Karnataka Film Chamber of Commerce again found guilty of anti-competitive activities of restricting telecast of films, CCI directed to bring in place ‘Competition Compliance Manual’

Competition
Commission of India:
It is third
time when the CCI found the Karnataka
Film Chamber of Commerce (KFCC) in violation of section 3 of the Competition Act, 2002. CCI in
the present order imposes penalty on KFCC, Karnataka Television Association (KTVA),
and Kannada Film Producers
Association (KFPA) for having been involved in the practice of preventing the release/ telecast
of dubbed films/ TV-serial in the State of Karnataka.  KFCC was found to be engaged into such
anti-competitive activities by CCI in Cinergy
Independent Film Services Pvt. Ltd v. Telangana Telugu Film Distributors
Association, [2013] CCI 23; and in Reliance Big Entertainment v. KFCC, Case
No. 25/2010.

It may be noted that the issue of restriction imposed
by the associations on the dubbed version of TV serials has been declared
anticompetitive by the Commission in a similar case involving West
Bengal film and television industry.  In  Sajjan Khaitan v Eastern India Motion Picture Association, the
Commission had opined that the act and conduct of the film associations is
anti-competitive in nature if it imposes restrictions on the free and
unrestricted distribution and exhibition of non-Bengali TV serials dubbed in
Bengali language. Such act and conduct was held to be limiting and controlling
the supply of serials dubbed in Bengali language in violation of provisions of
section 3(3) (b) of the Act.

In the present case the competition regulator viewed
that KFCC as an association is guilty of carrying on the practices of
prohibiting/banning dubbed content in the form of films in the State of Karnataka; and KTVA as
an association is guilty of on the practices of prohibiting/banning dubbed
content in the form of TV serials.  KFPA
is found guilty of participating in the anti-competitive decision making
practices and implementing such decisions by boycotting the cinema theatres who
do not obey their decisions in the State of Karnataka. The conduct of these associations,
therefore, falls under the purview of section 3(3) (b) of the Act which raises
a presumption of appreciable adverse effect on competition.

The Commission rejected the plea that the associations
are putting such restriction to preserve and promote the Kannada language. It
is opined by the Commission that in absence of any statutory restriction of
such nature, it is the viewer who should have the choice to watch a dubbed
programme or original language programme or any other programme. Trade
associations cannot become the self-appointed guardians of local language and
culture and interfere with the market forces.

Other then imposition of penalty and other usual
directions, the competition watchdog in its present order exercising its powers
under 27(g) of the Act, directed the guilty associations to bring in place, in
letter and in spirit, “Competition Compliance Manual’ to educate its members
about the basic tenets of competition law principles. These erring associations
should play an active role in creating awareness amongst its members of the
provisions of the Act through competition advocacy. [Kannada
Grahakara Koota v. Karnataka Film Chamber of Commerce, decided on
27-07-2015]
Source: Legal news India

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