relaxed its FDI policy Sports retail is a niche retail segment in India and at present. recreational consumption in India is growing. According to one estimate. There are no official estimates of the total retail market and estimates given by different consultancy organisations vary. the sports retail market is small. India has developed as a sourcing hub for sports goods and the focus of the manufacturing sector has been on exports. the total size of the Indian retail market was $372 billion in 2008. This has attracted sports retailers from developed countries to the growing markets of India and China. they not only source products from these countries but are also trying to enter and establish a presence in the domestic market. The size of the domestic market is small However. the Indian government announced partial FDI liberalisation in 2006 and after its accession to the World Trade Organisation (WTO).

royalty and wealthy Indians played sports like golf and cricket. shoes. Global brands such as Reebok. Earlier. Wilson and Yonex are sourcing their products from India. but the involvement of the general public in these sports was limited. Retailers entering the sports segment can source many products from the domestic market. After 1995. therefore. This has increased the market for sports retail in these segments. have better bounce than the machine-stitched balls from China. Adidas. skilled manpower vis-à-vis developed countries like the US and Italy. A large number of Indian corporates such as the Future Group and Reliance Retail Limited have entered sports retail and some family-owned businesses have grown from a single shop to multiple outlets. which enables it to produce sports goods of international standards at a lower cost. it is a niche player in manufacturing. equipment and accessories under one roof. India is among the largest sports goods manufacturers in Asia after countries like China and Japan. moving from family-owned. foreign brands have entered the Indian market. The retail formats in sports have changed in the post-1991 period.The figure above demonstrates the potential of the market on spending on recreational activities. one-shop businesses to corporate retail. In the past. inflated balls produced in India are largely handstitched and. This has affected sports retail. Although FDI is not allowed in multi brand retailing. foreign players . The Indian retail sector is undergoing liberalisation and the sports retail sector has been a part of this change. Puma. this gives them an advantage over China in European markets where hand-stitched balls are preferred. Although its share in global trade is only around one per cent. sports apparel was sold by apparel retailers and shoes by footwear retailers. Hardly any outlets provided sports apparel. For instance. This has given further impetus to modern stores. single-shop outlets. With the growth of modern retail. sports equipment and toys were sold through family-owned. At present. The country has a comparative advantage in low-cost. cricket is a common man’s game and a large number of people working in the corporate sector play golf. The proliferation of brands has increased brandconsciousness and Indian consumers are now more inclined to buy branded products. A large number of sports are now being played in India and this has increased retail opportunities. the retail industry in India underwent massive changes.

The complete paper is an excellent thesis on sports retail in India and can be downloaded from http://www.org/pdf/Working_Paper_250.pdf Chap 2: Structural reformations The year 2010 so far has been a strange year for Indian sport. test marketing. In addition sports like hockey ad its world cup in India after 35 years. All these major events point at the direction of growth of Indian sport and more importantly the emergence of India as an economic superpower which can undertake the organization of such mega events. department stores. There is immense potential for the sport retail sector. A number of foreign brands can be seen in India in exclusive branded outlets. It is imperative that India grows from being a strong exporter to a strong consumer market. The Government and the Sports federations have been in a deadlock in terms of how sport is . On the other hand 2010 has also seen massive shake ups in the way sport is administered.have entered the market through different routes such as wholesale cash-and-carry. the biggest sporting event to have ever touched India. In addition we are looking forward to hosting other Mega events including the ICC Cricket World Cup and a F1 race in 2011. single-brand retail and franchising. there are possibilities for sports equipment and sport lifestyle categories. We are at the anvil of proving our mettle and finesse in organizing the Commonwealth Games. There is a strong need for federations and other sport promotion bodies to tap this sector for opportunities.icrier. There are a few pitfalls including non availability of infrastructure which is hampering the sport business in general and retail in particular. Although currently Sport shoes form the bulk of the investment. local manufacturing. multi-brand sports outlets and factory outlets among others.

