The Latvian Competition Authority (KP) conducted an in-depth investigation into the club transfer rules established by the Latvian Sports Dance Federation (LSDF) after receiving a complaint from a parent about difficulties in changing their child's dance club. The investigation revealed that the existing rules imposed unreasonable restrictions on competition within the sports dance service market.

KP found that the club transfer rules, which included provisions for transition periods and compensation payments when children switched clubs, were disproportionate. While such requirements are common in professional sports to ensure stability, they were found to limit dancers' freedom of movement and reduce competition among dance clubs, ultimately affecting service quality.

KP emphasized the need to balance the stability of the sports sector with the rights of dancers, particularly children, to freely choose their clubs. The authority criticized the practice of imposing compensation payments, noting that dance clubs did not make significant investments that warranted such fees.

Following KP's recommendations, LSDF made substantial amendments to the club transfer rules, eliminating the possibility of compensation payments and shortening the transition period from four to three months. Exceptions were also introduced for transfers during the summer period, and the rules were clarified to apply only to dancers aged ten and older.

KP believes these changes will significantly improve competition in the sports dance sector by removing excessive restrictions and allowing clubs to compete more freely for new dancers. The authority also informed the sports sector that sports organizations and their members are considered market participants subject to competition law requirements.

In addition to addressing the club transfer rules, KP highlighted other potential competition law violations in the sports sector, such as 'no-poach' agreements between clubs, overly restrictive licensing rules, and the abuse of dominant positions by sports federations. This case underscores the growing importance of applying competition law in the sports industry, especially as it becomes more commercialized.