Communiqué

March --2002

On March 8 2002, the International Network for Cultural Diversity (INCD) released its first draft of a Convention on Cultural Diversity to its members in 52 countries- the first version publically released by any of the various organizations and governments involved in developing this instrument. In doing so, the INCD continues to be at the forefront of the cultural diversity movement which has been calling for this treaty since 1999. The complete text of the draft is available at below.

Prepared by Canadian trade lawyer Steven Shrybman, the Convention translates the principles and concepts endorsed by the membership of the INCD at meetings held in Santorini, Greece in 2000 and Lucerne, Switzerland in 2001 into the terms of a binding international treaty on cultural diversity. In addition to a preamble, it sets out 20 substantive provisions dealing with the key elements of such a treaty, including rules concerning trade in cultural goods, and investment in providing cultural services.

This convention will provide a stable legal framework for the protection and enhancement of the full diversity of cultural expression, currently under threat from the homogenizing effects of globalization. It will also ensure that cultural products are not reduced to their market value by trade agreements and arrives at a particularly important moment as the WTO launched a new round of negotiations in November 2001. The Convention stresses the rights and responsibilities of governments to implement measures designed to foster diversity and creativity while securing the rights of all creators and citizens to freedom of expression and access to the full range of cultural activities.

Mireille Gagné, Director of the Canadian Music Centre (Québec) and a founding member of the INCD Steering Committee, says: "the essence of every work of art is a personal or collective form of cultural expression - the fruit of this is not intended at the outset to be a commercial product and cannot be treated solely as such."

RH Thomson, Chair of the INCD’s Artists Leadership Council, actor and broadcaster, says that "as the WTO continues to push forward with its aggressive new round of negotiations, the global cultural community needs to step up its actions and ensure that the treaty is in place before the end of this round. Diverse expression is the lifeblood of culture and I feel that we must establish once and for all the rights of peoples to promote the diversity of their cultures. " Indeed, it is not only the WTO which is pushing forward in its trade agenda: currently, the US, in its bilateral trade talks with Korea, is demanding that the Korean screen quota system be scrapped. At present, culture has been consistently exempted from existing trade agreements - if the US succeeds with Korea, it sets a dangerous precedent and may indicate how the US will approach culture and trade in the future.

The strategy of the INCD now is to continue discussing and amending the draft text within its membership and to consult with other inter-governmental organizations such as UNESCO and the Council of Europe. The contentious issues of where to house the treaty and how to enforce it will form the basis for these discussions. It will then be adopted during the INCD’s third annual meeting which will take in Cape Town, South Africa Oct 11 -13 2002 and officially presented to the ministers of culture organized in the International Network on Cultural Policy.

Draft Convention on Cultural Diversity

[The preamble will recite the official antecedents to this Convention. Principal among these would be the Universal Declaration of Human Rights, International Covenant on Economic, Social and Cultural Rights, and International Covenant on Civil and Political Rights.

For some, the concept for cultural diversity engenders a notion of culture in its broadest sense - the totality of values, institutions and forms of behaviour within a society. Diversity may similarly be broadly defined to include not only diversity of human communities, but of biological ones as well, since there is a fundamental link between human beings and other species and life forms that share this planet. It is desirable to acknowledge the importance of these conceptions, but to narrow the focus of this Convention to forms of cultural diversity having to do with artistic and cultural expression.

Accordingly, for the purposes of this Convention, cultural diversity includes all forms of artistic and cultural expression, including popular culture, as well as traditional knowledge and practices, and linguistic diversity.

The following preamble transcribes elements of the INCD’s Santorini and Lucerne communiqués. These need to be refined, amended or modified as discussion of this Convention proceeds, but for the time being they reflect statements approved by the INCD membership.]