The final and probably the biggest expose was the lack of preparedness of the country for the Commonwealth games and the deep rooted allegations of mismanagement and corruption. It is pertinent to note that although leagues have been tried before the concept of a pure league based on strong globally accepted economic principles was a first from IPL and its success more as an acceptance at the consumer level has created a strong model for other sports for follow. mismanagement.managed and run in this country. The economics of Sport has a peculiar nature. the fundamental unit of production is a team or a club (for team sports) and an individual (for individual sport). It all began with IPL the flag bearer for the new model of sport in India having corruption charges. professional sports and revenue . Although this is a welcome step greater amount of transparency is required for the growth of the sport. The second issue was the federations being brought under the RTI act. Monopoly is a state which would be the dream of most industries but in sport monopoly leads to disaster as to create a cost and hence revenue we need competition between a couple of teams at least. Thus took root two concepts. The advent of modern sports was in the mid 1850s wherein rules for most games was formed and people took to Sport. dubious deals and allegations of match fixing. A few budding entrepreneurs realized that there was scope to conduct sporting contests and people were willing to pay to watch them.The third issue was the government’s diktat on the tenure and age of office bearers in federations which was seen as an attack on the autonomy of the federations and hence was severely opposed to the move. A common factor between all the above mentioned issues has been the legal structuring and governance issues across sports bodies to develop sport in India. The IPL was based on the hugely popular and successful leagues of the USA namely the NBA and NFL.

The BCCI sold the . There is no government body or a sports association which is directly involved with the running of the NFL. A league is a joint venture between various clubs in order to create contests which followed similar rules and had a calendar. In both the cases it is evident that the bodies were formed with the idea to ensure maximum profit for its constituents and were legally incorporated as companies following norms as companies in other sectors. One key historical factor here was the teams led to leagues and hence ensured private ownership whereas in India an artificial league was created sensing the economic value that lay within. This revolution also gave birth to the concept of leagues. The NFL was formed in 1922 and is an unincorporated association with league members getting into joint ventures to ensure that the league’s interests are paramount. The EPL was formed in 1992 with the first division teams resigning from the football league to form the FA Premier league which was incorporated as a limited company. The IPL was created by the BCCI which offered franchisees rights and territorial protection whereas this evolved in the American leagues and the parent body has representations from all clubs. A league is an association of clubs wherein the overall revenue and health of the league is paramount. The league is similar to an economic cartel and the major sporting leagues in the USA enjoy anti trust exemption. Although the basic structure of league operations were similar to the leagues in the USA there were some major differences which have cropped up in the latest crisis. The NFL can be very clearly seen as an association (with Anti-trust protection) with profit maximization as the main objective.generation through team ownership. The IPL was floated as the arm of the BCCI. The industrial revolution and the advent of quick means of transport helped the sports industry to expand and create contests between towns and cities. The FA Premier League is independent of the FA in England and negotiates its own sponsorship and broadcasting deals. The IPL preferred the US system of closed leagues akin the NFL and MLB. The leagues of the USA and Europe paved way for the creation of IPL.

Generally leagues collectively sell broadcast rights and sponsorships to ensure benefit for the league as a whole. The second element in this situation is the role of the Commissioner. The BCCI could have used its existing domestic competitions which over the years have never experienced domestic structures. as BCCI charged the owners for its services in the form of rent and shares from revenues. Economically. It is questionable why BCCI would not promote its own event but rather seek private investment for the league? As for its own league all the revenues would have been owned by BCCI itself and could have been used to promote cricket. The Commissioner similar to the MLB or the NBA . The BCCI registered as a society is for regulating and growing the sport of cricket in India. the franchisees had no say in the running of the league which fundamentally goes against the nature of leagues. There is a clear gap and an economic paradox in this situation wherein the main funders of this event have limited decision making capabilities in the governing council and hence have limited say in the way the event would progress and in the long run the economic return on investment for the franchisees. while IPL is a pure commercial venture with franchisees providing the funding to run the event. the ownership of the league remained with the BCCI. this would surmount to having a return without any kind of investment. Moreover. Further the franchisees are registered as for profit organizations whose sole interest in the league is profit maximization. The IPL is a part of the BCCI. Economic sense suggests that the IPL governing council would act more for the needs of the BCCI rather than the objectives of the franchisees. In the current case the IPL governing council is responsible for collective deals and even merchandizing rights and also owns all marks of the franchisees making the franchisees incumbent on the IPL to provide the returns. If the idea was to promote Cricket at the lower level.franchisees to bidders and ensured private funding but unlike the developed leagues of the west. which is a registered society and hence falls under the societies registration act which provides tax exemptions and is for non-profit organizations. The fact that BCCI claims that money from the IPL would be used to improve infrastructure and development of cricket raises the fundamental question as to why are they not using existing tournaments? The governing council of the IPL has people from the BCCI and 3 ex-cricketers as members.

