Proposal for a COUNCIL DECISION on the extension of the entitlement for co-productions as provided for in Article 5 of the Protocol on Cultural Cooperation to the Free Trade Agreement between the European Union and its Member States, of the one part, and the Republic of Korea, of the other part
Date: 2023-01-13
Institutions: Directorate-General for Communications Networks, Content and Technology, European Commission
Subjects: South Korea, audiovisual co-production, cultural cooperation, free-trade agreement, protocol to an agreement, revision of an agreement, trade agreement (EU)

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   EUROPEAN COMMISSION  Brussels, 13.1.2023  COM(2023) 23 final 2023/0006 (NLE)  Proposal for a COUNCIL DECISION on  the extension of the entitlement for co-productions as provided for in Article 5 of the Protocol on Cultural Cooperation to the Free Trade Agreement between the European Union and its Member States, of the one part, and the Republic of Korea, of the other part     
 
EXPLANATORY MEMORANDUM 

1. 

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CONTEXT OF THE PROPOSAL 

Reasons for and objectives of the proposal 

On the 1 October 2015, the Council adopted Decision (EU) 2015/2169 on the conclusion of 
the  Free  Trade  Agreement  between  the  European  Union  and  its  Member  States,  of  the  one 
part, and the Republic of Korea, of the other part. 

The  Protocol  on  Cultural  Cooperation1  annexed  to  the  Free  Trade  Agreement  between  the 
European Union and its Member States, of one part, and the Republic of Korea, of the other 
part ('the  Protocol'),  sets  up  in  Article  1  the  framework  within  which  the  Parties  are 
to cooperate for the facilitation of exchanges regarding cultural activities, goods and services, 
including in the audiovisual sector. 

This entitlement was established for a period of three years (from 1 July 2011 until 30 June 
2014).  Pursuant  to  Article  5(8)(b)  of  the  Protocol,  “[t]he  entitlement  will  be  renewed  for  a 
duration  of  three  years  and  shall  thereafter  be  automatically  renewed  for  further  successive 
periods  of  the  same  duration,  unless  a  Party  terminates  the  entitlement  by  giving  notice  in 
writing at least three months before the expiry of the initial or any subsequent period.” 

In accordance with that provision, the entitlement was already renewed three times for periods 
of  three  years.  The  first  renewal  ran  until  30  June  2017,  the  second  one  ran  until  30  June 
2020,  and  the  third  one  runs  until  30  June  2023,  no  Party  having  so  far  terminated  the 
entitlement. 

It is now proposed that the Council agrees to the continuation of the entitlement for another 
three  years.  EU-Republic  of  Korea  co-productions  are  potentially  mutually  beneficial  both 
economically and  culturally. The audiovisual  entitlement  can create additional opportunities 
for all Member States, including those who have so far been unable to develop co-productions 
bilaterally. 

• 

Consistency with existing policy provisions in the policy area 

The  Creative  Europe  MEDIA  sub-programme  supports  the  development  and  distribution  of 
European audiovisual works from participating European countries. Beneficiaries from third 
countries may participate under certain schemes if certain conditions are met.  

Certain  schemes  help  create  an  environment  conducive  to  co-productions,  notably  the  Market 
Access  and  Training  schemes  which  fund  markets,  networking  meetings  and  workshops, 
including  with  Korea.  In  addition,  the  co-development  and  TV  Programming  schemes  help 
European and international co-production partners, including from Korea, to cooperate.    

• 

Consistency with other Union policies 

The Protocol on Cultural Cooperation was concluded by the EU and Korea in 2015 as part of 
the Free Trade Agreement. Specifically, it was seen as an instrument to  promote the  United 
Nations Educational, Scientific and Cultural Organization (UNESCO) Convention of 2005 on 
the Protection and Promotion of the Diversity of Cultural Expressions.  

