Ster-Kinekor, Nu Metro off the hook for collusion - Tribunal

Large machinery on either side of the auditorium is used in the 4DX cinema to provide wind, sound and other effects.
Large machinery on either side of the auditorium is used in the 4DX cinema to provide wind, sound and other effects.
Supplied

Cape Town – The Competition Tribunal has dismissed a complaint of collusion by Nu Metro and Ster-Kinekor.

The complaint was lodged by the Competition Commission as far back as May 2009. The commission submitted that Nu Metro and Ster-Kinekor engaged in market allocation relating to lease agreements at the V&A Waterfront shopping mall in Cape Town, Fin24 reported previously.

The tribunal on Friday said that it dismissed the complaint as it found the settlement agreement, which was later changed to an order of the court in May 1998, was concluded before the Competition Act came into effect.  

Initially Nu Metro had entered into an agreement with its then landlord Transnet Pension Fund, whereby Nu Metro had an oral right of first refusal in relation to any film screened at the Waterfront, the tribunal explained. When Nu Metro discovered that there were negotiations with Ster-Kinekor, which was also going to operate at the Waterfront, Nu Metro filed an interdict. 

“Nu Metro and Ster-Kinekor later entered into a settlement agreement that was subsequently made an order of the court, in which Nu Metro would withdraw its objection to Ster-Kinekor’s lease agreement and that Nu Metro would only show commercial films while Ster-Kinekor could only show subtitled or art movies,” the tribunal said. 

The commission’s complaint related to there being a continuous implementation of the settlement agreement even after the Competition Act came into force.

However, based on evidence presented by employees of Ster-Kinekor Distribution, the movie house had never implemented the settlement agreement, which they were alerted to in December 2008 by Nu Metro, the tribunal said.

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