Srinivasan in the operations of a franchise has raised the issue of conflicting interests wherein the franchise owner has presence on both sides. The IPL is a role model in terms of a system to promote sport. The third element is the lack of transparency in the functioning of the IPL. In this position the commissioner needs to act on the behalf of the franchisees and protect their interests which in the current status does not seem feasible. the Commissioner (rumored to have indirect stakes in franchisees) is actually a representative of the BCCI and hence is in a dichotomous position wherein the interests of the board as well as the franchisees is to be protected. the basic concept of the fundraisers running the league is further validated as a few franchise owners have not proposed his name to be the Commissioner. The second issue which was raked in 2010 was the functioning and governance practices of the National Sports Federations (NSFs) and the Indian Olympic Association (IOA). for federations exceeding Rs 10 Lakh . and other sports need to implement within their structures key checks and processes to ensure operational efficiencies. The presence of a BCCI member as a commissioner would not be the ideal scenario for franchisees and the Boca’s central revenue is the major component of funds for the IPL owners. The idea of presenting this case has been a need to create a structure which is transparent and can run the sport successfully. The fact that Modi may own stakes in franchisees may actually be favorable to the franchise owners as rational thinking suggests he would work on profit maximization ensuring ROI for the franchisees rather than somebody from the BCCI whose objectives may not align with the franchisees. In the case of the IPL.is the CEO and is responsible for protecting the interest of the stakeholders and the sport at large. The government brought the NSFs under the RTI act forcing them to make mandatory disclosures. Although prima facie it appears as a conflict of interest. Although transparency has always been an issue with Indian sport the presence of huge monies coupled with the success of the league accentuates the importance of this element. The presence of BCCI functionaries especially N. Like any other business sport leagues need to have clarity in terms of operations.

This change was in response to the commercial opportunities like TV broadcast and sponsorships which existed with the IOCs. This was unfortunate as any organization which gets support from public funds or is a representative of the country at international levels should be accountable at the very basic level i. The word autonomy featured in the Olympic charter in 1949 under rule 25 where the words “independent and autonomous” were used with respect to NOCs. This autonomy was further reinforced by their financial independence. This rule was amended a number of times keeping in line with the changing global environment. It is necessary for us to understand historical principles which led to the concept of autonomy. they were IOC’s representatives in their country. In this sphere it would be necessary to appreciate what autonomy means and how it is practiced worldwide. This was also seen as a step to curtail the autonomy of the IOA and NSFs and event the IOC was against this step of the Government.grant from the Government. In 1989 the IOC permitted NOCs to raise their own funds maintaining the Olympic dignity and spirit.e. . Please find below list of entries in the Olympic charter with respect to autonomy. Thus autonomy was sacrosanct. The Olympic movement founded by Pierre De Coubertin in the last decade of the 19th century the primary concept was that the members of the IOC were independent of the country they represented and unlike they being the country’s representative to the IOC. to the people who are its primary stakeholders. The NSFs saw this as a step to undermine their authority and rejected it. The Government also issued a diktat which sought to monitor the functioning of the NSFs by limiting terms of office bearers and putting a upper limit for age of the office bearers. The members of IOC were wealthy individuals who could use their personal financial muscle to fund the movement and hence receive no subsidies.