The State Parties to the present Convention,

Desiring to maintain and strengthen the capacity of all sovereign states to preserve and enhance cultural diversity, and to ensure their capacity to develop and implement measures to support diversity of artistic and cultural expression within and among nations; and taking into account the potential impediments to these goals that may arise from international trade, investment and services disciplines,

Desiring to promote the full social, human, economic aspects of cultural diversity,

Recognizing the need to increase the exchange of ideas, information and artistic creations around the world,

Acknowledging that support for artistic expression and cultural production can be an important tool of sustainable economic development,

Acknowledging that the fruits of artistic creation are far more than conventional goods and services, each is unique and all are an integral part of human societies,

Recognizing that the rights of individual artists and creators to practice their craft in security and freedom are fundamental human rights,

Endorsing the right of artists and creators to freedom of expression and freedom from censorship,

 

Recognizing that freedom of information and freedom and pluralism of the media are preconditions for diverse cultural creation and exchange,

Recognizing that there is a clear link between cultural diversity and identity, pluralism of ideas, human and societal values and sustainable development,

Confirming that there is a special need to preserve the cultures and traditional knowledge of indigenous peoples,

Confirming the importance of preserving languages as reservoirs of thought, history and knowledge,

Recognizing also the special needs of the less developed country members for maximum flexibility in the domestic implementation of laws and regulations in order to achieve the objectives of this Convention,

Recognizing the need for effective and appropriate means for preventing and settling disputes concerning measures adopted in accordance with the provisions of this Convention; and

Desiring to establish a mutually supportive relationship with the World Trade Organization (WTO), and the World Intellectual Property Organization (WIPO) (as well as other relevant international organizations – the United Nations Educational, Scientific and Cultural Organization (UNESCO) will be added as well, if it is not the host organisation of the Convention),

Emphasizing the need to ensure that the implementation and enforcement of international disciplines concerning trade in goods, investment, services and intellectual property, not occur in a manner that may undermine, or derogate from the rights and obligations of Parties to this Convention.

Hereby agree as follows:

1. The objectives and purposes of this Convention are to:

establish a multilateral framework of principles, rules and disciplines for the purposes of preserving and enhancing cultural diversity both within and among nations;

maintain and strengthen the capacity of sovereign states to preserve and enhance cultural diversity by taking any action, or adopting, maintaining and enforcing any measure that they consider necessary to preserve or enhance cultural diversity;

secure the rights of individual artists and creators to freedom of expression and to work in security and free from censorship, and to

provide effective and appropriate means for preventing and settling disputes concerning measures adopted in accordance with the provisions of this Convention.

2. Conscious of the often unique characteristics of the social, economic, educational, recreational, ecological and aesthetic values that are inherent to cultural diversity, nothing in this Convention shall be taken to derogate from the sovereign authority of a Party to define "culture", and "cultural diversity" in a manner appropriate to the diverse characteristics of its particular society and cultures.

3. Subject to the requirement that such measures are not applied in a manner that would interfere with the right of artists and creators to freedom of expression and freedom from censorship, nothing in this Convention shall be construed to limit the rights of the Parties to define such terms and concepts as indigenous or national culture as, from time to time, it considers appropriate, and for the purposes of defining the "diverse" rather than "like" characteristics of cultural products and services, a Party may distinguish between products and services based upon the:

(a) distinct indigenous, and national forms of cultural expression;

(b) country of origin of the artist or cultural producer;

(c) character, content, language or informational characteristics of such goods or services; or

(d) any other qualities or features that are relevant to preserving and enhancing diverse forms of cultural expression.

4. Each Party shall, in accordance with its particular conditions and capabilities:

(a) develop national strategies, plans or programmes for the preservation and enhancement of cultural diversity or adapt for this purpose existing strategies, plans or programmes which shall reflect, inter alia, the measures set out in this Convention; and

(b) integrate, as far as possible and as appropriate, the preservation and enhancement of cultural diversity into relevant economic, international trade, social and environmental policies and programs.

5. Each Party may from time to time adopt and implement appropriate measures, provided that they are consistent with the provisions of this Convention, that it considers necessary to preserve or enhance cultural diversity, or address practices which unreasonably interfere with, or undermine, the objectives of this Convention.

6. Each Party shall respect, preserve, maintain and support the diverse forms of cultural expression practiced by aboriginal, indigenous and local communities within its society, including those embodied in traditional lifestyles.

