2016 Forecast as Record Year for Foreign Shoots in France

New 30% TRIP rebate rate attracts high-profile productions

PARIS — In the wake of France’s decision to increase the rate on its Tax Rebate for International Productions (TRIP) rebate scheme from 20% to 30%, effective from the start of this year, a series of high-profile foreign productions have booked shoots in Gaul in 2016, including Christopher Nolan’s “Dunkirk,” lensing in Northern France in May, Neil Jordan’s 10-part Cote d’Azur-based TV crime series “Riviera,” and a yet undisclosed major U.S. TV Series expected to start production in the Fall.

Other confirmed shoots for 2016 include Clay Jeter’s sci-fi pic “IO.”

France’s domestic tax rebate scheme, for official French productions, has also increased from 20% to 30%.

“The increase to 30% is a huge change,” says line producer John Bernard of Peninsula Film. “It’s been further amplified by the rising value of the dollar. It’s been absolutely essential.”

“30% is a wonderful new development,” says line producer Raphael Benoliel, of Firstep. “It makes us more competitive, especially with our closest competitors, Germany and the U.K. Eastern Europe remains cheaper, but France is now much more competitive.”

“2016 will be the biggest year ever for foreign shoots in France,” forecasts Olivier René Veillon, executive director of the Paris-region Ile de France Film Commission. “Until now we have been limited because of the lack of competiveness of our tax scheme in comparison with other schemes such as that of the U.K. We have been attracting shoots for artistic reasons, related to the story, but they have been staying the least time possible. Now there will be much more extended shoots.”

Another significant change to France’s tax rebate schemes concerns official French productions shot in English or other languages.

Until now if a French producer was developing a French production, but wanted to shoot in English, it was impossible to benefit from either the domestic tax rebate scheme or the TRIP scheme.

Luc Besson played a key role in lobbying for changing these rules since he threatened to shoot his English-language $180 million production “Valerian and the City of a Thousand Planets” outside France, even though it’s an official French production.

Under the new rules, enacted at the end of 2015, non-French language official French productions with a strong VFX component receive the same status as animation features and therefore qualify for the 30% rate. In the case of “Valerian,” this is estimated to be worth $34 million.

Film producer Leonard Glowinski believes that this change is particularly important. “You can now develop an official French co-production and still be eligible for TRIP. I think the combination of both will be very effective.”

This change is also significant because if a French co-production shoots inside France it receives more points in the country’s automatic subsidy system (soutien automatique), and will therefore receive a higher percentage of its calculated subsidy.

Glowinski emphasizes that reinforcing the tax rebates is very important, given the tightening of the French film market: “The French market is not what it used to be. There used to be the perception that shooting a co-production in France would immediately lead to a pre-sale. But TV channels are paying much less than they used to, which affects what distributors can offer. Two years ago, an international co-production could easily be pre-sold to TV and then to distributors, but now it takes much longer.”

Thierry de Segonzac, prexy of technicians union FICAM, considers that enabling French producers to shoot in English or other languages and still qualify for a tax rebate reflects economic common sense and also the changing role of language in French culture.

“Young people in France are increasingly fluent in English. And in economic terms, on some projects if you shoot in English you can achieve ten times more impact than if you shoot in French. I perhaps wouldn’t have said that ten years ago. But now there’s a certain consensus amongst the public authorities that French culture can also be disseminated by productions shot in other languages.”

TRIP is attracting an increasing number of high-budget productions from Asia, such as Aditya Chopra’s Bollywood romance “Befikre,” produced by Yash Raj Films and line produced by Raphael Benoliel’s Firstep. This will be one of the first examples of an Indian film that is almost entirely lensed in France.

South Korea’s Jung Sung Bok will also be lensing “Legend of King Arthur” in 2016, produced by Fabulous Ltd.

Asian films lensed in France have proven to be a box-office draw in their home markets. For example, the Bollywood romantic drama “Tamasha,” directed by Imtiaz Ali, with a 16-day shoot in Corsica in 2014, was released in India in November and generated over $10 million at the Indian box-office and over $16 million worldwide.

Some Asian producers lens in France even if they don’t qualify for the TRIP scheme – because their production spend is less than €1 million ($1.1 million) and less than 50% of budget and therefore doesn’t quality for the scheme.

Examples include the Chinese film “Marriage Contract” which shot 23 days in France in 2015 and Bollywood romantic drama “Ae dil hai muschkil”, by Karan Johar, which lensed for 20 days.

In 2014, 22% of total foreign shoots in France came from China, Japan, India and South Korea – including TRIP productions and non-TRIP shoots.

Under the existing 20% rate the number of shooting days for productions approved under the TRIP scheme fell from 423 days in the record-high year of 2013, to 381 days in 2014 and 284 days in 2015.

But under the new 30% rate Film France, Gaul’s national film commission, forecasts a record number of shooting days in 2016 that may top 500 days in total.

One of the main areas of growth is TV series, which involve a high number of shooting days.

