EC plans third consultation on state aid for the film industry

The EC Commissioner responsible for Competition Joaquín Almunia replied to questions tabled by French MEP Philippe Boulland of the European People’s Party (PPE) that another round of consultation is planned “in early 2013” about the Communication’s proposed new rules regarding aid provided by EU Member States to audiovisual production.

A first public consultation had been held from June to September 2011 and a second one from March to June 2012.

According to the German Federal Film Board’s representative to the EU Gisela von Raczeck, the forthcoming consultation is to last for two months and will not begin before the end of March.

Von Raczeck added that a multilateral meeting will also be held during the consultation phase between representatives of the Member States and the Commission.

Last November, the EC had delayed adoption of the Communication to the first quarter of 2013, but the indicative timetable now suggests that it will be due to be adopted in the third quarter of this year.

The EC originally agreed on the Cinema Communication in 2001, setting out the state aid assessment criteria for support for producing films and audiovisual works. The validity of these criteria was then extended in 2004, 2007 and 2009 and was due to expire at the end of 2012. The last extension of the Cinema Communication is still valid whilst negotiations continue on a new draft.

Swedish, Austrian, German state aid

The EC has also extended the Swedish Film Institute’s “Film Agreement” for a further three years.

The introduction of the Film Agreement sees the Film Institute’s overall budget for production and film-related activities increased by around $63.5m (€48.5m) to $190.4m (€145.5m).

In its statement to the Film Institute, the EC confirmed that four specific compatibility criteria, as set out in the Cinema Communication, had been met:

• the aid aims at a cultural product
• the aid intensity is limited to 50% of the production budget of the respective film
• there are no territorialisation requirements
• there are no bonuses for specific filmmaking activities.

The Austrian production incentive scheme Filmstandort Austria (FISA) – with an annual budget of $9.8m (€7.5m) - has been approved until the end of this year” on the basis that the Republic of Austria has undertaken to implement any changes to the scheme which may be required after the expiry of the Cinema Communication”.

In addition, the annual production scheme of $11.78m (€9.07m) by the Leipzig-based German regional fund Mitteldeutsche Medienförderung (MDM) has been given the greenlight by the EC DG Competition for another three years from Jan 1, 2013 to Dec 31, 2015.

At its latest funding sitting, MDM decided to back film projects as diverse as Wes Anderson’s The Grand Budapest Hotel ($1,168,24/€900,000), Elie Chouraqui’s The Origin Of Violence ($584,118/€450,000), Hineer Saleem’s Aga ($194,706/€150,000) and the animation film Mullewapp 2 ($908,628/€700,000).