2.1. The UNESCO Convention’s Impact Vis-à-Vis the WTO

Despite the impressive number of states that have ratified the convention, and thus have arguably committed themselves to the objective of protecting and promoting cultural diversity, the impact of the UNESCO Convention on the WTO regime is to be judged as minimal. What is observable above all is an affirmation of the status quo,^{Footnote 41} which has been characterized by the legacy line of separation between the European Union (EU) and the United States with their respective proculture and protrade positions, if we are to describe them in a typified manner,^{Footnote 42} and the existence of diverse smaller clusters of countries with less strongly voiced opinions.

The success of the adoption of the UNESCO Convention cannot mask the political economy behind it and the fact that different states have ratified it for very different reasons.^{Footnote 43} Although the Canadian and French delegations,^{Footnote 44} assisted by a number of NGOs, were fairly efficient during the convention’s negotiation,^{Footnote 45} this mobilization is not strong enough to go beyond the weak regulatory charge of the UNESCO Convention and to matter when “real” trade interests are at stake. At present, it is highly unlikely that a negotiating bloc will form within the WTO to push for more culture-oriented solutions—such as including some sort of “cultural exception,”^{Footnote 46} an express clause for culture in the general exception provisions of the General Agreement on Tariffs and Trade (GATT) (Article XX) and the General Agreement on Trade in Services (GATS) (Article XIV), or including cultural diversity as one of the objectives of the WTO in the Preamble of the WTO Agreement.^{Footnote 47} This is evident from the current state of trade talks, as launched under the Doha Development Agenda in 2001.^{Footnote 48}

Although Doha has not stalled because of the trade-versus-culture debate, the requests and offers tabled so far reveal precious few new commitments and no future-oriented rules design that could address cultural matters at their intersection with economic interests. This is particularly palpable in the audiovisual services sector, which has been the most contentious in this clash and is likely to remain the service sector with the fewest commitments even after a successful completion of the Doha round.^{Footnote 49} Despite the recognition widely shared by key WTO members that the audiovisual sector has changed dramatically,^{Footnote 50} in particular in the face of the convergence of the information technology, telecommunications, and media sectors, and due to the sweeping transformations caused by the Internet, there is little agreement on the way forward. The trade-versus-culture status quo has indeed been perpetuated through the UNESCO Convention. This has had multiple (primarily negative) effects for the WTO outside the narrow domain of audiovisual services. The spillover effects are felt in the discussions on advancing liberalization and coherent global regulation in the “neighboring” areas of telecommunications and electronic commerce.^{Footnote 51} Overall, the WTO, in many senses, is rendered unable to appropriately address trade in the Internet age,^{Footnote 52} despite the organization’s inherent flexibility and potential to adapt.^{Footnote 53}

Against the backdrop of this political deadlock, many observers had been hoping that when a new trade-versus-culture case emerged, the WTO adjudication—a uniquely powerful mechanism of dispute resolution at the international level^{Footnote 54}—would provide a final resolution to the conflict, while possibly also clarifying the status of the UNESCO Convention and its relationship with the WTO rules.^{Footnote 55} The China–Publications and Audiovisual Products case,^{Footnote 56} decided in favor of the United States in 2009, proved the contrary. In this particular case, China tried to justify diverse measures in the media domain by invoking the UNESCO Convention and the related UNESCO Declaration on Cultural Diversity.^{Footnote 57} The panel was not sympathetic to this attempt and recalled that “the UNESCO Convention expressly provides: ‘Nothing in this Convention shall be interpreted as modifying the rights and obligations of the parties under any other treaties to which they are parties.’”^{Footnote 58} The panel went on to say that “[i]n any event, nothing in the text of the WTO Agreement provides an exception from WTO disciplines in terms of ‘cultural goods,’ and China’s Accession Protocol likewise contains no such exception.”^{Footnote 59} Thus, China’s attempt to apply the UNESCO Convention as a shield remained futile—a position that was also supported by the Appellate Body, despite China’s request to the Appellate Body to be “mindful”^{Footnote 60} of the specific dual nature of cultural goods and services.