All . There is a need to evolve a sports law in this country to better understand this sector and create guidelines for all stakeholders to ensure a conducive atmosphere for the growth of sport. As in other sectors it is necessary for the stakeholders to unlock the potential of sport both at the business as well as the social level There is a need to integrate the various sporting bodies in the country and create an ambience for efficient promotion of sport. In India Sport is a part of the state list and it is the prerogative of the state to promote sport. It is suggested that self regulatory guidelines be incorporated at the top level which be followed by every governing body. As suggested in the 195th report of the standing committee on promotion of sport in India there are questions on the accountability of NSFs. The absence of a sports law in this country makes it difficult to regulate sport. There are countries in the world where there is a sport law or a law for sport.Thus it can be assumed that the Olympic charter promotes the autonomy of the NSFs and NOCs. Although the charter promotes the concept of autonomy it would need to be looked in depth on the spirit of autonomy and its efficacy in promoting sport. Sport as a sector is the 13th largest contributor to the GDP of the USA and the potential of sport is immense.

What we need to do is collectively put our minds together and logically think so that we can get Indian sports out of the quagmire it currently finds itself in. SPORTS THE ANCIENT WORLD: From the earliest days of human civilization to the more advanced civilizations of ancient Rome. but the ground reality is very different. TOUGH TURF WARS INDIA ROCKS: The US National Intelligence Council (NIC) and the European Union's Institute for Security Studies (EUISS) joint report “Global Governance 2025” states that India will be the third most powerful nation in the world. Greece etc. the first Olympic women athletes were from Sparta.. condescending or self sympathetic. .federations are accountable to the people of this country as well as the sports persons and the citizens of the country. Statistics such as these would gladden the heart of any Indian. The sports the Spartans participated in included the Olympic events. At the second level there needs to be certain level of professionalism and trained sports management graduates well versed academically with the business of sport to be put into the syatem. For a nation of a billion plus people one would normally assume world champions galore across multiple sports. What has been attempted in this knowledge paper is to highlight certain key legal and regulatory concern areas without getting cynical. Sparta for example emphasized sports and even allowed women to participate. Incidentally. Corporate governance norms should be implemented within all sporting organizations to ensure a certain level of clarity and accountability. sports has developed from a mere source of personal entertainment to a global industry.

The strong entertainment flavour is clearly missing. Multiple measures to ensure competitive balance between competing clubs. Strong flavour of entertainment. or a recently concluded soccer world cup match say between Germany and Argentina are prime examples. 6. 2. Strict division between amateur and professional sports. 5. Sports are also a greater enabler of better relations between countries. 3. the Olympics is a case in point.SPORTS IN THE MODERN WORLD: Global sports today is a multi-billion dollar industry covering multiple disciplines and is no more a form of exercise and/or national pride. 2. 4. Maintaining competitive balance until recently was never an . The key ingredients of the European Model of Sport are: 1. Closed competition structures based primarily on economic considerations rather than any entry barriers. Traditionally. Profit maximization is the name of the game. It’s necessary for us to appreciate the two major models of sports in the world today namely. Whilst profits are important profit maximization is not the name of the game. It is organized on an out and out commercial basis. the American Model of Sport and the European Model of Sport. An Ashes match between England and Australia. The key ingredients of the American Model of Sport are:- 1. 3. a sport when mixed with both national pride and entertainment makes for a heady mix.

The monies expended . Rajas. SPORTS AND BUSINESS SCENARIO IN INDIA TODAY: The legal contracts governing various business verticals of sport are becoming slowly and gradually more complex. Some measures were installed to limit the powers of affluent clubs (For e. Many of the persons at the helm of some of the sports federations in India have never been sportsmen or sports administrators. 4. 5. SPORTS SCENARIO IN INDIA TODAY: During the days of the British Raj there were Nawabs.cap on the number of foreign players). Sports league in India has been generally organized either directly by. . The open structure ensures that each year some clubs exit and an equal number of other clubs join the competition. Most of the leading sports leagues in the world operate independent of the respective sports governing bodies. Since the ICL attempted to operate outside the BCCI structure . therefore it’s hardly surprising to see the present dismal state of affairs in these individual sports in India.it met with an instant death.today there are persons heading various sporting federations in India who treat the federation as their personal jagir or fiefdom.g. etc.important issue. . The notion that revenues should be divided equally for the good of the sport was never really part of the European ethos. 6. It’s about time the awareness of the Indian citizens is raised and our collective action compels these jagirdars to be evicted from their cosy positions and replaced with competent sports administrators. or in combination with the governing body of that respective sport the famed exception being the Indian Cricket League (ICL).

