NBCUniversal fined for restricting sales of film merchandise
This article is part of the January/February 2020 edition of our competition law newsletter, focusing on some recent key developments.
On 30 January 2020 the European Commission ("Commission") fined NBCUniversal EUR 14,327,000 for restricting intellectual property licensees from selling licensed merchandise within the EEA to territories and customers beyond those allocated to them.
what you need to know - key takeaways |
---|
|
NBCUniversal, which operates film and TV production companies worldwide, licenses the intellectual property rights to the characters in its movies (including Jurassic Park, the Minions, Trolls, and Shrek), for use in film merchandise such as toys, mugs, and clothes.
In June 2017 the Commission initiated an investigation into NBCUniversal's licensing and distribution practices, and on 30 January 2020 it found that certain restrictions imposed by NBCUniversal on licensees constituted an infringement of EU competition law. In particular, NBCUniversal implemented a number of direct measures which restricted out-of-territory sales by licensees, sales beyond allocated customers or customer groups, and online sales. NBCUniversal also required licensees to pass these restrictions onto their customers and implemented a series of measures to indirectly encourage compliance with these restrictions.
The Commission considered that these measures, which were in force for over six and a half years, partitioned the Single Market and prevented licensees in Europe from selling products cross-border and across customer groups, to the detriment of European consumers. As put in a statement by Executive Vice-President Vestager, a "department store in Spain couldn't sell "E.T." pyjamas from a Belgian manufacturer – because that manufacturer was banned from selling into Spain. The extra-terrestrial may have made it all the way to Earth – but he was stopped in Spain because of a contractual restriction." However, NBCUniversal received a reduction in fine of 30% for cooperating with the Commission's investigation.
This investigation followed on from the Commission's sector inquiry into e-commerce markets (which completed in May 2017 and concluded that territorial restrictions were becoming increasingly common). It is the third such Commission decision in less than a year, after fines imposed in 2019 on Nike (EUR 12.5 million) and Sanrio (EUR 6.2 million) for similar cross-border restrictions on the sale of licensed merchandise.
With thanks to Danica Barley of Ashurst for her contribution.
Contents
- Europe fit for the digital age - a preview of how the EU might regulate AI and Big Data
- NBCUniversal fined for restricting sales of film merchandise
- ECJ provides further guidance on pay-for-delay cases
- End of the line for Ceské dráhy
- Belgium adopts new rules on simplified merger control procedures
- No second life for Continental Can before the French Competition Authority
- Paris Court of Appeal confirms CANNA France imposed prices on wholesalers
- 10th amendment to Germany's Competition Act
- ICA fines ENI for "greenwashing" Diesel+ fuel in ad campaign
- Council of State upholds annulment of reinforcing steel bars and electro-welded wire mesh fines
- Spanish authority accepts Adidas online sales restriction commitments
- Guitar maker fined for illegally preventing price discounts online
- First UK fine for failure to respond to market study information request
- Court of Appeal confirms Ping's online sales ban infringement
- When three is better than four: Federal Court approves TPG / Vodafone merger
- Federal Court of Australia rejects the ACCC's 'dieselgate' settlement and imposes a record $125 million fine on Volkswagen for breaches of the ACL
- The transition period and a potential future deal: Brexit's practical impact on competition law
Key Contacts
We bring together lawyers of the highest calibre with the technical knowledge, industry experience and regional know-how to provide the incisive advice our clients need.
Keep up to date
Sign up to receive the latest legal developments, insights and news from Ashurst. By signing up, you agree to receive commercial messages from us. You may unsubscribe at any time.
Sign upThe information provided is not intended to be a comprehensive review of all developments in the law and practice, or to cover all aspects of those referred to.
Readers should take legal advice before applying it to specific issues or transactions.