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The Danish Competition Council finds agreements limiting the ability of cinemas to grant discounts on ticket prices anticompetitive

25. maj 2016

On May 25, 2016, The Danish Competition Council (“DCC”) issued a decision ordering the Association of Danish Film Distributors (“FAFID”) and the Association of Danish Cinemas (“DB”) to terminate certain anticompetitive agreements, which restricted cinemas in granting discounts on cinema tickets.

The DCCs decision will improve the conditions under which the cinemas compete on ticket prices and pave the way for lower cinema tickets prices for Danish consumers.

This case first of all concerns the general terms and conditions on distribution of films to cinemas entered into between the two trade associations, FAFID and DB. According to § 16(1) of the general terms and conditions, cinemas may only grant discounts on cinema tickets after having obtained approval from the relevant film distributor.

In addition, the case concerns a reprimand sent by the trade association FAFID to all cinemas reminding the cinemas that all discounts exceeding 20 pct. must be approved by FAFID (“the 20 pct. rule”).

The DCC found that § 16(1) reflected a horizontal agreement between the members of FAFID and a vertical agreement between FAFID and DB.

Furthermore, the DCC found that the 20 pct. rule reflected a horizontal agreement between the members of FAFID and a vertical agreement between FAFID and the cinemas that had accepted the reprimand.

Both in relation to the horizontal and the vertical aspects, the DCC further found that § 16(1) and the 20 pct. rule constituted infringements “by object” of § 6 of the Danish Competition Act and the corresponding Article 101 of the Treaty.
    
In its assessment the DCC has found:

•    That the agreements create transparency on how competing film distributors calculate their payment. Furthermore
•    That the agreements limit the ability of cinemas to determine their admission prices.

The case was initiated by the Danish Competition and Consumer Authority in 2011 by a complaint from a cinema.

Read the Competition Council's decision (Danish)
Last updated: 25. maj 2016