IN THE FUTURE: If the success of the IPL is anything to go by it appears that sports leagues in India will most likely be governed by an operating model involving sports federations and private investors.. privileges and licenses that are granted. so as to protect the interests of all the stake holders including inter alia the athletes. milestones etc. terrorist attacks. cyclothons etc. Indemnity cum Undertaking etc. Whilst one is happy to see little children participate in a kids cycle ride.are increasing by the day and so are the rights. sponsors. obligations. one is also overwhelmed by the potential risks. India today hosts very large mass participation events such as marathons. It is therefore imperative that contracts must clearly spell out the rights. interests. the operation of sporting leagues on a franchise based model.not only by means of an insurance cover.cancellation of an event. Having closely watched Sport18 organize these large mass participation events one realizes the need for risk mapping and risk mitigation . SPORTS SCENARIO IN INDIA . broadcasters etc.. With the humungous amounts of monies being spent the short and long term investments made into sporting events and sports respectively need to be protected at all costs including the risks arising from . involving big ticket investments by entrepreneurs brings into play the delicate . 3rd party liability etc. titles. but by putting in systems and processes to protect precious human life. In this scenario.

Open this year because a male fan insisted on being able to say the “F” letter word because he paid for a ticket and because he had “a lot of money on the game”. The real risk in doing so is that if the sporting federations are allowed to get away with what appears to be a “restrictive and anti-competitive” tactic as deployed by the BCCI to shut the ICL down. position on the application of antitrust laws to sports is well settled. as vainly attempted by the ICL. do not appear to be possible in the near future.S. A match between Novak Djokovic and Phillip Petzschner had to stop at the Arthur Ashe Stadium (Flushing Meadows. To add fuel to the fire there is always the allegation of sports leagues as fronts for high class organized betting and conduits for slush money laundering. which she deemed inappropriate or abusive. Unruly mob behaviour is a common phenomenon world over and is no more limited to soccer hooliganism.balancing act of maintaining credibility. Also. It would do well to remember this especially with the kind of money riding on our cricketers. It’s quite possible that an alternative devised would be to shut out the government completely and devise these leagues as independent properties. private leagues independent of federations.S. New York) at the U. equity and equal opportunity. Even today there are no stadium rules in India. while a female fan told him to “Shut Up” and threatened to have him thrown out of the stadium because of his language. The U. what is the recourse say for a contractual dispute over a breached pre-scheduled soccer match say between the home . Had this happened in India – how would we have dealt with it? The impact of the Tiger Woods scandal brings into focus the almost forgotten morals clauses in Endorsement contracts.

:- 1. Arbitration and Conciliation Act. 1999. 3. 2000. 1963. Specific Relief Act. Narcotic Drugs and Psychotropic Substances Act. 4. 1860. 1985. 5. The above list is merely illustrative and not exhaustive. anti-doping laws etc. In addition there are remedies under criminal laws such as the Indian Penal Code. Depending on a case to case basis there could be interplay of one or more of the under mentioned statutes in India for e. in addition there is the law of torts. 1872. 1996. In case there involves broadcast of a sporting event one needs to remember the provisions of the Cable Television Networks (Regulation) . Trademarks Act. 7. 2002.g. 2. 1957. Competition Act. Information Technology Act. 6. The Copyright Act. PRESENT FRAMEWORK OF SPORTS LAW IN INDIA: There is no sports law in India but there are multiple laws governing various facets of a given sport.team and the tournament favourite? All these and several other questions need to be adequately addressed so as to ensure a robust sporting system that fosters the spirit of sportsmanship in the country. Indian Contract Act.

