June 11, 2013 6:38 pm

US warns EU against exempting film industry from trade talks

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Jean Dujardin portrays George Valentin, left, and Berenice Bejo portrays Peppy Miller in a scene from "The Artist."©AP

A scene from the Oscar-winning French film 'The Artist'

The US government has warned Brussels that EU efforts to placate French demands to exempt its film industry from high-profile transatlantic trade talks could unleash a torrent of demands in Washington for similar reciprocal carve-outs that would imperil a comprehensive deal.

William Kennard, the US ambassador to the EU, said that while he did not want to “suggest line edits” to the mandate being prepared for EU negotiators, language that prevents Brussels from discussing cultural or audio-visual issues would violate the spirit of a bilateral agreement to leave all issues on the table.

“If a mandate is released that constrains the negotiators – whatever you want to call it, a carve-out, a red line, an exception – if it’s not a clean mandate, it will increase the pressure on our side to do the same,” Mr Kennard said in an interview. “That’s only natural. There’s a quid pro quo here, and there will be a price to pay.”

The US concerns come as EU negotiators are in the middle of a last-ditch effort to win French support to greenlight the trade talks at a meeting of trade ministers on Friday. Without such approval, a formal launch of the negotiations at next week’s Group of Eight summit in Northern Ireland is impossible.

A copy of a compromise circulated to European capitals last week and obtained by the Financial Times would put strict limits on EU negotiators, forbidding them from discussing European laws that promote and subsidise their homegrown film and music industries. It would also limit their ability to negotiate on future rules for internet distribution.

By including such limits in the European Commission’s negotiating mandate, EU diplomats insist that they are not violating their promise to Washington to avoid excluding any trade issue, since audio-visual industries can still be discussed within limits.

But Mr Kennard said, “I don’t get that logic at all,” arguing: “Either you come to the negotiating table without preconditions and exceptions and carve-outs or you don’t.” Paris has also rejected the compromise language, insisting that the commission invoke a “cultural exception” and remove the issues entirely from negotiations.

José Manuel Barroso, the European Commission president, met European filmmakers on Tuesday, including “The Artist” star Bérénice Bejo, to reassure them the trade deal will not jeopardise their protections. “Let me state loud and clear: the cultural exception is not negotiable,” Mr Barroso said after the meeting.

Although Mr Kennard would not say what pressures are building for carve-outs on the US side, people in Washington briefed on the trade talks said government procurement – where European companies are trying to level the playing field at both the federal and state level with their US counterparts – could be particularly vulnerable.

“If they take issues off the table, it will increase the pressure on our side to start carving out issues,” Mr Kennard said. “I’m not sitting here telling you we don’t have our own sensitivities. We do. It’s just that we’re not putting constraints on our negotiators on those issues.”

Although Mr Kennard said the White House is agnostic on launching the talks at Monday’s G8 meeting, something British Prime Minister David Cameron had been hoping for, further delays would make an agreement more difficult, since both sides had committed to starting in mid-June.

“The clock is ticking,” Mr Kennard said. “We have a [European] Commission whose mandate will expire at the end of next year... It’s not like delaying this is going to make the issues any easier.”

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