This is the first in a planned series of reports on the people, projects and polemics that have folks buzzing in various overseas territories.

Each year following the Cannes Film Festival the French film industry falls into semi-hibernation as execs recover from months of build-up, the box office gives way to Hollywood tentpoles and attention turns to tennis and weeks-long vacations. Some years, it seems like the industry doesn’t even really wake up again until the fall festivals hit. But in this past month since Cannes ended, there’s been quite a bit keeping the industry buzzing. Among the issues are what France’s Oscar entry will be, vagaries at the local ratings board, a renewed push to allow film advertising on television and the fight to preserve the Cultural Exception. France led the charge on the latter, winning in its bid on June 14 to keep the audiovisual business out of a negotiation mandate for trade talks between the U.S. and Europe. This was a fight that got a lot of traction in Cannes with even Harvey Weinstein and Steven Spielberg coming out in favor of the Cultural Exception as a means to maintain the diversity of European cinema.

Meanwhile, the jury that Spielberg chaired in Cannes gave its top honor to a coming-of-age love story between two women, Blue Is The Warmest Color. Many people have posited that Blue will be France’s Oscar entry this year, but I’m told that it will not. It’s generally accepted that films that win the Palme d’Or end up representing their country — the last time a French film won, The Class, it indeed was the submission.

Despite the difficulties of trying to woo some Academy voters with a lesbian love story with explicit sex scenes like Blue, the main reason I’m told it won’t make the cut is because French distributor, Wild Bunch, is not releasing it in time. The Oscar rep selection committee at French film body the CNC requires that a film go out nationally in France before September 30 and Wild Bunch has set an October release. Wild Bunch’s Vincent Maraval calls the rule “stupid” but tells me they believe October is best for the picture. It’s my understanding that Sundance Selects will release Blue unrated later this year in the U.S. Blue is expected to get a French rating that bars only kids under 12 because, Maraval says, “There are only positive values and love in the film, no violence or drugs.” When I asked him if he thought drugs were regarded more damaging than sex by the ratings board at the CNC, he said “Well, I hope sex is less serious than drugs, no?”

Blue‘s crowning in Cannes came at the same time as France was in the process of legalizing gay marriage – a move that has not been warmly embraced in all corners of the country. That was exemplified by protests in two affluent Parisian suburbs against the ad campaign for another Cannes winner, Stranger By The Lake. The gay-themed thriller won helmer Alain Guiraudie the best director prize in Un Certain Regard and was released in France on June 12. At the same time, its poster, an artist’s rendering of two men locked in a smooch with a beach scene in the background where other men are seen in various evocative poses, was removed in both Saint Cloud and Versailles after the locals said they were an affront to unwitting passers-by. The movie was slapped with a -16 rating meaning no one under 16 could go to see it; not a major shock — there are graphic sex scenes and some limited violence near the end — but the vehement reaction to the poster was a surprise.

In the U.S. where Strand Releasing has distribution, it will go out unrated in January 2014. Strand’s Marcus Hu tells me, “It’s such a mild drawing.” But, he suggests that “had there not been all the local unrest over gay marriage, it would have been fine. Right now you have people hot. It could be anything that set it off; it could be a Gap ad.” Stranger was one of the best received films in Cannes, but is unlikely to be selected as France’s entry for the Foreign Language Oscar given its subject matter and the strong rating.

A sex vs violence vs drugs issue is one that has put a spotlight on the French ratings board. There are five categories: All Audiences, -12, -16, -18 and X. The CNC doesn’t explain its criteria, saying rating a film “is in large part subjective and constitutes an exercise that is difficult to theorize.” Vetting the films is a 28-person committee made up of industry professionals, medical/scientific experts, reps from state ministries, and a group of 18-24 year-olds. If its subcommittee is unanimous on the equivalent of a G rating, the main committee doesn’t need to see the film. If there is any question of restricting certain audiences, the main committee screens the movies in a plenary session, then debates and votes. The result of the vote is presented to the Culture Minister who then makes the final determination, but does not need to see the film.

