Tax law

IRIS Plus 2014-1: The new Cinema Communication

Author: Francisco Javier Cabrera Blázquez & Amélie Lépinard, European Audiovisual Observatory

Published: 01/09/2014

A mark, a yen, a buck, or a pound
A buck or a pound
A buck or a pound
Is all that makes the world go around,
That clinking clanking sound
Can make the world go ‘round.

“Money Money” (from Cabaret, lyrics by Fred Ebb)

Younger generations nowadays take the existence of the European Union for granted. Today’s European adolescents were born into the European Union, so to speak, but it is a very recent development if we take into consideration the history of Europe as a whole. It is an organisation that was not created overnight, not even in seven days, but one that evolved gradually. Some would argue that the EU is still an unfulfilled dream, but despite this much has been achieved since its creation. Among the many advantages that citizens of an EU member state enjoy, the fundamental freedoms enshrined in the EU treaties allow them to move around, do business and live in other EU countries.

The younger generations may not remember, for instance, that there was a time not so long ago when each European country had a different currency. Now more than 300 million Europeans share the Euro and can move freely inside the Eurozone without need to change money at the border or the airport.

Of course, the fact that circulation inside the EU is significantly easier than in the past does not oblige EU citizens to benefit from this freedom. Something similar could be said about the circulation of European films inside the EU. If certain films benefit from EU rules on the free circulation of goods and services and are successful in going beyond their national borders, it is an exception rather than the rule. There are surely different explanations for this phenomenon. According to the Commission, it results from the fragmentation of the European audiovisual sector into national or even regional markets. Another reason for this could be the absence of a common language in the EU. Paraphrasing Nelson Mandela, you can only reach a person’s heart if you talk to him or her in his/her own language.

The EU has changed many things, but one thing that remains unshaken is that money still makes the (cinema) world go round. And in Europe “that clinking clanking sound” comes partly from the public coffers. The European Commission, as guardian of the EU treaties and defender of the general interest, has the duty to assess whether national support schemes for film and audiovisual production comply with EU law. Until very recently, the Commission based this assessment on rules contained in the 2001 Cinema Communication, with its subsequent temporary extensions. In 2011, the Commission launched a public consultation process with the aim of adapting its ten-year-old rules to the current times.

In a previous publication The Observatory described the situation up to 2012, see Nikoltchev S. (ed.), The Future of State Aid , IRIS plus 2012-3, European Audiovisual Observatory, Strasbourg, 2012. The publication you are holding in your hands (or reading on your screen) updates it with information about the rules included in the Communication on State aid for films and other audiovisual works adopted in November 2013. The Lead Article tells the story of how these new rules came to life, and gives special consideration to the consultation process that led to the adoption of the new Cinema Communication. Also, in the two years that have passed since the publication of our previous IRIS plus, many important developments have taken place in different member states of the European Union. These are described in the Related Reporting section of this publication. Finally, the Zoom section provides a set of basic facts and figures on the quantitative development of the market segments in question drawn from recent European Audiovisual Observatory publications. This includes the most recent development of European theatrical markets, the relative success of European and US films in the European Union, the total number of theatrical feature films produced in Europe, and the roll-out of digital projection in Europe’s cinemas and assistance for cinemas in difficulty.

Willkommen, bienvenue, welcome to the 2013 Cinema Communication!

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