Select Committee on European Scrutiny First Report


SEC(01) 619

Commission staff working paper on certain legal aspects relating to cinematographic and other audiovisual works.

Legal base:
Document originated: 11 April 2001
Forwarded to the Council: 11 April 2001
Deposited in Parliament: 4 May 2001
Department: Culture, Media and Sport
Basis of consideration: EM of 10 May 2001
Previous Committee Report: None
To be discussed in Council: No date set
Committee's assessment: Politically important
Committee's decision: Not cleared; further information requested


13.1  The Commission has issued this working paper to stimulate a debate on a number of legal and technical issues concerning the audiovisual industries. It has invited views from all interested parties by 11 July. Later in the year it will follow this up with a Communication. The paper follows an undertaking given by the Commission in its 1999 Communication Principles and guidelines for the Community's audiovisual policy in the digital age, to monitor the current regulatory framework closely, with a view to adapting it where necessary. We concluded that that document and the draft Council Conclusions on it adopted by the May 2000 Culture/Audiovisual Council were relevant to any debate on the audiovisual content industry.[19]

13.2  The paper poses a wide range of questions but does not set out any particular views or propose any specific course of action. The Commission stresses that the issues raised are not intended to be a complete list at this stage but cover points which the audiovisual industry considers have an impact on the circulation of European audiovisual works. The intention is to assess their importance and to decide if there is any need to take action, whether at a regional, Member State, Community or international level.

The issues

— The definition of a European work

13.3  Different definitions operate at the international level, the Community level and the national level. For example, current definitions include those in the Council of Europe Convention on Cinematographic Co-Production, in the Television without Frontiers (TVWF) Directive,[20] which is the reference for the Media programme, and in the Eurimages programme. A further variety of definitions is used at Member State level, both in implementing the TVWF Directive and in applying national support schemes. Apart from affecting financial support, these definitions affect co-production agreements.

13.4  The Commission suggests that the following questions should be considered in this context:

    "—  do the differences between the different definitions for 'European works' adopted at Member State level create barriers to the transfrontier production of European audiovisual works and to their circulation?

    "—  do the criteria in the Television Without Frontiers Directive and the guidelines under the Media programme, as applied at national level, provide sufficient legal certainty for operators?

    "—  would there be an added value in the adoption of a more detailed definition in Community law?

    "—  [if] in the affirmative, which criteria should be adopted (e.g. 'cultural' aspects or other elements such as the sources of financing and/or control of rights)?

    "—  should such a definition of a European work be used in contexts other than that of the Television Without Frontiers Directive and the Media programme? (e.g., application of Community competition rules)."

— The definition of an "independent producer"

13.5  Article 5 of the Directive provides that broadcasters should reserve a certain proportion of transmission time, or of their programming budget, to European works created by producers who are independent of broadcasters. Recital 31 of the Television without Frontiers Directive, as amended,[21] states that it is essential that the Community ... should promote independent producers and that Member States, in defining the notion of 'independent producer' should take appropriate account of criteria such as the ownership of the production company, the amount of programmes supplied to the same broadcaster and the ownership of secondary rights.

13.6  The Commission notes that, here too, a number of different definitions are in use across Europe. One question that arises is whether national definitions that do not reflect the technical development of the sector, such as digitalisation and competition between different methods of distribution such as cable, satellite and the internet, might give rise to competition problems, if the criteria are not neutral in any given market.

— Protection of heritage and exploitation of audiovisual works

13.7  The Commission says that a number of different issues have been raised concerning the need to safeguard Europe's audiovisual heritage as well as to promote public access to it, taking advantage of the new digital technologies. Three different issues which have been identified by the industry as potential areas of added value for action at European level in terms of protection of rights, transparency, and effective exploitation are:

— The legal deposit of audiovisual works

13.8  A Council Resolution adopted in May 2000[22] called on the Commission to "take account of the specific needs of this particular form of cultural legacy, and to support and encourage a transnational study on the situation facing European cinema archives".

