CCI junks filmmaker's abuse of dominance plea against PVR

Exhibiting a film is dependent on various commercial factors, CCI observed

The Competition Commission of India (CCI) dismissed a plea against multiplex chain PVR alleging that the company was abusing its dominant position. The plea was filed by a filmmaker and a former police officer Yogesh Pratap Singh.

Singh alleged that by controlling more than half of the upscale
multiplex screens in the country, PVR is in a dominant position in the film exhibition market. He alleged that the company abused its dominance by giving special treatment to films of powerful and monetarily affluent production houses, thus creating entry barriers to films by independent filmmakers.

He also alleged that PVR indulged in cartelisation and vertical integration by entering into the business of film production, film distribution and film exhibition with the big production houses. To substantiate his claim, Singh alleged that his first fictional Hindi film called ‘Kya Yahi Sach Hai’ and second film called, ‘The Indian Supari Company’ suffered due to PVR's anti-competitive practices such as allotting screens to films by big production houses.

Singh alleged that PVR was indirectly involved in the production of the Ranbir-Alia starrer Brahmastra, as a consequence of which, the film received preferential treatment. According to him, PVR played multiple trailers of the film free of cost, put up huge banners and LED displays and assigned an overwhelming number of screens for its screening to the extent that other films got almost no space in the first week of its release. He made allegations of preferential treatment by PVR for films such as RRR and Lal Singh Chadha as well.

PVR's response

Countering the allegations, PVR told CCI that Singh's allegations were not backed by evidence and that he initiated proceedings at the CCI to pressurise it to exhibit his film. PVR also said that it is not in its interest to provide preferential treatment to any particular producer/distributor. According to PVR, screen allocation is done based on the revenue-generating potential of the movie and not on any other criteria. PVR also told CCI that it does not discriminate against independent filmmakers but exhibits movies of independent filmmakers regularly.

CCI's conclusion

CCI noted that Singh has not produced any evidence to prove his allegations against PVR, however, the multiplex chain has submitted proof of it exhibiting films by independent filmmakers.

CCI said, "Commercial wisdom of the exhibitors is largely governed by consumer demand and unless harm to competition is apparent, any intervention will only lead to undesirable consequences by taking away the autonomy of such undertaking and substituting the decision of such entity by the decision of the regulator."

The regulator dismissed the plea by stating that the autonomy available to the exhibitors to deal with movies is in alignment with their business requirements and subject to provisions of the Competition Act. Furthermore, PVR cannot be compelled to exhibit a particular film in a particular way unless it is against the Competition Act.