Interestingly, the panel did leave the door open for further consideration of cultural concerns, as it interpreted broadly Article XX(a) GATT, which justifies measures violating rules of the WTO Agreements when these measures serve the protection of public morals.^{Footnote 61} It acknowledged China’s claim that “reading materials and finished audiovisual products are so-called ‘cultural goods’” and these are “of a unique kind with a potentially serious negative impact on public morals.”^{Footnote 62} Despite the fact that the panel found the measures at issue not “necessary within the meaning of Article XX(a),”^{Footnote 63} this may be interpreted as newly enhanced flexibility of the WTO rules with regard to culture, which can be used in the future.

2.2. The UNESCO Convention’s Impact Outside the WTO

The standstill in the WTO in trade and culture matters, which has only been confirmed by the UNESCO Convention, has had repercussions outside the WTO. The example with digital trade and the inability of the WTO to tackle the relevant questions because of the issue overlaps with culture is illuminating. It is symptomatic of the overall intensified power plays, which led to increased fragmentation of both negotiation themes and of negotiation fora. The lack of solutions within the WTO context has driven and will continue to drive members to take the bilateral or regional paths to advance their policy priorities. The United States in particular has made substantial efforts to ensure implementation of its digital agenda^{Footnote 64} through a number of free trade agreements (FTAs). The agreements reached since 2002 with Australia, Bahrain, Chile, Morocco, Oman, Peru, Singapore, the Central American countries,^{Footnote 65} and most recently with Panama, Colombia, and South Korea, contain only minimal restrictions on digital products, applying a negative scheduling approach (in contrast to the standard GATS positive pick-and-choose mode) and also tackle some “deep” e-commerce regulatory issues.^{Footnote 66}

Interestingly in this exercise, the United States has shown some deference to the culturally inspired measures of its FTA partners in the field of audiovisual services and permitted the policy space needed for these measures. The measures are, however, frozen at their present level.^{Footnote 67} Moreover, they could only relate to conventional offline technologies. It is also noteworthy that the leeway given to the U.S. partners with respect to trade in cultural products tends to reflect the negotiating capacity of the states involved—the smaller the country, the more concessions it makes.^{Footnote 68} Policy room thus may often be substantially reduced, and countries (especially the poorer ones) may not be able to appropriately cater for diverse public interests in the field of media—particularly digital media—in effect constraining the possibilities for implementing the UNESCO Convention in the said domains.

Before looking at the implementation activities of the convention’s parties, we can sum up at this stage by saying that the UNESCO Convention has had a certain impact on the international regime complex. In the specific case of starkly diverging positions of the EU and the United States on the matters of trade and culture, the theoretical conjecture that ambiguity would persist has by and large been confirmed. Further, it appears that the deadlock in the WTO realm with regard to cultural products and services may have led to overall greater uncertainty and unpredictability regarding the WTO trade liberalization commitments and the ways forward, both in terms of future commitments and rules design. As Shaffer and Pollack contend, and as the China–Audiovisual case mentioned earlier proves, this may be related to a process of “softening” the hard law of the WTO.^{Footnote 69} Importantly, as the distributive conflict between the United States and the EU continues, the UNESCO and the WTO regimes are highly unlikely to “converge into a new synthesis, but rather will remain in conflict for a prolonged period.”^{Footnote 70}

The impact of the convention on UNESCO (its own parent organization) and UNESCO’s authority can be deemed sizeable, as it has subsequently become a hub of new activities. The UNESCO Convention has also effectively contributed to promoting the notion of cultural diversity and establishing it as a global public good—that is, as a regulatory objective worth pursuing in a wide range of activities and venues, both domestically and internationally. To be sure, the convention has mobilized international cooperation, although the overall impact of the activities it has triggered may be small in practical terms, as we discuss in the next section, and the question of whether this development can be sustained remains open.

