A day after the European Union announced it was charging Google with anti-trust violations, Paramount Pictures has offered a number of concessions in its own anti-trust case with the EU. The European Commission first launched its case last July against pay TV platform Sky and the six major Hollywood studios, arguing that customers across Europe should have access to Sky’s services in the UK and Ireland. At the time, E.U. competition commissioner Margrethe Vestager had argued that European consumers want to watch the pay-TV channels of their choice regardless of where they live or travel in the EU.
“Our investigation shows that they cannot do this today, also because licensing agreements between the major film studios and Sky UK do not allow consumers in other EU countries to access Sky’s UK and Irish pay-TV services, via satellite or online,” said Vestager. “We believe this may be a breach of EU competition rules.”
Today, however, the commission revealed “commitments offered by Paramount Pictures to address competition concerns relating to contractual clauses preventing the cross-border provision of pay TV services.”
These are, essentially, that Paramount will not introduce broadcaster obligations that prevent or limit a pay TV broadcaster from responding to unsolicited requests from consumers within the EEA but outside of the pay TV broadcaster’s licensed territory; Paramount will not prohibit or limit pay TV broadcasters located outside the licensed territory from responding to unsolicited requests from consumers within the licensed territory; and Paramount will not seek to bring an action before a court or tribunal for the violation of a broadcaster obligation or a Paramount obligation.
In its own statement, Paramount said, “Viacom and Paramount Pictures are gratified to have reached an early and satisfactory resolution with the European Commission regarding the European Commission’s statement of objections adopted in July 2015.
Subject to final approval, Viacom and Paramount will give binding commitments to neither enforce nor renew the types of clauses in premium pay-TV license agreements that were described in the statement of objections and that restrict European Economic Area (EEA) broadcasters from responding to unsolicited requests by consumers located in a different territory in the EEA. No admission of liability will be made.
The commitments permit Paramount to continue to license films through premium pay-TV output license agreements in Europe on an exclusive territorial basis. In addition, today’s agreement eliminates the possibility of fines and enables the Commission to close similar pending cases against Viacom and Paramount relating to broadcasters in Italy, France, Germany and Spain.”
The European Commission will now invite “comments from interested parties on commitments offered by Paramount Pictures to address competition concerns relating to contractual clauses preventing the cross-border provision of pay-TV services.”
The ongoing debate over geoblocking content has been at the heart of this battle. Last summer, there was outcry over the E.U.’s attempts to break down the license barriers between individual European countries to create a single Eurozone for IP, including film rights. Those moves were denounced by many in the film business, who said it threatened to destroy the European independent film financing model overnight.
A Sky rep added, “We are engaging with the European Commission in its ongoing inquiry to examine cross-border access to film content. We will respond to the Commission’s consultation on the Paramount proposal, as appropriate.”
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