The digitization that leads to new distribution channels, business models and marketing strategies with own rules and restrictions is only one part of all the changes and challenges the European film industry is confronted with. While the green paper was promoting multi-territorial licensing and intended to leave no place for national theatrical distributors, the European Commission suggested for the new Cinema Communication to repeal the release windows that are contractual in the funding guidelines. Another key issue that raised a lot of protest in the European industry was the subject of territorialization. The European film funding organizations didn‘t want to give up the established territorial conditions in their film support systems in favor of a single common market in Europe.

These concerns seem to be reflected in the recent draft of the Cinema Communication which was published by the European Commission at the end of April. For certain issues there is still a need for clarification but there is hope that there is a resolution coming up that will be satisfying for the distributors, producers, exhibitors, filmmakers and funding organizations in Europe. For all of them it is obvious that the Cinema Communication is essential to provide legal certainty.

But all these efforts won‘t be effective if the European Commission doesn‘t protect culture anymore. The price for that is high because not less than the European film is at stake.

President Obama suggests to negotiate a free-trade agreement between the United States and the European Union. The aim of this Transatlantic initiative is not only to raise economic growth, but also lower prices for European and American consumers since China’s rapidly growing economy becomes a serious competitor.

The Transatlantic Trade and Investment Partnership (TTIP) has been well received by the European Union that proposed a negotiation mandate that doesn‘t stipulate a „cultural exception“ for audiovisual and film services – as the EU has always enforced in the free trade rules of the world trade organization in the past.

„The cultural exception is non-negotiable!“, declare European filmmakers such as Luc & Jean-Pierre Dardenne, Ken Loach, Pedro Almodovar, Michael Haneke, Cristian Mungiu, Aki Kaurismäki, Jean-Jacques Beneix, Thomas Vinterberg, Isabel Coixet, Bertrand Tavernier or Stephen Frears in an online petition that is adressed to the European Commission. This protest initiative has been started by the French authors, directors and producers guild ARP and already collected 4,500 signatures. „The European Commission, under the leadership of Commissionner Karel de Gucht, decided to trample on the cultural exception“, criticize the filmmakers.

It will have farreaching consequences if cultural and audiovisual services are included in a global agreement on commerce and investment between the EU and the US. „As producers we endorse a fair competition“, underlines Alexander Thies, president of the German Producers Alliance – Film & Television  „But cultural diversity as well as the creation and reflection of a European cultural identity is not possible without a ‚cultural exception‘ in the TTIP agreement.“ The fact that the European film industry needs support – in contrary to the one in the U.S. – is not distorting competition but makes it only possible.

„Without support, without ‚cultural exception‘ the European film would not exist anymore“, emphasizes the producer. There would be no Academy award winners such as ‚Amour‘ or European blockbusters like ‚Untouchable‘.“

If the „cultural exception“ is gone, then all measures which support European film on the European level and in the Member states have to be scrapped because the liberalisation of the trade with goods and services means that all market participants have to be treated in the same way. Any kind of quotas are not allowed, all the subsidies have to be available for both parties – or none of them. „This works out for selling cars or financial services but not in the field of culture“, concludes Thies.

As already in 1993 during the GATS agreement battle the resistance started in France. Back then Bertrand Tavernier harshly criticized the MPAA president Jack Valenti in his speech at the European Parliament and blamed Hollywood to colonialize all wishes and thoughts – with the one and only message that consumers should buy American movies. Jacques Toubon, the French Minister of Culture, declared he would never give up on this.

20 years later, his successor Aurélie Filippetti stands up for the „cultural exception”. “It is on this basis that an audiovisual and cinematographic industry has developed in Europe“, says the Minister of Culture. „It lies at the heart of its cultural identity and is a major asset for growth and employment”. The French president François Hollande supports her position and argues in Brussels that the audiovisual sector should “stay out of the mandate of negotiations for a free trade treaty between the European Union and the United States”.

The EU’s Education and Culture Commissioner Androulla Vassiliou is convinced that there will be no change to the current system of ‘the cultural exception’. „The Commission – like Members States including France – recognises the importance of our cultural diversity.” She pointed out that the EU had obligations, as enshrined in Article 167 of the Lisbon Treaty, to protect cultural diversity. „Trade liberalization will not weaken those policies and measures at EU level, or in the Member States”, assures the Commissioner.

A future trade and investment agreement between the EU and US would be a ‘game-changer’, giving a strong boost to our economies on both sides of the Atlantic, outlines Vassiliou. This might lead to an estimated 1.3m more jobs in the EU and 520,000 more in the US. According to a report for the EC by the London-based Centre for Economic Policy Research the transatlantic economic alliance could bring significant economic gains as a whole for the EU. Estimations are amounting up to €119 bn for Europe and €95bn for the U.S. per year.

The negotiations on the Transatlantic Trade and Investment Partnership will start this summer and might take about two years. The German chancellor Angela Merkel is keen to fire the starting pistol for the discussions on a free-trade agreement between the US and the EU as soon as possible. She suggested to bring this subject on the agenda of the G8 summit in London where the leaders of the most important European industrialized countries will meet on the 18th of June.