The opinions expressed in this editorial are those of the author and do not necessarily reflect those of Decima Reports.Some corporations are so large that an ownership chart looks as confusing as a Tokyo street map. Even executives have a hard time keeping track of interests, partnerships, and alliances. Throw in cultural protectionism, and things can become very scrambled indeed.  Such is the case in Vivendi’s proposed merger with Seagram. Most people think of Seagram as Canada’s best-known whisky-maker, the company that distills Canadian Club to the delight of rye-lovers everywhere. But the ever-profitable company continued to grow, buying the entertainment conglomerate Universal, which, in turn, bought the PolyGram from the Dutch electronics giant Philips. Keeping track of these takeovers is tricky enough without tossing the whole lot into the blender of Canada’s film distribution laws. Canada favors Canadian-owned corporations, giving them first dibs on the distribution of foreign films. The "Hollywood" majors (now owned by far-flung corporations based in New York, London, Tokyo, and the other major investment cities of the world) were grandfathered under these rules. But PolyGram was neither a Hollywood major nor a Canadian company. It was a relative latecomer to the distribution business. When it was Dutch-owned, PolyGram chafed under Canada’s rules, going so far as to successfully lobby the European Union to challenge Canada’s rules at the WTO. That attack was blunted when Seagram bought PolyGram. PolyGram became Canadian. But now the clock is turned back. Seagram would emerge from the merger as a minority owner of Vivendi, making PolyGram French-owned. But PolyGram has employees, contracts and investments in Canada that it can’t just walk away from. It could sell its Canadian operations to a Canadian firm or one of the Hollywood majors, but that wouldn’t resolve the issue of challenges to Canada’s distribution rules. The WTO could settle the issue, probably not to the benefit of the Canadian film industry. Or, if Ottawa’s ongoing drive to develop a bloc of countries that supports cultural exemptions in trade law succeeds, the protectionists will escape the noose of free trade by the skin of their teeth.