The Future Of The Funding Of European Films

The Perspective of some changes in the EU Commission film funding policy recently raised concerns among the major European funding bodies. In an unprecedented joint declaration, these funding bodies are now calling the EU Commission for cautious analyses that should consider an existing EU Commission document; the “Cinema Communication guidelines”.
Indubitably, the issue will be debated off-stages during the coming Czech International Karlovy Vary Film Festival. The Czech Film Chamber is one in a long list of signatories’ members of the European national and regional funding bodies of Europe.

The reason of this unusual concern from these major EU funding bodies is closely connected to the possible introduction at an EU-level of new automatic rating system; the “Cultural Tests”, which started to be used by Germany and the United Kingdom at the beginning of the year.
In the case of British films, the UK funding scheme has been given the green light by the European Commission and came into force on 1 January 2007. The test determines within four sections whether films can qualify for tax relief. The test is supposed to measure the extent of a film’s British cultural character. Film makers are awarded points in each of the categories and must score a minimum of 16 points out of a possible 31 to pass the test.

The signatories of the joint declaration are asking why to amend the Cinema Communication guidelines at the European Union level with the introduction of such a measurement system? The network of funding institutions highlights that the current Commission Communication (Commission Communication of 26.09 2001 – extended in 2004) succeeds in its main task: which is: reconciling Community competition principles with the right and duty of each Member State to implement cultural policies for film.

THE CONCERN FROM THE INDUSTRY
Looking at the results published by the UK Film Council Statistical Yearbook for 2005 – 2006 confirm the success and the competitiveness of the British Film Industry previous to the introduction of the Cultural Test of January 2007. Films in UK directly employed 31,000 people and supported a total of 97,500 jobs (2004). These films contributed £3.1 billion to UK GDP, and UK films promote tourism to an estimated value of £800 million per year!
Rather than amending the current Communication, which the EU film industry national founders believe could threaten the stability of the sector, and constitute a restrictive and reductive approach towards culture and film; these funding bodies would prefer a status quo.

The fact is that the current Cinema Communication guidelines have been drawn up in a period where the European Union counted only 15 Member States, and the guideline was modeled mainly from the French automatic aid scheme to film production. Since then, the Union enlarged to 27 Member States, and in 2006 the Commission approved two new film support schemes: one from the UK and one from Germany.

THE CONCERN FROM THE EUROPEAN COMMISSION
The Commission is not concerned about the volume of the aid to support culture. These supports are compatible with the Treaty. What can become a mater of concern for the Commission are the clauses in some funding schemes that would impose the producers to spend a certain amount of the film budget in a specific country of the enlarged Europe. These “territorialization clauses” may constitute a barrier to the free circulation of workers, goods and services across the EC, and may also hamper the EU internal market.

To take into account the case of the Member States for which it is vital to ensure the continued presence of human skills and technical expertise on their territory, the Commission decided in February 2004 to extend the validity of the “Cinema Communication guidelines” until 30 June 2007. Now that we have reached the date, the signatories are hoping that the new Communication would not be more restrictive than the 2001 Communication on Cinema.

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EUROPEAN COMMISSION COMMUNICATION
Commission communication of 26 September 2001 on certain legal aspects relating to cinematographic and other audiovisual works:

Communication on the follow-up to the Commission communication on certain legal aspects relating to cinematographic and other audiovisual works:

NUMBERS FOR THE UK FILM INDUSTRY – FROM THE BRITISH FILM COUNCIL

EU FUNDING SCHEMES
The European Audiovisual Observatory's KORDA database lists 169 support bodies and around 600 different aid programmes (KORDA for the film production at its different stage of development).

ON THE GERMAN NEW FUNDING SCHEME

ON THE UK NEW FUNDING SCHEME

By Gyora Gal Glupczynski