In 2015, the biggest single shoot was the BBC TV series “Death in Paradise: Series 5” that involved a 104-day shoot in the French island of Guadeloupe.

Smaller shoots have been eligible under the TRIP scheme since early 2015. Previously, in order to qualify for the TRIP program, it was necessary to spend at least €1 million ($1.1 million) in France. But since 2015, if the total production budget is under €2 million ($2.2 million) and producers spend 50% of the film’s total budget in France (including above- and below-the-line expenses), they can also qualify for TRIP.

Over the last 12 months, productions that have benefited from these new rules include “Jackie,” about the first four days after the assassination of President JFK, produced by Darren Aronofsky, directed by Pablo Larrain (“No”) and starring Nathalie Portman. Over two thirds of the film’s production took place in France – a 20-day shoot – even though the action was set in the U.S.

2015 was a relatively slow year for major U.S. and U.K. shoots in France, in part because from early 2015 onwards producers were aware that the TRIP scheme would be upped to 30%, starting Jan. 1, 2016 and therefore decided to postpone shoots and benefit from the higher rate.

The 10% increase in TRIP has been further leveraged by a 20% slide in the exchange rate of the euro against the dollar, now making it broadly 30% cheaper to lens in France compared to 15 months ago.

In 2015, John Bernard at Peninsula Film line-produced a two-week shoot in the South of France on the “Absolutely Fabulous” movie, but says that several shoots were rescheduled because of the 30% TRIP rate effective as of Jan 1, 2016.

In 2016 Bernard will be line-producing Christopher Nolan’s “Dunkirk,” shooting in Northern France in May and Neil Jordan’s 10-part TV crime series “Riviera,” for Sky, set in the Cote d’Azur.

“ ‘Riviera’ involves 130 shooting days in France, which is clearly happening because of the 30% rate,” says Bernard. “The same thing applies to the Christopher Nolan film, with a six-week shoot on location. Without the 30% rate, this would have been limited to a five-day shoot.”

Christopher Nolan’s “Dunkirk,” is slated for a Warner Bros. release in 2017, and will be shot on Imax 65mm and 65mm large format film, using many of the locations of the historic event.  It will be Nolan’s second feature to be shot under the TRIP scheme, following “Inception” in 2010.

It is extremely unlikely that the 30% rate will be increased further, but it may be possible to widen the base of eligible expenses and potentially revise the ceiling.

The other issue affecting shoots in France is the underlying crew costs.

France is sometimes criticized because of the high fringes, but the line producers interviewed by Variety said that if the shoot is correctly managed this isn’t a problem.

“I’ve always maintained that although France has very high fringes, if you look at the salaries along with the fringes, it certainly compares favorably with Canada, the U.K. and the U.S.,” says Bernard. “If we embrace the limitations and use the advantages and schedule the shoot properly, it remains highly competitive.”

Benoliel agrees: “Fringes can be very high in France, up to 60%, but if you look at the base salaries they are lower, overall France is not the most expensive in terms of crew expenses. And with the 30% TRIP rate and the favorable exchange rate, France is much more competitive.”

Benoliel considers that the main problem is not crew rates but the flexibility of working hours, where legislation continues to be restrictive.

The other potential issue related to foreign shoots in France is whether last year’s terrorism attacks in Paris have had any lasting impact on production plans.

However all the industry professionals interviewed by Variety considered that this has not been the case.

Some shoots were inevitably postponed after the November attacks and rescheduled for 2016. One example is Netflix’s David Michod-directed satirical comedy “War Machine,” starring Brad Pitt and line-produced by Benoliel. It was initially slated for the end of 2015 and will instead shoot this year.

“It’s important that the project wasn’t cancelled, just delayed,” says Benoliel. “I think people want to show that they’re committed to shooting in France.”

“I’m not aware that people have not come to France because of these issues,” says John Bernard. “France is a leading world nation. If you want to shoot in the U.K., Germany, India, the United States etc. there’s always a potential risk of terrorism. It’s a world issue, not a local issue.”


TRIP scheme – key data

The TRIP scheme was launched in 2009 and has played a key role in attracting major live action shoots to France, such as Woody Allen’s “Midnight in Paris,” Christopher Nolan’s “Inception” and “The Hunger Games – Mockingjay.”

96 projects from 18 countries have benefited from the TRIP scheme to date, according to data from Film France, generating a total spend in France of €530.5 million ($575 million).

Based on 2014 data, 39% of shoots have been in the Paris / Ile de France region, followed by 14% in the Provence-Alpes-Côte d’Azur region.

TRIP productions represent 27% of all foreign shoots and over 50% of total foreign spend in France.

In terms of total foreign shoots in France (TRIP projects and other productions) the U.K. is the highest source of visiting productions – 18%, followed by Belgium – 13%, the U.S. – 12%, China – 11%, Netherlands – 8%, Japan – 6% and India – 5%.

However, in terms of investments under the TRIP scheme, there is an overwhelming domination of the U.S., followed by the U.K..

In 2015, U.S. productions were responsible for 87% of total TRIP investment, followed by 11% from the UK.

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