• The draft rules extend the scope of activities covered by the Communication to include all phases of an audiovisual work from concept to delivery to audiences. The existing rules (adopted in 2001) only apply to production support.

The Commission proposes to continue allowing Member States to impose territorial spending obligations up to 80% of the overall production budget. However, restrictions on the origin of goods and services, which are incompatible with the basic principles of the EU Single Market, would be clearly prohibited. Compared to the previous rules adopted in 2001, the new draft ensures proportionality of territorial obligations with the aid granted and takes into account the specific characteristics of tax incentives.

Comments should be sent by 28 May 2013 to: Stateaidgreffe@ec.europa.eu

Background
EU Member States provide an estimated €3 billion per year in film support: €2 billion in grants and soft loans, as well as €1 billion in tax incentives. Around 80% of this is for film production. France, the UK, Germany, Italy and Spain offer the majority of this financial support.

The State aid assessment criteria which have been applied since 2001 expired on 31 December 2012. In this interim period before the new Communication is adopted, the Commission is continuing to assess new film support schemes directly on the basis of Article 107.3(d) of the Treaty on the Functioning of the EU. This allows aid of a cultural nature provided that it does not adversely affect competition and trade between Member States.

Where possible, the Commission relies on its established case practice, which was based on the assessment criteria of the 2001 Cinema Communication (IP/01/1326). The Member State concerned commits to modify its scheme if needed by a change in the State aid rules during the lifetime of the scheme.

New publications of state aid decisions on the internet and in the Official Journal are listed in the State Aid Weekly e-News.

The revised draft Communication is intended to create a level playing field between Member States and to encourage cross-border productions, taking advantage of the internal market rules. It should ensure that European audiences are offered a more culturally diverse choice of audiovisual works.