841.4061 Motion Pictures/96: Telegram

The Chargé in the United Kingdom (Johnson) to the Secretary of State

40. We have discussed in confidence with both Allport10 and Sir William Brown11 the points raised in the Department’s 13, January 12, 2 p.m. We have undertaken not to tell the American industry of our conversation with Brown. The numbers of the following paragraphs correspond to the numbered paragraphs of the Department’s 13.

1(a). It is not clear to us why in fact a quota based on footage rather than number of films would be particularly burdensome to the American interests. It is true, however, that if the British acceded to the industry’s request the total renters’ quota would be reduced by an estimated seven or eight films.

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The Board of Trade is unwilling to adopt a number basis. However, the specified length of feature films may be cut down, the figure to be possibly, 6,800 feet.

1(b). It must be remembered that the American industry, apart from expressing its disapproval of any quota, has not in the past pressed for a reduction in the quota schedule. That means that it would be next to impossible for Stanley12 to reduce the quota figures once they have been written into the bill. Allport has concentrated on gaining concessions on other points, e. g., multiple credit, reciprocity, et cetera, which would have the practical effect of substantially reducing quota requirements. However, since the Board of Trade has not been willing to meet the industry’s request in full, the Embassy feels that the industry would be justified in asking for a 15 per cent quota throughout the life of the act, and that it would be well treated if it got this figure.

When questioned as to whether the Board of Trade would give any assurances that the quota would not be raised progressively during the life of the act above some specified figure as 15 per cent, Brown remarked that he felt that this was properly a subject for negotiations and could be taken up by Overton13 in the conversations at Washington. We got the definite impression that the Board of Trade would be willing to hold the film quota at 15 per cent for features and 10 per cent for shorts during the life of the trade agreement. We were given to understand that there was no possibility of persuading Mr. Stanley to reduce the quota to 12½ per cent or to obtain a progressive yearly reduction. After all, as Brown pointed out, the maintenance of a quota is the essence of the British scheme.

2. This request seems justified since an exhibitors’ quota smaller than a renters’ quota operates to give a preference to nonquota pictures.

The Board of Trade has included this provision as a sop to the exhibitors and we were informed that there is a good deal of Parliamentary sentiment in favor of retaining it.

3. Stanley’s “double quota” plan, which includes the principle of a viewing test, is considered to be detrimental to American interests. If this plan is adopted it so alters the setup that the whole quota position will have to be reexamined.

The plan is reported to be unpopular with all interested groups, i. e., British producers and labor; British exhibitors; renters (preponderantly American). Brown could not definitely say that this plan would be dropped but we gained the impression that it might [Page 8]be. We have no means of knowing what might be substituted therefor.

4. The cost-per-foot basis has been accepted by the Board of Trade (see paragraph 1, page 4, despatch No. 3712, December 28, 193714).

The principle of a viewing test was so strongly opposed by Mr. Stanley in committee that it was defeated (see paragraph 3, page 4, despatch 3712). In spite of this he is reviving this objectionable principle in his new plan for tactical political reasons, according to Brown. This inconsistency gives further grounds for belief that he may ultimately abandon the double quota plan.

5. The multiple credit principle has been accepted by the Board of Trade as requested by the trade (see paragraph 2, page 4, despatch 3712). This is Mr. Stanley’s own proposal but was linked in his mind with the double quota plan and offered as a kind of compensation for it.

6. The present bill provides for a 20,000 pound minimum while the industry asks for a 10,000 pound minimum. We have grounds for belief that both sides could be persuaded to accept a compromise at 15,000 pounds.

7. The trade’s desire to get extra quota credit for expensive pictures is understandable but surely is not vital to its welfare. This is one more method of scaling down the basic quota requirement.

This idea was new to Brown who asked for time to consider it.

8. This request does not seem justified as it strikes at the core of the British legislation. We understand in confidence that Allport has recommended its withdrawal.

9. This subject was discussed under paragraph 4, page 5, despatch No. 3712. The Embassy feels that the request is not unjustified.

From Mr. Stanley’s point of view this request will probably be most difficult to grant. Objection in Parliament to the employment of more foreigners cuts directly across party lines and has wide popular support. Brown insisted that the cost of two non-British technicians was the maximum number which could be deducted. He intimated, however, that the 25% figure for other foreign categories might stand instead of the suggested 15% figure.

10(a). This request seems justified to the Embassy since a higher quota for renters is a discrimination against American interests.

Brown claims that it is absolutely impossible to alter this provision. He also stated that the principal American companies have fulfilled their quotas for the current year and that Anglo-American minor producers who have delayed fulfilling their quota requirements in the hope of evading them are affected.

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10(b). It is the Embassy’s impression that both British and American film interests prefer the old act to the new.

It would seem hardly possible however for Mr. Stanley to withdraw his film bill at this late stage. Brown says it is politically out of the question.

11. It is the Embassy’s opinion, confirmed by Brown, that the idea of a control commission is dead.

The question of quota increases during the life of the act has been discussed above under paragraph 1(b). The Board of Trade, of course, must always retain the right to recommend to Parliament the regulation of any industry.

12. The Embassy agrees that it would be better to have no quota for short films on principle and that if there should be one it should be equal for exhibitors and renters. In fact however if feature films are to be put under quota, it would be in the interest of the American renters that desirous subjects should also be under quota. No quality test for short films is proposed under the bill.

Brown insisted that the quota for short subjects must be maintained.

13. This seems a minor question. The discrimination against American interests is believed to be more apparent than real.

Brown maintains that this provision cannot be dropped and denied that it injured American interests in any way.

14. This question was touched on in paragraph 7, page 6, despatch 3712. The Board of Trade will propose that pictures made in the dominions should qualify for exhibitors’ but not renters’ quota. It argues that it is contrary to reason to permit films of questionable quality produced in the dominions to satisfy the British renters’ quota.

We have the impression from several sources, an impression cautiously confirmed by Sir William Brown today, that whether rightly or wrongly Mr. Stanley considers himself to be in a tight political spot as the sponsor of this unpopular bill. If it appears various proposals are disliked by different parliamentary groups for different reasons and Mr. Stanley consequently gives the impression of being unusually receptive to suggestions from any quarter, it would be a mistake to underestimate the political influence of those groups whose interest in the films bill is based on their concern at the cultural influence of films. Many of these are individuals well known to the public who are both articulate and aggressive and not particularly interested in the purely trade aspect of the film problem.

A further approach to the Foreign Office under instructions might influence the vacillating Stanley. If, however, such renewed American representations received publicity we believe that Stanley’s present difficulties would be greatly increased.

Johnson
  1. F. W. Allport, United States film representative in the United Kingdom.
  2. Permanent Under Secretary of the British Board of Trade.
  3. Oliver Stanley, President of the British Board of Trade.
  4. A. E. Overton, chief of the British Trade Delegation to the United States.
  5. Not printed.