Notice : at the date of drafting the present document, the legal framework of the new scheme has not been finalised. It is also being reviewed by the European Commission. Therefore, some details cannot be disclosed. The procedure is expected to come into effect at the beginning of the third quarter of 2009. In the meantime, there is no official application process, but you can contact the CNC or Film France for any information.

What is it about ?

Last December 2008, the French Parliament enacted a law creating an incentive for attracting the shooting of foreign productions to France, provided the "dramatic content" of these productions is linked to the "French culture, heritage or territory".

The rebate, which is worth 20% of all eligible costs, is capped at 4 million euros (USD 5.3 million1).Elligible costs include authors' rights (under French contracts), the salaries of actors (up to the minimun rate of the collective bargaining agreement) and the crew, technical costs (rentals and purchases), including locations fees, transportation, food, and all fringes.

What are the eligible works ?

In order to get a rebate on expenditures, theatrical movies, TV movies, and series will have to pass a test designed to check their links with "Frenchculture". The draft test is currently being reviewed by the European Commission for approval before its implementation. Therefore, it cannot be circulated. It would assess the content, creative contributors, and technical infrastructure of the movie. A specific test has also been designed for animated features so as to take into account their specificites.

The other main conditions set out by the law to get the rebate are the requipement to shoot at least five days in France (except of course for animation works) AND to spend at least one million Euros in France on eligible costs.

1 Rate :€1 = USD 1.3313 (05/06/09)

2 The centre national de la cinématographie (CNC) is a public administrative organization, set up as a separate and financially independent entity. The centre comes under the authority of the Ministry of the Culture and Communication.

How will it work ?

Once the foreign producer has signed a deal with his French line producer, he will be able to sumit an application to the CNC2. He will get a return receipt. None of the expenditures incurred before the reception date of the application form will be eligible.

However, in 2009 only, movies that are already in production before the procedure is official, and that happen to be eligible to the tax rebate, will be able to get the rebate for all expenses made sinces January 1 st 2009.

Any company incorporeted in France could be the line producing company applying for the rebate . It may be a foreign producing company's subsidiary, even in case it was especially created for this purpose.

Once the application is made, a CNC's committe, with the assistance of Film France, will determine the eligibility of the prposed foreign production. The committee will gather on a regular basis. If approved, the CNC will issue an official letter of agreement. This agreement will be delivered on provisional basis and will have to be confirmed once all the activities taking place in France have been completed. If confirmed, the French line producer will receive an official letter of agreement.

Upon presentation of the provisional agreement. The French line producer will be awarded the rebate by the Fench Tax Administration, as a credit against its corporate tax, at the end of the fiscal year(s) of the shooting.

If the amount of the rebate exceeds the amount of the corporate tax, the French line producer's company will get a cash refund from the tax office ; since the law aims at attracting foreign productions to France, the contract between the French line producing company and the foreign producer's company will need to be included into the application.

What can you do for the time being ?

Please do not hesitate to contact the CNC should you have any further questions about the regulatory framework ;
Feel very free to inform Film France about your film or TV projet that may be eligible to the tax rebate.

CNC (Centre national de la cinématographie)
Directorate of multimedia and technical industries
Tel : +33 (0)1 44 34 37 70

www.cnc.fr