The existing entitlement foresees co-productions supported by groupings of national schemes 
and funds for audio-visual productions. The entitlement also allows the co-produced works to 

1 

The Protocol on Cultural Cooperation, OJ 2011 L 127, p. 1418. 

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qualify as European works under the definition of European works referred to in Article 1 (n) 
(iii) of the Audiovisual Media Service Directive (AVMSD).  

2. 

• 

LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY 

Legal basis 

The Court of Justice  with  its  judgment of 1 March 2022 in  Case C-275/20  - Commission v 
Council (Accord avec la République de Corée)2 clarified that the legal basis for the proposed 
decision should be Article 3(1) of Council Decision (EU) 2015/2169 as amended by Council 
Decision (EU) 2022/2335, which provides for a decision by qualified majority. 

• 

Subsidiarity  

The  renewal  of  the  entitlement  will  represent  an  opportunity  for  the  European  audiovisual 
industry to maintain its presence and further gain market shares, experience and knowledge in 
the Korean market, which is growing fast. 

Whilst  some  Member  States  have  successfully  undertaken  audiovisual  co-productions  on  a 
bilateral  basis,  many  others  still  have  not  and  therefore  the  entitlement  at  EU  level  has  the 
potential to allow for participation by a wider number of countries.   

The  European  Commission  has  limited  competences  regarding  production  of  films  whereas 
this  is  the  role  of  national  film  funds,  including  as  regards  international  co-productions.  
Therefore,  more  engagement  of  the  national  film  funds  will  be  necessary  in  order  to 
implement the Protocol in practice. 

• 

Proportionality 

Studies and data from the European Audiovisual Observatory have shown that co-productions 
lead  to  higher  audiences.  In  2021  European  films  in  Korea  made  up  23%  of  the  films  on 
release,  but  only  5%  of  cinema  admissions.  The  gap  between  the  cinema  releases  and  the 
admissions shows that there is a big unexploited potential and better collaboration could help 
tap into this potential. The co-production entitlement could create more opportunities for the 
European audiovisual  industry in  terms  of export and promotion to  Korea and a  gateway to 
Asia.  Therefore  implementation  of  the  coproduction  entitlement  would  help  build  market 
share in one of the top 10 markets by box office (USD 500 million, 61 million admissions).  
However, the presence of Korean films in the EU is quite limited.  Between 2017 and 2021, 
Korean films accounted for 0.6% of films on release and 0.5% of admissions in the EU. 

The lack of EU-Republic of Korea co-productions under the audiovisual entitlement since it 
was first agreed  seems due in particular to a continued lack of concrete information about the 
incentives available for co-productions in EU Member States and the Republic of Korea. This 
was lately exacerbated by the effects of the Covid-19 pandemic. Therefore, targeted measures 
should  now  be  taken  (covering  access  to  funding,  training  and  network  building),  both  at 
European  and  national  level.  The  previous  realisation  of  co-productions  between  Member 
States  and  the  Republic  of  Korea  outside  of  the  audiovisual  entitlement,  which  were 
interupted by the Covid-19 pandemic, shows there is the capacity and potential to do more. 

2 

Case C-275/20 - Commission v Council (Accord avec la République de Corée), EU:C:2022:142. 

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• 

Choice of the instrument 

In  accordance  with  Article  3(1)  of  Council  Decision  (EU)  2015/2169,  the  appropriate 
instrument to agree to the extension of the entitlement is a Council decision. 

3. 

• 

RESULTS 
CONSULTATIONS AND IMPACT ASSESSMENTS 

EX-POST 

EVALUATIONS, 

OF 

STAKEHOLDER 

Ex-post evaluations/fitness checks of existing legislation 

Not applicable 

• 

Stakeholder consultations 

The  Protocol  foresees  that  each  Party  shall  establish  a  Domestic  Advisory  Group  (DAG), 
comprised  of  their  respective  cultural  and  audio-visual  representatives  active  in  the  fields 
covered  by  this  Protocol.  On  the  EU  side,  the  DAG  met  in  December  2022  in  order  to 
evaluate  the  results  of  the  implementation  of  the  entitlement  in  terms  of  enhancement  of 
cultural diversity and mutually beneficial cooperation on co-produced works. 

