Following U.S. president Donald Trump’s imposition of sweeping new tariffs — including a 10% minimum tariff on all countries exporting goods to the U.S. — announced during his “Liberation Day” Rose Garden address on Wednesday (April 2), the full impact on the international screen content sector remains unclear.

But according to several screen content industry organizations in the U.S., the effect of current international government policies — ranging from tax incentives in various territories, to plans to regulate content and investment quotas for U.S.-owned streamers — is clearly detrimental to the American entertainment ecosystem. In the days leading up to “Liberation Day,” these bodies took the opportunity to voice their concerns via public submissions to the U.S. government — submissions which labeled such practices and policies as “protectionist” and “predatory.”

In late February, the White House released a memorandum under the heading “Defending American Companies and Innovators From Overseas Extortion and Unfair Fines and Penalties.” That memo took aim at myriad trade practices that have emerged in the digital age — among them, foreign government-imposed quotas placed on U.S.-owned mediacos (including major streamers) to fund local content. The U.S. Trade Representative subsequently issued a call for public comment regarding “Reviewing and Identifying Unfair Trade Practices and Initiating All Necessary Actions to Investigate Harm from Non-Reciprocal Trade Arrangements.”

As reported by UK entertainment trades Broadcast and Screen Daily, the Motion Picture Association (MPA), which represents the interests of major American studios and streaming services, was one of the organizations to respond to the call for comment, filing an 86-page document on March 11 that outlined specific policies in 30 territories that the MPA frames as “our industry’s observations on unfair trade practices in priority foreign markets.”

The MPA’s concern over streaming regulation in territories where U.S.-owned streamers are active has been well documented, with the organization’s Canadian office — representing the interests of such mediacos as Netflix, Disney, Sony, Paramount, Universal and Warner Bros. Discovery — coming out strongly against the CRTC’s decision regarding base contributions from “foreign-owned online undertakings in Canada.” The MPA submission to the Trade Representative is also critical of the policy move, which is tied to the passing of the Online Streaming Act in 2023 — another flashpoint for U.S.-owned media and tech companies.

The MPA submission, signed by chairman and CEO Charles Rivkin, declares the decision’s requirement for foreign-owned services to give 5% of Canadian revenues to designated funds — including the Canada Media Fund and the Independent Local News Fund — and the Online Streaming Act at large to be “inconsistent” with the U.S.-Mexico-Canada-Agreement. The submission states: “… the Government of Canada should ensure that the CRTC’s implementation of the Online Streaming Act does not impose undue burdens or obligations on non-Canadian digital services, including by repealing the requirement for non-Canadian digital media services to pay 5% of Canadian gross broadcasting revenues to local production funds.”

While aspects of the CRTC decision are still under appeal, the submission also takes aim at two other established CRTC quotas regarding minimum Canadian programming expenditure and the age-old bugbear, Canadian content requirements. According to the MPA, “such quotas are discriminatory and artificially inflate the amount expended on, or the time allocated to, Canadian programming.”

The MPA, via its submission, also regards the requirement for Canadian BDUs to offer more Canadian than non-Canadian services as “protectionist” — a term often used by critics of the current wave of Trump administration tariffs.

Government policies for the audiovisual industries in Australia, the United Kingdom and Europe are also highlighted in the MPA submission, with U.K. broadcast and VOD quotas as well as the potential regulatory terms in the Media Act of 2024 cited as areas of concern. For European countries, “market access issues” coupled with broadcast and VOD content quotas and investment requirements are flagged in the submission.

Regarding Europe, the MPA submission states: “Disproportionate investment obligations, coupled with excessive sub quotas for works of original national expression — and in some cases the absence of a thematic or niche AV services exemption — could fuel an inflationary trend in production costs and work against the objective of supporting and attracting foreign investment and opening the market to new entrants.”

As for Australia, the MPA submission took aim once again at broadcast quotas and OTT/VOD local content regulation, citing Australian prime minister Anthony Albanese’s efforts to introduce investment obligations for streaming services. “Such a mandate would be violative of Australia’s FTA [free trade agreement] commitments to the United States,” the MPA maintains. “To date, there is no evidence to support any assertion of a market failure. Indeed, the data on investment in Australian content for streaming services continues to indicate high levels of production and wide availability for subscribers. There remains no need for consideration of quotas or obligations to invest in local content.”

In a statement released Thursday (April 3), serving as a response to the Trump administration’s universal 10% tariff on countries exporting to America, Albanese doubled down on the need to ensure that “Australian stories stay on Australian screens.”

Screen Producers Australia CEO Matthew Deaner applauded the prime minister’s response, adding: “I know that the Australian government has been under enormous pressure from the USA on this front, amply evident from the aggressive position of the Motion Picture Association, which has sought to resist, delay, and read down the local content rules agreed to in the 2004 Australia-US Free Trade Agreement.

“In upending trade conventions, the Trump Administration has given the opponents of these rules a big boost. That’s why today’s statement by the prime minister is such a welcome indication of the government’s continuing stance in this situation,” Deaner concluded.

Also responding to the U.S. government’s call for input prior to “Liberation Day,” the Directors Guild of America (DGA) and the International Alliance of Theatrical Stage Employees, Moving Picture Technicians, Artists and Allied Crafts (IATSE) filed a joint three-page submission, signed by the DGA’s national executive director Russell Hollander and IATSE international president Matthew Loeb.

Stating that the groups “represent nearly 200,000 filmmakers that comprise the directorial, technical, and artistic teams that power the American film and television industry,” the DGA and IATSE proclaim: “Often under the guise of protecting culture, other countries have erected trade barriers that disadvantage the work of our members and undermine the protections we have collectively bargained for in the U.S.

“These countries have increasingly turned to non-tariff barriers to disadvantage the works created by our members, particularly in the digital marketplace,” the statement continues. “Local content quotas on streaming services, predatory tax regimes, local content-investment obligations, and a myriad of unfair trade practices limits [sic] legitimate access to American content and drive foreign audiences toward online piracy.”

The issue of “runaway production” also looms large in the joint submission, citing the 40% decline in television production in the U.S. compared to 2022. (However, the submission does not cite the potential impact of the dual strikes of 2023 on U.S. production figures.)

“While some U.S. states have established their own incentive programs to mitigate runaway production, this piecemeal approach will not achieve significant success in remedying the problem without action at the federal level — including through the elimination of foreign trade barriers,” the DGA/IATSE submission states.

“The DGA and IATSE supports [sic] this Administration’s efforts to address foreign trade barriers and looks forward to working with you to prevent the continued discrimination by foreign countries against our industry and members,” the statement concludes.

The concerns highlighted by the MPA, DGA and IATSE weren’t specifically referenced in the “Liberation Day” presentation, but that doesn’t necessarily mean they won’t be addressed directly at some point in the near future. In the meantime, at least for some of the countries targeted by the tariffs, the impact on their domestic screen content businesses might not be as negative as feared. In Canada, for example, the knock-on effect of tariffs driving down the Canadian dollar might prompt even more “runaway production,” as American studios are presented with bigger cost savings that are even harder to ignore.

Indeed, in a statement issued by IATSE on March 28, well after its joint submission with the DGA to the U.S. Trade Representative, the union said that while “the use of tariffs to ensure fair trade are legitimate policy tools,” the U.S. and Canada should be focusing on “targeting those countries that do not enshrine worker rights and protections, not those that do. Canada should not face unnecessary blanket tariffs, given its unique relationship and partnership with the United States.”

This story originally appeared in Realscreen

Image: Unsplash