Music labels’ plea: ‘Don’t make us sacrificial lambs’

Date: 08/05/02

By Peter Chapman

INDEPENDENT record labels have told the European Union not to make them the sacrificial lamb in talks scheduled to start this summer on removing trade barriers in key services and media sectors.

The warning comes as the EU and other World Trade Organisation (WTO) members prepare a wish-list of service-sector areas they want to form part of the agenda for a new round of talks on the General Agreement on Trade in Services (GATS).

Music is currently classified as an 'audiovisual' service - meaning it sits in the 'no-go area' the EU, led by France, has carved out for the sector. This allows it to protect its culture from foreign attack through trade protection and special subsidies for home-grown industry.

But Michel Lambot, president of the Independent Music Companies Alliance (Impala), said that could change if major labels succeed in persuading the EU to use the GATS talks to prise open some foreign music markets they say are riddled with trade barriers.

Crucially, other countries would expect the EU to give-up its right to develop music-friendly policies, warns Lambot, who won support from Culture Commissioner Viviane Reding in a recent meeting. Reding's spokesman, Christophe Forax, said offering music as a bargaining chip in the talks risked 'opening Pandora's box' and could undermine the EU's hard-fought right to protect its culture in sectors such as film or TV.

Member states must give a negotiating mandate to the Commission for the talks. The UK, Germany and Netherlands are prepared to put music on the table, but Forax said he doubted whether France would be willing to lift its opposition.

This would leave the Commission with the same mandate for the cultural sector that it prepared ahead of the doomed WTO ministerial meeting in Seattle in 1999 - carried over to last year's more successful Doha event.

But Frances Moore, EU director of the International Federation of the Phonographic Industry, which lobbies on behalf of major labels, said the talks could still be a 'win-win situation'. She said EU music markets were already open to foreign competition, and that the EU may not have to give up its right to support its domestic industry in return for the removal of barriers faced by record companies abroad.

She said firms are often forced to seek local partners before they can do business in a country - a problem in new WTO member China.

Independent record labels have told the European Union not to make them the sacrificial lamb in talks, scheduled to start in summer 2002, on removing trade barriers in key services and media sectors.