Useful  exchanges  were  held  on  a  number  of  issues.  Stakeholders  acknowledged  the  lack  of 
EU-Korea  audio-visual  co-productions  under  the  conditions  mentioned  in  the  Protocol  and 
there were some calls to evaluate the reasons why the entitlement has not worked so far.  The 
discussion  highlighted  how  the  Covid-19  pandemic,  the  lack  of  awareness  and  the  strict 
requirements  were  possible  contributing  factors.  Some  stakeholders  remain  unconvinced 
about  the  institutional  basis  for  the  entitlement,  as  audiovisual  should  not  be  part  of  trade 
agreements.  

Moreover,  the  discussion  highlighted  how  the  overall  cultural  Protocol  was  contributing 
successfully  to  developing  cultural  relations  in  line  with  the  UNESCO  Convention  of  2005 
and  the  importance  of  further  strengthening  EU-Republic  of  Korea  cultural    relations.  
Concerns were raised about a potential lack of reciprocity of the Republic of Korea regarding 
the quotas for national productions on online video on demand services. However, given the 
lack  of  EU-  Korea  co-productions  so  far  the  potential  risks  are  low.  The  Commission 
concluded  that  a  renewal  of  the  entitlement  could  provide  an  opportuntity  to  adapt  the 
entitlement to address concerns and facilitate implementation of the Protocol?.   

• 

Collection and use of expertise 

Studies  and  data  from  the  European  Audiovisual  Observatory  have  shown  that  overall  co-
productions lead to higher international audiences. In 2021 European films in Korea made up 
23% of the films on release, but only 5% of cinema admissions. The gap between the cinema 
releases  and  the  admissions  shows  that  there  is  a  big  unexploited  potential  and  better 
collaboration  could  help  tap  into  it.    The  Cultural  Cooperation  Committee  set  up  by  the 
Protocol  reviewed  factors  possibly  affecting  the  implementation  of  the  audiovisual 
entitlement, including the Covid-19 pandemic, the lack of awareness about opportunities and 
requirements for co-productions.  

• 

Impact assessment 

Not applicable.  

• 

Regulatory fitness and simplification 

Not applicable.  

• 

Fundamental rights 

Not applicable.  

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4. 

BUDGETARY IMPLICATIONS  

None. 

5. 

• 

OTHER ELEMENTS 

Implementation plans and monitoring, evaluation and reporting arrangements 

The  Commission  will  continuously  monitor  the  implementation  of  the  audiovisual  co-
production  entitlement,  drawing  on  data  from  the  European  Audiovisual  Observatory  and 
from industry, in particular as regards the animation sector. 

Once a year the Cultural Cooperation Committee set up by the Protocol will meet to monitor 
progress and discuss challenges and opportunities. 

• 

Explanatory documents (for directives)  

Not applicable. 

• 

Detailed explanation of the specific provisions of the proposal 

Article 1 renews the duration of the audiovisual entitlement from 1 July 2023 to 30 June 2026 
and  during  this  period  allows  EU-Korea  co-productions  to  benefit  from  the  schemes  of  the 
respective parties. 

Article  2  provides  that  the  Decision  shall  enter  into  force  on  the  date  of  adoption.  This  is 
necessary due to time constraints related to the obligation for the EU to notify the Republic of 
Korea three months in advance if the EU intends not to renew the entitlement. 

