New guidelines for official UK film co-production have recently been issued by the Department of Culture, Media and Sport. These will affect all applications made by UK co-producers on or after 5 January 2004 seeking to have their films qualify as British under one of the seven bilateral co-production treaties with the UK (France, Germany, Italy, Norway, Canada, New Zealand and Australia) or under the European Convention on Cinematographic Co-Production. The guidelines suggest that the DCMS will be operating a much tighter regime and that the rules will be strictly applied.
Some key changes are set out below (with paragraph references).
- Applications for provisional approval of a qualifying co-production must arrive at DCMS no later than 4 weeks before principal photography commences. Aim to submit the form 6 to 8 weeks in advance (6.7).
- DCMS will indicate if it is minded to reject an application and the applicant will be given an opportunity to make its case. After that, the DCMS will make a final decision and will not engage in negotiation (1.4).
- DCMS will expect UK co-producers to have a track record in film or television production although exceptions may be made if an experienced producer is providing support (3.4).
- Deferred payments should only be included in finance plans where such payments are guaranteed at a future date (3.13).
- Use of a number of UK nationals who are ordinarily resident in other countries and counted as a UK contribution may jeopardise qualification (3.25).
- In UK-Canadian co-productions, the minimum UK spend has been increased to 40% for a bilateral co-production, 35% for a trilateral co-production or 30% for a four-way co-production (4.14).
- The minimum spend and contribution under the other bilateral treaties remains at 20% for France, Italy, Norway and New Zealand, and 30% for Germany and Australia.
- In a European Convention co-production, the co-producers should provide a contribution of at least 20% for a bilateral co-production and at least 10% for a multilateral co-production. Where a UK co-producer is contemplating a finance-only contribution (which is allowed within the DCMS’s discretion) the DCMS requires strong evidence that the UK co-producer is not in a position to make the corresponding film-making contribution also (5.9).
- Auditors’ reports must be prepared by auditors who have not provided applicants with advice on the structure of their co-production and the report must not be completed before the film is finished (6.13). Where the DCMS repeatedly receives information from an auditor which is unclear or inaccurate, reports from that auditor will no longer be acceptable (6.14).
- If the UK spend is likely to be under 30%, the DCMS is unlikely to exercise its discretion to derogate from the requirements of the seven bilateral treaties.
After 5 January 2004 UK co-producers can expect a much more stringent interpretation of the treaties and a strict application of these new guidelines. From January 2004 producers should pay close attention not only to the treaty under which they are applying but also to these guidelines.