13.9  The Council of Europe has prepared a draft European convention which would provide for compulsory legal deposit of "moving image material forming part of its audiovisual heritage and having been produced or co-produced in the territory of the party concerned". The International Federation of cinema producers associations (FIAPF) supports a "voluntary" deposit for cinematographic works.

13.10  Questions raised in this context include:

  • is there a need for regulatory intervention?

  • should there be a European scheme, to provide legal certainty, which would entail a compulsory requirement, or a voluntary one, for the deposit of a physical copy of an audiovisual work and, in either case, which types of such works should be covered?

— The creation of a registration scheme

13.11  Only a minority of Member States have set up a register for films and other audiovisual works. An initiative to create an international register under the World Intellectual Property Organisation (WIPO) has met with only limited success.

13.12  One of the questions raised in this context is:

  • would there be added value in a European approach in terms of feasibility and/or legal certainty, transparency and protection of rightholders?

— A rightholders database

13.13  This would be different to the registry. It would enable the identification, for commercial purposes, of rights or licensing agreements across the EU. Information on who holds the rights for the various territories can be difficult to obtain in the European market, which is still fragmented.

— The exploitation of rights

13.14  The Commission says that the questions raised by this issue include:

  • are all there difficulties in identifying rightholders which hinder the showing of audiovisual works?

  • what would be the most efficient way of overcoming these difficulties, taking into account the advantages or disadvantages of different options, such as negotiating with collecting societies or creating a fund?

  • how would an assessment of remuneration be carried out, and by whom?

— Other issues

    delivery, such as on-line rights

    One question here is whether there is a need to consider rights by categories, such as TV or Internet.


    The standardisation of electronic delivery to cinema screens, for instance by video, is currently being considered by the Commission. It questions whether there is a need for European action on this and, if so, what sort of action?

    tax issues

    Books are subject to a reduced rate of VAT whereas audiovisual products, such as video cassettes and DVDs are subject to the normal rate. Member States operate a wide range of financial incentive schemes, from grants to tax advantages. The Commission questions whether there is a need for action at EU level and, if so, how might the fiscal measures in operation in Member States be modified to improve the production and circulation of audiovisual works.


    The Commission believes that there is a need for a coherent approach. At the moment the different rating systems applied within and between Member States constitute an impediment. In some Member States, even when films have been released and classified, videos are subject to a separate rating, incurring additional expenses, separate administrative procedures in each country, the need to manufacture specific packaging and, sometimes, to create specific versions of the original.

The Government's view

13.15  The former Minister for Tourism, Film and Broadcasting, Janet Anderson, says in an Explanatory Memorandum dated 10 May, that the Department for Culture, Media and Sport is co-ordinating consultations within Government and the film and broadcasting industries. The extent and nature of the questions posed raise issues which could, she says, have a significant impact on these industries. She expects them to be "extremely interested" in the paper and to respond accordingly.

13.16  The Minister says that a formal UK Government response will be sent to the Commission before the 11 July deadline. Until the consultation with all the interested parties is complete, it is not possible for the Government to assess the likely policy implications. She promises a further Explanatory Memorandum outlining its response to the Commission.


13.17  The Minister has drawn attention to the significant impact which the resolution of the issues raised in this consultation document could have on the film and broadcasting industries in this country. We accept that the policy implications cannot be fully assessed until the Government's own consultation is complete and look forward to her Supplementary Explanatory Memorandum on its response to the Commission. If the industries affected react as she predicts, recognising the significance of the issues raised, we are likely to recommend this document for debate in European Standing Committee C, together with the two documents already noted as relevant to such a debate to which we refer in paragraph 13.1 above.

13.18  Meanwhile, we shall not clear this document.

19  (20991) 14261/99 and (21182) - ; see HC 23-xvi (1999-2000), paragraph 9 (10 May 2000). Back

20  OJ No. L 298, 17.10.1989, p.1. Back

21  OJ No. L 202, 30.7.97. Back

22  2261 Council Meeting (16 May 2000) Press 154 - Nr. 8394/00. Not submitted for scrutiny. Back

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