Lithuanian cinemas did operate as cartel, court says

Last December, the Competition Council (CC) ruled that Forum Cinemas had encouraged its competitors – JSC Multikino Lithuania and UAB Cinamon Operations to not discount ticket prices. Forum Cinemas, the Finnish company at the centre of the probe operates the biggest chain of cinemas in Lithuania.

Investigators found that a restrictive agreement between UAB Forum Cinemas and UAB Lithuania Multikino in Vilnius lasted for almost two years, and the agreement between UAB Forum Cinemas UAB Cinamon Operations – over three years.

The Competition Council said that if it had not participated in the cartel for a movie ticket prices, they would have been able to offer consumers cheaper tickets to the movies.

The Lithuanian Competition Council announced in December that the company had an agreement with two other theatre chains, Multikino Lietuva and Cinamon Operations, to coordinate ticket prices.

“The investigation has revealed that the companies, which operate cinema theatres in Vilnius and Kaunas, picked up on the initiative of Forum Cinemas and refused to give special offers for families, weekend screenings and did not offer discounts on popular titles. Forum Cinemas clearly encouraged its competitors to stick to ‘established’ practices not to offer discounts on film tickets in the beginning of the run,” Jolanta Ivanauskienė, a member of the Competition Council, said at the time

The other two companies named in the decision, Multikino Lietuva and Cinamon Operations, admitted their involvement in the cartel agreement in exchange for having their fines, €99,200 and €136,800 respectively, waived. Forum Cinemas has been fined €1.384 million.

According to the Competition Council, the cartel agreement between Forum Cinemas and Multikino Lietuva in Vilnius lasted for almost two years, while the one between Forum Cinemas and Cinamon Operations, lasted for three years.

After examining the complaint, the Vilnius court said that the Competition Council’s ruling was legitimate and justified and fined in proportion to the seriousness of the infringement.

The court’s ruling can now be appealed within 14 days to the Supreme Administrative Court of Lithuania.

Forum Cinemas said in a statement that following the ruling it hoped “that the Lithuanian Supreme Court will ultimately come to a legitimate and fair decision. Our assessment is that the only evidence in the case – email correspondence – clearly showed the Forum Cinemas did not want to influence movie ticket prices but wanted to protect its legitimate interest, that is to receive the agreed remuneration for the distribution of movies”. It said that Forum Cinema’s acted as a distributor of films and that the court failed to take into account the fact that the evidence that many cinema ticket prices were discounted during the period by the cinema chains.