3.1. In External Affairs

As the recently submitted country reports reveal, there have been a number of activities on the international scene related to the UNESCO Convention’s implementation. The major thrust is on international cooperation. Worth noting is that the focus of international cultural cooperation activities by the parties has expanded geographically over the past 20 years (with a new focus on Brazil, China, and India). Even more importantly, there has been a shift from “purely ‘promotional’ activities (showcasing the cultural heritage of one country in another) to those that facilitate cooperation in specific cultural industry sectors as well as on concrete cultural policy themes or related projects.”^{Footnote 78} Culture has become one of the underlying objectives in international frameworks, strategies, and programs of several parties, in particular in the specific context of cultural cooperation for development (as provided for in Article 14 UNESCO Convention).^{Footnote 79} This includes not only capacity building, training, and technology transfer but also newer forms of bilateral and multilateral cooperation that aim to support cultural and creative industries in developing countries, which facilitate the flow of cultural goods and services and the mobility of artists and creators worldwide.^{Footnote 80}

While the number and the diversity of these activities may be impressive, it should be said that many of them are smaller-scale projects without sizeable budgets and they may often be of limited duration.^{Footnote 81} Even the convention’s own International Fund for Cultural Diversity (IFCD), established under Article 18, is not well enough endowed to support larger initiatives, as its resources consist of voluntary contributions made by the parties and gifts from other countries, organizations, and individuals.^{Footnote 82} If we contemplate the convention’s impact in the longer run, it may be that this aid is found to be insufficient by developing countries, especially those who were not strong cultural proponents to begin with; these countries may choose the benefits from trade and seek real market access concessions. Such an aspiration would not be utterly misplaced, as “even a cursory look at international trade in cultural products shows” that, “developed countries at the forefront of efforts to ‘protect’ cultural diversity are at the forefront of cultural trade as well.”^{Footnote 83}

Still, these activities endorsed under the auspices of the UNESCO Convention should not be underestimated. They significantly raise the awareness of cultural diversity as a policy objective, as well as the awareness of cultural diversity policies, and move towards establishing best practices.^{Footnote 84} They mobilize an expanding network of actors at all levels of government, including many NGOs—some already existing (such as the network of European Union National Institutes for Culture^{Footnote 85}), others specifically founded for the purpose (such as the Global Alliance for Cultural Diversity^{Footnote 86})—as well as actors from the cultural industries. None of the initiatives so far, however, amounts to a legal or policy reform; neither does any initiative expressly seek an interface with the trade regime.

One model that stands out for its innovative design and possibly further-reaching effects is that of the Protocols on Cultural Cooperation, negotiated by the European Commission on behalf of the EU and its Member States. The protocols are, on the one hand, a direct implementation effort of the UNESCO Convention; on the other hand, they are responses to broader changes in the EU’s external policies. These changes relate to the extended competencies of the EU in matters of common commercial policy after the Lisbon Treaty,^{Footnote 87} as well as more specifically to the EU’s repositioning with regard to new regional or bilateral agreements having an economic integration dimension.^{Footnote 88} This latter foresees notably that audiovisual services (including the content-related implications of electronic commerce) should be excluded from the scope of such trade agreements, and that audiovisual and other cultural services should receive special treatment under dedicated cooperation frameworks.^{Footnote 89}

The first Protocol on Cultural Cooperation was signed in the context of the Economic Partnership Agreement with the Caribbean Forum of African, Caribbean and Pacific States (CARIFORUM)^{Footnote 90} in 2008, its negotiation having started before the UNESCO Convention was ratified by the EU and before its entry into force. The second effort, which has been slightly calibrated,^{Footnote 91} was the Protocol with South Korea. The most recent examples relate to the EU trade agreement with Colombia and Peru and the EU–Central America Association Agreement, both initiated in 2011, and both of which include cultural cooperation provisions.^{Footnote 92}

