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Informist, Friday, Sept. 11, 2026

 

NEW DELHI – The Competition Commission of India has invited public comments on PVR INOX Ltd.'s commitment application in a case in which the antitrust regulator had ordered its director general probe on the company's anti-competitive conduct in charging virtual print fees from Indian film producers. A virtual print fee is a charge paid by film producers or distributors to multiplexes to offset the costs of digital cinema technology, which replaces the expensive physical process of producing and shipping film prints. 

 

In its commitment application, PVR INOX said it would cease charging virtual print fees or any upfront payment from all film producers, irrespective of the language of the film. This would be effective from the expiry of 120 days from the date on which Competition Commission of India accepts the proposed commitments, said the company.

 

PVR INOX has committed to introduce a uniform choice-based framework for all producers. Under the framework, prior to the release of any film, producers will be able to choose between two options – they may pay a nominal weekly per-show fee towards exhibition service charges, deducted from the distributor or producer's share of the net box office collection at the end of every week. The per-show fee towards exhibition service charges will be INR 450 for standard format screens or INR 600 for premium format screens, which further drops to INR 250 and INR 350, respectively, after a total of 60 shows per theatre, it said. This model ensures that there is a standard set of rates equally applicable for all producers, and all producers are eligible to avail of a volume-based discount, which facilitates and promotes wider screening opportunities for all producers, it said.

 

The other option is producers can instead opt for a revised revenue share arrangement with PVR INOX, under which the distributor or producer's share of net box office collection is reduced by no more than 7.5% from the existing rate, the company said. PVR INOX believes that a uniform percentage reduction across all distributors or producers would be the most objective, uniform and transparent methodology, and it would, therefore, endeavour to apply the same percentage reduction to all distributors or producers, it said.

 

PVR INOX said that none of its options include any upfront payment at all and, therefore, the company is entirely doing away with the requirement of any upfront payment by film producers, fully eliminating the cash-flow burden associated with pre-release payment obligations. Instead, producers will now have the flexibility and freedom to opt either for a fixed and uniform exhibition service charges or, alternatively, a minor revenue-share reduction, based on whichever option best fits the relevant producer's commercial needs, it said. This will be equally available to all producers for all films, it said.

 

PVR INOX is willing to offer the commitment proposal in perpetuity. However, in order to ensure that the exhibition service charges or revenue share agreement remains cost-reflective and sustainable over time, the company reserves the right to reexamine the exact quantum after every three years, given that costs and revenue structure change over time, it said.  Any such re-examination will be undertaken in good faith, based on objective, data-backed assessment of actual cost movements including equipment and maintenance, and will be carried out transparently in consultation with producers, with a view to maintaining fairness and non-discrimination, the company said. 

 

A commitment application is a formal request by a company under antitrust investigation to propose voluntary corrective measures and resolve competition concerns early without a prolonged inquiry or admission of guilt. It allows businesses to fix anti-competitive issues such as vertical agreements or abuse of dominance quickly and save legal resources. 

 

The case has its genesis in the commission hearing the Film and Television Producers' Guild of India Ltd.'s complaint alleging violation of the competition law by PVR INOX for continuing to charge virtual print fees from Indian producers even after this had been discontinued for Hollywood producers in India for English films. PVR INOX has discriminated against Indian producers by agreeing to sign sunset clauses with only Yash Raj Films Pvt. Ltd. and Viacom18 Media Pvt. Ltd. while refusing to enter such clauses with other producers, the guild said. These sunset clauses were signed to put an end to virtual print fees. The commission had ordered a probe into all these allegations.

 

The antitrust watchdog noted that PVR INOX charged a virtual print fee for 30% of all films released by Hollywood producers and the remaining 70% Hollywood producers were not charged. "Accordingly, the Commission is of the view that the alleged discriminatory conduct of OP-3 (PVR INOX) is prima facie in violation of the provisions of Section 4(2)(a) of the (Competition) Act and needs to be investigated by the director general," said the watchdog.

 

Further, the Film and Television Producers' Guild has alleged anti-competitive conduct by PVR INOX by limiting and restricting the ability of small and medium size producers in producing and exhibiting films as widely as possible due to the continued charging of virtual print fees. The director general has been directed to investigate, based on more detailed and granular information with respect to exhibition of films in multiplex cinema halls of PVR INOX, the regulator said.

 

At 1409 IST, shares of PVR INOX Ltd. were up 1.5% at INR 1,239.00 on the National Stock Exchange.  End

 

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Reported by Surya Tripathi

Edited by Avishek Dutta

 

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