The British voters’ decision to leave the European Union is likely to have multiple consequences for the British entertainment biz, with leading U.K. industry figures approached by Variety highlighting several areas of concern.
First is the likely end of financial backing from the Media Program, the E.U.’s funding body for the film, TV and digital media sectors. This will hit funding for film in particular, including training, project development, co-production, festivals and the theatrical distribution of E.U. films in Britain and the theatrical distribution of British films in Europe.
One example of Media Program support is the €40 million ($44.3 million) given to the theatrical distribution of 84 British films in other European countries in 2014 and 2015. Another example is the funding of the development of this year’s Palme d’Or winner “I, Daniel Blake,” directed by British filmmaker Ken Loach, through the Media Program’s Slate Development initiative. Loach’s Sixteen Films received €172,828 ($191,000) for four projects, including “I, Daniel Blake.”
Second is the question of the various quotas for European content on TV channels across Europe. British shows, including those made for U.S. networks such as the BBC-AMC spy thriller “The Night Manager,” have until now qualified as E.U. shows. In future they may not. This could lead to fewer being picked up by European TV networks, which could drive down the price paid for them.
Third is the issue of visas and work permits for European executives, cast and crew coming to work in the U.K. and, conversely, British staff going to work in E.U. countries, which may now become more difficult. Linked to that is the movement of “goods” between countries, such as movie cameras, costumes, vehicles and so on, which may in the future require “carnets,” or special customs permits.
Fourth is that the U.K. will no longer have a seat at the table when the E.U. is deciding on issues like the Digital Single Market strategy, which seeks to end geo-blocking across Europe and stop companies enforcing territorial copyright rules.
But not all the consequences of Britain’s withdrawal from the E.U. will necessarily be negative. There could be positive effects as well.
So, a fifth effect could be that the falling value of the pound against the dollar and the euro in the long-term makes it cheaper for Hollywood and European productions to shoot in the U.K. But, on the flip side, this is bad news for U.K. distributors: A weak pound makes acquiring foreign films more costly, as most of these deals are done in dollars or euros. It will also hit the dollar and euro value of U.K. theatrical and home-entertainment revenue for Hollywood and other non-U.K.-owned distributors.
Sixth, the British film and TV industry would no longer be bound by E.U. “State Aid” rules that govern how government subsidies and other incentives are applied to the film and TV industry. The British government could set up more attractive incentives than the rest of Europe.
But this is all in the realm of speculation right now; no one knows anything for sure. As a result of Thursday’s referendum, Britain is facing at least two years of messy divorce negotiations from the E.U.
And so to the seventh and final consequence, which again is negative: a protracted period of uncertainty. This by itself will be damaging to the U.K. film and TV industry, which, by its nature, has to plan years in advance.