[Congressional Record Volume 144, Number 86 (Friday, June 26, 1998)]
[Senate]
[Pages S7256-S7259]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. LOTT (for Mr. McCain (for himself and Mr. Bryan)):
  S. 2238. A bill to reform unfair and anticompetitive practices in the 
professional boxing industry; to the Committee on Commerce, Science, 
and Transportation.


                     muhammad ali boxing reform act

 Mr. McCAIN. Mr. President, I am pleased today to introduce a 
new bipartisan proposal to improve several aspects of the professional 
boxing industry in the U.S. I am joined by Senator Bryan of Nevada in 
offering this legislation. He has been a great partner in my efforts to 
improve the safety and integrity of this major industry in the public 
interest.
  This bill is intended to protect boxers from some of the most 
egregious and onerous business practices which they have been subjected 
to across the U.S. over the last several decades. It will also help 
State officials provide more effective public oversight of boxing 
events held in their jurisdiction, so that they can better prevent 
business practice abuses and unethical conduct. Furthermore, this 
legislation will improve integrity and open competition in professional 
boxing, by curbing its most restrictive and anti-competitive business 
practices. This is a limited and modest proposal in many respects, but 
it is the product of months of consultation with experienced State 
athletic officials and the most respected and knowledgeable members of 
the boxing industry.
  Let me say a few words about the title of this legislation. I thought 
it would be a fitting tribute to name an important new reform measure 
on professional boxing after Muhammad Ali. Mr. Ali had perhaps the most 
impressive and exciting career in the history of professional boxing, 
and his many championships and achievements are legendary in the sport. 
Of course, Muhammad Ali's character, integrity, and personal charm 
appealed to tens of millions of Americans who did not even consider 
themselves to be boxing fans. His entire life has been a story of 
tremendous determination, accomplishment, and perseverance against 
daunting odds. I feel it most appropriate for the Congress pass a 
measure to protect the interests of boxers, encourage fair competition, 
and vastly improve the overall integrity of the boxing industry, that 
is named in his honor. I want to thank Mr. Ali for his graciousness in 
letting this legislation be so named.
  I have been deeply involved in exploring ways to improve the 
professional boxing industry for most of this decade. It is a complex 
task. Many of the steps that need to be taken to permanently end the 
disreputable and abusive business practices which have long marred the 
sport must be taken either by members of the industry, or by State 
officials. I firmly believe that State boxing commissioners and 
industry leaders must be the primary agents of reform in this sport. It 
is they who I have continually turned to for advice and recommendations 
on how the federal government might be of help, albeit in a limited and 
supportive role.
  This proposal seeks to remedy many of the anti-competitive, 
oppressive, and unethical business practices which have cheated 
professional boxers and denied the public the benefits of a truly 
honest and legitimate sport. This reform measure is designed to 
prohibit the harmful and arbitrary business practices which have 
clearly hurt the welfare of professional boxers, without imposing 
unnecessary restrictions or federal intrusions into the sport. I want 
to emphasize that this proposal requires no State or federal funding; 
creates no federal bureaucracy; imposes no mandates on State 
commissions; and requires no new regulatory actions by State boxing 
commissioners. It is a modest and practical measure that will establish 
several ``fair contracting'' standards to protect professional boxers, 
and enhance important financial disclosures that are made to State 
commissions by business entities in the industry.

  This bill also would establish certain federal standards with which 
boxing's ``sanctioning organizations'' must comply. These entities are 
notorious in the

[[Page S7257]]

