MONTREAL — Canada’s leading film distributor has lost its license to operate in Quebec.
The Quebec government’s Regie du Cinema notified Alliance Releasing this week that it was revoking its permit to distribute pics in the Canadian province because the company no longer conforms to Quebec’s stringent cinema laws.
As a result of the decision, Alliance was forced to reach an agreement with Cineplex Odeon Films to have Cineplex sub-distribute Alliance’s films in Quebec. The surprise move by the Regie du Cinema comes at an inopportune moment for Alliance Releasing, which is in the midst of a busy holiday season of high-profile releases — “Scream 2” launched last Friday, and “Jackie Brown,” “Deconstructing Harry” and “Good Will Hunting” are due on Quebec screens Dec. 25.
Under Quebec’s cinema law, only companies based in the province are allowed to distribute films in Quebec, with the exception of the Hollywood studios, which were granted an exemption to the Quebec-only rule. The Regie became concerned with Alliance’s status when the provincial agency learned that Alliance Communications vice chairman Victor Loewy had moved from Montreal to Toronto last year.
Alliance had been operating in Quebec under the auspices of a company, Vivafilm, owned by Loewy. The convoluted legal plot thickens at this point, with Alliance’s lawyers responding to the Regie by arguing that the films were being distributed in Quebec via a number company, 2855461 Canada Inc. and not through Vivafilm. Further, Loewy, when he moved to Alliance’s head office in Toronto, had transferred control of the numbered company to fellow Alliance executive Patrice Theroux, who is still based in Alliance’s Montreal office. According to the Regie files, this numbered company does not have a permit to distribute films in Quebec.
In the face of the legal challenge from the Regie, the numbered company applied in early December to become a licensed Quebec distributor, run by Theroux. But the Regie turned down the application this week, stating that the company did not seem to have any independence from Alliance and that the numbered company seemed to be an attempt by Alliance to distribute its own films in Quebec, which is in violation of the law.
“The law says they have to have their principal establishment in Quebec,” said Regie du Cinema legal counsel France Dionne. “As long as the decision-making is made by someone in Toronto, it will not work.”
Theroux, executive vice president of the Alliance Motion Picture Group, said he was upset by the Regie’s decision, but he expressed optimism that an agreement could be reached fairly swiftly.
“This is a technical issue and we’re in the midst of sorting it out,” said Theroux. As a Quebec resident, he believes he is able to run his own distribution company under the government regulations and that he would then be able to sub-distribute films for Alliance in the province.