Competition panel plans code of conduct for trade bodies

It’s not just numerology that links the recently released movies Dabangg, Anjaana Anjaani and Raavan. Thanks to the Competition Commission of India (CCI), the country’s fair trade practice watchdog, none of these movies would have reached theatres across the country on the scheduled date of release.

In the case of all the three movies, the local associations, mostly the state film chambers, had declared a ban on the screening of these movies in their respective regions, as the distributors failed to listen to the associations’ demands, which in CCI parlance were actionable offences under the country’s anti-competitive laws.

For instance, Anjaana Anjaani, the Hindi movie starring Ranbir Kapoor and Priyanka Chopra, got released in theatres as scheduled on October 1 after CCI thwarted the attempts of film trade associations such as Bihar and Jharkhand Motion Pictures Association and Central Circuit Association to block the release of the movie in Bihar, Jharkhand, Kerala, and parts of Madhya Pradesh and Rajasthan over unresolved issues the associations have with the distributor, Eros International.

In June, Anil Ambani’s Reliance Big Entertainment had secured a similar order from CCI to go ahead with the release of the Aishwarya Rai Bachchan and Abhishek Bachchan starrer Raavan in Karnataka.

The complaint filed by Eros alleged the associations were abusing their dominant position by threatening to block the screening of the movie in respective states.

Film industry experts had criticised the strong arm tactics of state-level film chambers and associations against film producers and distributors.

The increasing instances of trade associations and industry bodies indulging in anti-competitive practices have alerted CCI to plan a list of dos and don’ts for Indian trade associations.

CCI is keeping track of the activities of several trade associations, not just in the film industry but also cement manufacturers, DTH operators and aviation players, to name a few.

“Trade associations often have been found issuing guidelines which restrict the trade, business and are anti-competitive in nature. In the meetings of these associations resolutions are passed that have anti-competitive effects. They are behaving like overt cartels”, a senior corporate affairs ministry official said.

According to the official, CCI is in the process of enforcing a set of dos and don’ts for such associations to ensure that that they limit their activities to pro-competition measures.

“CCI has already come out with a compliance guideline for the associations. It is for them to put together an effective competition compliance programme to avoid infringement under the Indian Competition Act,” the official added.