PVR Inox Proposes Complete VPF Scraping Before CCI Following Industry Disputes

PVR Inox Limited has formally proposed to completely discontinue the Virtual Print Fee charged to film producers, a move that could permanently reshape the economic landscape of Indian film exhibition. The sweeping proposal has been submitted before the Competition Commission of India, which has invited public and industry comments and objections until October 1, 2026, following a prolonged antitrust inquiry into the multiplex operator.

The regulatory proceeding stems from Case No. 42 of 2023, initiated by The Film and Television Producers Guild of India Limited against PVR Inox. In September 2025, the competition watchdog directed a formal investigation into alleged contraventions of Section 4 of the Competition Act. PVR Inox subsequently filed a commitment application under Section 48B of the Act to settle the dispute regarding the continued levy of technology upgrade charges on film producers.

Under the terms submitted to the regulator, PVR Inox has proposed that VPF and any associated upfront payments from film producers, regardless of the language of the film, will cease entirely within 120 days from the date the regulatory body accepts the commitments. To replace the fee, the multiplex operator has formulated a two-option alternative framework designed to eliminate upfront financial burdens for distributors and production houses.

Producers would be offered a choice between a weekly per-show Exhibition Service Charge of Rs. 450 for standard screens and Rs. 600 for premium formats, which would decrease to Rs. 250 and Rs. 350 respectively after a film completes 60 shows. Alternatively, producers can opt for a Revised Revenue Share, reducing their existing share of net box-office collections by not more than 7.5% of the existing rate. The proposed framework specifies that neither option will involve upfront payments and that the structure will remain in place permanently, subject to reviews every three years based on objective cost data and consultation with producers.

The antitrust inquiry was triggered after the watchdog raised preliminary concerns regarding the continued levy of VPF, noting that certain Hollywood and Hindi film producers were exempted while others were required to pay. Regulators also highlighted that upfront payments created severe liquidity hurdles for small and medium-sized producers seeking theatrical distribution, and that the fee structure lacked a direct link to any specific service provided by the exhibition chain.

The longstanding friction erupted into open conflict in 2025, when PVR Inox suspended theatrical bookings for Jolly LLB 3 twice after Viacom18 refused to pay VPF, halting screenings on the eve of release and forcing producers to pay the levy under protest. A similar confrontation occurred during the release of Single Salma, though PVR Inox ultimately agreed to waive VPF for the Huma Qureshi-starrer as the regulatory investigation intensified.

The debate over VPF dates back to 2019, when producer Ronnie Screwvala filed a case against major multiplex operators including PVR, Inox, Cinepolis, and Carnival Cinemas. While the competition authority initially ruled in favor of the multiplex chains, subsequent investigations uncovered intricate arrangements between exhibitors and major studios.

Earlier regulatory orders revealed that PVR Inox had entered into private agreements with Yash Raj Films and Viacom featuring sunset clauses designed to phase out VPF payments by December 2024. However, those agreements were conditioned on the studios stopping VPF payments to all other exhibitors and digital cinema equipment providers, meaning anticipated 2025 releases such as Saiyaara and War 2 could have potentially secured VPF-free theatrical runs had the terms been fully implemented.

The exhibition sector also faced pressure from regional blockbusters that exploited shifting market dynamics. During the theatrical run of the Gujarati devotional drama Laalo - Krishna Sada Sahaayate, distributor Rupam Entertainment leveraged massive public demand to secure a VPF waiver from multiplexes desperate to screen the high-performing film.

Trade sources later indicated that the VPF for Laalo - Krishna Sada Sahaayate was eventually settled and adjusted directly from the substantial box-office revenues generated by the film. These recurring flashpoints demonstrated how powerful regional titles and high-stakes distributor pushback could bypass standard multiplex billing practices ahead of the formal regulatory settlement.

The Competition Commission of India has established a formal timeline for stakeholder feedback, inviting comments, objections, and suggestions on PVR Inox's proposed commitments until October 1, 2026. Following the conclusion of the public consultation window, the regulatory body will review the submissions before deciding whether to accept the commitments under Section 48B of the Competition Act.

If accepted, PVR Inox will be legally bound to implement the complete phase-out of upfront VPF within 120 days, transitioning all participating film productions to either the revised exhibition service charges or the adjusted revenue sharing model. The outcome of the ongoing proceeding is expected to set a definitive precedent for digital projection cost-sharing across the Indian cinematic distribution ecosystem.