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Support for the distribution of non-National Films 2018 - EACEA /05/2018
Deadline: 12 Sep 2018   - 27 days

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1. INTRODUCTION – BACKGROUND

These guidelines are based on Regulation No 1295/2013 of the European Parliament and of the Council of 11/12/2013 concerning the implementation of a programme of support for the European cultural and creative sector (CREATIVE EUROPE) 1 and its corrigendum of 27/06/20142.

The European Commission is responsible for the implementation of the Creative Europe Programme and for the decision to grant individual European Union funds. The Education, Audiovisual and Culture Executive Agency hereafter “the Agency” manages the Culture and MEDIA Sub-programme on behalf and under the supervision of the European Commission.

General background information about the Creative Europe programme can be found on the following link: http://ec.europa.eu/programmes/creative-europe/

 

2. OBJECTIVES – THEMES – PRIORITIES

2.1. Objectives

Within the specific objective of promoting transnational circulation, one of the priorities of the

MEDIA Sub-programme is the following:

 supporting theatrical distribution through transnational marketing, branding, distribution and exhibition of audiovisual works.

The MEDIA Sub-programme shall provide support for the following:

 establishing systems of support for the distribution of non-national European films through theatrical distribution and on all other platforms as well as for international sales activities, in particular the subtitling, dubbing and audio-description of audiovisual works.

2.2. Targeted projects

The aim of the “Automatic Scheme” is to encourage and support the wider transnational distribution of recent European films by providing funds to distributors, based upon their performance on the market, for further reinvestment in the promotion and distribution (including on-line) of new non- national European films.

The scheme also aims to encourage the development of links between the production and distribution sectors thus improving the competitive position of non-national European films and the competitiveness of European companies.

The Automatic support scheme works in two phases:

  1. The generation of a potential fund, proportional to the number of paying admission tickets sold during the reference period for non-national European films in countries participating in the MEDIA Sub-programme, up to a fixed ceiling per film and adjusted for each country.

  2. Reinvestment: the potential fund thus generated by each company must be reinvested in:

  • – the co-production of eligible non-national European films;

  • –  the acquisition of distribution rights, for example by means of minimum guarantees, of eligible non-national European films; and/or in

  • –  the release of eligible non-national European films.

Based on the amount of the grant that the applicant has calculated (section 9 – award criteria), the applicant is requested to submit a distribution strategy that includes investment in co-production, acquisition and/or release of eligible films..

 

3. TIMETABLE

 

a) Publication of the call

June 2018

b) Deadline for submitting applications Generation/Reinvestment

12 September 2018 - 12:00 (noon, Brussels Time)

c) Evaluation period

October-December 2018

d) Information to applicants

February 2019

e) Signature of grant agreement

March 2019

f) Starting date of the action /period of eligibility of costs

date of agreement3

g) Duration of the action / period of eligibility of costs

24 months from the starting date of the action

 

Only those costs incurred by the beneficiary during the period of eligibility of costs will be eligible.

 

4. BUDGET AVAILABLE

The total budget earmarked for the co-financing of projects is estimated at EUR 19 M.

This amount is subject to the availability of the funds after the adoption of the budget for 2019 by the budgetary authority.

The Agency reserves the right not to distribute all the funds available.

 

5. ADMISSIBILITY REQUIREMENTS

Applications shall comply with the following requirements:

  • - they must be sent no later than the deadline for submitting applications referred to in section 3 of the present guidelines;
  • -  they must be submitted using the online application form (see section 14 of the present guidelines);

  • -  they must be drafted in one of the EU official languages, preferably in English or French.

The application form must be accompanied by a balanced budget and all the other documents referred to in the application form.

Failure to comply with those requirements will lead to the rejection of the application.

In order to submit an application, applicants must provide their Participant Identification Code (PIC) in the application form. The PIC can be obtained by registering the organisation in the Unique Registration Facility (URF) hosted in the Education, Audiovisual, Culture, Citizenship and Volunteering Participant Portal. The Unique Registration Facility is a tool shared by other services of the European Commission. If an applicant already has a PIC that has been used for other programmes (for example the Research programmes), the same PIC is valid for the present call for proposals.

