Union film sector focuses on new funding proposal

Date: 26/03/1998

By Peter Chapman

EUROPEAN Union film-makers are set to relaunch their plea for extra cash to boost cinema production, calling for a new scheme to replace the guarantee fund plan which hit the cutting-room floor.

The industry has drawn up proposals for a film 'securitisation scheme' to provide additional finance for EU film-makers which address many of the concerns raised by Union finance ministers about the previous plan.

The idea will be discussed at the UK presidency's showcase audio-visual conference in Birmingham on 6-8 April, which officials say will set a new agenda for the Union media policy debate.

Philippe Kern, EU affairs director of Anglo-Dutch entertainment giant PolyGram, claims the initiative is already winning support from Audio-visual Commissioner Marcelino Oreja. It was PolyGram's movie unit, PolyGram Filmed Entertainment, which spawned the idea.

"We have submitted a new proposal for a financial scheme based on what we have seen in Hollywood with companies like 20th Century Fox," said Kern.

Under the programme, a handful of major film companies would be able to finance a slate of ten films each with loans from financial institutions backed up by EU money totalling up to 100 million ecu.

In exchange, firms would promise to put up a minimum level of funding to market the films in the EU to boost their chances of success. Once the films had been released, the loans would be repaid with a share of the profit.

Although a scheme on this scale would need be supported with 20 million ecu of EU cash, it would be more likely to satisfy Union finance ministers, who have repeatedly called for a more market-led approach to film funding than that proposed in the ill-fated guarantee fund plan.

A rearguard group of reluctant spenders led by Germany forced successive EU presidencies to water down the budget for the proposed fund from 100 million ecu to 60 million ecu. They finally killed the project late last year.

Calls for a new film finance scheme will be accompanied by a plea for greater EU efforts to improve training to ensure a steady stream of young film professionals in the Union.

Other key issues on the agenda for the UK event, which is expected to attract the great and the good from the film, TV and new media industries, include copyright and intellectual property regulation.

Part of the debate will focus on the Commission's draft directive on copyright in the information society which is about to face European Parliament scrutiny.

Top UK pay-TV operator BSkyB says it will also use the conference to remind EU and UK regulators not to interfere in the new digital television sector unless absolutely necessary.

"With spectrum scarcity disappearing, we will be calling for a light regulatory touch," said one BSkyB EU affairs expert, noting that digital technology meant hundreds more channels could be crammed on to the airwaves than with old analogue technology. "We will argue for freedom in the market-place allied to a fair application of competition rules."