The protocols are not uniform but rather are tailored to the specific circumstances of the partner.^{Footnote 93} Typical of all, however, is the attempt to interface trade and culture, and this is no trivial matter: “The inclusion of language on cultural cooperation matters marks a significant evolution in EU attitudes towards the subject matter in a trade policy context, hitherto marked by a desire to preserve maximum policy autonomy by eschewing any commitments in trade agreements and, in the case of the DDA [Doha Development Agenda], by refusing to direct negotiating requests to its trading partners and to entertain offers in response to trading partner requests in cultural industries.”^{Footnote 94} Although the EU does not expressly grant new market commitments, in many senses the protocols improve access to the EU market, especially with regard to the temporary entry of natural persons and the treatment of cultural industries.^{Footnote 95} In effect, such provisions allow preferential treatment under the exception of Article V GATS for economic integration, and thus again have an impact on global trade and global trade regulation.^{Footnote 96}

Far-reaching has also been the commitment inscribed in the EU-CARIFORUM and the EU–Korea Protocols, whereby coproductions qualify as “European works” in the sense of the EU Audiovisual Media Services Directive (AVMSD),^{Footnote 97} and thus can benefit from various quota and other support schemes made available in the EU, in particular from the majority broadcasting quota.^{Footnote 98} This obligation is reciprocal, and European producers can enjoy the same treatment in the partner country.^{Footnote 99}

The Protocols on Cultural Cooperation have been subject to some criticism, in particular by France and the European Coalitions for Cultural Diversity. Among other things,^{Footnote 100} they have argued that the European Commission is stretching its competences by incorporating culture into trade negotiations through the back door, while cultural affairs still primarily fall into the policy domain of the Member States. They also fear that the trade and culture linkage goes against the spirit of the UNESCO Convention and may in fact harm cultural diversity.^{Footnote 101}

Regardless of whether this critique is unfounded (and it probably is),^{Footnote 102} the EU has softened its approach in the last two cultural cooperation agreements, as they are not directly tied to the trade agreement, which has been negotiated in parallel, and do not include the controversial coproduction recognition as domestic works, which offers a deeper market access and a sizeable package of benefits, otherwise available only to audiovisual works made with European money.^{Footnote 103}

3.2. At Home

As we noted earlier, the UNESCO Convention is fairly vague on what exactly is to be done to secure its appropriate implementation. The convention’s reporting framework was slightly more specific in showing what is expected, at least for the purposes of reporting. It requested information on the measures that the parties have put in place to promote the diversity of cultural expressions at the different stages of creation, production, distribution, dissemination, and participation. As such, these measures were meant to be understood as those that nurture creativity and form part of an enabling environment for independent producers and distributors working in the cultural industries, as well as measures that provide access for the public at large to diverse cultural expressions.^{Footnote 104} Actions that fall under these categories and have been undertaken by the parties include direct financial support to artists (majority of reporting parties); legislation on the status of the artist (e.g., Austria, Canada, Germany, Lithuania, Namibia, Mongolia, Montenegro, Norway, and Peru); incubator schemes for young artists and female artists (e.g., Austria); support for artists’ mobility, particularly in a regional or subregional context (e.g., Bolivia, Chile, Cyprus, and the EU); establishing artists’ residencies (Argentina and Tunisia), as well as support for the better use of copyright mechanisms (e.g., Denmark, Greece, Namibia, Oman, Slovenia, and the EU).^{Footnote 105} In addition, there have been a number of training and education programs^{Footnote 106} and a great variety of initiatives that can be considered as forming part of an enabling environment for the production and distribution of cultural goods and services. On the production side, they encompass direct funding for the production of domestic cultural content (majority of reporting parties); support for the creation and functioning of production infrastructures and entities such as cultural industry companies or networks (e.g., Argentina, Brazil, Bulgaria, Canada, Ecuador, Estonia, France, Germany, Monaco, Paraguay, and the EU); workshops on production competencies and individual entrepreneurial skills (e.g., Argentina, Brazil, and Peru); schemes that collect levies on the revenues of public and private cultural industries to reinvest into national productions (e.g., Poland); and coproduction schemes (e.g., the EU and its Member States). Frequently reported distribution measures were local or national schemes to build up distributional and marketing capacities in cultural production (e.g., Austria, Brazil, Cyprus, Ecuador, Estonia, Mongolia, Nigeria, Slovakia, Tunisia, and the EU); development of local distribution mechanisms including the creation of physical infrastructure (e.g., Montenegro); content quotas (e.g., Canada, France, and Portugal); measures to promote the export of cultural goods and services (e.g., Austria, Argentina, Canada, Estonia, Finland, Oman, and Tunisia); media policies, including the promotion of public service media and of diversity therein (e.g., Austria, Argentina, Denmark, France, Montenegro, Norway, Peru, Slovakia, Slovenia, Sweden, Switzerland, and Uruguay); and support for promotional events such as “markets,” “fairs,” “festivals,” or “years” (e.g., Argentina, Ecuador, Estonia, Greece, Montenegro, and Peru).^{Footnote 107}

