Film pay-TV rights scrutinised by European Commission

The sale of Hollywood film rights for screenings on pay-TV channels, a market estimated to be worth a billion-a-year in Europe, is under examination by the European Commission.
Clauses dealing with the contract and duration of the rights have come under scrutiny as increasing demand for pay-TV movie channels have fuelled a three-fold increase in the European distribution market since the early 1990's.
European Commission anti-trust regulators are looking at the deals from a number of leading Hollywood studios, who have been asked to co-operate in the investigation. It was reported that the Commission are examining a possibly anti-competitive clause in Hollywood film rights contracts that have been drawn up with several television channels in Europe.
A spokesperson for the European Commission said an ongoing preliminary inquiry was looking at a restrictive clause that required broadcasters to pay the same price for films. Apparently, this operates on the basis of a set price for a package of films in a set period of time. Another issue under examination is the length and exclusivity of deals between certain studios and a particular pay-TV concern.
Investigations conducted in the past few years have resulted in raids on the office of European-based pay-TV firms in an effort to elicit pertinent details concerning deals with what is reported to be around seven film studios.
Recent news reports indicate that BskyB in the UK, Canal Plus in France, Telepiu in Italy, and Sogecable TV in Spain are among the companies so far contacted for information on the practices.
The investigation was triggered in response to complaints and counter-complaints originating from contracts reached with US-based film studios and two rival pay-TV companies in France.
(SP)