The European Commission began legal action yesterday against the Premier League in England over the way it sells television rights. In condemning BSkyB's monopoly as unfair and anti-competitive, it signalled a potentially fundamental change in the broadcasting landscape.

After an 18-month investigation the commission concluded the current system, whereby rights are sold collectively, is bad for fans and the less well-off broadcasters.

The commission is concerned with delivering value to consumers, and wants TV rights to be distributed more widely and for clubs to have the right to negotiate their own deals with channels or broadcast matches exclusively on their own TV channels. The Premier League cannot afford to ignore the commission. Brussels has the power to enforce change and could fine the league up to 10 per cent of annual turnover for anti-competitive behaviour. Yesterday it gave the Premier League two and a half months to respond to its accusations.

"The current joint selling arrangements are anti-competitive because they have the effect of foreclosing the market for other broadcasters and ultimately limit media coverage of soccer events to the detriment of consumers," it said in a statement.

The Premier League said it would try to convince the commission the current arrangements were beneficial to all involved. Its spokesman Philip French said: "We are taking this in our stride. We are optimistic that the commission will come to agree that joint selling in our case is beneficial to all our member clubs. They have already allowed a precedent for UEFA and the Champions League."

The principal of collective bargaining established for the Champions League will be a crucial part of the Premier League's response. The league is in a stronger position than was the European federation because it sells to several delivery platforms. Live games appear on BSkyB, highlights on ITV1 and there are also pay-per-view games.

Smaller clubs may also be reluctant to give ground on the existing system as they are unlikely to do as well when negotiating individually. The commission will argue for more live games, which the Premier League opposes on the grounds that saturation point has already been reached, and the consumer is already well served.

The commission's stance is potentially a blow for Rupert Murdoch. His pay-TV operator, BSkyB, has an exclusive deal to screen live Premiership matches until the end of the 2003-04 season. ITV has the rights to show match highlights throughout the week.

The commission made it clear its concerns centre on three issues - the way in which TV rights are bundled up and sold collectively, the length of contracts, and the exclusive nature of broadcast rights, whereby only a handful of rich broadcasters can afford them. "Joint selling of TV and media rights is tantamount to price fixing and can be exempted only if there are benefits for stakeholders (consumers)," said Amelia Torres for the commission.

Meanwhile, a group of Spanish businessmen are attempting to set up a new European-wide soccer competition to rival UEFA's Champions League, Spanish press reported yesterday.

The group, headed by entrepreneur Carlos Garcia Pardo, said it is aiming to establish a 16-team competition involving Europe's leading clubs, which it hopes will get under way in September 2003. The organisers say they have issued invitations to 26 clubs from Spain, Italy, England, Germany, France, the Netherlands, Portugal and Scotland to join the competition.