19
Annual Report -
2013
-
Vivendi
Group Profile |
Businesses
| Litigation | Risk Factors
1
Canal+ Group
for movie channels:
–– first window: ten months for an original broadcast if an
agreement is entered into with film organizations, 12 months
otherwise,
–– second window: 22 months if agreed with the film organizations,
24 months otherwise;
on unscrambled television channels and on other pay television
channels:
–– 22 months if the channel contributes at least 3.2% of its revenue
to film production,
–– 30 months otherwise; and
for on-demand subscription video films (Canalplay Infinity):
36 months.
2.1.8.
Piracy
2.1.9.
Competition
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2.1.9.1. Canalsatellite / TPS merger
On September 20, 2011, the French Competition Authority issued a
decision relating to Canal+ Group’s failure to comply with several
commitments to which it was subject under the August 30, 2006
decision authorizing the merger between Canalsatellite and TPS.
As a result, the French Competition Authority withdrew the decision
authorizing the transaction, thereby forcing Vivendi and Canal+ Group
to give notice of the transaction again within a month. Additionally, the
French Competition Authority ordered Canal+ Group, together with all
its subsidiaries, to pay a fine of €30 million.
On October 24, 2011, notice of the transaction was given once more to
the French Competition Authority which, on July 23, 2012, issued its
decision on the new notice. This decision makes the merger between
Canalsatellite and TPS subject to compliance with 33 injunctions,
which are imposed for five years and subject to one renewal. They
predominantly affect:
the acquisition of film rights from US studios and French producers;
the interest of Canal+ Group, through its subsidiary Multithématiques SAS,
in Orange Cinéma Séries; and
the availability and distribution of independent or internal premium
and special-interest channels, as well as non-linear services (VoD
and SVoD).
Canal+ Group and Vivendi filed two appeals before the French Council
of State to have the decision of the French Competition Authority of
September 20, 2011 and the 33 injunctions set aside.
Both appeals were dismissed by two decisions dated December 21, 2012.
The French Council of State decided, however, to reduce the amount
of the fine imposed by the French Competition Authority by €3 million.
The entry into force of the injunctions was accompanied by the creation
of a dedicated organization within Canal+ Group. An executive was
appointed to monitor the successful application of the injunctions
by Canal+ Group, and reports every three months to the Competition
Authority on this implementation.
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2.1.9.2. Acquisition of the Direct 8
and Direct Star Channels
On December 5, 2011, notice of the acquisition of the Direct 8 and Direct
Star channels by Canal+ Group was given to the French Competition
Authority and was approved by the Authority on July 23, 2012, subject
to compliance with several commitments by Canal+ Group over five
years, subject to one renewal after a new analysis of competition is
performed by that Authority.
These commitments involve:
a limit on acquisitions by Canal+ Group of combined free-to-air and
pay-TV rights to US films, US series and recent French films;
the separate negotiation of these rights;
a limit on acquisitions by Direct 8 and Direct Star of French film
releases from Studiocanal; and
the transfer of unscrambled broadcasting rights for major sporting
events.
TF1 and M6 filed an appeal before the Council of State on the
grounds that the French Competition Authority’s decision approving
the acquisition of these two channels exceeded its powers.
On December 23, 2013, the French Council of State annulled the
Competition Authority’s decision on the grounds that it had not
deliberated collectively on the version of the commitments contained
in its decision of July 23, 2012. Further, with regard to the internal
legality of that decision, the Council of State ruled that the Competition
Authority had committed an evaluation error in stating that Commitment
2.2 would prevent the anti-competitive effects of the deal, which are
linked to restricting the French film rights markets in the second and
third unscrambled windows.
On January 15, 2014, Vivendi and Canal+ Group once more provided
notice to the French Competition Authority on the acquisition
of the Direct 8 and Direct Star channels. On April 2, 2014,
the French Competition Authority re-authorized, subject to a number
of commitments, the acquisition by Canal+ Group of Direct 8,
Direct Star, Direct Productions, Direct Digital and Bolloré Intermédia.
Canal+ Group actively combats audiovisual piracy. It gives priority to
innovation and technological monitoring and to pursuing violators, to
protect its commercial interests and those of its licensees.