The Participant Portal allows applicants to upload or update the information related to their legal status and attach the requested legal and financial documents (see section 14.2 for more information).

 

6. ELIGIBILITY CRITERIA

Applications which comply with the following criteria will be subject to an in-depth evaluation.

6.1. Eligible applicants

Applicants shall be European Cinema/Theatrical distribution companies

European company:
Company owned, whether directly or by majority participation (i.e. majority of shares), by nationals of

Member States of the European Union or nationals of the other European countries participating in the MEDIA Sub-Programme and registered in one of these countries.

Applications from legal entities established in one of the following countries are eligible as long as all conditions referred to in Article 8 of the Regulation establishing the Creative Europe Programme are met:

EU Member States and overseas countries and territories which are eligible to participate in the Programme pursuant to Article 58 of Council Decision 2001/822/EC

Acceding countries, candidate countries and potential candidates benefiting from a pre-accession strategy, in accordance with the general principles and general terms and conditions for the participation of those countries in European Union programmes established in the respective Framework Agreements, Association Council Decisions or similar agreements;

EFTA countries which are members of the EEA, in accordance with the provisions of the EEA Agreement;

The Swiss Confederation, on the basis of a bilateral agreement to be concluded with that country;

Countries covered by the European Neighbourhood Policy in accordance with the procedures established with those countries following the framework agreements providing for their participation in European Union programmes.

 

The Programme shall also be open for bilateral or multilateral cooperation actions targeted at selected countries or regions on the basis of additional appropriations paid by, and specific arrangements to be agreed upon with, those countries or regions.

The Programme shall permit cooperation and joint actions with countries not participating in the Programme and with international organisations which are active in the cultural and creative sectors such as UNESCO, the Council of Europe, the Organisation for Economic Cooperation and Development or the World Intellectual Property Organisation on the basis of joint contributions for the realisation of the Programme's objectives.

The Agency may select proposals from applicants in non EU countries, provided that, on the date of the award decision, agreements have been signed setting out the arrangements for the participation of those countries in the programme established by the Regulation referred to above.

(Updated list of countries that fulfil the conditions referred to in Article 8 of the Regulation and that the Commission has started negotiations with can be found on the following link:

https://eacea.ec.europa.eu/creative-europe/library/eligibility-organisations-non-eu-countries_en

For British applicants: Please be aware that eligibility criteria must be complied with for the entire duration of the grant. If the United Kingdom withdraws from the EU during the grant period without concluding an agreement with the EU ensuring in particular that British applicants continue to be eligible, you will cease to receive EU funding (while continuing, where possible, to participate) or be required to leave the project on the basis of Article II.16.2.1(a) of the grant agreement.

Cinema / theatrical distributor:
A cinema / theatrical distributor is involved in commercial activity designed to bring to the attention of a wide audience a film for the purpose of exploitation in cinema theatres. This shall be the principal activity of the company or division of the company. Such activity may include aspects of the technical publishing of an audiovisual work (dubbing and subtitling, striking of prints, circulation of prints, etc.) as well as marketing and promotional activities (production of trailers and publicity material, the purchase of advertising space, the organisation of promotional events etc.).

Digital distribution is supported as long as it is of a minimum quality (=1.3 K). This excludes DVD, DVIX, Digital Beta or any other support whose resolution is below 1.3K as a copy or source of the films for theatrical release.

A cinema / theatrical distributor shall fulfil the following criteria:

  • -  be the holder of the theatrical distribution rights for the film in the country concerned;

  • -  carry out the theatrical distribution of the film in the country (determines the release date, plans, controls and executes the distribution and promotion campaign);

  • -  pay directly the associated distribution costs; and

  • -  be registered and have theatrical distribution operations in the country for which a grant is requested4

    4 This requirement is waived for the following countries as they are linked for distribution purpose: Belgium and Luxembourg; Greece and Cyprus; United Kingdom and Ireland.

