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ACCORDO DISTRIBUTORI ED ESERCENTI CINEMA


PRESS RELEASE



PRESS RELEASE

The Competition Authority has found the agreements between film distributors and theatre proprietors to be illegal


At its meeting on 26 July 2001 the Competition Authority resolved that the association of film theatre operators, ANEC, and the associations representing the film distributors, UNIDIM and FIDAM, had violated section 2 (2) of the Competition Act by concluding agreements designed to fix the fees for the hire of cinematographic films, and by colluding to influence box office pricing policies.
The Authority also found that on the Salerno film theatre market, the film distribution companies Buena Vista International Italia S.r.l., Columbia Tristar Films Italia S.r.l., Twentieth Century Fox Italia S.p.A., Warner Bros Italia S.p.A., Cecchi Gori Distribuzione S.r.l., Filmauro S.r.l., Medusa Film S.p.A., on the one hand, and the Cinegest S.r.l., Vip s.a.s. di Iengo Giuseppe & C.  and Società Italiana Spettacoli & Turismo s.a.s. di Rizzo Giuseppe companies, on the other, had concluded exclusive screening rights agreements for the most popular films.
More specifically, the Authority ruled that by setting film hire prices and payment terms under a framework agreement, the association of distributors and film theatre operators had acted anti-competitively, bearing in mind the market conditions.
The investigation also showed that between 1991 and 1999 the association of film theatre operators and the film distributors' associations had established a continuous series of agreements between all the associations, and within each individual association, to standardise the cinema box office ticket prices and promotional ventures.  This concerted effort had had the effect of substantially bringing all the box office prices into line, reducing competition to the detriment of cinemagoers.  Considering the serious nature of this agreement, the Authority has imposed fines on the associations equivalent to 2% of the subscriptions in the case of ANEC (Lire 26 million) and UNIDIM (lire 11 million) and 1% on FIDAM (lire 1,650,000) in view of the fact that the offences were committed by the latter association over a shorter period.
Lastly, during the course of the investigation the Authority analysed the procedures for hiring films on certain local film theatre markets, focusing on the exclusive relations existing between film distributors and theatre operators. It transpired that in Salerno the film distributors had exclusive relations with only one film theatre circuit for the first screenings of new productions. The Authority considered that the exclusive system applied to only one film theatre circuit was likely to substantially restrict access by competing film theatres, in addition to restricting the range of choice open to the cinema-going public.
The parties were ordered to immediately desist from this unlawful conduct, and within 90 days of service of notice to submit to the Authority a report on the measures adopted to put an end to these offences.

Rome, 9 August 2001