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Brazil: Nets cast movie coin

TV comes to the rescue of features, thanks to Article 3A

Nets cast movie coin | 3D phenom expands Brazil B.O. | Private investors bring home two big pics

A new fed gov incentive, the so-called Article 3A, has prompted local broadcasters and pay TV nets to invest as co-producers in indie features and TV programming. According to the National Cinema Agency (Ancine), the incentive is injecting as much as $29.7 million this year in the local production sector.

If in Europe nets are regular financers of pics, the mighty broadcasters in Brazil have traditionally remained detached from film. The longstanding gap between the industries has narrowed since leading broadcaster TV Globo created its theatrical branch Globo Filmes in 1997. But this division’s support to pics has been basically limited to the granting of media space to promote the features’ theatrical releases, as well as some counseling.

With the advent of Article 3A, nets are effectively investing coin in pics. TV Globo is again leading the pack and has invested about $14.5 million through the new system, roughly half in pics and the other half in TV programming, says Carlos Eduardo Rodrigues, exec director of Globo Filmes and head of TV Globo’s task force created to operate Article 3A.

The list of pics backed by TV Globo is headed by Jose Padilha’s “Elite Squad 2.” It also includes vet helmer Hugo Carvana’s “Nao se preocupe, nada vai dar certo,” Mauro Lima’s “Reis e ratos,” Flavio Tambellini’s comedy “Agamenon,” Jayme Monjardim’s “O tempo e o vento,” Cao Hamburguer’s “Xingu” and Jose Alvarenga’s “Cilada.com.”

The net has also funded four indie drama, doc and animation series.

“In years with the (FIFA Soccer World) Cup, such as 2010, we will have some 20 million to 30 million reais (U.S. $11.6 million to $17.4 million) to invest via Article 3A,” says Rodrigues. “In regular years, the amount will be down to about 12 million to 13 million reais (U.S. $6.9 million to $7.5 million).”

Article 3A allows nets to invest in pics and TV programming by allowing them to put 70% of their taxes in coin remittances abroad for the payment of international programming deals.

In TV Globo’s case, the net makes large remittances every four years to pay for the FIFA Cup’s TV rights for Brazil, but they also pay regularly for pic and series packages and other types of programming.

The incentive was created in December 2006 and became operational in December 2008. Broadcasters and pay TV nets spent a great part of last year learning about the new system. They eventually started to deposit 3A “credits” in special accounts in Ancine, which by August amounted to $29.7 million.

The net must invest the coin in productions within six months after the deposit, or it is returned to the fed treasury.

“We expect this entire accumulated amount to be invested this year,” says Ancine’s president-director Manoel Rangel. “Article 3A is mainly impacting the production of independent programming for television, but it is also benefiting the film sector.”

Film channel Telecine, a joint venture between U.S. studios and Globo, is the only other net investing in pics through the new system. It is co-producing Carvana’s “Don’t Worry.”

Three other nets have invested via Article 3A in TV series. No. 2 broadcaster TV Record invested in “Uns bracos” and “Machado do Brasil,” HBO in “Alice Especial” and “Mulher de fases,” and ESPN in “Viajantes radicais.”

In addition to boosting the production sector, the purpose of Article A3 is to open broadcasters to indie content. Even with Article 3A, broadcasters commission little. But it’s definitely a step forward.

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