The Board of Control for Cricket in India has emerged victorious in an arbitration ruling over the inaugural global broadcast rights deal signed for the Indian Premier League with the World Sport Group agency.
The Indian Supreme Court arbitration tribunal has upheld the termination by the BCCI in 2010 of World Sport Group’s international broadcast rights contract for the IPL.
The arbitration ruling comes nearly a decade after the ousting of Lalit Modi, the controversial commissioner and founding father of the highly-lucrative Twenty20 league, amid allegations of corruption.
Modi was subsequently banned for life by the BCCI in September 2013, but the dispute surrounding the WSG rights deal has rumbled on.
In 2008, ahead of the inaugural season of the IPL, the BCCI awarded the league’s global media rights to WSG under a 10-year deal worth $918m (€809.5m) in rights fees alone.
The BCCI scrapped the WSG deal in June 2010 on the grounds of “all-pervasive fraud” allegedly perpetrated by the agency when agreeing a new deal with Indian broadcaster Multi Screen Media. MSM is alleged to have entered in an $80m facilitation fee agreement with WSG before acquiring the IPL media rights in the Indian subcontinent.
The BCCI claimed that it had only recently been made aware of the facilitation fee payment, a claim disputed by WSG and Modi. MSM subsequently terminated its facilitation agreement with WSG and agreed to pay the fees directly to the BCCI and took legal steps at the time to recover the funds it had already paid to WSG.
A Supreme Court arbitral tribunal led by three retired Justices – Sujatha Manohar, Mukunthakam Sharma and S.S. Nijjar – have now upheld the termination of the BCCI’s global rights agreement with WSG in June 2010.
This will allow the BCCI to access funds from the BCCI-WSG agreement that have been siting in an escrow account, along with interest for seven out of the 10 years. This amounts to between Rs800 crore (€93.5m/$106m) and Rs850 crore, according to the Times of India and the Hindustan Times.
The case went to arbitration after WSG is reported to have staked claims over the profit it would have made and sought damages for wrongful termination of the agreement.
Senior Supreme Court counsel P Raghu Raman, who was advising the BCCI and its then secretary N Srinivasan and chief executive Sundar Raman at the time, told the Times of India: “It is a result of BCCI’s courage of conviction back then that has led to this.
“It is Srinivasan who put his foot down and challenged this move on part of Modi and his actions have been proved right by the highest court of law. He saved the BCCI close to Rs300 crore then and today, with interest accrued – which is BCCI’s money – the Board gets back close to Rs800 crore.”
In 2015, the Lagardère conglomerate, which acquired a majority stake in World Sport Group in 2008, announced that WSG had been ordered to pay €26m ($29.5m) by the International Court of Arbitration. This was for the reimbursement of past proceeds, including interests.
The World Sport Group name disappeared in 2015 as Lagardère housed its agencies under the ‘Lagardère Sports’ name in a rebranding exercise. At the start of this year, Lagardère sold a 75.1-per-cent stake in its sports business to H.I.G. Europe, an arm of the international private equity and asset management firm, in a deal valuing Lagardère Sports at just €110m.
Pay-television broadcaster Star India is the IPL’s current rights-holder. In September 2017, Star ousted Sony Pictures Network India as the main rights-holder to the League after securing the global television and digital rights to the competition.
Under an agreement with the BCCI, Star paid Rs164.375bn for all rights packages on offer across the five editions of the IPL, from 2018 to 2022.