Golfers v the PGA European Tour: Participation in LIV - out of bounds

Golf, one of many great sports given to the world by the Scots, has long had “professional” events operated on the basis of various “tours”. These tour events allow golfers of skill and ambition to renounce their amateur status, declare that they seek to make a living from the sport, try to obtain (and qualify for) a “tour card” and ultimately compete for prize money as independent contractors.  Leaving aside opportunity and the outlays required to achieve a life of chasing a wee white ball around various terrains in all weathers, golf has long held itself out as an example of true sporting meritocracy; if a player was good enough and beat the field or performed sufficiently well, the golfer could earn their “card”; earn sufficient prize money; earn a spot at one of the grander tournaments (including the four majors) and further opportunity would exist to achieve more sporting success – and with it personal reward.

To protect the opportunity for this individual pursuit of success, rules of participation, as in any sport, have become ever more important for the collective interest, securing the collective will of regulated behaviours, fairness and a platform for commercial exploitation, to generate sporting interest and commercial return for participants.  The two main recognised “tours” (the PGA European Tour (branded as the DP World Tour) and the US PGA Tour) are sophisticated businesses that are, in essence, collective organisations existing for the benefit of their members – golfers on tour, past and present.  New players qualify each year and those who earn too little, lose their playing rights, and leave, to play in lesser tours or not at all.  As such, the European Tour is not a regulatory body for golf.

LIV Golf, created by virtue of the Saudi Arabian Public Investment Fund, differs.  As an invitation-only organisation, golfers signed up to play a set number of events, with significant sums paid to those golfers to join (reportedly up to $200m for one golfer) and with substantial prize money also on offer for all, from first to last.  This alternative tour caused significant disruption when golfers joined, as some resigned their current membership of existing tours, whilst some maintained their membership.  In the case of Ian Poulter and fifteen other members of the European Tour, who did not obtain requisite permission from the European Tour to participate in the first and following LIV Golf events, sanctions of significant fines were imposed, leading to interim relief being sought by the players (and granted, in July 2022) on appeal to Sports Resolutions, that procedural route being as provided for in the Members’ General Regulations Handbook (governed by English law).

The substantive appeal (SR/165/2022) was heard in February 2023 with the decision recently published, in favour of the European Tour, following a de novo hearing of the substantive matter between the parties.  That a de novo hearing could take place was provided for in the Regulations and allowed the European Tour to, in effect, cure the asserted procedural deficiencies in the first instance decision-making. The golfers were found to have committed “serious breaches” of the Code of Behaviour and Regulations as their actions were directly contrary to the express behavioural rules agreed amongst the members, by playing despite their release requests having been refused. Within the Regulations, a framework for consideration of release existed and allowed, amongst other things, the wider interests of the European Tour to be considered, when weighing up a release request.

Whilst the case was a “landmark” in golf and has helped further draw divisions between those on perceived rival tours, the appeal determination is notable as central to the golfers’ defence was that they were entitled in law to participate in the rival tour, arguing that the Regulations and resultant disciplinary procedures were unlawful, unenforceable and/or void.  Arguments for the golfers focused on restraint of trade, UK competition law and separately breach of contract (through excessive exercise of discretionary power).  In a lengthy judgment (87 pages) these arguments were dismissed primarily on finding that the regulatory framework created for the collective good of the European Tour members was not unreasonable, it was justified and did not in fact stop the golfers from practicing their trade.  It protected the interests of the members.  Interesting analysis noting LIV’s competitive nature (to try to compete with the European and US PGA Tours) was reflected in finding that the arguments further to s2 of the Competition Act 2008 were to be rejected, finding that the Regulations were not anti-competitive by object or effect.  Arguments as to unreasonableness in sanction were quickly rejected by the Appeal Panel.

A widely reported indemnity is said to be in place protecting the golfers from any personal financial consequences.  All but one players are reported to have paid their fines, with the European Tour said to be taking enforcement action, with the disposal award of Sports Resolutions being enforceable as an arbitral award.  A separate anti-trust case is due to be heard in the USA in 2024 revolving around LIV golfers and the USPGA tour.