BERLIN — With new tax regulations, continuing consolidation in the local market and some big players licking their wounds from their tumbles on the Neuer Markt, Germany’s film finance arena has been in a state of upheaval this past year.

One of the major changes in the industry came in March when the government revamped investment fund regulations.

“It’s a continuous game,” says Patrick Martin, head of Munich’s 2K Media. “The government introduces new tax legislation and people find ways to adapt to it, then inevitably the changes come again.”

Martin says Germany’s private film funds remain “one of the few investment possibilities for tax deferrals,” despite new legislation that bars investors from boarding a project after it has started production for producer status.

A behind-the-scenes player, 2K has major stakes in Hollywood outfits such as Light Motive, Original Voices and MPCA, which recently joined German partners Gemini Film and Intl. West Pictures (IWP) on boxing pic “Joe and Max” and “Boat Trip.”

IWP was recently set up by Gemini and Germany’s Commerzbank as a financing and production joint venture.

Rainer Koelmel, who heads producer-distrib Kinowelt, agrees that film funds remain a viable option for financing, despite new regulations that make international co-productions more difficult.

“That problem has to be solved,” he says.

German companies like 2K, which have U.S. subsidiaries, don’t face such problems, however.

“We don’t do international co-productions,” says Martin.

Unless filmmakers find a way to get past the new legal obstacles, Martin says the trend of mergers and takeovers among German and U.S. outfits is likely to continue, if not increase.

In view of the Neuer Markt’s downturn, Koelmel adds that companies have to start financing projects through their cash flow for a change, which he says would be a healthy development.


National film fund: FFA/Federal Film Board, annual budget of $48 million

Regional film funds (annual budgets): FilmFernsehFonds Bayern ($23 million), Filmboard Berlin-Brandenburg ($17 million), Filmstiftung NRW ($32 million)

Private investment funds: ALCAS, Apollo Media, Cinerenta, CP Medien, Hollywood Partners Management, IMF (Internationale Medien und Film), MBP (Medien Beteiligungs und Produktionsgesellschaft)


Banks: Commerzbank (Intl. West Pictures), Deutsche Bank, Dresdner Bank, HypoVereins Bank

Filmstiftung NRW: Michael Schmid-Ospach

Private funds: Apollo Media (Frank Huebner), Cinerenta (Rainer Bienger), CP Medien (Roland Pellegrino), MBP (Rainer Mockert)

Consultants: Michael Braun, Media Entertainment Funding

Attorneys: PriceWaterhouseCoopersVeltins (Christof Schmidt); Noerr, Stiefenhofer und Lutz (Tim Duemichen)


International co-productions, with German partners:

“Joe and Max” (IWP, MPCA, Starz! Pictures)

“Investigating Sex” (Apollo Media, Gemini Film, Kingsgate Films); dir. Alan Rudolph

“The Cat’s Meow” (CP Medien, Lion’s Gate Intl.), dir. Peter Bogdanovich