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Booking and billing, is allowed, provided that:
- it has been disclosed to the Agency.
- it is substantiated by receipted invoices.
- it complies with the sub-contracting rule set out in section 11.1.e).

In the event that distribution activities are shared between several companies, the contracts/agreements between these companies must be disclosed to the Agency. The Agency will consider as compliant the company which meets all the criteria and actually executes the distribution of the film in the country in line with the above conditions. If tasks and/or responsibilities are so shared between different companies that it is impossible to assess a unique distributor for the film in a territory, the film will not be supported in that territory and the admissions will not be eligible. The decision of the Agency will be final.

In order to assess the applicants' eligibility, the following supporting documents are requested:

private entity: extract from the official journal, copy of articles of association, extract of trade or association register, certificate of liability to VAT (if, as in certain countries, the trade register number and VAT number are identical, only one of these documents is required),

public entity: copy of the resolution or decision establishing the public company, or other official document establishing the public-law entity.

Physical distributors shall not be eligible for support.

6.2 Eligible activities

To generate a potential fund and to qualify for reinvestment measures, the film must comply with the following criteria:

  • -  it must be a work of fiction (including animated films) or documentary, with a minimum duration of 60 minutes;

  • -  it must have its first copyright established in 2014 at the earliest;

  • -  it must not consist of alternative content (operas, concerts, performances, etc.), advertising, pornographic or racist material or advocate violence;

  • -  it must be majority produced by a producer or producers established in the countries participating in the MEDIA Sub-programme (see section 6.1). To be considered as the actual producers the production companies must be credited as such. Other elements such as copyright appearing on the rolling credits, creative control, ownership of exploitation rights and share of profits may also be taken into account to determine who the actual producer is; and

  • -  it must be produced with the significant participation of professionals who are nationals/residents of countries participating in the MEDIA Sub-programme (see section 6.1).

 

‘Significant participation’ is defined as having more than 50% of the points on the basis of the table below, e.g. having 10 or more points in the case of a work of fiction or the biggest share of points if the total is less than 19 as is normally the case for documentaries or animation films where all of the categories are not usually included in the credits:

 

POINTS:

Director 3

Scriptwriter   3  

Composer 1

Actor 1   2

Actor 2 2

Actor 3 2

Production Design   1

Director of Photography 1

Editor   1

Sound 1

Shooting location  1

Post Production location 1

Total   19

 

If the film has an interoperable standard identifier, such as ISAN or EIDR, it must be indicated in the eReport.

National / Non-national European film:
Countries participating in the MEDIA Sub-Programme are defined under section 6.1.

European films will be considered as “national” in the country participating in the MEDIA Sub- programme whose nationals/residents have participated in the highest proportion in the making of the film, on the basis of the points table shown above. They will be considered as “non-national” in all the other countries.

In the event of a tie (i.e. where the points are equal for a given nationality) the nationality of the director (or the following talent in the above list) shall be decisive.

1. Generation of a potential fund

The potential fund is proportional to the number of eligible paying tickets sold for non-national European films in countries participating in the MEDIA Sub-programme, up to a fixed ceiling per film and adjusted for each country, in the reference period (2017).

To be eligible, admissions must comply with the following criteria:

  •   they must be achieved between 1st January and 31st December 2017;

  •   a normal ticket price was actually paid to the relevant exhibitor (including any special offers or discounts) but explicitly excluding those admissions where no fee was paid;

  •  they must be clearly identifiable and certified by the national correspondents designated by the Member States;

  •   they must be declared by applicants who are eligible in the country (see section 6.1);

  •   the films must be eligible non-national European films.

Group or club screenings where an individual ticket price is not levied will not be eligible.

Only applications that fulfil the eligibility criteria will be considered for a grant. If an application is deemed ineligible, a letter indicating the reasons will be sent to the applicant.

All admissions must be certified by the Responsible National Authority. It is the responsibility of the distributor to have its admissions certified by the submission date. In absence of certification, admissions will be ineligible and no support will be awarded. These admissions will be published on the website of EACEA.

