The President of the Polish Office of Competition and Consumer Protection (“the OCCP”) has recently commenced antitrust proceedings against Cyfrowy Polsat – the largest provider of pay satellite television broadcasting services in Poland – to determine whether the company has abused its market position by selling its rights to the public screening of sport broadcasts.
According to the OCCP, Cyfrowy Polsat was the only company in Poland selling the rights to show all the matches during Euro 2008. Businesses such as cinemas, pubs or hotels were permitted to show the games on the condition that they bought the rights to public screening and a decoder from Cyfrowy Polsat. The OCCP believes that by imposing the obligation to buy a decoder, unnecessary additional obligations were imposed on those businesses by Cyfrowy Polsat. According to the OCCP this raises concerns in terms of competition rules, in particular the potential abuse of a dominant position.
Proceedings regarding Cyfrowy Polsat were launched on the basis of information on the company’s website and complaints submitted to the OCCP.
In the course of the antitrust proceedings, the OCCP will verify if Cyfrowy Polsat abused its dominant position by making the sale of rights to public screening of Euro 2008 coverage subject to purchasing a decoder and technical support.
According to the Polish Act on competition and consumer protection, if an abuse of dominance is found, the President of the OCCP may impose a maximum financial penalty of 10% of the involved enterprise’s revenue gained in the preceding year. Cyfrowy Polsat had 1,134 million PLN of revenues in 2008.
Cyfrowy Polsat claims that the proceedings are groundless. In particular it claims never to have made selling the rights to broadcasting Euro 2008 conditional on buying a decoder or technical support. According to Cyfrowy Polsat, they were acting merely as a representative of an entity entitled to publicly broadcast Euro 2008. Cyfrowy Polsat did not have a right or licence to sell rights to the public broadcasting of the Euro 2008, and thus was not entitled to do so. The company claimed that the number of the decoders sold within the special “Euro 2008 offer” constituted only 0,16 % of all gross sales in 2008 and the revenue obtained was insignificant.
Last year the OCCP conducted over 150 proceedings concerning abuse of dominance – 80 of them resulted in issuing antitrust decisions.