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2023/0006 (NLE) 

Proposal for a 

COUNCIL DECISION 

on  the extension of the entitlement for co-productions as provided for in Article 5 of the 
Protocol on Cultural Cooperation to the Free Trade Agreement between the European 
Union and its Member States, of the one part, and the Republic of Korea, of the other 
part  

THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Council Decision (EU) 2015/2169 of 1 October 2015 on the conclusion 
of the Free Trade Agreement between the European Union and its Member States, of the one 
part,  and  the  Republic  of  Korea,  of  the  other  part,  as  amended  by  Council  Decision  (EU) 
2022/23353, and in particular Article 3(1) thereof, 

Having regard to the proposal from the European Commission, 

Whereas: 

(1) On 1 October 2015, the Council adopted the Decision of 2015/2169 on the conclusion of 
the  Free  Trade  Agreement  between  the  European  Union  and  its  Member  States,  of  the  one 
part, and the Republic of Korea, of the other part. 

(2) The Protocol on Cultural Cooperation annexed to the Free Trade Agreement between the 
European  Union  and  its  Member  States,  of  the  one  part,  and  the  Republic  of  Korea,  of  the 
other part ('the Protocol'), sets up in Article 1 the framework within which the Parties are to 
cooperate  for  the  facilitation  of  exchanges  regarding  cultural  activities,  goods  and  services, 
including in the audiovisual sector. 

(3)  The  Protocol  includes  provisions  on the entitlement  for  audiovisual  co‐productions  to 
benefit from the respective schemes. 

(4)  Pursuant  to  Article  5(8),  point  (b)  of  the  Protocol,  following  the  initial  period  of  three 
years  the  entitlement  will  be  renewed  for  further  successive  periods  of  the  same  duration, 
unless  a  Party  terminates  the  entitlement  by  giving  notice  in  writing  at  least  three  months 
before the expiry  of the  initial  or any  subsequent period.  In  accordance  with  that provision, 
the entitlement was last extended until 30 June 2023, no Party having terminated it. 

(5)  In  accordance  with  Article  3(1)  of  Decision  (EU)  2015/2169,  the  Commission  is  to 
provide  notice  to  Republic  of  Korea  of  the  Union's  intention  not  to  extend  the  period  of 
entitlement to co-production pursuant to Article 5 of the Protocol following the procedure set 
out  in  Article  5(8)  of  the  Protocol  unless,  on  a  proposal  from  the  Commission,  the  Council 
agrees four months before the end of such period of entitlement to continue the entitlement. If 

3 

Council  Decision  (EU)  2022/2335  of  28  November  2022  amending  Decision  (EU)  2015/2169 on  the 
conclusion of the Free Trade Agreement between the European Union and its Member States, of the one 
part, and the Republic of Korea, of the other part. 

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the Council agrees to continue the entitlement, that procedure is to become applicable again at 
the end of the renewed period of entitlement. 

(6)  The  Domestic  Advisory  Group  provided  for  in  Article  3(5)  of  the  Protocol  has  been 
consulted on the extension of the period of entitlement, as provided for in Article 5(8) of the 
Protocol. 

(7)  On  7  December    the  Committee  on  Cultural  Cooperation  assessed  the  results  of  the 
implementation of the entitlement in terms of enhancement of cultural diversity and mutually 
beneficial cooperation on co-produced works as provided for by Article 5(8), point (a) of the 
Protocol. 

(8) The Council agrees to continue the entitlement as EU- Republic of Korea co-productions 
are  potentially  mutually  beneficial  both  economically  and  culturally.    The  audiovisual 
entitlement  can  create  additional  opportunities  for  all  Member  States,  including  those  who 
have so far been unable to develop co-productions bilaterally. 

(9) This Decision should not affect the respective competences of the Union and the Member 
States. 

HAS ADOPTED THIS DECISION:  

Article 1 

The  period  of  entitlement  for  audiovisual  co-productions  to  benefit  from  the  respective 
schemes of the Parties for the promotion of local/regional cultural content, as provided for in 
paragraphs 4 to 7 of Article 5 of the Protocol, shall be extended for a duration of three years, 
from 1 July 2023 to 30 June 2026. 

Article 2 

This Decision shall enter into force on the date of its adoption.  

Done at Brussels, 

For the Council 
The President 

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