7. Understanding the importance of transparency each Party shall, in accordance with its particular conditions and capabilities, publish all relevant measures of general application which pertain to or affect the operation of this Convention and also establish one or more enquiry points to provide specific information on all such measures.

8. Each Party undertakes to provide, in accordance with its capabilities, financial support and incentives in respect of activities which will achieve the objectives of this Convention. These measures may include, but are not limited to: procurement practices; the provision of subsidies and grants; or, the granting of any advantage, favour, privilege or immunity, including tariff and/or tax preferences.

9. These financial supports and incentives may be allocated in a manner which accords special, preferential, or more favourable treatment to indigenous, or national forms of cultural expression where the Party considers that such measures will support or achieve the objectives of this Convention.

10. Such financial supports and incentives may be provided directly or indirectly to individuals, institutions, state enterprises, associations, non-governmental organizations or cultural industries.

11. The developed country Parties may also provide, and developing country Parties avail themselves of, financial resources related to the implementation of this Convention through bilateral, regional and other multilateral channels.

12. The Parties shall take full account of the specific needs and special situation of less developed countries in their actions with regard to funding the international exchange of cultural goods and services.

 

[The following provisions are adapted from the terms of international investment, and procurement treaties. However, the intent here is to confirm the sovereign authority of each Party to maintain, adopt and enforce investment, procurement and competition measures that it considers necessary for preservation and enhancement of cultural diversity. A discussion of the potential for conflicts to arise with other treaties, follows below.]

Each Contracting Party shall, in accordance with its particular conditions and capabilities, integrate, as far as possible and as appropriate, the objectives of this Convention with relevant investment, and competition measures, and may for such purposes prohibit or limit foreign investment in the cultural sector; or where investment is made in cultural undertakings, maintain, adopt or enforce any of the following requirements:

(i) to achieve a given level or percentage of domestic content;

(ii) to purchase, use or accord a preference to goods produced or services provided in its territory, or to purchase goods or services from persons in its territory;

(iii) to restrict sales of goods or services in its territory that such investment produces or provides;

(iv) to enter into independent, co-production, or co-distribution agreements; and

(v) that members of the board of directors or senior management be nationals of that Party.

13. For greater certainty, nothing in this Convention shall be construed to prevent a Party from adopting, maintaining or enforcing any measure that it considers necessary to ensure that investment activity in its territory is undertaken in a manner sensitive to concerns and policies concerning cultural diversity.

14. A Party may adopt procurement policies and practices which favour or accord preferences to indigenous and national cultural goods and services which it considers necessary to preserve or enhance cultural diversity.

[While quantitative import and export controls are prohibited under Article XI of the GATT with respect to trade in goods, unless subject to specific tariff reduction agreements, the use of tariffs (duties, taxes and other charges) is still allowed and represents an important regulatory tool for controlling trade in cultural goods. However, under the North American Free Trade Agreement and other regional free trade agreements, the use of tariffs is generally disallowed.

There are two key problems that have emerged in the WTO context concerning cultural goods and services. The first concerns the failure of WTO dispute bodies, in the cases that have involved cultural goods and services, to acknowledge that forms of artistic and cultural expression are more than commercial goods, products, or services even where they compete in the market place.¹ The second has to do with uncertainty about when a particular form or artistic and cultural expression will be considered a good, service or both. We note that the demarcation line, if any, between cultural goods and services, is still an open question for the WTO

The Draft Convention proposes to establish the authority of the Parties to make distinctions among cultural goods, products and services that may compete commercially but are "unalike" in other respects, by reserving these definitional questions to their sovereign authority (Article 3). Article 17 makes explicit their right to implement such distinctions.

Article 18 is based on the provisions of the General Agreement on Trade and Services (GATS), and inverts the prohibitions that the GATS articulates with respect to services that are subject to specific commitments under that Agreement.]

15. Each Party shall ensure that all measures of general application established to preserve and enhance cultural diversity are administered in a reasonable manner, but nothing in this Convention, or any other International Agreement to which it may be a Party, shall be construed to prevent a Party from adopting, maintaining or enforcing any measure that accords special, preferential, or more favourable treatment to indigenous or national goods and services which it considers necessary for achieving the objectives of this Convention.

