The European Commission has made commitments offered by Disney, NBCUniversal, Sony Pictures, Warner Bros. and Sky legally binding under EU antitrust rules.
These commitments address the Commission's concerns regarding certain clauses in these studios' film licensing contracts for pay-TV with Sky UK.
These clauses prevented Sky UK from allowing EU consumers outside the UK and Ireland to subscribe to Sky UK's pay TV services to access films via satellite or online. They also required NBCUniversal, Sony Pictures and Warner Bros. to ensure that broadcasters other than Sky UK are prevented from making their pay-TV services available in the UK and Ireland.
Disney, NBCUniversal, Sony Pictures and Warner Bros. have now committed not to apply these clauses in existing film licensing contracts for pay-TV with any broadcaster in the European Economic Area (EEA). They have also committed to refrain from (re)introducing such clauses in film licensing contracts for pay-TV with any broadcaster in the EEA.
Similarly, Sky will neither apply existing clauses nor (re)introduce new ones in its film licensing contracts for pay-TV with Disney, Fox, NBCUniversal, Paramount Pictures, Sony Pictures and Warner Bros.
In April 2016, Paramount offered commitments to address the European's Commission's competition concerns. The commitments were accepted and made legally binding in July 2016.
In December 2018, the General Court of the European Union fully upheld the Commission's decision to accept commitments from Paramount. In particular, the General Court confirmed the Commission's preliminary concerns that the Broadcaster and Studio Obligations contained in Paramount's film licensing contract with Sky infringed Article 101 TFEU by eliminating cross-border competition between pay-TV broadcasters.
Article 9 of the EU's Antitrust Regulation allows the European Commission to conclude antitrust proceedings by accepting commitments offered by a company. Such a decision does not reach a conclusion on whether EU antitrust rules have been infringed but legally binds the company to respect the commitments.
If a company breaks such commitments, the Commission can impose a fine of up to 10% of the company's worldwide turnover, without having to find an infringement of the EU antitrust rules.