2. Reinvestment (eligible costs)

The potential fund thus generated by each beneficiary is to be reinvested in:

  •   the co-production of eligible non-national European films (i.e. films not yet completed at the start of the eligibility period);

  •   the acquisition of distribution rights, for example by means of minimum guarantees, of eligible non-national European films; and/or in

  •   the release of eligible non-national European films (promotion and advertising, digitisation and transcoding costs).

The beneficiary will have 24 months to carry out the project. However, if after the signing of the agreement and the start of the action it becomes impossible for the beneficiary, for fully justified reasons beyond his control, to complete the action within the scheduled period, an extension to the eligibility period may be granted. A maximum extension of 6 additional months may be granted if requested before the deadline specified in the agreement.

 

7. EXCLUSION CRITERIA

7.1. Exclusion from participation

The authorising officer shall exclude an applicant from participating in call for proposals procedures where:

(a) the applicant is bankrupt, subject to insolvency or winding-up procedures, where its assets are being administered by a liquidator or by a court, where it is in an arrangement with creditors, where its business activities are suspended, or where it is in any analogous situation arising from a similar procedure provided for under national laws or regulations;

(b) it has been established by a final judgment or a final administrative decision that the applicant is in breach of its obligations relating to the payment of taxes or social security contributions in accordance with the law of the country in which it is established, with those of the country in which the authorising officer is located or those of the country of the performance of the contract;

(c) it has been established by a final judgment or a final administrative decision that the applicant is guilty of grave professional misconduct by having violated applicable laws or regulations or ethical standards of the profession to which the applicant belongs, or by having engaged in any wrongful conduct which has an impact on its professional credibility where such conduct denotes wrongful intent or gross negligence, including, in particular, any of the following:

  1. (i)  fraudulently or negligently misrepresenting information required for the verification of the absence of grounds for exclusion or the fulfilment of selection criteria or in the performance of a contract, a grant agreement or a grant decision;

  2. (ii)  entering into agreement with other applicants with the aim of distorting competition;

  3. (iii)  violating intellectual property rights;

  4. (iv)  attempting to influence the decision-making process of the Agency during the award procedure;

  5. (v)  attempting to obtain confidential information that may confer upon it undue advantages in the award procedure;

(d) it has been established by a final judgment that the applicant is guilty of any of the following:

  1. (i)  fraud, within the meaning of Article 1 of the Convention on the protection of the European Communities' financial interests, drawn up by the Council Act of 26 July 1995;

  2. (ii)  corruption, as defined in Article 3 of the Convention on the fight against corruption involving officials of the European Communities or officials of Member States of the European Union, drawn up by the Council Act of 26 May 1997, and in Article 2(1) of Council Framework Decision 2003/568/JHA, as well as corruption as defined in the law of the country where the contracting authority is located, the country in which the applicant is established or the country of the performance of the contract;

  3. (iii)  participation in a criminal organisation, as defined in Article 2 of Council Framework Decision 2008/841/JHA;

  4. (iv)  money laundering or terrorist financing, as defined in Article 1 of Directive 2005/60/EC of the European Parliament and of the Council;

  5. (v)terrorist-related offences or offences linked to terrorist activities, as defined in Articles 1 and 3 of Council Framework Decision 2002/475/JHA, respectively, or inciting, aiding, abetting or attempting to commit such offences, as referred to in Article 4 of that Decision;
  6. (vi) child labour or other forms of trafficking in human beings as defined in Article 2 of Directive 2011/36/EU of the European Parliament and of the Council;

(e) the applicant has shown significant deficiencies in complying with main obligations in the performance of a contract, a grant agreement or a grant decision financed by the Union's budget, which has led to its early termination or to the application of liquidated damages or other contractual penalties, or which has been discovered following checks, audits or investigations by an authorising officer, OLAF or the Court of Auditors;

(f) it has been established by a final judgment or final administrative decision that the applicant has committed an irregularity within the meaning of Article 1(2) of Council Regulation (EC, Euratom) No 2988/95.