sport for engaging in arbitrary and manipulative activity with respect 
to their ratings of professional boxers. Though often foreign-based, 
these entities operate on an interstate basis in the U.S. with 
virtually no oversight at the State or federal level. For several 
decades they have been repeatedly and credibly criticized by boxers and 
sportswriters for business practices that are highly questionable. 
Their inconsistent and subjective methods of rating boxers, often in 
apparent collusion with powerful promoters in the sport, clearly has 
had negative consequences for boxers. A boxer's career can be 
effectively stalled or crippled by these entities' arbitrary decisions. 
This legislation would establish a series of prudent business conduct 
standards and financial disclosure requirements on sanctioning 
organizations to ensure they are subject to legitimate public oversight 
by State officials.
  I want to note the vital need for these reforms at the federal level, 
Mr. President. Boxing in the U.S. is regulated by individual State 
boxing commissions, many of which are severely underfunded and 
understaffed. Many do not have more than a single employee. Though many 
State commissions have extremely knowledgeable and dedicated members, 
they do not have the capacity to prevent the indefensible interstate 
business abuses which this legislation address. Indeed, when a small 
group of states boxing commissions tries to crack down on the promoters 
and others who are engaged in fraudulent or unethical activity, State 
officials face the prospect of losing all their professional boxing 
events to another jurisdiction. Promoters and sanctioning bodies can 
avoid State reforms by seeking out new forums where public interest 
protections are fewer and weaker. That is not good for the boxers who 
bear all the risks of this punishing profession, and it not good for 
the ticket-buying fans, either.
  Decades of scandals, controversy, and corruption have shown 
professional boxing to be an industry where public oversight is 
absolutely critical, Mr. President. Therefore, this limited series of 
national fair business standards and public disclosure requirements 
will be of tremendous service to the State officials and general public 
concerned about this industry. This bill will in no way interfere with 
any legitimate, good faith business practices in the sport.
  Senator Bryan and the many industry members that I have worked with 
over the past five months to develop this bill have come up with a 
solid, practical, and no-cost way to protect the interests of the 
athletes and the public in the boxing industry. The sole objectives of 
this bill are to ensure that boxers are not cheated of their fair 
earnings in the sport; that State officials are given better 
information with which to supervise major boxing events, and take 
corrective actions when necessary; and to encourage integrity and 
honest business practices by the business interests which dominate 
professional boxing. I have attached a one page summary of this 
proposal, and ask unanimous consent to print the bill and summary in 
the Record. I look forward to comments on this proposal by members of 
the industry and State commissioners across the U.S., and ask my 
colleagues for their support.
  There being no objection, the items were ordered to be printed in the 
Record, as follows:

                                S. 2238

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Muhammad Ali Boxing Reform 
     Act''.

     SEC 2. FINDINGS.

       The Congress makes the following findings:
       (1) Professional boxing differs from other major, 
     interstate professional sports industries in the United 
     States in that it operates without any private sector 
     association, league, or centralized industry organization to 
     establish uniform and appropriate business practices and 
     ethical standards. This has led to repeated occurrences of 
     disreputable and coercive business practices in the boxing 
     industry, to the detriment of professional boxers nationwide.
       (2) Professional boxers are vulnerable to exploitative 
     business practices engaged in by certain promoters and 
     sanctioning bodies which dominate the sport. Boxers do not 
     have an established representative group to advocate for 
     their interests and rights in the industry.
       (3) State officials are the proper regulators of 
     professional boxing events, and must protect the welfare of 
     professional boxers and serve the public interest by closely 
     supervising boxing activity in their jurisdiction. State 
     boxing commissions do not currently receive adequate 
     information to determine whether boxers competing in their 
     jurisdiction are being subjected to contract terms and 
     business practices which may be violative of State 
     regulations, or are onerous and confiscatory.
       (4) Promoters who engage in illegal, coercive, or unethical 
     business practices can take advantage of the lack of 
     equitable business standards in the sport by holding boxing 
     events in states with weaker regulatory oversight.
       (5) The sanctioning organizations which have proliferated 
     in the boxing industry have not established credible and 
     objective criteria to rate professional boxers, and operate 
     with virtually no industry or public oversight. Their ratings 
     are susceptible to manipulation, have deprived boxers of fair 
     opportunities for advancement, and have undermined public 
     confidence in the integrity of the sport.
       (6) Open competition in the professional boxing industry 
     has been significantly interfered with by restrictive and 
     anti-competitive business practices of certain promoters and 
     sanctioning bodies, to the detriment of the athletes and the 
     ticket-buying public. Common practices of promoters and 
     sanctioning organizations represent restraints of interstate 
     trade in the United States.
       (7) It is necessary and appropriate to establish national 
     contracting reforms to protect professional boxers and 
     prevent exploitative business practices, and to require 
     enhanced financial disclosures to State athletic commissions 
     to improve the public oversight of the sport.
       (8) Whereas the Congress seeks to improve the integrity and 
     ensure fair practices of the professional boxing industry on 
     a nationwide basis, it deems it appropriate to name this 
     reform in honor of Muhammad Ali, whose career achievements 
     and personal contributions to the sport, and positive impact 
     on our society, are unsurpassed in the history of boxing.

