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Europe, Hollywood Denounce European Commission Digital Market Plans

Variety logo Variety 5/2/2017 John Hopewell
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Flagging a likely Cannes Festival hot button issue, 411 trade orgs, companies and European film-TV executives have signed a open joint letter calling upon the European Commission and Parliament to reject the Commission’s plans for opening up Europe to pan-continental online broadcaster services.

The letters’ signatories include representatives of Hollywood’s MPAA, as well as FIAPF, the global producers’ body, and IFTA, co-headed by Jean Prewitt (pictured), another global trade assn., representing the independent industry.

Also signing are some of Europe’s biggest movie and TV companies, such as AMC Europe/Odeon Cinema Group, Europe’s biggest cinema theater chain, and Spain’s Mediapro, led by Jaume Roures (pictured), plus prestigious institutions such as the British Film Institute and the good and great of distributors and sales agents across Europe, from Haut et Court’s Carole Scotta (pictured) to Lucky’s Red’s Andrea Occhipinti and Studiocanal U.K.’s Danny Perkins.

The communique is, moreover, backed by a huge diversity of signatories from all 28 E.U. member states, including dozens of national and European trade orgs, including Animation Europe, Europa Distribution, Europa International and the European Producers Club. In all, the 411 signatories will represent hundreds of thousands of European and Hollywood industry executives.

“We already saw a lot of concern last July when a similar letter was sent with over 100 signatures. Now we are seeing a massive increase in the level of concern on behalf of the E.U. audiovisual sector,” said Stan McCoy, president and managing director of the Motion Picture Association (MPA), Europe, Middle East and Africa, who signed the letter on behalf of the MPA. He stressed European leadership on the issue: “The MPA has been very supportive of E.U. industry efforts to preserve the existing system of film financing based on territorial exclusivity, so we are pleased to see that effort continue,” he added.

Sent Tuesday, the letter looks like a first last-ditch attempt to derail a proposed overhaul of European Union copyright legislation which threatens territorial exclusivity, “the cornerstone of creativity and investment in European audiovisual works,” the letter read.

The letter also looks like a call for mobilization made just two weeks before the Cannes Festival. At stake is the European Commission’s push, framed in a September 2016 proposal, to extend the so-called “country of origin” principle to cover online digital services. The proposed regulation envisages E.U. broadcasters carrying catch-up and simulcast online programming in other countries, if they have cleared the rights in the country they are broadcasting in.

The letter claims the Commission is “persistently moving ahead” on the so-called “country-of-origin” principle, despite a 2016 communication to E.U. president Junker from 100 trade bodies and individuals opposing it. The industry’s prime concern is that the proposal could decimate rights-holders’ ability to license their movies or TV shows on a territory-by-territory basis.

The country of origin proposal allows rights-holders to opt out if selling films to broadcasters for online pan-European distribution. Even so, Europe and Hollywood’s industry representatives are not happy.

One often-cited example: a producer negotiating in a weak position the sale of his rights with their home-territory broadcaster. Industry execs ask what power they would have to opt out of any agreement if the broadcaster demands that the film is made available on its online services across the E.U..

The industry also fears that consumers could view films and TV programs on catch-up online services before their first-run release in their countries.

For Europe’s film, TV and sports program industries, broadcaster online services is the “big landmark on the calendar in the immediate future.” McCoy argued.

The Commission’s proposal is currently out to the E.U.’s Council of Ministers and the European Parliament.

On Dec. 17, the Bundesrat, Germany’s upper house, questioned whether the country-of-origin proposal took rights-holders interests sufficiently into account. This Feb. 20, following a France-Spain summit in Malaga attended by French president François Hollande and Spain’s prime minister Mariano Rajoy, the two governments issued a joint declaration “opposing the extension of the country-of-origin principle to certain broadcasters’ online services.”

Despite that, the 411 letter claims that “amendments from some Members of the European Parliament would further broaden the scope and deepen the severe harm” wrought by the Commission proposal.

The proposal is now at a “critical stage of the legislative process,” the letter added.

The European Parliament’s Committee on Legal Affairs is scheduled to vote on the country-of-origin legislation on Sept. 28, though that date could be subject to change, said McCoy. .European Parliament supporting committees are due to give their opinions on the proposed regulation in May and June.

A “reasonable process expectation” would be for the E.U. Council of Ministers to work on the commission proposal during second-half 2017, he added.

“The fact that E.U. member states as influential as France and Spain are taking clear-cut positions at this stage of the process is helpful in part in clarifying the issue for the other member states,” McCoy said.

That said, Council of Ministers’ decision are taken by a qualified majority decision. Opposition of three of the E.U. 28 member states, however important, may or may not prove enough.

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