(g) for the situations of grave professional misconduct, fraud, corruption, other criminal offences, significant deficiencies in the performance of the contract or irregularity, the applicant is subject to:

  1. (i)  facts established in the context of audits or investigations carried out by the Court of Auditors, OLAF or internal audit, or any other check, audit or control performed under the responsibility of an authorising officer of an EU institution, of a European office or of an EU agency or body;

  2. (ii)  non-final administrative decisions which may include disciplinary measures taken by the competent supervisory body responsible for the verification of the application of standards of professional ethics;

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  1. (iii)  decisions of the ECB, the EIB, the European Investment Fund or international organisations;

  2. (iv)  decisions of the Commission relating to the infringement of the Union's competition rules or of a national competent authority relating to the infringement of Union or national competition law.

  3. (v)  decisions of exclusion by an authorising officer of an EU institution, of a European office or of an EU agency or body.

(h) a person who is a member of the administrative, management or supervisory body of the applicant, or who has powers of representation, decision or control with regard to that applicant (this covers the company directors, members of the management or supervisory bodies, and cases where one person holds a majority of shares), is in one or more of the situations referred to in points (c) to (f) above.

(i) a natural or legal person that assumes unlimited liability for the debts of that applicant is in one or more of the situations referred to in point (a) or (b) above.

If an applicant is in one of the situations of exclusion listed above, it should indicate the measures it has taken to remedy the exclusion situation, thus demonstrating its reliability. They may include e.g. technical, organisational and personnel measures to prevent further occurrence, compensation of damage or payment of fines. The relevant documentary evidence which illustrates the remedial measures taken must be provided in annex to the declaration. This does not apply for the situations referred in point (d) of this section.

In the cases provided in (c) to (f) above, in the absence of a final judgement or where applicable a final administrative decision, the Agency may exclude an applicant provisionally from participating in a call for proposals where their participation would constitute a serious and imminent threat to the Union's financial interests.

7.2. Rejection from the award procedure

The authorising officer shall not award a grant to an applicant who:

(a) is in an exclusion situation established in accordance with the above section 7.1;

(b) has misrepresented the information required as a condition for participating in the procedure or has failed to supply that information;

(c) was previously involved in the preparation of a call for proposals where this entails a distortion of competition that cannot be remedied otherwise.

Rejection from this procedure and administrative sanctions (exclusion or financial penalty) may be imposed on applicants or affiliated entities where applicable, if any of the declarations or information provided as a condition for participating in this procedure prove to be false.

The applicants should be informed that the Agency may publish on its internet site the following information related to the exclusion and, where applicable, the financial penalty in the cases referred to in points (c), (d), (e) and (f) of the section 7.15:

5 This information shall not be published in any of the following circumstances:
(a) where it is necessary to preserve the confidentiality of an investigation or of national judicial proceedings;
(b) where publication would cause disproportionate damage to the applicant concerned or would otherwise be disproportionate on the basis of the proportionality criteria and to the amount of the financial penalty;

(a) the name of the applicant concerned;
(b) the exclusion situation;
(c) the duration of the exclusion and/or the amount of the financial penalty.

In case of a preliminary classification in law (i.e. absence of a final judgement or a final administrative decision), the publication shall indicate that there is no final judgement or final administrative decision. In those cases, information about any appeals by the applicant, their status and their outcome, as well as any revised decision of the authorised officer, shall be published without delay. Where a financial penalty has been imposed, the publication shall also indicate whether that penalty has been paid.

The decision to publish the information is taken by the Agency either following the relevant final judgement, final administrative decision or preliminary classification in law, as the case may be. That decision shall take effect three months after its notification to the economic operator.

The information published shall be removed as soon as the exclusion has come to an end. In the case of a financial penalty, the publication shall be removed six months after payment of that penalty.
In accordance with Regulation (EC) No 45/2001, where personal data is concerned, the Agency shall inform the applicant of its rights under the applicable data protection rules and of the procedures available for exercising those rights.

