MONTREAL — Far and away the most significant development in the pic financing landscape in Canada is the creation of a C$100 million ($63 million) feature film fund, administered by Telefilm Canada, which doubled the amount of public coin available for financing Canuck pics.
Another change is the way in which film money will be doled out by Telefilm. In the past, the federal movie-funding agency handed out its cash based on subjective project-by-project evaluation. Under new rules, Telefilm will give out much of the money based on the previous box office performance of pics produced by the companies seeking the money. The goal is to make it a more commercially focused fund and to try to achieve some success at the wickets for Canadian films.
The new coin is good news for Canadian film distributors like Alliance Atlantis, says Andrea Wood, executive VP, business and legal affairs, at the Toronto-based company. If producers come with more equity, it makes it easier for distributors to support the bigger budgets, she adds.
The new fund also will allow key producers like Alliance Atlantis and Serendipity Point Films to finance pricier productions.
“To be competitive in the international marketplace, we have to start spending more money on stars and putting more money on the screen,” says Wood. “I think the feature film fund is going to help companies do that.”
Another key shift is the federal government’s decision to increase the tax on foreign actors working in Canada. The government introduced legislation earlier this year to increase the withholding on actors from 15% to 23%.
The increase in the tax could be a problem for U.S. actors “who may not be able to get a full U.S. credit,” says L.A.-based attorney Paul Sczudlo of Loeb & Loeb. “It’s certainly better than a full graduated rate, but it’s not a favorable change in terms of encouraging the industry to come up there.”
One of the main motors of pic financing in the Great White North remains the federal and provincial tax-credit programs, which can together account for up to approximately 20% of an overall budget.
After the much publicized allegations of tax-credit fraud at Montreal TV producer Cinar Corp., the government ordered a full-scale review of the tax-credit system and the result is that the Canadian Audio-Visual Certification Office (CAVCO) is much tougher in its application of the rules.
Many provincial governments also provide direct-funding and tax-credit support for pic production.
Canadian Television Fund (also includes feature film money)
Canadian Film or Video Production Tax Credit
Funds: Telefilm Canada; National Film Board of Canada; Canada Council for the Arts
Provincial funds: Alberta Cultural Industries Assn.; British Columbia Film; Manitoba Film & Sound; New Brunswick Film; Newfoundland & Labrador Film Development Corp.; Nova Scotia Film Development Corp.; Ontario Media Development Corp.; Saskatchewan Film & Video Development Corp.; SODEC (Quebec); FIDEC (Quebec Entertainment Investment Limited Partnership); Yukon Film Incentive Program
Banks: Banque Nationale, Royal Bank of Canada, Toronto Dominion Bank
Attorneys: Fraser Milner (Joey Mastroguiseppe); Gascon and Associates (Sandor Gibson); Goodman and Associates (David Zitzerman); Hall Pasternak (Steve Pasternak); Heenan Blaikie (Sam Berliner, Norman Bacal); McMillen Binch (Carolyn Stamegna); Stikeman Elliott (Etienne Massicotte)
The following recent prods. all tapped the main financing sources, including federal and provincial tax credits, Telefilm, Canadian Television Fund:
“Ararat” (Serendipity Point Films); dir. Atom Egoyan
“Le Collectionneur” (Christal Films)
“Men With Brooms” (Serendipity Point Films, Alliance Atlantis)
“Owning Mahowny” (Alliance Atlantis, Natural Nylon)