UTV Software Communications Limited, Mumbai v. Motion Pictures Association, Delhi

UTV Software Communications Limited, Mumbai v. Motion Pictures Association, Delhi 

MANU/CO/0053/2012

FACTS:

UTV Software Communications Limited is a producer, title holder and distributor of feature films. The members of the Motion Pictures Association, Delhi (MPA) are engaged in the business of production, distribution and exhibition of films. MPA governs the arena of distribution and exhibition of motion pictures in the territory of Delhi, Uttar Pradesh and Uttarakhand.

UTV alleged that Motion Pictures Association (MPA), Delhi abused its dominant position in contravention of provisions of section 4 of the Act by forcing its members to sign a Producer Distributor Certificate and an Acquiring Form for the purpose of registration of the films. The Acquiring Form contained some mandatory conditions as per which the members have to agree for the transfer of all commercial and non-commercial rights of the film including the copyrights plus commercial video rights through any media including video parlor rights and telecasting rights to the distributor and imposes a holdback period[1] of 5 years. MPA had made it mandatory for the producer/suppliers and distributors to sign the declaration and undertaking for registering a film with it prior to the release of the film in the territory. The said Form has to be signed by the members without any corrections or cuttings. Thus the said unreasonable terms and conditions limited the production, supply, distribution and exhibition of films in the areas of operations of the MPA.

MPA had forced UTV to register the film “7 Khoon Maaf” by submitting the Acquiring Form and affidavit in the pro-forma prescribed by it. Since the film was due for release the

UTV had no choice but to accept the direction of MPA and to submit the requisite documents for smooth release of the film.

HELD:

Rules of MPA and other associations restricting their members not to deal with non-members, making compulsory the registration of each film before release in their territories, restrictions regarding unfair holdback period for exploitation of Satellite, Video, DTH and other rights and act and rules regarding penalizing members who do not follow the dictates of the association are anti–competitive and violative of provisions of section 3(3)(b) of the Competition Act.

To carry out the business of film distribution in the territory of any association it becomes essential for a distributor to take the membership otherwise one may not be able to do the business smoothly. Although as per its Articles of Association, the membership is voluntary but as almost all the distributors are its members and since the members are not allowed to deal with non-members, it is almost impossible to survive in the film distribution business without becoming the member of the association

The acquiring form and affidavit containing undertakings as per the prescribed proforma are also obtained from the producer at the time of registration. MPA makes it mandatory to register every film before release in its territory.

The conduct and activities of the opposite party are restrictive in nature and are violative of the provisions of the Act.