A proposal of film industry measures

Under the current state of emergency, the film industry has come to a complete halt. Due to the measures implemented to prevent the spread of the coronavirus disease (COVID-19), production houses have incurred additional unexpected expenses, while foreign investments into Slovenian majority co-productions are expected to decrease significantly. Furthermore, under the state of emergency, cinematographic reproduction is at a standstill as well: all the cinemas are closed; all film festivals and other film events have been cancelled; and film distribution is on hold.

The current circumstances even emphasise the urgent need to immediately address investments into the film industry in such a manner as to encourage the development activities that can allow the operators in this area to remedy the consequences of the crisis measures, more easily weather the crisis, and more successfully begin the new period of development as announced by the recently-adopted Strategy of the Slovenian Film Centre (SFC).

During the quarantine, it has become all the more evident how very important film contents actually are, how vital the national film is, and how crucial the digital accessibility of films. Immediately after the onset of the emergency measures, we have, in cooperation with filmmakers, established the project All (films) at home, which provides free access to Slovenian films on a weekly basis. Only during the first two weeks, these films were seen by more than 20,000 Slovenians. This proves that people wish to see more Slovenian films, while simultaneously underlining two necessities: the need to establish digital platforms and make these films accessible; and the need to digitally restore the older film titles. We hope that the Slovenian government will, after the crisis, recognise the significance of Slovenian films as well as the importance of their accessibility. During the current crisis, it has once again become apparent how important film art is, while Slovenian films have once again acquired a large audience at home. 

We expect that after the crisis, the decision-makers will recognise the film and audiovisual arts as a priority, as the study Economic and Fiscal Effects of the Audiovisual Industry in Slovenia, prepared last year by Deloitte, provided clear information indicating that the film and audiovisual activities in Slovenia possess a significant economic potential, which could also contribute to the restarting of the Slovenian economy.

In the continuation, we will provide brief summaries of the key measures that we see as crucial for the film industry and audiovisual activities.

1. LEGAL FRAMEWORK FOR THE ESTABLISHMENT OF PROVISIONAL ANTI-CORONA SCHEMES

To remedy the consequences of the coronavirus pandemic, the financing of certain activities and establishment of extraordinary schemes[1] (e.g. supporting the development of series, grants, profession support) will need to be ensured in the film and audiovisual field in order to allow for the continued smooth implementation of the already-adopted Strategy after the end of the state of emergency.

Temporary schemes would contribute to de-bureaucratisation and ensure greater responsiveness of the SFC, which cannot ensure appropriate responses to the crisis under the current conditions.

2. RELEASING THE TRANSFERS

In 2020, Slovenian filmmakers have not yet received the already confirmed financial resources, which has put them in an even more difficult position after the onset of the state of emergency. In accordance with the provisions of the contract, concluded with the Ministry of Culture, the SFC submitted the claims as early as on 28 February 2020. However, until 6 April 2020, the Ministry of Culture has not yet released these funds.

The immediate transfer of these funds is crucial to ensure the financial resources for the project activities that have already been carried out (i.e., for the work already done) for numerous self-employed filmmakers as well as independent production companies that currently endure the extraordinary circumstances.

3. ADDITIONAL RESOURCES FOR THE 2020 AND 2021 FILM TRANSFERS

All film projects – the pre-production, shooting, as well as post-production of films – have come to a complete stop due to the COVID-19 prevention measures. Production houses have incurred additional unexpected expenses, while foreign investments into Slovenian majority co-productions are expected to decrease significantly (every year, Slovenian film producers acquire up to thirty percent of resources for Slovenian films from the co-production investments of foreign co-producers). Only in 2020, we expect that the standstill in the international co-production investments and the postponement of all national film funds’ tenders will cause the Slovenian film productions to lose an investment in the amount of two million EUR.

According to our estimates, in order to ensure the smooth realisation of the projects that are already underway, additional financing in the amount of at least EUR 1.5 million will be required in 2020. In case that the emergency is over until 1 July 2020, an additional one million EUR will be required in the year 2021.

