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Source: Variety
Where exactly does the money needed to make a film come from? In the United States, the answer to this question isn’t that hard to figure out; Hollywood is a business after all, so it’s only natural that the various studios found within Hollywood build on the profits earned from past productions to fund those intended to be released in the future. There are certainly flaws to this system, especially given how often certain films bomb and fail to make back the money spent on them, but it’s persisted for well over a century nonetheless, and no matter how many problems it faces, this business model will most likely remain in place for quite some time. Elsewhere in the world, however, it’s the national governments that provide filmmakers with the needed monetary resources; whereas some countries view cinema as a business, others prefer to see it as an art and are thus more inclined to financially support the creation of such artworks. Still, there are some conditions that have to be met in order for a filmmaker to receive government funding; these rules will vary from nation to nation, but when followed, they should make it as easy as possible for someone to make the film they wish to create. Similar laws apply to how a film can be financed and exhibited within the nation in question, and in the new year, Germany will begin to enforce a brand new set of laws that relate specifically to its own film industry, albeit those that may not solve all of the issues that they were initially intended to address.
Before the end of its final 2024 session on Friday, December 27th, the German parliament passed a new law that heavily revises a currently standing law relating to how films are financed within the European nation, one that intends to streamline and simplify the process but, according to a handful of critics, has been watered down from what was originally drafted. While much of the new law focuses on subsidies given to local film and television productions and the means from which they’re provided (e.g. ticket sales), it also raises the current cash back production grant on these productions from 5% to 30%. In other words, there’s more money going into these films, which makes filming in Germany far more lucrative to those from outside the country (e.g. Hollywood) to want to produce at least a couple films within it. According to producer Philipp Kreuzer, whose credits include “Nine Perfect Strangers” and “Cliffhanger 2”, the grant will supposedly make Germany “more lucrative for incoming productions”, meaning that the number of people coming into the country for filming could increase dramatically over the next few years.
Given the various internal political struggles the German government has contended with as of lately, it’s all the more relieving for Hollywood that this law has been able to come into being, especially if it means there’s a great financial incentive to be gained from it. One of the films that Kreuzer is currently involved in the production of, an addition to the Vin Diesel starring “Riddick” series titled “Riddick: Furya”, has already been given a grant worth over $11 million in US currency, so even after only a couple days since the law’s passing, Hollywood is already benefiting. It has of course been benefiting from Germany’s patronage for quite some time now of course – “The Matrix Resurrections” and “The Hunger Games: The Ballad of Songbirds and Snakes” are among some of the more recent film releases that have been supported in part by Germany’s patronage – but many are enthusiastic that this new law will draw even more Hollywood productions to the central European nation.
There is, however, a major catch to all of this: the current cap on how much Germany is willing to fund a given project remains firmly in place. At the moment, the German government will only grant a maximum of $26 million (in US currency) to a given film production (for television, the limit is even lower at just over $10 million), and the total amount that it’s willing to provide for all films and television shows shot in a single year is $374 million; if the maximum amount was granted to each film production, then only fourteen films would be supported, and the $26 million may not be enough to cover all the costs that aren’t backed by other sources. There was an effort made to raise the cap during the law’s initial drafting, but a long and tiresome debate process ultimately forced this provision out of the law, much to the chagrin of many producers who reside and work in Germany. Simone Baumann, who currently heads the promotional body Germany films, alleges that there is currently enough money to finance the productions that are currently in place, but by either August or September, there may not be any more.
It’s worth noting that there are three pillars on which this new law is based, some of which are largely fulfilled by what’s contained within the law while others are not. The first of these are the local subsidies provided to the film and television productions shot within Germany; this is what lawmakers have agreed to keep in place, and the law’s contents relating to how these subsidies are determined and granted will be enforced as originally intended. The second is the tax incentive that seeks to attract foreign productions; this was modified slightly by the German parliament, but with the existing cash grant now being set at 30%, the provision has yet to be fully approved. The third and final pillar is an investment obligation directed largely at streaming platforms that could theoretically bring forth over $624 million each year that would go to German film and television productions; this pillar has so far not been approved, and will continue to receive further debate and revision in the coming year. It’s these last two that have proven to be a particularly daunting challenge for those seeking to boost Germany’s film industry, and with the issue of streaming – one that has brought its own set of challenges to the table – only growing more prominent with each passing day, there are worries that the financial incentive to be gained may not be as high as initially hoped. “There’s a lot of discussion around it,” Baumann claims, adding that many German producers will probably “have to downsize the [20%] percentage [of revenues] they are asking for… otherwise, it might not happen at all.”
