Canal Plus Fined $41 Million, TPS Merger Halted

7:40 AM PDT 9/21/2011 by Rebecca Leffler

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French antitrust authorities take back their approval, saying the pay TV giant failed to fulfill the 59 requirements it was expected to execute by 2012.

PARIS - France’s antitrust watchdog the Autorite de la Concurrence withdrew its approval of pay TV giant Canal Plus’ 2006 merger with then-rival group TPS on Wednesday and fined Canal Plus for not following through on its commitments.

The regulator has forced Canal Plus to pay €30 million ($41.1 million) for not respecting what they deem “essential” conditions of the deal, but urged Canal Plus to file a new application in one month for re-approval.

Canal Plus is accused of not following up on its promise to even out the pay TV playing field in the country by making TPS group’s channels available to Internet service providers as part of their package and not providing TPS with recently acquired U.S. sports and movie rights.

The merger was meant to bring Canal Plus and TPS together to offer a strong movie and sports package of channels, but the French Competition Authority claims Canal Plus failed to fulfill the 59 requirements the group was expected to execute by 2012. Canal Plus plans to appeal the decision that the group called “highly unusual and disproportionate given the alleged breaches identified” in a statement on Wednesday, adding: “It is naturally not conceivable to call into question a merger five years after it was completed.”

Canal Plus said it welcomes the opportunity to begin a new dialogue with the antitrust authorities and pointed out: “The conditions of competition prevailing in 2006 have completely changed and the Autorites de la Concurrence’s decision fails to account for the disruption caused to the TV market by the arrival of global Internet companies and Tecom operators.”

Canal Plus Group is owned by media powerhouse Vivendi.