European films scored at Cannes. Congratulate yourselves. You paid for it.

Michael Hedges May 30, 2008

Europe’s national film industries have been in a long battle, mostly with Hollywood, often among each other, soon with Brazil and Bollywood. After a two decades waiting a French film, the documentary style “Entre les murs” by Laurent Cantet, won the Golden Palm. Other European film works partook of the prestige. EC President José Manuel Barroso said, “Europe can be proud.”

Proud, and paying for it.  Individual national governments and the EC itself are pouring a righteous amount of tax money into the audiovisual sector, most visibly for film production and distribution support. The average European cinema ticket price in 2007 was about €6, more than double what Americans pay. Here in sunny Switzerland a movie ticket costs just under €10, of course. When ticket sales (and product placement) hardly support national film industries, Culture Ministers step in. More and more, Culture Ministers are turning their interest toward enticing big, and generally America, producers to local studios, locations and talent.

Last year Germany set up the German Film Fund (DFFF) and subsidized 99 films with just under € 60 million. The German initiative is less interested, however, in happy cinema-goers and more interested in keeping – and attracting – productions to German studios.

"We've sponsored the whole group in the middle, but we've also managed to draw big Hollywood productions to Germany,” said DFFF project manager Christine Berg to DW-World. That includes Tom Cruise latest. Once qualified financially and committed to spending 25% of the production budget in Germany, the DFFF grants 16% of the total.

In April Norway’s Ministry of Culture consolidated three agencies involved in film promotion and production into a new National Film Institute. Certainly, promotion of Norwegian film and video content is a primary goal. Added emphasis will be given to “a stronger focus on Norwegian interaction with foreign territories than in the past, through co-productions, incentives for foreign projects, and greater support for exports,” said the announcement.

The French film industry would seem to be thriving. French producers made 227 films in 2007, half Hollywood’s output but three time that of the UK. Unique in continental Europe with a large international distribution French producers, nonetheless, receive generous State aid, €270 million in 2007, made possible by a tax on cinema tickets and broadcasters’ turnover. And every French production is ‘officially’ a cultural creation.

Finland’s Ministry of Culture and Sport increased film production support by €2million last year, funds coming from the State lottery.

But the mere mention of State aid and subsidy raises European Commissioner for Competition Neelie Kroes from her chair. The new Members states have been particularly hard hit. Under pressure from DG Competition, Hungary’s Motion Picture Public Foundation (MMK) expired at the end of 2007. Commissioner Kroes’ office was concerned about that 20% tax break, otherwise known as indirect subsidy. Already, Hungarian films receive 50%-55% State subsidy. Delta

The developer of a major film complex near Budapest put his project on hold, perhaps permanently, when the Hungarian law expired. Real estate developer Sándor Demján told the business weekly Figyelo (February 10) that filmmakers would desert the project of the government couldn’t find a way to subsidize foreign productions.

Turkish director Nuri Bilge Celan won the Golden Palm for best director with “Three Monkeys.”  Turkey isn’t quite in the EU yet but its film producers, directors, actors, writers and all the rest suffer from the dilemna felt across Europe. Celan’s work is serious fare. His 2006 film “Climates” sold but 35,000 tickets, according to Turkish Daily News (May 28). Turkey founded its Support Fund for the Cinema and Musical Arts in 1989. Being a Council of Europe (CoE) Member, Turkey also participates in the EURIMAGES co-production and distribution support system.

As the Cannes film festival wound down, European film work scoring well, EC Info society and Media Commissioner Viviane Reding and Competition Commissioner Neelie Kroes addressed the continuing struggle of European film production by proposing (May 22) to extend, again, rules allowing Member States to provide State subsidies.

The original Cinema Communication was approved in 2001, extended in 2003 and 2007. Before it expires at the end of 2009 the Commissioners want another extension. Technically, European Commission rules ban State aid that interferes with competition. The audiovisual sector is considered more cultural than economic so State aid, under strict guidelines, is allowed.

State aid to the audiovisual sector, now broadly interpreted as everything imaginable with the possible exception of the printed media, is a discipline more than a rule. State aid to industries and economic sectors must not undermine competition within and among States. The audiovisual sector, however, is not considered a purely economic actor. But economic factors – like employment – are a certain consideration.

European films, directors and writers fared well at Cannes last week, though Latin American themes and artists dominated. Four films supported by the European Commission’s MEDIA program picked up awards.

"The awards from Cannes mark the climax of what has been a truly successful year for European filmmakers," said Commissioner Reding (May 26),  "I am very proud to see the high quality of films that Europeans are now able to produce. The support given by Europe's MEDIA program to these award winners will now ensure that they can also be seen outside national and European borders."

“Yet European film makers are still facing important challenges in Europe and on international markets,” she added. “We will therefore explore ways to forge worldwide partnerships based on cooperation and reciprocity to more actively promote coproduction and distribution of films.”

The MEDIA program’s budget supporting European film between 2007 and 2013 is about €750 million. Fourteen films screened at this years’ Cannes Film Festival received about €900,000 in EU MEDIA funding support. Feature films, television drama, documentaries, animation and new media can find production support, typically as co-production, from MEDIA as well as training programs and development aid.

French Culture Minister Christine Albanel,in an interview with Le Monde (May 22), made clear that while all those art-house films are nice she really wants to attract Hollywood stars and producers to France.

“The idea is to bring back these Hollywood films shot elsewhere today, but without opening the floodgates to all projects,” she said. Part of her plan is to include an international tax rebate in the 2009 French budget. By appearances, Commissioners Kroes and Reding concur. Perhaps their support will trickle down to the Hungarians.

Minister Albanel may already have part of her wish. Nice Matin reported (May 28) that Brad Pitt and Angelina Jolie signed a three year lease on a chateau (20 fountains and a moat) near Cannes.