France draws red lines for EU-US free trade negotiations

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Food safety, GMO cultivation and France’s cherished “cultural exception” for audiovisual services are non-negotiable areas in view of upcoming EU-US free trade talks, the French stressed. The message was apparently well received by the European Commission in Brussels.

Speaking at the conclusion of a two-day European summit on 15 March, French President François Hollande said he was “in favour of opening a negotiation” with the US to lift trade barriers and “promote growth” in Europe.

The EU Council of Ministers, representing the 27 member states, is expected to agree a mandate for the European Commission to start negotiations with the United States on 14 June.

“But there must be safeguards in certain areas,” Hollande stressed, citing health and safety standards in food production, which have come under intense scrutiny in Europe over the past weeks amidst the horsemeat scandal.

Another sensitive area is GMOs, which are rejected by a vast majority of consumers in France and in the European Union more widely.

Cultural exception

“But there is another area that I would like to emphasise,” Hollande said. “It is the question of the cultural exception, including audiovisual services. This sector, like with other agreements, cannot be part of the [negotiation] mandate.”

“I want these areas to be excluded from the negotiation.”

The concept of “cultural exception” is particularly dear to the French, who introduced it during the Uruguay round of international trade talks in 1993 to ensure culture is treated differently from other commercial products. It notably allowed France to introduce quotas for local music and film on national TV and radio stations and subsidise its industry.

The United States claims that cultural exception is a form of protectionism that harms global trade.

The European Commission is on the same line as the French, saying it “recognises the concerns and sensitivities of the audiovisual sector in relation to the proposed mandate for trade negotiations with the US.”

Cultural industries account for 4.5% of total EU GDP, employing 8.5 million people in sectors as diverse as cinema and the audiovisual media, publishing, the craft industry and music, according to the European Commission.

Speaking in the European Parliament on 12 March, EU Trade Commissioner Karel De Gucht made it clear that the EU-US trade agreement “will not force a change of current practices in the member states.”

“Member states will continue to be able to support their cultural industries and the audiovisual sector in particular, such as through broadcasting quota or subsidies, as foreseen in the current EU directives,” De Gucht said.

John Clancy, spokesperson for De Gucht, added in emailed comments to EURACTIV that the EU even had “a Treaty obligation [Article 167] to protect cultural diversity so this will always be borne in mind in our future trade negotiations and exchanges.”

Clancy added that the treaty obligation to protect cultural diversity also applies to emerging technologies linked to the internet, such as connected TV and video on demand.

“In the future, we will and must continue to promote our cultural diversity as technologies develop. That is what the treaty requires,” De Gucht said. “So yes, we will be very mindful of these sensitivities”.

Within the European Commission, others such as culture commissioner Androulla Vassiliou would have preferred audiovisual services to be excluded outright from the scope of negotiation but this was not possible.

“Commissioner Vassiliou will be very vigilant on this,” said Dennis Abbott, her spokesperson.

GMOs, food safety and geographical protection

Food and drink is another area which is particularly sensitive for France, including safety standards, protected geographical indications, and GMOs, according to a French source.

“We are not going to negotiate food safety standards, GMOs, etc. Europe has defined its own model, European consumers are extremely demanding, so we will not negotiate it,” said the source who was briefing journalists on condition of anonymity ahead of the EU summit last week.

The French source was particularly adamant on the issue of GMOs, saying it would be “useless to strive to define a negotiating objective that will create a huge problem and will be detrimental to the image of both the United States and the European Union.”

“Honestly, it is not the turnover of some US seed companies that determines the value of this agreement for the United States. The political cost would be such that we should be able to find a framework that is in the interest of both parties.”

To avoid misunderstandings and an early failure of the negotiation, the source recommended defining a negotiation mandate for the European Commission that clearly excludes some areas form the agreement.

Avoiding ‘scare stories’

Sources close to the talks said no other EU member state has so far put any veto and that all favour the principle of negotiating a comprehensive free trade and investment agreement with the US. However, individual countries might make their voice heard once negotiations are started.

Clancy, the EU’s trade spokesperson, conceded it might be wise to exclude GMOs and some other sensitive food issues from the scope of the negotiation.

“It is true that we have proactively raised the issue of GMOs – because of this is such an emotive issue to many among the general public and we wanted to avoid scare stories,” Clancy said.

Strict EU rules on GMOs are already in place and that will not change because of a free trade agreement, he stressed. The same went for EU legislation on animal health and welfare, the environment and consumer interests, which he said “will not be part of the negotiation”.

“We will not negotiate changes that we do not want, be it on hormones in beef or GMOs,” Clancy told EURACTIV in emailed comments.

“We have a different understanding on this today and we will have a different understanding on this tomorrow and in the future.”

In February, US President Barack Obama and EU negotiators announced they had initiated internal procedures necessary to launch negotiations on a much-awaited free trade agreement.

>> Read: EU, US clear way for game-changing trade deal

The negotiations will be based on the work of the EU-US High Level Working Group on Jobs and Growth co-chaired by EU trade Commissioner Karel De Gucht and United States Trade Representative Ron Kirk.

Two-way goods trade between the US and the EU now totals more than $600 billion (€447 billion), annually. Services trade, including sales by majority-owned US or EU companies in each other's market, adds about $1.2 billion (€920 million).

American companies have invested around €1.4 trillion in production, distribution and other operations in the EU, far more than in China or anywhere else in the world. EU companies have invested about €1.2 trillion in the US.

Since most tariffs between the US and the EU are already low, reducing regulatory barriers to trade in areas like agriculture and chemicals is expected to be the most challenging aspect of the talks.

  • 14 June: Meeting of the EU's 27 trade ministers. Irish EU Presidency hopes to agree negotiation mandate for the Commission to start free trade talks with the US.

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