MADRID — The Spanish government has announced a draft General Audiovisual Law that slashes broadcasters’ obligations to invest in local movies.

Since 1999, broadcasters have been obliged to invest 5% of annual revenue in European films, 60% of that in Spanish-language movies. The bill reduces this to 3%, and extends it to other TV operators, as yet unidentified.

Half of this 3% must be covered by independently produced films.

In a further change, the bill allows TV movies to count toward the 3%.

The move comes as Ignasi Guardans, the recently appointed director general of Spain’s Icaa film institute, pushes forward new film regulations. These focus direct governmental subsidies on movies selected at big festivals, award-winners and projects of slightly larger commercial ambition. TV movies and Internet pics will now qualify for subsidies, not just theatrical pics, as was previously the case.

Icaa is hiking its subsidies from Euros 58.2 million ($81.9 million) to $126 million. Subsidy caps for individual films will double to $2.8 million. Guardans’ reforms apply to films lensing from October 2010.

Taken together, the measures mark the most ambitious makeover in state-engineered Spanish film financing this decade.

Most observers believe that the likely effect of the measures is that fewer movies will get made in Spain, and that some will boast slightly larger commercial ambition. But broadcasters will likely back fewer big-budget pics like “Che” or “Agora,” whose financing covered a hefty part of quota obligations.