In October 2012, the Competition Appeals Tribunal (CAT) overturned Ofcom’s decision to apply an obligation on Sky to wholesale its Sky Sports channels at a price set by Ofcom (the Wholesale Must Offer obligation). The CAT concluded that Ofcom’s core competition concern was unfounded. It considered that Ofcom had misinterpreted evidence in respect of commercial negotiations between Sky and others, and that Sky had generally engaged constructively in its negotiations. As a result, the CAT had ordered Ofcom to set aside the WMO obligation (see our news item for further information). Subsequently, BT and Ofcom appealed the CAT’s decision to the Court of Appeal (CoA), claiming that the CAT had erred in law.
On 17 February 2014, the CoA upheld BT and Ofcom’s appeal of the CAT’s decision and asked the CAT to re-examine the Sky Sports case. The CoA noted that, although the CAT found that Ofcom had misinterpreted the facts regarding wholesale negotiations, it left open the question about the price at which these channels would be wholesaled. The CoA ruled that “the CAT has not dealt with Ofcom’s finding that the rate-card price is, in itself, an impediment to “fair and effective” competition.” The CoA considered that reasons the CAT gave for not considering that matter further were inadequate (read the full decision here). The CoA has ruled that the matter be remitted to the CAT for further consideration in the light of this judgment.
DotEcon provided expert economic advice to a media client over the course of the CAT Sky Sports appeal.