An investment deal between China and the European Union restricts Europeans from investing in Chinese media and entertainment companies but does not block Chinese firms from investing in European ones, according to newly released details.
Despite mounting alarm about Chinese disinformation and propaganda campaigns in Europe, the EU-China Comprehensive Agreement on Investment pact, announced Friday, gives Chinese firms a significant advantage in the media sector, critics say.
The deal, which was signed in principle in December, has drawn fire from Washington. Days before the agreement was struck, U.S. National Security Adviser Jake Sullivan urged the Europeans to delay completing negotiations, calling in a tweet for "early consultation with our European partners on our common concerns about China's economic practices."
Critics on both sides of the Atlantic say the deal will give China preferential access to European markets while Beijing continues to tamp down Hong Kong's pro-democracy movement and maintain detention centers in Xinjiang province, where China's Communist government has interned more than a million Uyghurs, according to rights groups.
The agreement still has several stages to go before adoption and needs to be ratified by the European Parliament. The rules governing investment access to the media and entertainment sector are quickly becoming the focus of criticism from some European lawmakers, mostly members of the center-right European People's Party (EPP), the largest grouping in the European Parliament.
In a statement, the EPP has urged European commissioners to "develop an EU-wide regulatory system to prevent media companies either funded or controlled by governments to acquire European media companies."
China has invested around $3.5 billion in European media firms in the past decade. EU officials say the investment deal is merely enshrining access rules that the bloc and China had agreed under World Trade Organization terms.
The deal "does not create any new rights for the Chinese investors in (the) media sector," according to a European Commission spokesperson. Under the terms, Chinese investors in media companies should be treated the same as European investors and enjoy similar market access. But the deal does not afford European investors the same rights.
French lawmaker Marie-Pierre Vedrenne, a liberal in the European Parliament, has "even more questions than before," since further details of the investment deal became public last week.
She said the EU is treating China as a partner, but Beijing is not reciprocating. Other lawmakers point to recent studies tracking Chinese influence that show when Chinese firms, mainly state-owned, invest in European media, China's coverage of the new acquisitions turn more positive.
In a study published last year, MapInfluenCE, a foreign policy research group operated by the Association for International Affairs, concluded that "local audiences in Poland, Czechia, and Slovakia have increasingly become direct targets of not only 'mask diplomacy,' but more complex propaganda efforts promote a positive image of China, strain transatlantic relations and directly attempt to rewrite narratives around sensitive issues."
Eleven member states, mostly central European, including Poland, Slovakia and the Czech Republic, remain concerned about the deal and are reserving the right to treat Chinese investors differently.
China is a major trading partner for the EU. Over the past 20 years, European companies have invested $174 billion in China. The European Commission said the investment agreement will provide overall improved market access and fairer rules for European companies in China, investors and service providers.
"The agreement provides a clear and enforceable framework of rules, which will give EU businesses greater access and more certainty when investing in China," the bloc's trade commissioner Valdis Dombrovskis said in a statement last week.
Critics of the deal say there is no level playing field when it comes to the media. China's state-controlled CCTV channels are broadcast without hindrance across Europe, but restrictions are placed by China on European broadcasters.
Outside the EU, Britain and China have disagreed over the media. Last month, the Beijing government banned BBC World News after the channel ran a string of reports on accusations of systematic rape of Uyghur Muslims in Xinjiang.
British Foreign Secretary Dominic Raab called the move an "unacceptable curtailing of media freedom."
The U.S. State Department condemned the decision, calling it part of a wider campaign to suppress free media in China.
China's National Radio and Television Administration (NRTA) said BBC World News had "seriously violated" broadcast guidelines, including a "requirement that news should be truthful and fair" and not "harm China's national interests."
Earlier this year, British media regulator Ofcom revoked state broadcaster China Global Television Network's (CGTN) license to broadcast in Britain.
The details of the EU-China investment pact will likely add to the Biden administration's dismay over the EU's decision to advance the deal. U.S. President Joe Biden wants a "united front" when it comes to China to increase leverage on Beijing.
Analysts have warned for weeks that the EU and the Biden administration will not see eye to eye on the best ways to handle an increasingly assertive China.