VietNamNet Bridge - Eight domestic film producers and distributors have sent a complaint to the Vietnam Cinema Association, saying that they were being hampered by the CGV theater system, which belongs to the CGV film distributor of South Korea, because of the profit sharing ratio and form of film distribution, reported VNExpress online newswire.

The eight complainers include BHD, Galaxy, Skyline, Golden Media, Saigon Media, MVP, Early Risers and VAA.

According to the eight local film producers and distributors, CGV has imposed unreasonable profit sharing ratio at its cinema system (CGV currently accounts for 40% of the total cinemas in the country).

For the Vietnamese movies distributed by CGV at other cinema systems, the profit sharing ratio is 55/45 (CGV earns 55%)  

Meanwhile, for the Vietnamese movies distributed by local firms at CGV cinema system, the ratio is 45/55 (with 45% for the distributor and 55% for CGV in the first week; the rate reduces by week).

They said that CGV set different commercial conditions in different transactions, which violates the competition law of Vietnam.

Domestic film distributors said they had to accept CGV’s conditions since CGV owns a large number of cinemas in Vietnam.

They said this situation only occurred in Vietnam, where film distributors and producers receive less profit than cinema owners.

The local film producers and distributors also argued that CGV tended to screen more foreign films, especially films produced by their own country, for longer periods during the peak hours in comparison with Vietnamese films.

Because of this, Vietnamese films must be screened at theaters that don’t have many viewers and not during the peak hours.

They asked the state agencies to prevent such activities to ensure healthy competition.

This is not the first time CGV has been the subject of complaints by local film producers and distributors.

In 2010, when CGV was still known as Megastar, it was investigated after local firms lodged complaints to the Competition Management Agency of the Ministry of Industry and Trade.

Finally, local firms withdrew the complaint and CGV had to pay VND100 million of fees, voluntarily fixed the problems and dealt with the consequences.

Ms. Luu Hanh, media representative of CGV Vietnam, said that CGV has been always complied with the regulations on the distribution and screening of films under the laws of Vietnam. CGV and partners discussed and reached agreements on the profit sharing ratio based on the quality of films, the number of theaters and the number of projection rooms of each distributor.

She said CGV did not differentiate between film distributors. The cinema system with higher number of cinemas and projection rooms, and higher fares will bring about higher profit for film producers although the profit sharing ratio is 5-10% less than the normal rate.

CGV also always provides free marketing activities for the movies released at its cinemas, she added.

The CGV representative said that the film distribution contracts between CGV and its partners all have the clause on information security. The unilateral disclosure of information in contracts without CGV’s prior consent is a violation of contractual commitments.

In addition, it is unfounded and inconsistent with the provisions as some companies that have never signed a film distribution contract or partnership agreement with CGV made complaints against the company.

The representative of the Vietnam Cinema Association said the agency was considering the complaint.

Besides the Vietnam Cinema Association, the complaint was also sent to the Central Committee for Ideology and Culture, the Ministry of Culture, Sports & Tourism (Cinema Department, International Cooperation Department), the Ministry of Industry and Trade (Competition Management Department), the Vietnam Cinema and Film Distribution Association, the National Assembly Commission for Culture and Education for Youth and Children, and the Department of Culture-Information of Hanoi and Ho Chi Minh City.

VNE