The PGA Tour and DP World Tour have reached an agreement to merge with LIV Golf, a Saudi Arabian-backed circuit. This groundbreaking deal puts an end to the acrimonious split in the game, but legal experts warn that this agreement could raise antitrust concerns.
A Unified Front
After a year of legal battles and fierce competition between the established tours and LIV Golf, the announcement of the merger has taken the golfing world by surprise. LIV Golf, known for poaching top players from the PGA and DP World Tours, was viewed as an existential threat by the established tours. The merger marks an extraordinary climbdown for the PGA and DP World Tours, as they acknowledge the transformative impact of LIV Golf on the game.
Key Elements of the Merger
Under the terms of the agreement, the PGA Tour, DP World Tour, and LIV Golf will combine their commercial operations and rights into a new, yet-to-be-named for-profit entity. The DP World Tour, formerly known as the European Tour, will also be part of this unified structure. The merger aims to maximize excitement and competition among the world’s best players while benefiting all stakeholders involved.
Resolving Legal Disputes
One of the significant benefits of the merger is the cessation of pending litigation between the tours. The legal battles between the PGA Tour and LIV Golf, which stemmed from the unauthorized participation of players in LIV Golf events, will be halted. This development provides a significant peace dividend for the sport and removes the financial burden associated with legal proceedings.
Implications for Players and the Ryder Cup
The merger opens up opportunities for LIV Golf players to return to the PGA and DP World Tours. An objective process will be established for players to reapply for membership after the completion of the 2023 season. This presents a potential reprieve for European golfers who had resigned from the DP World Tour and faced exclusion from the Ryder Cup. However, the resolution for the upcoming Ryder Cup in Rome remains uncertain, as some players are no longer part of the DP World Tour.
The Role of Saudi Arabia and Criticisms
The involvement of the Saudi Arabia Public Investment Fund (PIF) in backing LIV Golf and its subsequent merger with the established tours has drawn attention and criticism. Critics argue that Saudi Arabia’s significant financial influence raises questions about sportswashing and diverts attention from the country’s human rights record. However, the merger represents a unifying force for the men’s professional game and highlights the transformative power of Saudi Arabia’s wealth in golf.
Legal Proceedings
Lawsuits rolled out from both sides last year, including antitrust suits, as LIV aggressively lured high profile players away from the tour for big paychecks. Both leagues had claimed that the other’s contracts and policies restricted golf talent and stifled proper competition. LIV Golf sued the tour, also citing anti-competitive practices for banning its players. The PGA Tour countersued.
The new merger puts an end to all the fighting, in and out of court, but this doesn’t necessarily mean all the legal dispute will be over. “Anything that happened before this announcement is still actionable,” said Henry Hauser, a former Federal Trade Commission (FTC) lawyer noting the DOJ could still look into these claims outside of the merger process.
The new entity will need to show the benefits for consumers and that it doesn’t restrict competition. For professional players, some of whom where able to reap the benefits of the competition between the different tours, may also need to participate in the benefits of the merger.