7.3. Supporting documents

Applicants must sign a declaration on their honour certifying that they are not in one of the situations referred to in the above sections 7.1. and 7.2, filling in the relevant form attached to the application form accompanying the call for proposals. If applicable, the relevant documentary evidence which appropriately illustrates any remedial measures taken should be provided in annex to this declaration. The declaration is available at: http://eacea.ec.europa.eu/creative-europe/funding_en

Applicants must submit a declaration on their honour, completed and signed, attesting to their status as a legal person and to their financial and operational capacity to complete the proposed activities.

8.1. Financial capacity

Applicants must have stable and sufficient sources of funding to maintain their activity throughout the period during which the action is being carried out or the year for which the grant is awarded and to participate in its funding. The applicants' financial capacity will be assessed on the basis of the following supporting documents that will be requested from selected applicants:

Low value grants (≤ EUR 60 000):
- a declaration on their honour.

Grants > EUR 60 000:

  • -  a declaration on their honour

  • -  the financial statements (including the balance sheet, the profit and loss accounts and the annexes) of the last financial year for which the accounts have been closed;

Grants for an action ≥ EUR 750 000, in addition to the above:

  • - an audit report produced by an approved external auditor certifying the accounts for the last financial year available.

On the basis of the documents submitted, if the Agency considers that financial capacity is not satisfactory, it may:

  • request further information;
  • propose a grant agreement without pre-financing;
  • propose a grant agreement with a pre-financing paid in instalments;
  • propose a grant agreement with a pre-financing covered by a bank guarantee (see section 11.4 below);
  • where applicable, require the joint and several financial liability of all the co-beneficiaries;
  • reject the application.

In the course of the procedure applicants may be requested to register and provide a Participant Identification Code (PIC, 9-digit number), serving as the unique identifier of their organisation in the Participant Register. Applicant(s) will receive instructions on how to create a PIC in due time.

Upon communication of the applicant's PIC, the EU Validation Services (Research Executive Agency Validation Services) will contact the applicant (via the messaging system embedded in the Participant Register) and request the latter to provide the supporting documents necessary to prove the legal existence and status and the financial capacity of the organisation. All necessary details and instructions will be provided via this separate notification.

8.2 Operational capacity

Applicants must have the professional competencies as well as appropriate qualifications necessary to complete the proposed action. In this respect, applicants have to submit a declaration on their honour, and, for those applying for a grant above EUR 60.000 the following supporting documents:

  •   the curriculum vitae of the legal representative of the company and

  •   the curriculum vitae of the Head of Distribution (if they are not the same person).

 

9. AWARD CRITERIA

A potential fund will be attributed to eligible European distribution companies on the basis of the eligible admissions achieved by the European non-national films distributed by the applicant in the reference year as set out in the call for proposals (i.e. 2017).

The support will take the form of a potential fund available to distributors for further investments in eligible non-national European films.

Within the limit of the budgetary resources available, the potential fund available for each distributor will be calculated on the following basis:

  • -  Eligible admissions generated by eligible non-national European films up to a limit fixed per film and per country.

  • -  This limit can be reached in one or more years but in any case all paid admissions over the maximum threshold for an individual film will not be taken into account in the calculation of the fund.

Country of distribution

Maximum threshold

(nr of admissions)

Germany, Spain, France, Italy.

600.000 €

Austria, Belgium, The Netherlands, Poland, United Kingdom.

200.000 €

Czech Republic, Denmark, Finland, Greece, Hungary, Norway, Portugal, Sweden.

150.000 €

Albania, Bosnia and Herzegovina, Bulgaria, Croatia, Cyprus, Estonia, FYRoM, Iceland, Ireland, Latvia, Lithuania, Luxemburg, Malta, Montenegro, Romania, Republic of Serbia, Slovakia, Slovenia, and any other new country participating to the programme.

32.000 €

 

The amount of the potential fund will be calculated by multiplying the number of eligible admissions by a fixed amount per admission.

Amount per eligible admission (in EUR)

 

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