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20
10.6
CODE 18-77
Mr P M S Corley
Head/OT4
Room 302
1 Victoria Street
сс
Reference...
Mr Sunderland OT2 Mr Muir OT4/2
Mr Dunning OT2/2
Mr Neal ITP 3 Mr Nieduszynski
IT2 (OR)
ENG'S SUPPORT FOR PROPOSED PAL QUOTAS ON EXPORTS OF COLOUR TV SETS FROM HONG KONG TO THE UK DURING 1982
The Phase (reversal on) Alternate Lines (PAL) colour television (CTV) broadcasting standard used in the UK and much of Europe was devised and patented originally by AEG-Telefunken in the 1960's. These patents
have formed the basis of manufacturing licences which have been issued
to a large number of CTV set manufacturers throughout the world but particularly to those in countries which have adopted the PAL colour broadcasting standard. Until recently the terms of such licences dictated that only 50% of production could be exported, thereby providing partial protection for UK set manufacturers against low-cost sets imported into the UK for example, from the Far East. This protection has proved to be of inestimable value to the survival of the UK consumer electronics manufacturing industry which has virtually abandoned large-scale manufacture of most other mass market electronic goods in the face of severe competition from the Far East and in spite of voluntary export restraint agreements negotiated by the Radio Industries Council (RIC) with their opposite numbers in several Far Eastern countries. Thus, the UK consumer electronics industry has effectively retreated into the manufacture of colour TVs behind the protection that PAL has hitherto provided while at the same time attempting to rationalise its operations and deepen its capital investment in modern (mainly Japanese and US) CTV production technology.
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By agreement with AEG-Telefunken, Thorn-EMI administer the PAL manufacturing licences in several countries, including some special arrangements which apply in countries where CTV broadcasting is based on the US NTSC or French SECAM standards and which limit such countries exports of PAL sets to very much lower levels of domestic production.
Unfortunately several of the key PAL patents are now expiring although the exact date of expiry varies from country to country. This has now made it virtually impossible to enforce the blanket export limit of 50% of production from PAL countries. Consequently, AEG-Telefunken and Thorn-EMI decided recently to abandon this constraint and to allow unlimited exports from PAL-standard countries except for exports to Germany and to the UK, for which PAL quotas need to be negotiated.
Hong Kong (a PAL-standard country) is likely to become an incre asingly important manufacturer of PAL colour TVs and a quota of 50,000 sets was consequently offered for the Crown Colony's CTV exports to the UK during 1982. (Actual exports of CTVs to the UK from Hong Kong amounted to~20,000 sets in 1981). However the Hong Kong manufacturers are threatening to disregard this proposed quota and Mr Fred Evans (who administers the PAL licences for Thorn-EMI ) has appealed for our help, suggesting that he be provided with a letter indicating that HMG supports the quota. He believes that if he were able to quote from such a letter to the Hong Kong manufacturers they would come into line. He is particularly concerned at the demands of Cony, the largest producer there, that its quota should be more than doubled to 50000 units because of the domino effect this might trigger.
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