Abuse On Account Of Collective Dominance Not Recognized By Indian Competition Regime: CCI Dismisses Allegation Of Cartelization By Telugu Film Producers [Read Order]

Ashok Kumar (Informant) had purchased the distribution and exhibition rights for the dubbed version of the Tamil movie 'Petta' in Telugu language, in States of Andhra Pradesh and Telangana through a Theatrical Distribution Agreement (TDA) with Sun Picture, the producer of 'Petta'.

Sun Picture had announced the release of the movie worldwide in January, 2019 during Sankranti festival, and Ashok Kumar had requested the film studios mentioned in the complaint (the opposite parties) to provide a minimum of 400 screens, well in advance. It was submitted that these studios have control over more than 80% of the local movie theatres i.e. the theatres other than those owned by national multiplex chains like PVR, INOX, etc. in Telangana and Andhra Pradesh.

It was Ashok Kumar's contention that due to cartelization amongst the film studios, 'Petta' was allotted only limited screens for screening, thereby depriving his right to exhibit the movie in sufficient number of screens and causing immense monetary loss. It was submitted that the conduct of the parties was in contravention of Sec 3(3)(b) of the Competition Act, 2002.

Section 3(3)(b) deals with Anti-competitive agreements which causes or are likely to cause an adverse effect on competition within India by limiting or controlling the production, supply, markets, technical development, investment or provision of services.

In view of his submissions, Ashok Kumar had prayed for the Commission to direct the studios not to restrict new producers like him from accessing screens for release of movies and also to restrict the opposite parties from abusing their dominant position.

The Commission was of the view that since the abuse on account of collective dominance is a concept not recognized by the Indian Competition regime so far, the Act, under Section 4 (dealing with abuse of dominant position) only contemplates the abuse of dominant position by an enterprise or a group.

Furthermore, the commission also pointed out that no producer or distributor can claim as a matter of right any particular number of screens for exhibition of its movies. In furtherance of this, since the informant Ashok Kumar could not furnish enough evidence to prove collusion amongst the studios, no case under could be made out under provisions of the Competition Act and accordingly closed the case.

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