Brussels, 18/01/2016 (Agence Europe) - The European Commission investigation into possible anti-competitive practices by six major US cinema studios and the British pay-TV channel, Sky, is underway. On Monday 18 January, a three-day hearing began in Brussels that brought the major stakeholders together. The Commission's decision on this matter is expected before the summer, explained one reliable source.
The affair goes back to the beginning of 2014 when the Commission opened a formal procedure to examine whether the main European pay-TV broadcasters were not benefiting from “absolute territorial exclusivity”. A year and a half later, the Commission went into top gear by sending a “statement of objections” to Sky UK, as well as six major US production studios: Disney, NBCUniversal, Paramount Pictures, Sony, Twentieth Century Fox and Warner Bros. The reason for sending the statement involved the licence contracts that included geographical exclusivity clauses that prevented Internet users from obtaining satellite or online access to their programmes from another country.
In its statement of objections, the Commission said that that such clauses restrict Sky UK's ability to accept unsolicited requests for its pay-TV services from consumers located abroad. Under European law, these so-called “passive” sales benefit from an exemption to the territoriality principle. The Commission also highlights the clauses in which crossed geo-blocking means Sky only broadcasts certain programmes abroad and in exchange foreign broadcasters block access to the same programmes in the United Kingdom or through its satellite pay-TV services to consumers outside its licenced territory (UK and Ireland).
The normal follow-up to the statement of objections involves the Commission organising a hearing on 18, 19 and 20 January with the countries involved. According to Politico, around 150 people are expected to attend. This dossier is in effect being very closely followed in all the different European countries because the other major European TV broadcasters [Canal Plus (France), Sky Italia (Italy), Sky Deutschland (Germany) and DTS (Spain) are also in the Commission's sights. The rights holders are also following the discussions about passive sales very attentively, to ensure that the principle of media chronology does not suffer.
If the Commission' s preliminary position is borne out, each of the different companies could face a fine as high as 10% of its annual turnover and they will obviously have to put a stop to these practices. (Original version in French by Sophie Petitjean)