Film Distribution Under Probe in Britain : Box office: Independents say studio-linked theaters have unfair advantage. Antitrust action is considered.

LONDON —  While American movies are more popular than ever here, Geoff Henshaw, who runs the independent Cine City theater in Manchester, couldn’t get Tristar’s U.K. distribution arm to give him a copy of “Sleepless in Seattle” until five weeks after it was released in Britain.

Henshaw and other independent theater owners in Britain say they are being denied fair access to such blockbuster films, in part because the major Hollywood studios control more than half this nation’s $400-million exhibition business.

In response to the complaints, Britain’s Monopolies and Mergers Commission is looking into Hollywood’s cross-ownerships with several large theater chains. The head of the Office of Fair Trading, which referred the case to the commission, said competition appears to be restricted enough to warrant investigation.

That’s good news for the British Film Institute, which promotes the indigenous movie industry and hopes that one result of the probe will be an increase in the number of British and European films reaching audiences here.

That is not the intent of the independent theater owners, however. They want more access to big American films, which account for more than 90% of all box office revenue in Britain.

“I never get offered American films--unless it’s either a dog or they’re confused about what to do with it,” said Tony Kirkhope, managing director of the independent Metro Cinema in the West End, London’s entertainment district.

Spokesmen for the Hollywood studios have denied any wrongdoing, but Kirkhope said the major distributors have made it clear that “they don’t want us to compete with their West End cinemas.”

Most prominent among the Hollywood studios that have substantial links to both distribution and exhibition in Britain are Paramount, Universal and MGM. In various configurations, the three account for nearly a third of the distribution business in Britain, and their theaters account for more than half of all tickets sold.

The three studios together run United International Pictures, which distributes their films overseas. The European Commission is investigating UIP to determine whether it should be dismantled on antitrust grounds.

On the exhibition side, MGM-Cannon, owned by the French bank Credit Lyonnais, runs the largest theater chain in the country with nearly a quarter of the 1,750 screens. According to 1991 figures, the latest available, it accounts for 30% of all admissions. Paramount and Universal jointly own the third-largest chain, UCI, which has more than 12% of the screens and sold 18% of all tickets in 1991.

Industry analysts believe UCI’s share of admissions grew substantially in 1993, however, perhaps to 23%, because it screened “Jurassic Park” at all its theaters.

Britain’s Rank Organization accounts for just 6% of the film distribution business, but it sells about 22% of all theater tickets through its Odeon theater chain.

In announcing the industry investigation, the chief of the Office of Fair Trading, Bryan Carsberg, said: “Most major companies are vertically integrated into the production, distribution and exhibition of films in cinemas, and follow practices which could lead to the exclusion of independent producers, distributors and exhibitors from the marketplace. . . . Competition remains restricted to such an extent that it is appropriate . . . to undertake a fresh investigation of the market and decide whether any aspect of the industry (operates) against the public interest.”

Chris Hedges, managing director of United International Pictures in Britain, said he is confident that the Monopolies and Mergers Commission will find that competition in the film business is not restricted and that audiences now have more choices than in the past.

“In our view,” he said, “there is a vastly more competitive system today.”

James Higgins, president of the Society of Film Distributors, noted that more than $750 million has been invested in building and upgrading movie theaters here in the last 10 years and that prints of films are being distributed in ever larger numbers.

Higgins declined to discuss whether independent theaters have benefited from the increased number of films available. The issue, he said, is whether audiences have a wide range of choices, and they do, he said.