16. Each Party undertakes to establish, in accordance with its capabilities, measures intended to preserve and enhance cultural diversity, and foster the exchange of ideas, information and artistic creations regionally, nationally and internationally, which may include measures relating to:

qualification requirements and procedures, technical standards and licensing requirements with respect to cultural goods and services;

limitations on the number of cultural service suppliers whether in the form of numerical quotas, monopolies, exclusive service suppliers or the requirements of an economic needs test;

limitations on the total value of cultural service transactions or assets in the form of numerical quotas or the requirement of an economic needs test;

limitations on the total number of cultural service operations or on the total quantity of service output expressed in terms of designated numerical units in the form of quotas or the requirement of an economic needs test;

limitations on the total number of natural persons that may be employed in a particular cultural service sector or that a service supplier may employ and who are necessary for, and directly related to, the supply of a specific service in the form of numerical quotas or the requirement of an economic needs test; and

measures which restrict or require specific types of legal entity or joint venture through which cultural goods or services are supplied.

The Role of Public Cultural Institutions

17. In recognition of the vital role that governments have to play in providing cultural goods and services, each Party may, in accordance with its particular conditions and capabilities, establish institutions, such as museums, theatres and libraries; language and/or heritage programs which it considers necessary to achieve the objectives and purposes of this Convention.

18. Each Party may establish, endow or empower state enterprises, monopolies, and other publicly governed institutions to provide cultural goods and services, such as arts education and funding, film development, and public service broadcasting.

Relationships With Other Agreements

[Under Article 30 of the Vienna Convention, the provisions of this Convention are deemed to prevail over those of an earlier treaty relating to the same subject matter, but only as between States that are parties to both treaties. For states that are not party to the Convention, a prior treaty (e.g. the GATT) will govern with respect to all State Parties to that earlier treaty, including those also party to this Convention.

In other words, it is not open to the Parties to this Convention to assert its priority with respect to non-signatory nations with which they have pre-existing international obligations - namely those arising under the WTO, international investment treaties, and any regional trade agreement. The important proviso however, is that for conflicts to arise between international instruments - both must deal with the same subject matter. Arguably many aspects of this Convention concern matters, e.g. audio-visual services, with respect to which there are few pre-existing obligations.

In addition, the INCD acknowledges the priority of certain WIPO conventions. This is codified by the following provision.]

19. Nothing in this Convention shall derogate from existing obligations that Parties may have to each other under the Paris Convention, the Berne Convention, the Rome Convention, the WIPO Copyright Treaty, the WIPO Performances and Phonograms Treaty and the Treaty on Intellectual Property in Respect of Integrated Circuits.²

Perhaps the most important strategic question facing the INCD concerns the approach it will take to resolving conflicts between this Convention and the requirements of international trade, investment and services regimes. The Lucerne statement clearly identifies the application of trade disciplines as problematic. WTO decisions to date illustrate how the disciplines of that regime can work to undermine the goals of this Convention. WTO dispute bodies have shown little sensitivity to societal goals that reside outside the commercial boundaries of trade liberalization.

However, it is important to keep in mind that much of the potential for conflict in this sphere, is incipient, and might yet be averted. In this regard, it is possible to conceive of the relationship between this Convention and the rules of trade liberalization in three ways:

as being fundamentally incompatible and therefore in need of harmonization;

as not being in conflict, and therefore capable of co-existence, or

as being potentially compatible if dispute resolution and implementation decisions are made in a manner that is sensitive to, and willing to accommodate the goals of cultural diversity.³

Of these, it is unrealistic to regard the respective agendas of trade liberalization and cultural diversity as being essentially compatible. However, it is possible that potential conflicts might be averted if the goals of cultural diversity are given legitimacy under the WTO and other trade regimes. With this qualification in mind, the following describes some of the options available for avoiding and/or ameliorating the potential conflicts that may arise in this context.

