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State aid granted to the European national film sectors has traditionally been legitimised on the basis of notions of national identity, the public interest and cultural diversity. While the economic value of these industries has contributed to their importance in the eyes of national policy-makers, this has also put state aid regimes under pressure on a European and global level, where a liberalisation agenda has come increasingly to the fore from the 1980s on. The research question raised in this article is therefore whether state aid in the film sector will be able to stand the proof of EU and WTO liberalisation efforts. Considering the evolution of primary and secondary EU legislation, as well as the on going debates within the WTO, it seems that the biggest threat to the sector’s aid regimes comes not from the regulation itself, but from the ambivalence and vagueness of its application. Not all points to a liberalising evolution however. The EU itself has set up a number of programmes intended to support the film sector, while the recent adoption of the Unesco Convention on the Protection and Promotion of the Diversity of Cultural Expressions can be seen as a counterweight as well. The actual strength and impact of these counterbalances in practice, however, is doubtful and/or unclear. The question remains therefore whether the WTO and the EU will be able to wander from their path dependent future, as a liberalist approach lies at the base of both. In consequence, political willingness will prove to be crucial in the following years, beginning with the review of present EU state aid regulation in 2007.
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