Canal Plus loses bid to overturn Paramount’s pay-TV settlement at EU court

13 December 2018 3:36pm

12 November 2018. By Andrew Boyce.

French film studio Canal Plus has lost a legal challenge against a settlement Paramount Pictures reached with the European Commission in 2016 to end its involvement in a pay-TV antitrust probe.

The commission’s decision to settle the probe was “sufficiently grounded in law as regards whether the commitments offered by Paramount … were suitable to resolve the competition concerns expressed by the commission,” the EU’s lower-tier General Court ruled today. The judges held that the commission’s decision was proportionate.

The European Commission is carrying out an antitrust investigation into clauses that several Hollywood studios have with UK broadcaster Sky, which restrict access for consumers living in other EU countries.

Paramount, a film studio owned by Viacom, reached a voluntary settlement with the regulator in 2016 after it agreed to scrap the problematic distribution clauses.

Last month, the Walt Disney Company joined Paramount in offering to settle its part in the antitrust probe after it similarly agreed to remove clauses in its licensing contracts with Sky.

The commission continues to probe Sky and three studios — NBCUniversal, Warner Bros. and Sony Pictures — following Disney’s agreed acquisition of 21st Century Fox’s film and television studios.

French cinema

Canal Plus appealed Paramount’s settlement with the commission, arguing that a prohibition of territorial exclusivity agreements would be detrimental for French cinema and for cultural diversity.

The company — supported by the French government and two film associations — told a hearing at the EU’s General Court in September that the settlement posed a “serious threat” to France’s film industry.

Canal Plus argued that the commission’s investigation had failed to prove any competition concerns and had wrongly applied the findings of 2011 judgment on English Premier League soccer.

That “Murphy” ruling found that an English pub owner was in breach of EU rules on “exclusive licenses” by showing Premier League matches with a satellite decoder card imported from Greece.

Canal Plus argued that the commission hadn’t carried out any specific analysis of the French film market — which depends on territorial exclusivity agreements for funding.

Lawyers also argued that antitrust officials exceeded their powers by accepting commitments that applied to all EU member states, when the concerns only related to the UK.

However the General Court rejected all the grounds raised by the appellants.

ABA 2019