     SEC. 3. PURPOSES.

       The purposes of this Act are--
       (1) to protect the rights and welfare of professional 
     boxers by preventing certain exploitative, oppressive, and 
     unethical business practices they may be subject to on an 
     interstate basis;
       (2) to assist State boxing commissions in their efforts to 
     provide more effective public oversight of the sport; and
       (3) to promoting honorable competition in professional 
     boxing and enhance the overall integrity of the industry.

     SEC 4. PROTECTING BOXERS FROM EXPLOITATION.

       The Professional Boxing Safety Act of 1996 (15 U.S.C. 6301 
     et seq.) is amended by--
       (1) redesignating section 15 as 16; and
       (2) inserting after section 14 the following:

     ``SEC. 15. PROTECTION FROM EXPLOITATION.

       ``(a) Contract Requirements.--
       ``(1) In general.--Any contract between a boxer and a 
     promoter or manager shall--
       ``(A) be reasonable;
       ``(B) include mutual obligations between the parties; and
       ``(C) specify a minimum number of professional boxing 
     matches per year for the boxer.
       ``(2) 1-year limit on coercive promotional rights.--The 
     period of time for which promotional rights to promote a 
     boxer may be granted under a contract between the boxer and a 
     promoter, or between promoters with respect to a boxer, may 
     not be greater than 12 months in length if the boxer is 
     required to grant such rights, or a boxer's promoter is 
     required to grant such rights with respect to a boxer, as a 
     condition precedent to the boxer's participation in a 
     professional boxing match. Nothing in this paragraph shall be 
     construed as pre-empting any State statute or common law rule 
     against interference with contract.
       ``(3) Promotional rights under mandatory bout contracts.--
     Neither a promoter nor a sanctioning organization may require 
     a boxer, in a contract arising from a professional boxing 
     match that is a mandatory bout under the rules of the 
     sanctioning organization, to grant promotional rights to any 
     promoter for a future professional boxing match.
       ``(b) Employment As Condition of Promoting, Etc..--No 
     person who is a licensee, manager, matchmaker, or promoter 
     may require a boxer to employ, retain, or provide 
     compensation to any individual or business enterprise 
     (whether operating in corporate form or not) recommended or 
     designated by that person as a condition of--
       ``(1) such person's working with the boxer as a licensee, 
     manager, matchmaker, or promoter;
       ``(2) such person's arranging for the boxer to participate 
     in a professional boxing match; or
       ``(3) such boxer's participation in a professional boxing 
     match.
       ``(c) Enforcement.--
       ``(1) Promotion agreement.--A provision in a contract 
     between a promoter and a boxer, or between promoters with 
     respect to a boxer, that violates subsection (a) is contrary 
     to public policy and unenforceable at law.
       ``(2) Employment agreement.--In any action brought against 
     a boxer to recover money (whether as damages or as money

[[Page S7258]]

     owed) for acting as a licensee, manager, matchmaker, or 
     promoter for the boxer, the court, arbitrator, or 
     administrative body before which the action is brought may 
     deny recovery in whole or in part under the contract as 
     contrary to public policy if the employment, retention, or 
     compensation that is the subject of the action was obtained 
     in violation of subsection (b).''.
       (b) Conflicts of Interest.--Section 9 of such Act (15 
     U.S.C. 6308) is amended by--
       (1) striking ``No member'' and inserting ``(a) Regulatory 
     Personnel.--No member''; and
       (2) adding at the end thereof the following:
       ``(b) Firewall Between Promoters and Managers.--
       ``(1) In general.--It is unlawful for--
       ``(A) a promoter to have a direct or indirect financial 
     interest in the management of a boxer; or
       ``(B) a manager to have a direct or indirect financial 
     interest in the promotion of a boxer.
       ``(2) Exception for Self-promotion and management.--
     Paragraph (1) does not prohibit a boxer from acting as his 
     own promoter or manager.''.