The Cable Television Networks Rules. Govt. especially considering the long and arduous litigation framework in India. IS THERE A NEED FOR A SPORTS LAW IN INDIA? The recent controversies in various sporting federations (especially those concerning elections to Hockey India. Badminton Association of India and the Swimming Federation of India) has put the Union Government in a spot of bother. further they argued that they were already recognized by their respective international bodies/federations. The moot question then is how can they still retain the country’s name if they no longer represent India? All this great Indian tamasha is something that is detrimental to the interests of both sports persons and sports aficionados in India. so as:- .Act. Sports law in India in view of the foregoing appears to be the need of the hour. of India. The Federation’s response was that they were independent trusts/societies registered under separate legislation and that they did not want government money. 1995.the threat of de-recognition and stopping the monetary aid. Sports Broadcasting Signals (Mandatory Sharing with Prasar Bharti) Act. 2007 and not to forget the numerous notifications and directives issued by the Ministry of Information & Broadcasting. The Government’s response was on expected lines . Especially in the sports business there is no “one size fits all” kind of a contract and great care and caution is recommended in drawing up these contracts. 1994.

5. age restrictions etc. federations. To ensure transparency and accountability. To ensure collective bargaining agreements for team sports and corresponding changes to the prevalent labour laws. Switzerland. . 7. To check malpractices and rampant corruption. 13. To ensure just and fair league regulations governing various sports. sponsors etc. 4. players. To ensure a mechanism for quick (India’s legal system is infamous for being slow) redressal of grievances of various stake holders – viz. 11. To ensure that sexual harassment issues are firmly and expeditiously dealt with. teams. To spell out the role for Player’s Representative/ Agent.. 2. cap on the tenure of office-bearers of sporting federations.. To ensure uniformity and lack of special status on issues such as doping. To ensure a minimum qualification criteria. 12. 9. 8.1. To regulate the sports and the governing body regulating that sport.. To ensure that there is meritocracy and equal opportunity in selection devoid of bias on account of gender. 6. To consider having a Court of Arbitration for various sports in India may be on the lines similar to the one based in Laussane. if any. To consider a cap on player’s fees so that there is more equitable distribution among competing teams. 3. 10. The more the above issues get covered in the future sports law the better it will be for the health of sports in India. religion etc.

• The IOA should create self regulatory guidelines which be followed by all federations . If the reports appearing in the media are to be believed it appears that the Government of India appears to be keen that a sports law is in place by December and towards that end the ministry has already informed the IOC of its intent. Do you the reader sense a feeling of Déjà vu? It is proposed that • All NSFs and sporting organizations are accountable to the people of India. • Suitable modifications be made under the registration acts for sporting bodies to ensure certain level of accountability. With the proposed sports law round the corner. A separate form of registration of these bodies may also be considered to ensure the autonomy and tax benefits to these organizations.THE ROAD MAP AHEAD: It appears that the time is now ripe to put in place structural reforms in the field of sports. Never have Indians been more disillusioned with the sporting bodies than now. including the legal fraternity. There is already a great sense of anticipation and excitement amongst all stake holders. hopefully the face of Indian sports is set to change for the better.

. Sport management graduates should be a part of these NSFs.• Sport needs a strong structural foundation and this can only happen with professionals within the system.

It is also recommended Sport be moved to the concurrent list from the state list • • • • . New sporting competition structures like leagues with private participation needs to be encouraged The media especially the TV distribution business provides ample scope for promotion of sports. Cleansing and transparency in this sector shall improve business opportunities for Sport Sport retail and Sport hospitality are sectors ready to boom. The Government should create an atmosphere both at an administrative level as well as the commercial level. The sports bodies and NSFs should look at creating self regulatory guidelines to ensure transparency The Government could look at creating a new form of entity for sporting organizations which ensure autonomy but also create accountability.Final Recommendations • • • • • The sports bodies are accountable to the people of this country. Professional management of sports would be required to ensure this sector reaches its potential India with its huge youth population and increasing spending power is a market waiting to be tapped. Sporting events need to be packaged effectively to maximize outputs There is a strong need for laws dedicated to Sport.

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