MRTPC slaps restraint order on multiplexes

The Monopolies 038; Restrictive Trade Practices Commission MRTPC today restrained the Multiplex Association of India and its members from carrying on restrictive trade practices. The MRTPC order was passed in response to complaints from Ramesh Sippy and four other film distributors, who alleged that certain clauses of the Multiplexes Association of India Terms Agreement, 2007, were restrictive in nature.

According to the agreement, multiplex chains would negotiate terms with distributors on a national or regional basis and no chain would pay the distributors more than what has been agreed to in the MAI Agreement. It was also alleged that the agreement was with the intention of forming a 8220;cartel8221; to pressurise films producers and distributors to accept terms dictated by a cartel of multiplex owners.

The MRTPC also directed multiplex owners to file an affidavit of compliance in four weeks. The Commission found that the MAI Agreement was 8220;prima facie restrictive and against public interest8221;. Further, 8220;the continuation of such practice till the enquiry is completed could cost irreparable loss to the film industry and the applicants8221;, the commission was quoted as saying. The film distributors had filed an interim application seeking a temporary injunction to restrain the MAI from carrying on restrictive trade practice. They also claimed that the agreement restricts the members from entering into agreements with the distributors unless the same terms are extended to other members.