Canada's principal public sector film funder, TelefilmCanada, has announced a much-anticipated overhaul of its methods of investment- and re-investment - in the nation's indigenous production and distributionindustry.

The changes affect the $71m (C$81m) Canadian Feature FilmFund (CFFF) as it is applied in both English-lanuage and French-languagesectors in the 2007-2008 allotment.

The changes reflect the constrast in the states ofproduction and distribution in the nation's two major languages. WhileQuebecois film have enjoyed record results at the province's box office,English-language films typical acount for 1% or less of the box office in therest of Canada.

Hence, the lowering of the yardstick in English-Canada boxoffice performance envelopes. Where once a film needed to reach a box officegross of C$1m before triggering funding for future projects, that baseline hasbeen set to C$500,000.

However, the money will be awarded only to the top 15% offilms that pass that threshold. Producers of films that do some businesss willbe eligible for up to $150,000 in development funding based on box officeresults. Telefilm noted in its release, "The new threshold, which is more in step with market realities forEnglish Canadian cinema, will encourage new players to access the envelopesystem."

Conversely, for French-language pictures, while C$1m remainsthe threshold, the number of performance envelopes has been reduced from 12 to5 and there will be a per-company, per-year cap of C$3.5m in total Telefilmfunding. Both measures are a reflection of the success of the major producersin the province. Quebecois filmmakers complained earlier this year that themost successful producers were drawing too heavily from a limited pool offunds.

Quebec filmmakers will also see an enhanced "prestige andinternational exposure" bonus for films that are invited to major filmfestivals. Telefilm will also institute a recognition award to be paid to boththe director and the writer or writers of the film with the top box-officeearnings. This was triggered by complaints that Quebecois producers werereaping all the benefit from a film's success.

In English-Canada, feature documentaries will qualify forproduction performance envelopes of up to C$1m, a recognition of the success ofseveral Canadian documentaries released in the past few years, including The Corporation. Qualifying distributors in English-Canada will nolonger have to spend a minimum of C$500,000 on marketing to be eligible for adistribution envelope.

The new guidelines were instituted following consultationwith the CFFF working groups in both French- and English-language marketsrepresenting every sector of the industry, including production, distribution,exhibition, public and private broadcasters, and guilds and unions.