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NCLAT dismisses Karnataka Film Body’s plea against competition panel order

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A Division Bench of the National Company Law Appellate Tribunal (NCLAT) comprising Justice Rakesh Kumar and Kanthi Narahari dismissed an appeal preferred by the Karnataka Film Chamber of Commerce (KFCC) against CCI ruling which found KFCC to have acted in a concerted manner impeding entry and screening of dubbed movies in Karnataka. 

In 2018, the Competition Commission of India (CCI) found the conduct of KFCC in violation of the provisions of the Competition Act, 2002 that proscribe anti-competitive agreements and imposed a penalty of ₹9.72 lakh upon KFCC.

The investigation in was ordered by the CCI in 2017 based on the information filed by a film producer and distributor G. Krishnamurthy. 

He alleged that KFCC was causing hindrance and roadblocks to his Tamil movie originally titled as “ Yennai Arindhal” from being released in Karnataka post-dubbing as “ Satyadev IPS”. He also alleged that KFCC was inducing public protests against the release of the movie in Karnataka.

The Director-General (DG), after investigation, found that KFCC was acting in concert and impeded entry and screening of dubbed movies. The competition panel agreed with the findings of the DG in August 2018 and imposed a penalty of ₹9.72 lakh on KFFC and directed it to bring in place a Competition Compliance Manual to educate its members about basic tenets of competition law principles.

Aggrieved by CCI ruling, KFCC preferred an appeal before the NCLAT on the ground that impugned order failed to appreciate that there was neither any appreciable adverse effect on competition, nor any evidence of any concerned or collusive act by the KFCC. 

The Appellate Tribunal, however, dismissed the plea filed by KFCC, noting that there was ample evidence to show the existence of anti-competitive conduct by it. 

While dismissing the plea, NCLAT observed “For the aforesaid reasons, this Tribunal comes to an inescapable and irresistible conclusion that the order passed by the 1st Respondent (CCI) is in accordance with law and does not warrant any interference by this Tribunal. Resultantly, the Appeal  sans merit and the same is dismissed.”



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