Sarajevo Film Festival: co-producing with the UK

Sarajevo’s CineLink Partner Country Initiative has been running for more than a decade, systematically strengthening the working relationship between the Southeast European film industry and its international counterparts.

This year’s Partner Country is the UK, and a delegation of around 20 British producers, sales agents, distributors, agents and festival representatives will be present at CineLink for four intensive days of meeting regional film makers and promoting the possibilities of cooperation with the UK. 

As an introduction for the producers from Southeast Europe attending the festival, Isabel Davis, the head of international film fund at the BFI, held a presentation of its recently established minority co-production fund.

“The UK has had a good, long-standing relationship with this festival and this region, and it felt very timely to come here as a partner country,” Davis said.

“While the UK is very talent-driven and actually getting your film shown is hard - and these challenges remain - there have recently been two key changes on the funding side that can make it easier for these countries to access UK productions: the lowering of threshold for the tax credit; and the minority co-production fund of the BFI.”

International director

To access the minority co-production fund, which amounts to £1m annually, there has to be an internationally acclaimed director involved.

“I am not saying you necessarily have to have someone like Alfonso Cuaron on board, but it is common sense that it needs to be a name that can actually ignite interest of distributors and audiences.”

The first film supported by the minority co-production fund is The Lobster, directed by Yorgos Lanthimos, with an international cast that includes John C. Reilly, Colin Farrell, Rachel Weisz, Ben Whishaw and Léa Seydoux.

Speaking to ScreenDaily, UK producer Mike Downey said: “The UK minority co-production fund is essentially looking to support projects where the UK elements elevate their creative and commercial potential.”

Downey is currently deputy chairman of the EFA and spent four years as a member of the BAFTA Council. He added: “Clearly a unique UK angle has to be present in the configuration. The core of the ideology is to  maximise the economic growth and cultural reach of UK film. Backed projects are distinctly market focused.”

Cultural test

Besides bilateral treaties, which most of the Southeast European countries do not have with the UK, one way to qualify is the UK cultural test. This points to the creative and cultural element related to the UK, which has to be substantial.

But the test, which has been in force since 2007 and regulates key issues such as where the film is taking place and which language is it in, is under review. If amendments are passed by the government by the end of the year, it will give the test a very European-based dimension.

On the other hand, the tax relief threshold for co-productions has been lowered from 25% to 10% of the total spend on the UK soil, making it effectively a tax rebate.

“If you are making a film with British talent, but spending the budget in Croatia or Romania, that is not going to get you a penny out of the tax credit,” Davis said. “But the lowering of the threshold has made it possible to, for instance, only do the post-production in the UK and access the credit. So suddenly the UK has become able to be partner on much greater number of co-productions.”

Euro filmmaking

“Film making in Europe is by definition co-production,” said Downey, who has been involved in more than 50 international co-productions in the past 15 years with budgets totaling over €100m, through his company F&ME.

“It only works if there is reciprocity. The drawback with the UK is that it is difficult to maintain a credible reciprocal position.  There is zero participation by the broadcasters.  The tax credit, despite the lowering of the threshold, and when considered alongside comparatively high UK production and post-production costs is rarely viable. 

“The costs involved in monetising the UK tax credit for the relatively small sums involved in European co-production are comparatively high, and when it is possible to monetize (bond, pre-sales, etc.), banks are rarely interested and the so-called ‘middle-men’ that the new tax credit was designed to avoid are still there and doing business – and thank God they are, otherwise there would be nowhere to go.” 

This was the case on Lost In Karastan (aka EPIC), which screens in competition in Montreal. It is a British qualifying feature directed Ben Hopkins and written by Pawel Pawlikowski and starring Matthew Macfadyen, Myanna Buring and Noah Taylor. It was produced by Downey and  Sam Taylor. 

“To be honest, it was such a complex co-production between the UK, Georgia, Russia, and Germany that the UK tax credits just didn’t fit,” says Downey.

Another recent film Downey produced, Mohsen Makhmalbaf’s The President, which will open Venice, is a Eurimages recipient, and was made as a UK-German-Georgian-French co-production. It was entirely shot in Georgia and Makhmalbaf is a long time resident of the UK.

“We [F&ME] have become very savvy at integrating our UK business into the centre stage of European film production, but we are unique – and part of a dying breed,” Downey explains. “The future of film production in the UK is in its full participation with European structures.”

This is why Downey argues that, instead of finding legislative loopholes and shortcuts into the hard-to-break UK market for small territories, especially those which are not members of MEDIA programme, “The right legislative and film culture approach would be to reverse the UK’s entrenched position not to participate in Eurimages. 

“If the Eurimages would accept the UK back into the fold, then countries like Serbia, Turkey, Georgia could work with the UK in a much more integrated and reciprocal way.  As a European nation the UK has a serious duty to look at its position with regard to the incredible benefits that membership brings – not only financial.

“Clearly a unique UK angle has to be present in the configuration. The core of the ideology is to  maximise the economic growth and cultural reach of UK film-backed projects are distinctly market focussed. 

“There is £1m available per annum. There are approximately and on average 1,300 feature films produced in Europe annually.  You don’t need to be a statistician to analyse the probabilities involved here. Balkans, Caucasians, Scandinavians, Iberians, Celts, and post-Communists don’t need me to tell them to be realistic. Do the arithmetic.”