Uncertainty reigns as international film and TV sector digests impact of US tariffs

The international film and TV industry is digesting the likely impact of the sweeping new set of tariffs on physical goods entering the US announced by President Donald Trump last night (April 2).

The morning after, many industry execs told Screen that they were uncertain about the exact impact at this stage – and that it will take time for the full picture to become clear. Many were meeting with colleagues or industry associations today to discuss what it means for their businesses.

”We are puzzled by the blurriness of the announcement for the moment,” said Juliette Prissard, general delegate of France’s film and television producers association Eurocinema.

A statement from UK business organisation the Confederation of British Industry summed up the feeling of many: “The situation remains very fluid, and we are prepared for more developments in the coming days and weeks – these developments will undoubtedly affect the extent to which firms are impacted.”

Notably, Trump’s tariffs are aimed at physical goods entering the US. They do not extend to services, which include the sale of films and TV shows into the US. “The scope is restricted to goods and not services,” said Prissard.

For now, the details are as follows: a 10% baseline tariff on all goods going into the US comes into effect on April 5. This baseline tariff will apply to countries such as the UK, Brazil, Australia, New Zealand, Saudi Arabia and Singapore. A higher round of tariffs go into effect on April 9. The European Union will be hit with a 20% tariff rate, with 45% for Vietnam, 24% for Japan, 25% for South Korea, 34% for China, 26% for India, 32% for Taiwan and 36% for Thailand.

Trump has long complained that the US imports more goods than it sends to the rest of the world. But it is a different story for services: the US is the largest exporter of services in the world and the country ran a trade surplus in services of nearly $300bn last year.

A key fear for the international film and TV industry is the trade war may escalate if countries – from the European Union to Canada and Australia – seek to retaliate with their own tariffs on US services. This risks dragging the tech giants and the film and TV industry into the tariff war.

Many Europeans execs are now waiting to hear how the European Commission will respond. European Commission president Ursula von der Leyen said: “We are already finalising the first package of countermeasures in response to tariffs on steel, and we are now preparing for further countermeasures to protect our interests and our businesses if negotiations fail.” 

The US could escalate too: Trump has publicly expressed his disquiet at the fact that US streamers are forced to invest in local productions in Europe as a result of the AVMS directive. In a memo published in February, the White House identified a number of “unfair practices” impacting American companies. It included a reference to legislation that “require[s] American streaming services to fund local productions” in many countries around the world. The Motion Picture Association, which represents the leading US studios and streamers, has also complained about the financial obligations facing its members in Europe. 

The US Trade Representative published a report on March 31 that detailed trade barriers facing the US, which included digital regulation, copyright law and AVMSD.

”We do not know in practice what will be the consequences for us except future pressure on the EU government to unravel the current legislation,” said Prissard.

Trump has also spoken of his desire to address so-called runaway US production. In January, he pledged to bring back “the Golden Age of Hollywood”, which he says has “lost so much business…to foreign countries.”

Countries such as the UK and Canada, in particular, have attracted billions of pounds of inward investment for major film and high-end TV productions such as Disney’s Wicked.

On the flip side, European and UK execs note US studios and streamers benefit from generous financial support, funded by public money, from the various production incentives in Europe. “They benefit from our generous state aid to shoot in Europe but don’t want to comply with our rules,” said one.

At this stage, few are sounding positive, and many fear damaging repercussions from a likely recession as consumers worldwide are hit by the increased costs and uncertainty created by the tariff war. For the film and TV industry, a recession could mean consumers cutting back on spending on cinema visits through to streamer subscriptions.

Advertisers are likely to spend less on marketing, harming commercial broadcasters through to AVoD services – which will have less to invest in production. The tariffs will drive up costs, too, making production more expensive.

• Global film and TV industry braces for expansion of Trump trade war