A voluntary code to provide mediation between parties in the cinema industry, the Code of Conduct for Film Distribution and Exhibition, was officially launched today by Australian Competition and Consumer Commission Chairman, Professor Allan Fels, in Sydney today.
'This particular code is a win/win situation for all concerned,' he told an industry gathering.
'For some years now, the Commission has received a constant stream of complaints from small film exhibitors about the supply and conditions of films, particularly first release films which are the life-blood of film exhibitors. The small exhibitors argued that refusal to supply or onerous conditions of supply was an abuse of market power by the large distributors. However, to prove a breach of this particular section of the Trade Practices Act, the exhibitor or the Commission had to prove that the distributor had the purpose or intention of damaging or destroying particular competitors. Finding a 'smoking gun' was always a hard call and, besides, there often appeared to be a valid commercial reason for not supplying or supplying under particular conditions.'
Professor Fels said the new Code followed an extensive study of the industry by an ACCC commissioned consultant who recommended the development of a Code of Conduct.
'The [new] Code contains principles covering the supply of prints, trading terms, supply of trailers and advertising materials, supply of information, review of sessions policy, and exhibitors' and distributors' obligations.
'If a dispute arises in applying these principles, then there is a quick, accessible and relatively inexpensive means of settling disputes. The lynch-pin of this dispute resolution process is access to an independent conciliator.
'The code will be administered by a Code Administration Committee made up of representatives from all parts of the industry.
'I believe that this Code sets the scene for greater transparency in the industry and more objective benchmarks for access to films and the terms and conditions such access will be granted on.
'This will provide a greater degree of certainty for all parties. It should also help to alleviate some degree of mistrust which has developed between major distributors and some small exhibitors.
'This Code is one of a series of Codes that have been developed in Australia in recent years to help address the imbalance of bargaining power that small business suffers in its commercial relationship. This includes a Code covering the relationship of oil companies on the one hand, lessee/retailers and distributors on the other hand (ie. Oil Code), and the Franchising Code of Conduct. In addressing information on market failure and providing a more accessible and inexpensive means of dispute resolution, such Codes also serve as a mechanism for compliance with the new unconscionable conduct provisions of the Act.
'In short, it should provide a better commercial setting for the small business, non major exhibitors.'
