The fabulous destiny of France’s film subsidies

Date: 04/05/05

Ian Mundell looks at the French government's decision to relax subsidy rules initially designed to fend off Hollywood

On 4 April the French government announced that it would allow non-European companies to benefit from state support for film production, following several cases which highlighted contradictions in the present system.

The Centre National de la Cinématographie, which administers the aid schemes, has until mid-June to come up with a way of doing this that will not destabilise the French film industry. This is a delicate balance, which many states and pan-European schemes have addressed. Some are open, to varying degrees, to non-European productions, while others remain tightly closed.

The potentially destabilising factor is the all-powerful US film industry. Its production budgets dwarf those in Europe and the resulting films dominate European screens. When politicians talk about encouraging their national film industries, it is understood that this is with respect to the American threat. But this protectionism needs to be set against the advantages that US money can bring, particularly if it is spent in Europe.

The film that has done most to prompt a change in France is Un long dimanche de fiançailles, directed by Jean-Pierre Jeunet, the man who made the hugely successful Fabuleux destin d'Amélie Poulain. It was filmed in France, in French, with a largely French cast and crew. It was a co-production with the US giant Warner Brothers and was initially told that it would benefit from the French aid system. But two industry bodies launched a legal challenge, arguing that the French co-producer was effectively a subsidiary of Warners. They won, and Un long dimanche de fiançailles became - for the purposes of the aid scheme - an American film.

Those unhappy with this decision have a useful counter argument in Oliver Stone's film Alexander. This was produced by Pathé and so counts as a French film as far as aid is concerned. But it was filmed mainly in Morocco, in English, with a British and American cast.

The aim of the current reform is to move away from the nationality of the production companies and recognise the benefits that are brought to the French film industry. It is certain to let in Jeunet's film, although similar projects will be few and far between. It remains to be seen whether the reform will go so far as to exclude films such as Alexander.

There are other factors at play, however. Some observers see the French reform as preparation for anticipated international trade talks, removing an obvious target for US objections. In addition, the European Commission is investigating French state aid for the cinema and it is likely that the reforms will try to pre-empt that decision.

The French situation is significant because France has the most active production industry in Europe and is also the most enthusiastic giver of aid. Other nations make fewer films and offer less aid, but have also had to consider the benefits of rewarding US investment. In the UK, for example, tax breaks for film production are open to any company registered in the country, while the UK Film Council has discretion in how it awards production support. It will invest if it sees a benefit to the British film industry, even if the identity of the film is American. For instance, it cites Cold Mountain, a US-produced American civil war drama, as a film with substantial UK benefits. Filmed largely in Romania, much of the crew was British and the post-production took place in the UK.

While the UK plays to its strength in post-production, the countries of Central and Eastern Europe have put considerable effort into promoting themselves as cheap locations for filming. Public support in the Czech Republic, for instance, is targeted at US companies rather than its domestic film industry.

But support at the European level is much less open to US money. Eurimages, the scheme operated by the Council of Europe, only supports co-productions and puts a limit on how much non-European investment is allowed. Similar restrictions have recently been introduced by Media Plus, the EU programme of support for film development and distribution. Films must be majority produced by companies from states participating in the programme and involve a significant participation by European professionals.

Distribution companies must also be majority-owned by Europeans and in some parts of the programme there is a bar on films above a certain budget threshold.

The aim is to ensure that the small amount of EU aid is concentrated on films that really need it.

• Ian Mundell is a freelance journalist based in Brussels.

Author looks at the French government's decision to relax subsidy rules initially designed to fend off Hollywood. On 4 April 2005 the French Government announced that it would allow non-European companies to benefit from state support for film production, following several cases which highlighted contradictions in the present system.