No New Commitments

The most important strategy for reducing the potential for conflicts between this Convention and the disciplines of the WTO and other trade, services and investment Agreements, is to ensure that no further commitments are made under the former that might undermine the objectives of this Convention. While the application of the trade in goods provisions of the GATT to forms of cultural expression remains problematic, disciplines concerning tariffs, services, investment, procurement and competition policy are of greater concern. As many will know, these aspects of the trade liberalization agenda have yet to be realized in the WTO context. The next two years will be critical in determining whether negotiations will get underway on these subjects. A similar agenda is at play in regional trade liberalization initiatives, such as the Free Trade Area of the Americas and in various Bilateral Investment Treaties now under discussion.

Qualified Commitments

Alternatively, if commitments to new disciplines are being considered, it would be vital to ensure that any new obligations exempt measures that may be required to protect and enhance cultural diversity. For example, the listing process for service sector commitments under the GATS allows WTO members to qualify those commitments in virtually any manner they deem appropriate. However, given the demonstrable bias of trade dispute bodies to read such reservations and exceptions very narrowly, and other pitfalls, considerable caution is needed if this approach is taken.

Exclusions

The GATT and other trade agreements set out various exceptions to the disciplines established by these regimes. Several of these concern matters of culture and cultural diversity. For example, Article IV of the GATT establishes an exemption concerning screen quotas. Article XX(f) of the GATT establishes an exemption for certain measures imposed for the protection of national treasures of artistic, historic and archaeological value. The North American Free Trade Agreement carries forward a cultural "exemption" from the Canada-US Free Trade Agreement. But because this ostensible exemption does nothing to avert retaliatory action when NAFTA rules are offended, it is of little, if any, utility.

The most broadly framed and robust exemptions under both NAFTA and the WTO rules are reserved for National Security measures. For example Article XXI of the GATT preserves the right of any WTO member to take any action which it considers necessary for the protection of its essential security interests. While it has been suggested that cultural diversity should be considered a question of national security, it may be unrealistic to expect that a broad carve-out for cultural diversity could be achieved as a reform to current international trade obligations. Far more likely, would be the establishment of such exclusions as the quid pro quo for any future commitments.

Waivers

Waivers may be granted by the Ministerial Conference of the WTO in exceptional circumstances (Article IX of the Agreement Establishing the WTO). Such a waiver was recently granted to the European Community, allowing it to give preferential market access to exports from certain former colonies under the Cotonu Agreement (replacing the Lome Convention). Waivers are restricted in their ambit to trade in goods, must be approved by a three-fourths majority of WTO members, and are subject to periodic review.

Safeguards

Safeguard measures may be adopted where the imports of a product occur in such increased quantities as to cause or threaten to cause serious injury to the domestic industry that produces like or directly competitive products. The WTO Agreement on Safeguards sets out detailed procedures to be followed where such measures are adopted, and imposes time limits of the period for which such measures can be applied.

Political Statements

The recent Declaration concerning the Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS) and Public Health adopted by the WTO Council in DOHA, provides another alternative to resolving potential conflicts between this Convention and international trade agreements. While this particular declaration lacked legally binding language, it is nevertheless expected to 1) exert a salutary effect on Members that might be contemplating a formal challenge, and 2) ameliorate the coercive effect that the threat of such disputes may have on members who may take a more conservative view of the ambit of TRIPS disciplines. It is also reasonable to expect this statement to influence the views of WTO dispute bodies.

Co-operation

The Convention on Biological Diversity formulates this objective in this manner:

The Parties, recognizing that international agreements such as those of the WTO and regional trade agreements may have an influence on the implementation of this Convention, shall cooperate in this regard subject to national legislation and international law in order to ensure that such rights are supportive of and do not run counter to its objectives.

Conversely the WTO imports a reasonably detailed procedural code for managing its relationship with the International Monetary Fund. More recently, the DOHA declaration underscored the importance of strengthening the relationship between the WTO and United Nations bodies with respect to environmental matters.

