Cinema and audiovisual media

A Survey on National Cinematography
Questions and answers

Financing: state vs. commercial

The role of film financing was addressed by a specific set of questions.

– Does the government contribute to financing film productions?

– Please indicate the average percentage ceiling of such governmental financial participation.

– Is this participation regarded as a direct government grant?

– Are the funds managed by professionals themselves?

– Are they considered advances on ticketing revenues?

– Do they feed a special production fund?

Are there direct grants for film distribution (e.g. to finance copying or advertising campaigns)?

– Is there a tax-reduction scheme to encourage film investors?

– Are there other regular financing sources for film production?

– Is the private sector funding films?

– Are there particular grants for young filmmakers?

– Are there individual grants for script writing?

– Is there tax exemption for production companies, labs or studios?

– Does any film-funding come from abroad? Specify the sources.

– What is the average percentage of foreign financing in an international film co-production?

– Are public or private television companies compelled to contribute in film financing?

– Is this contribution a mandatory fixed share /quota to support the film industry?

– Is it an advance on broadcasting rights?

– Is it a kind of financial guarantee?

– What is the average percentage the financial contribution of broadcasting to film production?

– If the government (through ministerial departments, official agencies, but excluding public broadcasters) finances film production or audiovisual materials, please give an estimate of the number of productions receiving grants and the average share for each production in US$ per year.

– The same question as above, but specifically concerning public (institutional/governmental) information film and audiovisual productions.

There is a clear dichotomy between the industrialized world and the developing countries concerning film financing. The largest-producing nations like India, the United States America and Hong-Kong SAR, which are at the same time the largest exporters, are also those receiving the least amount of state funding. The percentage of public funding varies widely from one country to another.

Countries with highest amount of state funding

Country

Percentage of state funding

Total industry turnover in millions of US.$

Films produced in 1998

Austria

Azerbaijan

Luxembourg

Spain

Portugal

90%

90%

88%

80%

80%

100

0.5

41.2

23

60

22

3

1

45

14

As a reference:

France

23%*

798.3

183

*The sum of state funding and contribution from public/private broadcasters

These figures are in sharp contrast with the 5% ceiling proposed by the WTO. The most extensive mechanism for government financing recorded by the questionnaire is the so-called ‘taxation on ticketing’ which is probably also the oldest film financing source. Only in Europe and North America is there a system by which young filmmakers are financially supported for the realization of their first work, as well as specific funds reserved to scriptwriters.

The financial contribution of broadcasters in film financing has been decisive in maintaining and encouraging levels of national film production throughout the 1990s. That is particularly the case for medium-producing countries (from 20 to 199 productions per year), the category which includes Europe. In most of these countries, financing by broadcasters is compulsory, ranging from 15.7% in France to 75% in Italy. The participation of Mexican and Argentine broadcasters in national film production is 10%.

Last update 02/10/01