The crossroads of Europe

Financial necessity drives Austrians into co-productions

It takes two to waltz, and Austrian producers find it often takes a foreign partner or two to get a movie made. While there’s no lack of talent, the country’s filmmakers are finding it increasingly difficult to produce alone and are looking to international co-productions to realize ever-more ambitious projects.

Although Austria offers federal and state film subsidies, greater demand for financing has encouraged cross-border partnerships and led to louder calls from the industry for tax incentives to strengthen local investment in film production.

Common needs and greater access to neighboring markets in Eastern Europe are making co-productions a viable option for many and providing Austrian projects with a much more international slant. Recent examples include Raoul Ruiz’s “Klimt” and Simon Aeby’s “Henchman,” which attracted independent producers from across Europe.

Co-producing the $9 million “Klimt,” starring John Malkovich as Austrian painter Gustav Klimt, are Dieter Pochlatko’s Vienna-based EPO Film, Arno Ortmair’s Film-Line in Munich, Lunar Films in London, Paolo Branco’s Paris-based Gemini Films and German producer Andreas Schmid. The producers tapped coin from Austrian, German, French and European film subsidies, private film funds and Austrian and German pubcasters.

Similarly, “Henchman,” a $6.5 million English-language medieval tale about a 16th-century village executioner who takes on the Catholic Church, has a large team of veteran European independent producers onboard. But it was Hungary’s new tax rebate program that provided the necessary thrust to get the pic rolling.

“The tax incentive was definitely the deciding factor,” says producer Helmut Grasser (“Dog Days”), of Vienna-based Allegro Film. In Hungary, producers can claim up to 20% of costs thanks to Hungary’s new tax initiative, launched this year.

“We considered Luxembourg, but shooting in Austria was expensive and Luxembourg certainly isn’t cheap,” Grasser adds. “Hungary was really the perfect location.”

Private capital tax models are what’s missing in Austria, says Grasser, who adds that the Austrian subsidy system is not bad. The Austrian Film Institute offers nearly $13 million a year in grants.

Danny Krausz, head of Vienna-based Dor Film, agrees, adding that the current situation is “as hard as ever. We could make more films with the creative potential that’s available, but we have no dual-financing system. We have subsidy but no tax incentives.”

Austria’s film industry is pushing for such a tax initiative and while some government officials are receptive to the idea, Krausz says the biggest hurdle remains the country’s finance ministry, which is not thrilled with the idea of tax breaks.

In the meantime, local producers appear keen on more co-productions with bigger budgets. Dor Film, whose pics include Wolfgang Murnberger’s hit thriller “Silentium” and Pepe Danquart’s gangster drama “Basta. Rotwein oder Totsein,” co-produces with partners in Germany, France and the U.K.. It is increasingly teaming up with producers in Hungary, the Czech Republic and Poland. Dor co-produced Ondrej Trojan’s Oscar-nominated “Zelary” with Czech firm Total HelpArt and Slovakia’s Alef Film and Media.

Krausz says Dor’s future partners are in Eastern and Central Europe, but adds many countries there lack strong subsidy systems.

Similarly, Katja Dor-Helmer and Fiona Meisel of Mini Film, which recently co-produced tyke pic “Villa Henrietta” with Austria’s Lotus Film and Swiss producer Maximage, is looking east.

Adds local producer Nikolaus Geyrhalter, “The trend toward co-productions is driven by the subsidy structure and Central and Eastern Europe certainly enrich the industry.”

Geyrhalter says one major hurdle facing Austrian filmmakers is the lack of specialty distribs in the country. Aside from the majors, there are only three main distribs in Austria, something Geyrhalter finds unsatisfactory.

As a result, Geyrhalter, whose recent projects include docus “Across the Border,” in which five directors describe various border situations, and “Our Daily Bread,” about the industrial production of food in Europe, is setting up his own distrib outfit.

“Across the Border” — a co-production with Poland, the Czech Republic, Slovakia, Hungary and Slovenia — will be the first pic released by the yet unnamed company May 20. “We founded it for our own films but are talking to other people. Documentaries need a specific distribution, especially to market to target groups that are informed of the special topics of each film,” says Geyrhalter.

Vienna’s Coop99, which co-produced 2004 hit “The Edukators,” is doing more co-productions and working on its first English-lingo pic, “Dolphins,” from helmer Florian Flicker.

Coop99 producer Martin Gschlacht says, as has been the case in the past, there’s just not enough money for individual projects. Even so, while Gschlacht says Austrian auteurs are feeling increasing pressure to achieve commercial success, the country still offers filmmakers other possibilities: “The system still allows a little room for art.”

Yet Allegro’s Grasser adds, “If you make genre films, the budget is bound to the material. Some genre films need high budgets in order to appeal to audiences and to work commercially, others can be made on lower budgets.”

Grasser is working on a horror pic, “In drei Tagen bist Du tot” (In Three Days, You’re Dead), budgeted at $2.6 million and financed largely through subsidy money. “I was astonished that it worked,” he says. “They were so happy someone’s making a commercial film. In Austria it’s necessary to try to make genre films.”