Dispute Settlement

The INCD Lucerne declaration calls for the NIICD to: ensure that the agreed limits are respected by providing a binding and enforceable system of review that is appropriate for the cultural sector. At this juncture it might be more helpful to identify the characteristics of such a system that would be appropriate to the cultural sector, rather than attempt to settle on a particular model for enforcement. Key, or necessary features might include the need for any model to:

• establish fully transparent dispute resolution processes;
• emphasize the consensual resolution of disputes;
• provide for intervention by interested third parties, including non-governmental organizations;
• allow for the protection of individual as well as corporate rights, including non- commercial rights such as freedom of artistic expression;
• require that local remedies be exhausted before recourse is sought to any international dispute resolution process; and
• ensure that adjudicators, mediators, and arbitrators are competent; that is, possess the specialized expertise needed to address the full social, aesthetic, as well as commercial characteristics of cultural goods and services.

It is not clear from the Lucerne declaration that the INCD has settled on the need for an international enforcement regime to be established by the Convention itself. For instance, enforcement of the Convention might be invested entirely in domestic, rather than international institutions.

Indeed more than one dispute resolution regime may be warranted. For example, for the protection of the individual rights of the artist, which are analogous to basic human rights, European human rights conventions provide a model. For the commercial interests of transnational corporations, a different approach would obviously be needed. Perhaps the side agreements to NAFTA provide a useful prototype for resolving such corporate disputes.

The following options represent an illustrative, rather than comprehensive list of the models for dispute resolution that might be considered.

Possible Prototypes

Council of Europe - Convention for the Protection of Human Rights and Fundamental Freedoms - is widely regarded as the most robust international regime for the protection of human rights. The European Court of Human rights presides over disputes arising under the Convention which may be initiated by a Party or individuals. The court may allow third party interventions, must as a rule conduct hearings in public, and publish its judgments. The court has the authority to afford just satisfaction to the injured party, which includes the right to award damages. The Inter-American Court of Human Rights, has similar, albeit somewhat weaker powers.

Optional Protocol to the International Covenant on Civil and Political Rights - has features similar to those of the Council of Europe Convention - but with respect to remedies is limited to forwarding its views to the State Party concerned and to the individual complainant. It provides neither for enforcement, nor sanctions when its advice is ignored.

International Covenant on Economic, Social and Cultural Rights - Under the Covenant, States Parties are obliged to send periodic reports to the United Nations Economic and Social Council (ECOSOC) documenting their compliance with the objectives of the Covenant. A Committee on Economic, Social and Cultural Rights was established in 1987, but it has weak implementation authority, and few nations pay more than lip service to their obligations under the Covenant.

UNESCO Conciliation and Good Offices Commission - established by protocol in 1962, the Commission was established for the purposes of resolving disputes between parties to the Convention against Discrimination in Education. In 1978, UNESCO established a procedure to handle individual communications alleging violations of human rights. Deliberations are confidential, as are reports to the Executive Board. While hundreds of complaints have been processed, the strict confidentiality that obscures the process makes evaluating the efficacy of this regime difficult.

NAFTA - Side Agreements on Labour and Environment - The focus of the adjuncts to NAFTA is on the failure of the Parties to enforce their respective environmental and labour laws. However, neither side agreement mandates a minimum threshold of environmental or labour rights protection. Nevertheless these regimes engender features that may have some appeal. For example, the functions of these institutions include the powers of investigation and reporting and are therefore much broader than simple dispute resolution. Their procedures are more transparent, and both engender specialized expertise and competence.

Arbitration/ Mediation International arbitration in accordance with NAFTA investor-state remedies would not be an acceptable option, but an arbitration and mediation centre has been established under the auspices of WIPO, which might provide a more suitable alternative. This model requires further consideration.

NAFTA - Chapter 19 Remedies Under Chapter 19 of NAFTA, bi-national arbitral panels assume the role of domestic appellate courts with respect to applications for judicial review of domestic administrative determinations. This approach would restrict the role of international adjudicative determination to the question of whether domestic rules were fairly applied - leaving the substance of domestic law and regulation to the sovereign determination of the Parties.

Domestic Remedies Both the GATS and the TRIPS Agreements mandate the establishment of domestic judicial and administrative procedures that might be a complement, or an alternative to international judicial procedures. In both instances, international dispute procedures compliment these domestic regimes, although this need not be the case in our example.