- The Washington Times - Saturday, September 1, 2001

Exported American films long ago conquered foreign markets, but the nation's actors now worry that Hollywood has turned their jobs into its newest overseas blockbuster.
The Screen Actors Guild, the union for the nation's actors, is backing a petition to stop U.S. studios from heading for movie sets in Canada by slapping tariffs on films shipped into the United States.
At the heart of the problem, the actors say, are Canadian subsidies and incentives that encourage film production in major Canadian cities such as Toronto, which is now home to one of the world's biggest film festivals.
"The studios are looking for the biggest bang for the buck, and subsidies in foreign countries provide that," said Lance Simmens, director of national government affairs for the Los Angeles-based guild.
But Ron Atkey, counsel to the Canadian Motion Picture Distribution Association, criticized the actors' case, noting that the vast majority of production costs are still paid to people in Southern California.
"The pursuit of a protectionist policy by a group that already has the bulk of production has no credibility," said Mr. Atkey, whose group represents the Canadian affiliates of major U.S. studios.
The actors will file their request with the Commerce Department shortly after Labor Day. Their goal is to have tariffs imposed on films that are filmed in Canada and brought into the United States.
Once the department accepts their case usually a routine matter the actors will have to convince the independent International Trade Commission that Canadian subsidies have harmed them before duties would go into effect.
The Canadian Embassy declined to comment on the case, saying it would withhold judgment until the actors file their request.
The actors are being represented by the Made in the USA Foundation, a Washington group that has taken on other claims on behalf of organized labor. It has waged an unsuccessful battle to have the North American Free Trade Agreement declared unconstitutional because it was never ratified by two-thirds of the Senate.
But even if the actors succeed, they may find that tariffs will not solve their problem, according to Lewis Leibowitz, a lawyer with Hogan & Hartson who handles trade cases. Only goods crossing a border can be slapped with tariffs, so studios could simply beam their product into the United States to avoid the duties.
"In the film industry, nothing tangible may ever cross a border," Mr. Leibowitz said.
The actors call their problem "runaway production," and it affects major productions.
In January, the Commerce Department concluded in a report that movie production outside the United States drew $10.3 billion out of the U.S. economy, when factoring the loss of ancillary business, such as catering and trucking.
The actors say that 90 percent of production outside the United States takes place in Canada, lured by a variety of subsidies. The western province of British Columbia, for example, has had a tax credit for foreign producers since 1998.
According to Mr. Simmens, of the 139 movies currently being shot by Hollywood studios, 90 are being shot in Canada, 40 in the United States, and 19 in other countries.
The strong U.S. dollar also has accelerated the pace of film production abroad because it makes shooting in Canada and other English-speaking countries much cheaper, industry observers said.
Aware that the public tends to view actors as highly paid professionals with little to complain about, the actors stress that the main beneficiaries of the case would be those on the lower rungs.
"We're going after this on behalf of the rank and file, not the stars," said Brent Swift, chairman of the Film and Television Action Committee, which is collecting signatures to the petition. "[The stars] will always be OK."
Roughly 70 percent of the 100,000 actors guild members earn less than $7,500 per year from acting, Mr. Simmens said.

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