     SEC. 5. SANCTIONING ORGANIZATION INTEGRITY REFORMS.

       (a) In General.--The Professional Boxing Safety Act of 1996 
     (15 U.S.C. 6301 et seq.), as amended by section 4 of this 
     Act, is amended by--
       (1) redesignating section 16, as redesignated by section 4 
     of this Act, as section 17; and
       (2) by inserting after section 15 the following:

     ``SEC. 16. SANCTIONING ORGANIZATIONS.

       ``(a) Objective Criteria.--A sanctioning organization that 
     sanctions professional boxing matches on an interstate basis 
     shall establish objective and consistent written criteria for 
     the ratings of professional boxers.
       ``(b) Appeals Process.--A sanctioning organization shall 
     establish and publish an appeals procedure that affords a 
     boxer rated by that organization a reasonable opportunity to 
     submit information to contest its rating of the boxer. Under 
     the procedure, the sanctioning organization shall, within 14 
     days after receiving a request from a boxer questioning that 
     organization's rating of the boxer--
       ``(1) provide to the boxer a written explanation of the 
     organization's criteria and its rating of the boxer; and
       ``(2) submit a copy of its explanation to the President of 
     the Association of Boxing Commissions of the United States.
       ``(c) Notification of Change in Rating.--If a sanctioning 
     organization changes its rating of a boxer who is included, 
     before the change, in the top 10 boxers rated by that 
     organization, then it shall provide a written explanation of 
     the reasons for its change in that boxer's rating to the 
     boxer within 14 days after changing the boxer's rating.
       ``(d) Public Disclosure.--
       ``(1) FTC filing.--Not later than January 31st of each 
     year, a sanctioning organization shall submit to the Federal 
     Trade Commission--
       ``(A) a complete description of the organization's ratings 
     criteria, policies, and general sanctioning fee schedule;
       ``(B) the bylaws of the organization;
       ``(C) the appeals procedure of the organization; and
       ``(D) a list and business address of the organization's 
     officials who vote on the ratings of boxers.
       ``(2) Format; Updates.--A sanctioning organization shall--
       ``(A) provide the information required under paragraph (1) 
     in writing, and, for any document greater than 2 pages in 
     length, also in electronic form; and
       ``(B) promptly notify the Federal Trade Commission of any 
     material change in the information submitted.
       ``(3) FTC to make information available to public.--The 
     Federal Trade Commission shall make information received 
     under this subsection available to the public. The Commission 
     may assess sanctioning organizations a fee to offset the 
     costs it incurs in processing the information and making it 
     available to the public.
       ``(4) Internet alternative.--In lieu of submitting the 
     information required by paragraph (1) to the Federal Trade 
     Commission, a sanctioning organization may provide the 
     information to the public by maintaining a website on the 
     Internet that--
       ``(A) is readily accessible by the general public using 
     generally available search engines and does not require a 
     password or payment of a fee for full access to all the 
     information;
       ``(B) contains all the information required to be submitted 
     to the Federal Trade Commission by paragraph (1) in a easy to 
     search and use format; and
       ``(C) is updated whenever there is a material change in the 
     information.''.
       (b) Conflict of Interest.--Section 9 of such Act (15 U.S.C. 
     6308), as amended by section 4 of this Act, is amended by 
     adding at the end thereof the following:
       ``(c) Sanctioning Organizations.--
       ``(1) Prohibition on receipts.--Except as provided in 
     paragraph (2), no officer or employee of a sanctioning 
     organization may receive any compensation, gift, or benefit 
     directly or indirectly from a promoter, boxer, or manager.
       ``(2) Exceptions.--Paragraph (1) does not apply to--
       ``(A) the receipt of payment by a promoter, boxer, or 
     manager of a sanctioning organization's published fee for 
     sanctioning a professional boxing match or reasonable 
     expenses in connection therewith if the payment is reported 
     to the responsible boxing commission under section 17; or
       ``(B) the receipt of a gift or benefit of de minimis 
     value.''.
       (c) Sanctioning Organization Defined.--Section 2 of the 
     Professional Boxing Safety Act of 1996 (15 U.S.C. 6301) is 
     amended by adding at the end thereof the following:
       ``(11) Sanctioning organization.--The term `sanctioning 
     organization' means an organization that sanctions 
     professional boxing matches in the United States--
       ``(A) between boxers who are residents of different States; 
     or
       ``(B) that are advertised, otherwise promoted, or broadcast 
     (including closed circuit television) in interstate 
     commerce.''.

