Final Sports Broadcasting Services Amendment Regulations Passed
The Independent Communications Authority of South Africa (ICASA) has recently published the long-awaited and somewhat controversial Sports Broadcasting Services Amendment Regulations. Overall, what was published aligns with international practice.
Controversy over the proposed amendments to the Sports Broadcasting Services Regulations, 2010 (the 2010 Regulations) was resolved when ICASA published the finalised Sports Broadcasting Services Amendment Regulations, 2021 (the Final Regulations) last week.
In 2018, ICASA proposed amending the 2010 Regulations. It said the proposed amendments would advance equality and human dignity by enabling all citizens to access sports of national interest.
Despite these laudable objectives, sports bodies and broadcasters submitted that the proposed amendments were likely to have unintended adverse consequences for their businesses and, by extension, the local sports industry and consumers. Sports bodies such as Netball South Africa submitted that ICASA’s proposals were likely to significantly diminish the income earned by sports bodies from licensing their rights to broadcasters. Without this income, sports bodies argued, they would not be in a position to discharge their legislative mandate to support sports in South Africa. Sports bodies also reminded ICASA that they receive little or no income from the State.
On the other hand, broadcasters submitted that exclusive content is a crucial component of the broadcasting business model as it enables a broadcaster to distinguish its services from its rivals’. If the sports rights cannot be used by a broadcaster to distinguish its services from its rivals’, broadcasters would have little incentive to acquire the sports rights in the first place. If they do acquire the sports rights on a non-exclusive basis, broadcasters are unlikely to pay premium licence fees. This would have an adverse impact on sports bodies, which depend on the income earned from the licensing of sports rights on an exclusive basis for their continued viability.
Stakeholders also questioned the need for the amendments, as the regime put in place by the 2010 Regulations was reported to be working well. It struck a balance between the competing interests of all major stakeholders such as sports fans, sports bodies and broadcasters.
Concerns were also raised about the legality of the proposed amendments. Stakeholders expressed concern that ICASA did not have the power to amend the 2010 Regulations as proposed and, by doing so, it would contravene the Electronic Communications Act, 2005 (ECA).
The voices of affected stakeholders have been heard, and the Final Regulations appear to recognise and balance the interests of all stakeholders. ICASA has said that it is “keenly aware” that the sports industry relies on the sale of broadcasting rights to generate revenue. ICASA has now explicitly said that, in its view, the acquisition of exclusive rights to sporting events is not unlawful. However, these exclusive rights must not prevent or hinder the free-to-air broadcasting of national sporting events.
Apart from clarifying the position on exclusivity, which was the major point of contention, the Final Regulations also provide that the listing of national sporting events will be reviewed every 5 years, rather than every 3 years, as proposed in the 2018 regulations. Stakeholders had submitted that a 5-year period was required for sports bodies and broadcasters to realise a return on their investment. It was also submitted that this accords with international best practice.
Sporting events are symbolic of South Africa’s rich cultural heritage, and the South African sports industry is sure to breathe a sigh of relief knowing that it can continue to operate in a financially-viable manner. As the Final Regulations are in line with accepted international practice, South Africa will maintain its status as a major sporting nation. It will continue to field competitive teams such as the Springboks, and position itself to attract international tournaments.