We need to underline that at the end of 2018, the Committee on Culture of the National Assembly was unanimous in its decision to increase the funds dedicated to film to eleven million EUR until the year 2022. Since then, the increase in funds has been negligible, and Slovenian film is still waiting for a more significant upturn.

4. EXTRAORDINARY RESOURCES FOR THE REHABILITATION OF CINEMATOGRAPHIC REPRODUCTION

Under the state of emergency, cinematographic reproduction (cinemas, festivals, distribution, etc.) has come to a complete halt. All the cinemas are closed, all film festivals and other film events have been cancelled, and film distribution is on hold.

The recently-adopted Strategy of the SFC recognises the importance of developing and popularising film culture in Slovenia by emphasising a stable cinematographic reproduction network as well as updating and upgrading the system of support for complementary activities like the affirmation of filmmakers and the increased accessibility of film contents (e.g. video on demand as an alternative form of distribution).

The current circumstances underline even further the urgent need to immediately address investments into this field in such a manner as to encourage the development activities that can mitigate this crisis and allow for a more successful transition to a new period of development, as announced by the Strategy.

5. COMPENSATION FOR DAMAGES TO AUDIOVISUAL PRODUCTION COMPANIES

Many production companies have contacted the SFC to inform us that the majority of the crisis measures adopted by the government fail to address the problems and particularities of the film industry. The audiovisual sector mostly comprises of independent production houses established as private limited companies, institutes, or societies, organised as micro or small entities. Their projects are partly financed through tenders of the SFC, RTV Slovenija, and other foreign, national, regional, and European funds; and partly through contracts concluded with commercial TV stations and other companies. All these fund providers normally execute payments in instalments, in the form of occasional transfers that take into account the activities during more extended periods, which is why production houses face irregular income.   Furthermore, the winter period represents a downtime for production, as the weather conditions and daytime length are not favourable for shooting (the majority of shootings in Slovenia take place between April and October).

In light of all the indicated reasons (apart from the reason under Point 2 – see page 3), the majority of production companies fail to demonstrate the level of income in February 2020 that would enable them to benefit from the aid in the context of the crisis measures, adopted for companies by the government.

6. EXTRAORDINARY ALLOWANCES AND COMPENSATIONS FOR SELF-EMPLOYED FILMMAKERS

A survey regarding the effects of the 1^st anti-corona legislative package, conducted by the Alliance of Slovenian Associations of Filmmakers among its membership, has revealed that due to the reasons, indicated under Point 5 (see above), more than 60 % of self-employed filmmakers with the status of a sole proprietor or self-employed professional in culture will not be entitled to any crisis allowances under the measures, adopted for the self-employed by the government. The SFC thus suggests that the government should re-examine this particular group of the self-employed and include them in the Coronavirus Recovery Act.

7. INCREASE OF FUNDS FOR CASH REBATES TO THE ANNUAL AMOUNT OF 3 MILLION EUROS

Countries all over the world are currently releasing a vast quantity of financial resources for their film and audiovisual industries, which will result in an increase of days of shooting in the following years. The shooting of film and audiovisual contents in Europe will thus get launched vigorously after the end of the pandemic.

By significantly increasing the funds for cash rebates in the budget (from 1 million to 3 million euros annually in the next three years – or at least for the envisioned duration of the measures in other countries), a part of the increased volume of audiovisual production and post-production could also take place in Slovenia, thus providing job opportunities to Slovenian film workers, producers, and actors, as well as to Slovenian providers of tourist and all other support services that will be among the most affected after the epidemic. The totality of these resources will remain in Slovenia and could represent an important impetus for the local economy.

We propose that the measure be implemented by the Ministry of Economic Development and Technology, while the resources earmarked for this purpose at the Ministry of Culture should be assigned to the predominantly Slovenian film projects. We also propose that the amount of the cash rebate be increased to thirty percent of resources spent locally, as only this can ensure that Slovenia can compete with the other European countries.