Here’s the rub: Though, Blue, which includes a brief shot of an erect penis, is expected to get a -12; Stranger By The Lake got a -16 and the ultra-violent Only God Forgives went from an original -16 to a -12. The latter film by Nicolas Winding Refn is notorious for having divided critics in Cannes. Before the film’s May 22 release, distributor Wild Side had asked for the initial -16 rating to be reviewed and a second screening was held which resulted in the change, Culture Minister Aurélie Filippetti’s office said. By way of comparison, other recent films with a -12 rating include Django Unchained and Springbreakers; both with their fair share of violence.

So, violence, OK; sex, OK, except if mixed with violence. But what about drugs? Sundance debut The Look Of Love has its French distributor up in arms over a -12 rating for its depiction of drug use. James Velaise, an Englishman who’s been releasing non-French indies via his Paris-based Pretty Pictures for donkey’s years, tells me he’s confounded by the rating. The Paul Raymond biopic contains adult themes and is partly set in swinging 60s Soho when Raymond was opening his nudie revue clubs. A key part of the film is also drug use which led to the death of Raymond’s daughter by overdose at age 36. Velaise contends that the film shows drug use to be “destructive.” He questioned the ratings board’s decision and was told that the repetitive drug use in the film could potentially “trouble a young audience.” Velaise says the movie is “anti-drug if anything.” He’d have accepted a general public rating with a warning, but rues restricting kids under 12. The film’s sexy situations and rather grim overtones might have been a bit too much for the committee, but it’s notable that all three Hangover movies have been rated All Audiences (in the U.S. they were all rated R for such things as pervasive language, nudity, and some drug material). A U.S. distributor tells me they’ve always perceived France as “so much more lenient” than the MPAA ratings board and that between gay marriage and issues with immigration, it seems France is “becoming more conservative.”

Velaise’s biggest beef with the CNC is what he says is a lack of transparency on the part of the ratings board. He contends that he couldn’t get the committee to take a second look and says “We should be able to turn up and voice arguments.” But the committee’s identity and its opinions are confidential according to a law established in 1990. Because the decision was unanimous, the Culture Minister responded to Velaise saying “it didn’t seem opportune to ask the committee to deliberate again.” The CNC just got a new president this week, but it’s unlikely the rules will change.

One thing Velaise does believe will change is the situation around advertising for films on television. Movie ads are verboten on French television but the issue comes up every couple of years and broadcast authority the CSA just opened a consultation last week on whether to change the rules. Velaise says he has “absolutely no problem with advertising” and thinks “it’s going to happen because the channels need income.” All commercials are currently banned on public broadcasters after 8 PM, something the channels seriously lament. Velaise says if the rules do change it will have “zero effect on distributors of art house films.” But Eric Lagesse, who heads Pyramide Films, feels staunchly otherwise. Were it to happen, he says it would be a “complete catastrophe… It will kill us.” An argument was recently made that allowing ads for films on TV would be good because it would free up other sorts of advertising space. But Lagesse contends that the U.S. majors won’t desert one area for another. Indies are already squeezed in France by the cost of paying for trailers in theaters at about 30,000 euros per. “We’re all inflating our budgets to have the paid-for trailers,” says Lagesse adding that if he and others have to start paying for ads on TV, “we’ll be obligated to swell our budgets even more. We can’t do it. And it will be a fortune, not the 30,000 for a movie theater trailer.” A U.S. studio exec tells me that it’s been “a bit of a blessing” to not be able to advertise on TV because it’s kept P&A down in France as compared to say Germany where ads are permitted and releasing a film can be very expensive. But this same exec allows, “The flipside is as a U.S. movie you’re at a disadvantage” because it costs a mint to fly talent over, where they can pretty much only do one day’s publicity and then getting them on the talk show circuit is a whole other matter. French talent can get more exposure because essentially the only program that really hypes U.S. films with star talent is Canal Plus’ Grand Journal. On that show, which is getting an overhaul this summer, translation is filtered in through earpieces and there are long pauses while everyone tries to understand one another making things pretty awkward. Getting film ads on TV “would begin to level the playing field,” the studio exec suggests and “would give us the chance to sell movies more effectively.” But this person is still on the fence, “Is it worth it? I’m not sure.” Public officials believe adding movie ads to TV time will bring in about 10M euros to the broadcasters per annum, but Lagesse feels that’s not enough money to risk cash-strapping the indies. He doesn’t believe the rule will change and adds, “We can fight so hard for the Cultural Exception but if we let measures like this pass, it goes directly against the Cultural Exception.” A final decision will come down by the end of the year.