     SEC. 6. PUBLIC INTEREST DISCLOSURES TO STATE BOXING 
                   COMMISSIONS.

       (a) In General.--The Professional Boxing Safety Act of 1996 
     (15 U.S.C. 6301 et seq.), as amended by section 5 of this 
     Act, is amended by--
       (1) redesignating section 17, as redesignated by section 5 
     of this Act, as section 18; and
       (2) by inserting after section 16 the following:

     ``SEC. 17. REQUIRED DISCLOSURES TO STATE BOXING COMMISSIONS.

       ``(a) Sanctioning Organizations.--Before sanctioning a 
     professional boxing match in a State, a sanctioning 
     organization shall provide to the boxing commission of, or 
     responsible for sanctioning matches in, that State a written 
     statement of--
       ``(1) all charges, fees, and costs the organization will 
     assess any boxer participating in that match;
       ``(2) all payments, benefits, complimentary benefits, and 
     fees the organization will receive for its affiliation with 
     the event, from the promoter, host of the event, and all 
     other sources; and
       ``(3) such additional information as the commission may 
     require.
       ``(b) Promoters.--Before a professional boxing match 
     organized, promoted, or produced by a promoter is held in a 
     State, the promoter shall provide a statement in writing to 
     the boxing commission of, or responsible for sanctioning 
     matches in, that State--
       ``(1) a copy of any agreement in writing to which the 
     promoter is a party with any boxer participating in the 
     match;
       ``(2) a statement made under penalty of perjury that there 
     are no other agreements, written or oral, between the 
     promoter and the boxer with respect to that match; and
       ``(3) a statement in writing of--
       ``(A) all fees, charges, and expenses that will be assessed 
     by or through the promoter on the boxer pertaining to the 
     event, including any portion of the boxer's purse that the 
     promoter will receive, and training expenses; and
       ``(B) all payments, gift, or benefits the promoter is 
     providing to any sanctioning organization affiliated with the 
     event.
       ``(c) State Boxing Commission to Establish Requirements.--
     The boxing commission of each State, or the responsible 
     boxing commission for a State that has no boxing commission, 
     shall determine how far in advance of a professional boxing 
     match the documents described in subsections (a) and (b) 
     shall be provided to the boxing commission, and may prescribe 
     such additional requirements relative to the required 
     submission as may be necessary.
       ``(d) Information To Be Available to State Attorney 
     General.--A State boxing commission shall make information 
     received under this section available to the chief law 
     enforcement officer of the State in which the match is to be 
     held upon request.
       ``(e) Exception.--The requirements of this section do not 
     apply in connection with a professional boxing match 
     scheduled to last less than 10 rounds.''.

     SEC. 7. ENFORCEMENT.

       Section 10 of the Professional Boxing Safety Act of 1996 
     (15 U.S.C. 6309) is amended by--
       (1) inserting a comma and ``other than section 9(b), 15, 
     16, or 17,'' after ``this Act'' in subsection (b)(1);
       (2) redesignating paragraphs (2) and (3) of subsection (b) 
     as paragraphs (3) and (4), respectively, and inserting after 
     paragraph (1) the following:
       ``(2) Violation of anti-exploitation, sanctioning 
     organization, or disclosure provisions.--Any person who 
     knowing violates any provision of section 9(b), 15, 16, or 17 
     of this Act shall, upon conviction, be imprisoned for not 
     more than 1 year or fined not more than--
       ``(A) $100,000; and
       ``(B) if the violations occur in connection with a 
     professional boxing match the gross revenues for which exceed 
     $2,000,000, such additional amount as the court finds 
     appropriate,
     or both.''; and
       (3) adding at the end thereof the following:
       ``(c) Actions by States.--Whenever the chief law 
     enforcement officer of any State has reason to believe that a 
     person or organization is engaging in practices which violate 
     any requirement of this Act, the State, as parens patriae, 
     may bring a civil action on behalf of its residents in an 
     appropriate district court of the United States--
       ``(1) to enjoin the holding of any professional boxing 
     match which the practice involves;

