Montreal: Distributors and exhibitors are deeply upset with the scope of an Industry Canada Competition Bureau investigation into allegations of collusion and unfair business practices under the Competition Act against Cineplex Odeon and Famous Players, Canada’s two major movie exhibitors.

The Competition Bureau, through the Federal Court, is ordering distribution companies in Canada, Canadian and foreign, and exhibitors to divulge any relevant information on their business relationships, including correspondence and e-mails, contracts and understandings, and minutes and results of meetings covering the last five years.

The inquiry is expected to cost Canadian distributors hundreds of thousands of dollars as well as seek confidential information on agreements between distributors and rights owners and exhibitors, says Richard Paradis, president of the Canadian Association of Film Distributors and Exporters.

While the Competition Bureau technically represents government in the interests of the general public and consumers, it is known the suburban Montreal-based theatre chain Cinemas Guzzo (10 locations and 108 screens) filed a formal complaint with the bureau on June 26, 1998, alleging collusion and unfair business practices on the part of Cineplex Odeon and Famous Players.

Some observers feel the Competition Bureau inquiry, with the weight of the court behind it, has all the makings of an inquisition.

As a result of the court’s involvement, cafde’s Paradis says distribs have the choice of ‘either complying, or responding to the request. And we can expect probably a mixture of both.’

Paradis says it took the feds two years – ‘that’s normal’ – to turn the issue around. ‘The thing we’re finding a little strange is during the last two years the situation has more or less improved.’

While the major exhibitors admit they have developed exclusive business arrangements with distributors over many years, they deny this entails unfair business practices. The exhibitors, and many distribs, claim there’s a wealth of available movie product broadly distributed to all exhibitors. *