Stupid German Money Smartened Up - DFFF brings industry back to life

Tom Cruise come to Germany last summer to film his $80 million epic "Valkyrie," The Germans showed Cruise the money -- writing a check for 4.8 million euros ($7.14 million) for the MGM/United Artists production. Aside from the Cruise film, due out later in 2008, other international co-productions lured to Germany in the last year include the Wachowski brothers' "Speed Racer," which got 9 million euros from the fund, and Stephen Daldry's "The Reader." Germany is not the only country luring international productions with cash. Singapore, Hungary, Canada and others offer handsome rebates to film production companies. A fresh source of film subsidy has injected new vigor into Germany's rich cinematic tradition. "It's been a wundermittel (miracle cure)," said Dieter Kosslick, director of the Berlin Film Festival. About 34 international co-productions received money last year under the scheme, known as the German Federal Film Fund (DFFF). "The whole film industry infrastructure is being expanded and professionalized. It's a great leap forward." 180-million euro program that runs to 2009 has Hollywood, European and domestic filmmakers tripping over each other to produce enough of their movies in Germany to qualify. The grants, up to 20 percent of a film's budget provided enough of it when this amount is spent in Germany, it had a total economic effect of 388 million euros in production spending in 2007, its first year. They run alongside 230 million euros in existing German film board subsidies. "We're at the start of a sustained development," said Carl Woebcken, chairman of Studio Babelsberg. "It's made it a lot easier to finance films," Fred Kogel, head of Germany's leading producer and distributor Constantin AG, told Reuters. The term "stupid German money" was coined to describe the cash flooding into Hollywood to finance movies on the back of a German tax loophole which made it possible to write off the entire investment in the current tax year. Some people estate that about 20% of Hollywood's entire production budget until 2005 was financed through German media funds. Private investors put 2 billion euros a year into them, and 70 percent of the money went to Hollywood. "There's no more 'Stupid German Money'," said Kosslick. "Something like 20 billion euros of German tax money was squandered on Hollywood films. Reuters/Nielsen http://ca.reuters.com/article/oddlyEnoughNews/idCAN0623717620080207?pageNumber=3&virtualBrandChannel=0 http://www.usatoday.com/money/media/2003-08-11-hollywood-germany_x.htm
2008-02-09 13:09:47