A number of the reported cultural measures focus on the audience side and are intended to ensure the public’s participation in cultural life as a means to enhance the overall quality of life. Such interventions have been made with a view to promoting cultural and media literacy (majority of reporting parties); promoting the access and participation of minorities, indigenous peoples, young people, and women in cultural life (majority of reporting parties); promoting access and participation of the socially disadvantaged, the disabled and the elderly (e.g., Norway, Portugal, and Spain); and lowering price barriers to access to cultural goods through diverse measures, such as reduced taxes (e.g., the EU Member States).^{Footnote 108}

Overall until now, it appears that the bulk of the action has been on fostering the distribution and enjoyment of cultural goods and services; the policy objectives of creation and production are common but less prevalent.^{Footnote 109} Importantly, institutional policies were the most common type of policies and measures adopted by the reporting convention’s parties. Almost all parties have established national institutes to promote the cultural industries or a particular industry, created departments or institutes of the Ministry of Culture to promote cultural expressions of persons belonging to minorities, or, in some cases, established a Ministry of Culture.^{Footnote 110}

In all these activities, a key question that can be raised when attempting to assess the impact of the UNESCO Convention, as well as the progress made in its implementation, is that of the causal link between the convention and the manifold interventions in the field of cultural policy, some of which clearly predate the convention’s entry into force. With regard to the EU, which we somewhat singled out as a reference point in our analysis, this question is particularly pertinent.

Despite the EU’s limited competence in matters of culture,^{Footnote 111} it has a considerable number of actions in place in the field of culture, encompassing internal policy measures in the domains of (1) culture, education and youth; (2) communication; (3) regional policy; (4) agriculture and sustainable development; (5) employment, social affairs, and equal opportunities; (6) the audiovisual sector; (7) information society and research; (8) competition policy; (9) internal market; and (10) maritime policy.^{Footnote 112} In addition, pursuant to Article 167 Treaty on the Functioning of the European Union (TFEU) (formerly Article 154 EC), the EU has committed to continued efforts to mainstream culture in all its activities.^{Footnote 113} This certainly reflects the spirit and the letter of the UNESCO Convention on Cultural Diversity. On the other hand, despite the fact that the EU has this advanced package of internal policies related to culture, it has not taken any decisive new action for the protection and promotion of cultural diversity. We have argued elsewhere^{Footnote 114} that in particular in the field of digital media, its current instruments are outdated.^{Footnote 115} In its report to the UNESCO Convention’s Intergovernmental Committee, the EU and its Member States did admit that there is “a certain difficulty in distinguishing the achievements specifically linked to the implementation of the Convention from those related to their existing cultural policies.”^{Footnote 116}

Overall, it appears that for the parties, which already had the necessary structures and policies in place, the convention’s implementation has meant supplementing existing policies rather than making a major policy shift.^{Footnote 117} It has been argued that the UNESCO Convention has nonetheless introduced “a new perspective and reference framework to cultural policy debates.”^{Footnote 118} For parties with less developed structures, the convention has more tangibly spurred the active development of cultural policies and the strengthening of their cultural industries.^{Footnote 119}