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MEMO/08/329

Brussels, 22nd May 2008

State aid: future regime for cinema support

European Commissioners Neelie Kroes, and Viviane Reding, responsible respectively for Competition and Information Society and Media have indicated their intention of proposing a three year extension to the current regime for state aid for film support schemes, as laid down in the 2001 Cinema Communication (extended in 2004 and 2007). The Commissioners have taken into account the fact that the final report of the study on the economic and cultural impact of territorial conditions in film support schemes does not seem to be conclusive about the economic or cultural impact of territorial conditions in film support schemes and underlines the need for further reflection. At the same time, a three year extension of the current regime will allow further reflection on new trends facing the sector which are not covered by the current Cinema Communication, including support for inter alia digital technology and film distribution, as well as competition among some Member States to attract inward investment from large-scale, mainly US, film production companies.

The text of the joint declaration by Commissioners Kroes and Reding is as follows:

"The final report of the European Commission study on the economic and cultural impact of territorial conditions in film support schemes has just been published. The study, which was launched following the European Commission's Cinema Communication of 2004, has been conducted by a consortium led by Cambridge Econometrics. The complexity and sensitivity of the subject for the sector was evident to everyone who took part in the study workshop, organised in Brussels by the consultants in July 2007. We would like to thank the consultants, those film producers and funding bodies who have shared their experience with them and, in general, all those who have contributed to the study for their active engagement.

"The Commission still has to examine the detailed findings of the study. However, we are aware that many in the European film sector are keen to know what the Commission has in mind for the future of the State aid rules in the Cinema Communication. This is why we have decided to make this joint statement.

"The final report of the study does not seem to be conclusive about the economic or cultural impact of territorial conditions in film support schemes, one way or the other. However, the results underline the need for further reflection before proposing a modification of the existing territorialisation criterion in the Cinema Communication. This reflection should also allow an evaluation of a number of new trends facing the sector which are not covered by the current Cinema Communication. These include support for aspects other than film production (such as digital technology and film distribution), as well as competition among some Member States to attract inward investment from large-scale, mainly US, film production companies.

"We firmly believe that whatever State aid there is for film should have the cultural aim of ensuring that Europe's national and regional cultures and creative potential are expressed in the audiovisual media of film and television. At the same time, though, it should also aim to lead to a sustainable European film sector.

"In our view, attempting to complete this reflection between now and the expiry of the current Communication on 31 December 2009 would probably be difficult. More time is needed to allow interested parties to be fully involved. The existing Cinema Communication seems to be widely accepted within the film sector and enables the Commission to control schemes which may distort competition or have an effect on trade between Member States. Consequently, we intend to propose to our Commission colleagues that the existing Cinema Communication is extended for a period of 3 years.

"We will consult our Commission colleagues on this proposal in the coming months, based on the detailed findings of the study. We aim to consult Member States on a draft Communication in Autumn 2008."

For more information:

The final report of the study under taken for the European Commission on the economic and cultural impact of territorial conditions in film support schemes is available at:

http://ec.europa.eu/avpolicy/info_centre/library/studies/index_en.htm

The Communication from the Commission to the Council, the European Parliament, the Economic and Social Committee and the Committee of the Regions on certain legal aspects relating to cinematographic and other audiovisual works (COM(2001), prolonged in 2004 and 2007 is available at:

http://ec.europa.eu/avpolicy/reg/cinema/index_en.htm,


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