CCI's big relief for producers and distributors

MUMBAI: The Competition Commission of India (CCI) has granted a relief to UTV Software Communications, Reliance Big Entertainment Ltd., Eros International and Multiplex Association of India ) on antiquated laws which restricted production houses with unreasonable hold backs for all other rights outside theatrical rights.

The CCI ruled that the anti-competitive behaviour of any entity needs to be condemned heavily for effective function of the market. Further, it said that the associations are taking decisions and engaging in practices which are anti-competitive. Consequently, in Feb 2012, the CCI has imposed a hefty penalty on these distributor associations, to be deposited with immediate effect to the commission.

The order clarifies that the associations will have to stop compelling the producers/distributors/ exhibitors to become their members as a pre-condition for exhibition in their territories; discrimination between regional and non-regional films and imposing discriminatory conditions against non-regional films; screen restrictions based on language or manner of exhibition of a film to be done away with; holdbacks on satellite and home video, with studios free to decide such holdbacks; and compulsory registration of films as pre-condition to release to be done away with.

Commenting on the judgement UTV Motion Pictures CEO Siddharth Roy Kapur said, “This judgement by the CCI will stand out as a landmark event in the history of the Indian film industry. It unshackles producers and distributors from the draconian and archaic bylaws of defunct associations, driven by vested interests. It is a huge step forward in ensuring that the rules that govern the Indian movie business are reflective of current business practices, and not those practised in the last century."

In 2010, UTV had filed a case against distributor associations like KFCC (Karnataka Film Chamber of Commerce) for putting a restriction on the number of cinemas to release a non Kannada film and BJMPA (Bihar and Jharkhand Motion Pictures Association) for demanding unreasonable hold backs for registering its films.

The restriction had barred studios from exploiting satellite and home video rights in the respective regions and compelled the studio to register films with the trade body and bend to their archaic rules. As a result, this constrained the market access of the studio for unfettered distribution of its films on non theatrical platforms.

Apart from KFCC and BJMPA, Reliance, Eros and FICCI-MAI had filed complaints against other associations. The other trade associations which will be affected by this combined order are Eastern India Motion Picture Association, Central Circuit Cine Association (Amravati, Jaipur and Indore), Hyderabad State Film Chamber of Commerce, Northern India Motion Pictures Association, Indian Motion Pictures Distributors Association, Orissa Film Distributors Syndicate and The Chennai Kanchipuram Thiruvallur District Films Distributors Association.

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