New Year cash boost for European film industry

Date: 21/12/1995

By Fiona McHugh

KEEN to help EU film-makers produce box-office hits to rival those currently being made in Hollywood, the European Commission will begin handing out 310 million ecu in subsidies to the TV and film industry from the beginning of next year.

Media 2, the sequel to a cinema subsidies framework which expires on 31 December, will channel money into training programmes to boost artists' commercial and technical skills, developing programmes with a European flavour and creating an EU-wide distribution system for home-made media products.

The initiative was agreed by ministers earlier this year. After much discussion, they increased funding for the five-year programme from 200 million ecu to 310 million ecu, but rejected French pressure for the amount to be doubled.

Financial support will come in the form of subsidies or loans, which will cover up to 50&percent; of the total cost of any given production. Films must be shown in three countries before they qualify for subsidies and distribution must be coordinated by an existing network of independent European distributors.

European film-makers, who have been trying to defend themselves from an onslaught of cheap Hollywood blockbusters, have welcomed the package. “We are very pleased with the Media 2 programme, in particular, with the decision to focus on a number of key areas rather than spread the money too thinly,” said Philippe Kern of Polygram.

But not everyone was happy. Under the proposal, only companies with a minimum of 51&percent; European ownership can qualify for distribution subsidies, a provision which has annoyed international distributors such as Columbia Pictures, Walt Disney and Warner Brothers, all of which will be excluded from the programme.

“Even if we are distributing European-made films, we would not qualify. That is neither fair nor sensible,” said one US industry representative.

Some diplomats believe the increase in funding was agreed as a compensation prize for Paris to make up for its failure to have the current film quota regime tightened - even though the increase falls short of France's initial ambitions.

France had hoped to tighten the current regime by removing a legal loophole, but was forced to beat a humiliating retreat in the face of stiff opposition from a number of member states. Culture ministers are thought to have agreed to heavier industry subsidies as part of a milder package.

Another initiative aimed at revitalising the industry by mobilising private investment, was also launched in autumn of this year. Under this guarantee scheme, the EU executive would agree to underwrite loans for film-makers.