Fifty years of Olympic Games coverage on the BBC could come to an end in 2014 after the International Olympic Committee (IOC) vowed yesterday to tear up the way television rights are sold across Europe.

It rejected a pan-European bid, in which the BBC was representing Britain, for the Winter Games in 2014 and the Summer Games in 2016, and said each country would have to negotiate rights individually.

The decision comes at a difficult time for the corporation because the number of broadcasters that could compete to show the “crown jewels” sporting events will increase significantly from 2012.

Full live coverage of the Olympics must appear on a free-to-watch channel that is available to 95 per cent of the population. Historically, that has been restricted to the BBC, ITV, Channel 4 and most recently Five, but many more channels are available on Freeview.

However, it could be possible for a pay channel, such as Sky, 39.1 per cent owned by News Corporation, parent company of The Times, to compete for the rights and to transmit the Games free.

In Italy, Sky Italia, owned by News Corporation, bought the rights to the Games from 2010, but has to make them available without charge.

Ministers are reviewing the “crown jewels” rules, which also cover events such as the FA Cup Final and the Grand National. The events change only rarely, but the review is expected to confirm that more broadcasters will be eligible to pursue them.

The London Olympics in 1948 were the first Games shown on the BBC, and it has shown every one since Rome in 1960. It already holds the rights to the 2012 Summer Olympics in London, won as part of the previous pan-European deal.

Traditionally, agreements were struck between the European Broadcasting Union (EBU), a federation of public and commercial free-to-air channels.

However, BBC insiders said they were confident that they could retain the rights in a straight British competition. A spokeswoman for BBC Sport said that Fifa, the football governing body, used to sell the World Cup rights via the EBU, but now negotiated with each country individually and the BBC has retained its rights, in that case jointly with ITV. “Broadcasting the Games is a big commitment – it requires two channels over 19 days,” she said.

ITV and Channel 4 last covered the Olympics in 1988, when they shared the task with the BBC. Channel 4’s coverage was fronted by the veteran film critic Barry Norman, but in the competitive broadcasting market, neither could easily afford to cover some of the smaller rating events because they need to generate high viewing figures to satisfy advertisers.

A spokeswoman for the IOC said that the Olympic body was “conducting a fair and open bidding process giving all interested parties – broadcast unions, agencies and individual broadcasters, including EBU members – the opportunity to acquire 2014-2016 Olympic Games broadcast rights in Europe”.

The EBU said it was disappointed with the outcome, and said it appeared that the Olympic body wanted to raise more cash.

“We very much regret the decision of the IOC,” Fritz Pleitgen, the EBU president, said. “EBU members were surprised by the high financial expectations of the IOC.”