[[Page S7259]]

       ``(2) to enforce compliance with this Act;
       ``(3) to obtain the fines provided under subsection (b) or 
     appropriate restitution; or
       ``(4) to obtain such other relief as the court may deem 
     appropriate.
       ``(d) Private Right of Action.--Any boxer who suffers 
     economic injury as a result of a violation of any provision 
     of this Act may bring an action in the appropriate Federal or 
     State court and recover the damages suffered, court costs, 
     and reasonable attorneys fees and expenses.''.
                                  ____


                            S. 2238--Summary


                  protecting boxers from exploitation

       (a) Declares that all contracts between boxers and 
     promoters must be based on a mutuality of obligation, be 
     reasonable in length and terms, and contain terms specifying 
     a minimum number of bouts per year for the boxer.
       (b) Limits certain ``option'' contracts between boxers and 
     promoters to one year. (Those where a boxer was required to 
     provide options to a promoter, as a condition of getting a 
     particular fight.)
       (c) Prohibits promoters and sanctioning bodies from 
     requiring ``options'' from a boxer who is considered by a 
     sanctioning body to be the ``mandatory challenger.''
       (d) No promoter can require a boxer to hire an associate, 
     relative, or any other individual, as the boxer's manager, or 
     in any other employment capacity.
       (e) Prohibits conflicts of interest between managers of a 
     boxer, and the promoter. No promoter can have a financial 
     interest in the management of a boxer, or vice versa.


               sanctioning organization integrity reforms

       (a) Sanctioning organizations conducting business in the 
     U.S. on an interstate basis must establish objective and 
     consistent criteria for the ratings of professional boxers.
       (b) On an annual basis, sanctioning organizations must 
     provide the following information to the Federal Trade 
     Commission (or make it publicly available on the 
     ``internet''): (a) their bylaws, ratings criteria, and (b) 
     roster of officials who vote on their ratings decisions.
       (c) When sanctioning organizations change their rating of a 
     U.S. boxer, the organization must inform the boxer in writing 
     of the reason for the change.
       (d) Each sanctioning organization must establish an appeals 
     process for boxers in the U.S. to contest their ranking in 
     writing, and receive a written response from the organization 
     explaining its decision. Copies of their decision shall be 
     provided to the ABC.
       (d) No sanctioning organization can receive payments or 
     compensation from a promoter, boxer, or manager, except for 
     the established sanctioning fee and expenses they receive for 
     sanctioning a bout, and which are reported to the relevant 
     State commission.


        public interest disclosures to state boxing commissions

       (a) Sanctioning organizations must disclose to a state 
     boxing commission, in advance of the event, all charges and 
     fees they will impose on the boxer(s) competing in the event.
       (b) Sanctioning bodies must also disclose all payments, 
     fees, and complimentary services they will receive from 
     promoters, the host of the boxing event, and any other 
     sources affiliated with the event. Services or benefits of 
     minor value are excluded.
       (c) The promoter and matchmakers affiliated with each event 
     shall file a complete and accurate copy of all contracts they 
     have with the boxer pertaining to the event, with the boxing 
     commission prior to the event, and disclose in writing all 
     fees, charges, and costs they will assess on the boxer(s). 
     The promoter shall also disclose all payments and benefits 
     made to sanctioning organization affiliated with the event. 
     Promoters of ``club'' boxing events--those bouts of less than 
     10 rounds--are excluded from these reporting requirements.
       (d) Require that disclosures made under this Act to a State 
     Commission shall be provided upon request to the State 
     Attorney General's Office, upon request.


                              enforcement

       Civil and Criminal penalties similar to new federal boxing 
     law, but fines are higher to deter major promoters from 
     violations. Also, allow enforcement by State Attorney 
     Generals.
                                 ______