Audiovisual in luxembourg: A young but dynamic sector...
Luxembourg’s audiovisual environment was formerly mainly focused on broadcasting activities and has been diversified with the creation of infrastructure for production and post-production and the establishment of several production companies and audiovisual services. To better assess the positive effects of the introduction of financial support for audiovisual production in the late 80’s, it is important to have in mind that Luxembourg’s audiovisual sector has no other means of financial support (distributors, regions or television) that may help the audiovisual production as it is the case elsewhere.
Since 20 years, the sector is clearly booming: every year, the Grand Duchy produces or co-produces in collaboration with foreign companies in average twenty films that are regularly awarded at international level. The last two years are representative of this success: 2013 was very dynamic with many selections and international awards, including a César for Ernest and Celestine and three selections and prices at the "European Film Awards" for The Congress (best animated film), Pinocchio and Hannah Arendt. The success remains within the 2014 program, as illustrated by the Oscar of “best animated short film” for Mr. Hublot, and very recently, by the Golden Calf Special Jury Award - one of the most important awards in the Netherlands - for the Luxembourg co-production Secrets of war. Furthermore, in September, three films, co-produced in Luxembourg, have been presented at the International Film Festival in Toronto.
Luxembourg has several film locations (Studio Luxembourg in Contern and Filmland in Kehlen), a film academy (D'Film Académie) and a film prize (Lëtzebuerger Filmpräis). The Luxembourg film industry currently employs around 600 people in Luxembourg. There are 35 production companies (fiction and animation), of which 17 are active internationally, and 5 animation studios. There are 15 post-production companies, including special effects companies, and 15 other specialised companies.
...Regulated by an attractive and evolutive legal framework
The legal and regulatory framework to support audiovisual production has been developed principally by the two following laws:
- the amended law of 13 December 1988 regarding audiovisual certificates - in the form of tax credits - promotes investment in film production and international co-productions regarding such creations with a Luxembourg origin;
- the amended law of 11 April 1990 established the Film Fund Luxembourg and audiovisual production. This law aimed to promote and foster an environment in which the country’s film production industry can develop and better define the procedures, and especially the criteria, and modalities of granting financial support to audiovisual projects.
Film Fund Luxembourg offers two different support mechanisms for audiovisual productions carried out by a Luxembourg registered film production company1:
- the Audiovisual Investment Certificate Program (CIAV), in place from 1988 to end of 2013, which provides assistance to offset a proportion of production costs incurred in the European Union and in particular on the Luxembourg territory;
- the National Audiovisual Production Support (AFS), which provides discretionary loans to producers to finance development and scriptwriting, distribution and production, repayable from the finished work’s receipts.
In 2013, 14 films benefited from audiovisual investment certificates for a total sum of 15,491,579 euros, meanwhile 58 projects benefited from selective financial assistance for a total amount of 35,224,371 euros2.
THE NEW LAW OF 22 SEPTEMBER 2014
After the financial crisis, banks were less willing to make the necessary capital available. In this context, the Audiovisual Investment Certificate Program (CIAV) was considered less adapted in benefit to a single selective financial support.
The new Law of 22 September 20143 (hereafter “The Law”) formalises this change already effective since beginning of 2014. This new Law will be supplemented by a Grand-Ducal Regulation4 determining the financial intervention and clarifying the procedures, conditions, criteria and procedures for allocating funds established by the Law.
New selection committee
Film Fund Luxembourg was reformed by the Law. The new selection committee (“Comité de sélection”) recently nominated replaced the former committee, now composed of two bodies – one dedicated to script-reading (five members) and the other to technical and financial evaluation (five members). This new governance has the objective to proceed more quickly and more efficiently to the analysis of records.
The new selection committee is composed by five audiovisuals experts selected for their experience in cinema and audiovisual matters. The committee is headed by a board composed of three members.
The committee will assess the legibilitY rules as defined in article 10 of the Law and evaluate the requests based on the following criteria, detailed in the Grand-Ducal Regulation:
- artistic and cultural quality/merit;
- development of the audiovisual sector;
- interest in the national socio-cultural and historical heritage and collective memory;
- perspectives of distribution, circulation, commercialisation and exploitation, both nationally and internationally;
- Luxembourg promotion through the distribution strategy and operations of the applicant company.
The first meeting of this new committee is planned in the forthcoming days.
New selective financial support
The selective financial assistance under this Law may only be granted to resident and fully taxable limited companies whose purpose is audiovisual production. The selective financial assistance may be:
- within script-writing and development of cinematographic or audiovisual projects;
- within the production or co-production of cinematographic or audiovisual works.
The granting of selective financial assistance under this Law is subject to an agreement to be concluded between Film Fund Luxembourg and the recipient companies. The Grand-Ducal Regulation will define the content of this agreement. The eligible selective financial audiovisual assistance must:
- contribute to the development of the European audiovisual sector, and Luxembourg in particular, given a reasonable proportionality between inducements and the cultural, economic, social and long-term production of these works;
- be designed to be performed primarily in one or more Member States of the European Union, countries of the European Economic Area and Switzerland, especially in the territory of the Grand Duchy of Luxembourg;
- be operated or co-operated by the beneficiary's production company, including through the effective and sustainable detention of a significant part of the film and media rights.
The Grand-Ducal Regulation will determine the amount of the financial assistance and precise charges and expenditure categories that may be taken into account for the calculation of costs incurred as part of an audiovisual production.
The Film industry has to be seen as a global entity, not only cinema, audiovisual production but also ICT domain. Maggy Nagel, Ministry of Culture, encourages a development of synergies between the animation and gaming actors - also very active in Luxembourg.
2 Film Fund Luxembourg- Rapport 2013 http://fr.filmfund.lu/imperia/md/content/pdf/filmfund_ra_2013_web.pdf
3 Loi du 22 septembre 2014 relative au Fonds national de soutien à la production audiovisuelle et modifiant 1) la loi modifiée du 22 juin 1963 fixant le régime des traitements des fonctionnaires de l’Etat 2) la loi modifiée du 13 décembre 1988 instaurant un régime fiscal temporaire spécial pour les certificats d’investissement audiovisuel (Mémorial A 191, 10 October 2014) http://www.legilux.public.lu/leg/a/archives/2014/0191/a191.pdf
4 Grand-Ducal Regulation adopted on 08 October 2014 but not yet available