UK film, television and annination tax incentives - frequently asked questions
What are the new tax credits for UK high end TV and animation from April 2013
What are the UK tax incentives?
How the UK Cultural Test works
UK Budget reduces sideways loss relief
UK tax relief as producers equity
International co-production agreements
Australia's guidelines for co-production

Professional practice and copyright - FAQ's
Professional practice in the film and TV industry: Why is © so important?
Do you have to register to get copyright protection?
Dealing with broadcasters and production companies before you have a written commitment

Situations and practical examples of is and what’s not covered by copyright
Drama stories based on living people - do you need their permission?
The 30-40% rule if you alter a work by 40% then it’s OK?
Literary & Dramatic works. Using an existing work. Fictional characters Fanfic - aka fan fiction. Adaptations
Musical works

Internet and On-line. Do the normal copyright laws apply to cyberspace?
Ways of dealing with works which do not attact copyright protection including Formats. Passing Off & Breach of Confidence.
Copyright protection covers two types of rights: Economic rights and moral rights
Basic elements of a contract Is a verbal contract, a contact? In the course of employment / freelancing

Working outside the UK - Copyright in other jurisdictions, USA Germany France
Chain of Title - layers of protected copyright involved in film production

UK film, television and animation tax incentives

What are the new tax credits for UK high end TV and animation from April 2013
From April 2013 'high-end television' and 'animation' can qualify as British and claim the new creative content tax relief in one of two ways. They must meet the requirements of the new cultural tests or fall within one of the UK's six official bi-lateral co-production treaties. By extending the tax credits to high end TV and animation the government has extended the BFI's remit to certify the new tax credits for both sectors' from April 2013. Like the existing film tax relief each sector will also be based on passing a cultural test earning at least 16 criteria points out of a potential total of 31 points. 

The new high end television incentives will apply to programmes made by a production company with an intention to broadcast and with budgets of more than £1m per hour slot time. Covering drama, comedies  and documentaries (it will not apply to advertising, discussion programmes, news or current affairs, quiz shows panel shows, variety shows or similar entertainment). The production company must make the arrangements for preproduction, shooting, post production and delivery. The new cultural 'content' tests specifically include the UK and the European Economic are (thereby being wider than the film cultural 'content' test which only included the UK). Eligible productions will be able to claim back up to 25% of 80% of core production expenditure used or consumed in the UK. The final new guidance notes and tax relief is due to come into force on 13 August. . Granted State aid from 01.04.2013 to 31.03.2018 (European Commission approval http://ec.europa.eu). Further details:www.bfi.org.uk/film-industry/british-certification-tax-relief (updated 31.07.13.) Back to top

What are the UK film tax incentives?
The UK tax incentives are designed to encourage more film production in the UK. The UK film tax applies to projects which started shooting after 1st January 2007. At the launch Shaun Woodward MP. Minister for the Creative Industries said "the scheme will be good for independent and large studio productions". The Chancellor said the tax relief will be worth 20% for films costing up to £20 million, and 16% for films costing £20 million and above. In practice the tax relief is worth 10-18% of the negative spend of a UK shot film.

The percentage figures will apply where the total amount of UK spend is at 80% of a film’s qualifying UK production expenditure (as the new tax changes only apply to the UK spend up to a cap of 80%).

The minimum UK spend threshold for qualifying films is set at 25%. In other words at least 25% of the films budget must be spent in the UK to qualify for relief.

The legislation was set out in the Finance Act, published in the Autumn of 2006 as amedended by the EU's revisions to the "Cultural Test" (see below).

The 'qualifying UK expenditure' only covers UK elements, so it does not cover non-UK elements paid for in the UK, or UK elements paid for outside the UK. In other words the legislation defines qualifying UK expenditure as that undertaken within the UK only and this does not include expenditure on British talent, crafts and services working overseas. Put another way the official spend is where you film rather than where you actually spend. So for example, if you build a prop in the UK. and ship it to another country to shoot - that expenditure does not count towards the tax credit. This issue will continue to be strongly contested as there are other European countries where their definition of national expenditure is wider (e.g in Germany under their recently unveiled new tax relief system. HM Revenue and Customs has also inidacted in mid December 2006 that it is willing to look at a more generous defintion of what is included as UK expenditure.

The qualifying expenditure will cover pre-production costs, production costs and post-production costs but not development costs (in order to comply with European State aid restrictions). Nevertheless development costs will still be eligible for a 100% tax right off under standard accounting principals. Industry discussions are continuing with David Harris and HM Revenue and Customs, about what is, or is not, a claimable production cost, including the costs of writing the script (whether script right costs are within core expenditure and claimable against tne new tax relief). In January 2007 HMRC announced that Script costs could be apportioned -see update below).

Basically more films should qualify for tax relief, as the minimum UK expenditure threshold has been lowered from the previous 40% to 25%.

Cashflowing the tax credits: The European Film Finance Summit in Berlin heard that the Inland Revenue intend the tax credit to become available during the later part of production, which is in turn intended to remove the need for financial middlemen. The intention is these new tax incentives will be paid direct to production companies. The reforms also provide an opportunity for UK producers to phase tax credits, by taking them either at the start of production or at a later stage when they are receiving profits from the film. A few UK companies including Abacus (the film fiance arm of Zephyr Film), Aramid Entertainment Fund (a joint venture between UK financier Future Films, US Screen Capital International and Stonehenge Capital) and Brighthaven, are currently willing to cashflow the tax credits in exchange for a fee. Barclay Bank is cashflowing the tax credit through a £500m credit facillity through 3 companies including Abacus and Prescience.

The new tax credit aims to:
subsidise the UK production sector
encourage more home-grown culturally British films for audiences
allow the production industry to remain as a long-term competitive location for high-budget films which bring investment into the UK
maintain our creative & technical skills and expertise including innovation in the development of digital infrastructures.

Discussions with the Treasury continue on how the tax credit might be refined to provide ‘group relief’ to promote investment in a slate of films.

The European Commission approved the new incentives in autumn 2006. On 18th October 2006 Shaun Woodward MP, Minister for the Creative Industries, acknowledged the EC had "asked for clarification" and "there are still some issues to be resolved" as well as noting that it had taken the French two years to get approval for their provisions. Neelie Kroes, European Commissioner for Competition noted the EU was expressing new concerns about the treatment of European co-productions in the UK film tax incentive scheme. Michelle Sutton, EC competition cabinet member, also expressed concern whether the current Cultural Test for British Films meets the requirement that aid is directed to a cultural product, and whether the proposed production tax relief, is cultural, according to verifiable national criteria.

The EU finally approved the UK film tax incentives as complying with EC State Aid Rules on 23rd November 2006. This included adding a more rigorous qualifying culture test (see below), shifting the balance towards cultural criteria, settings, subject, and language, with the intention of enhancing support for British Content. Basically cultural content by itself, will now be enough to reach the threshold of 16 points out of a potential 31 points (updated 10.01.13).
Back to top

How does the UK Cultural Test work?
Operative from early 2007 the UK producer tax credits are injecting renewed vigor into the UK film production sector.

The introduction of pre-qualification provides a new level of certainty ahead of production which did not previously exist.
Basically to be qualified a film will need to get at least 16 points out of 31.

There are four sections:
Cultural contribution: 4 points e.g. does the film contribute to the promotion, development and enhancement of British culture?
Cultural content: 16 points. e.g. is the flm set in UK, are the characters & subject matter British, is it an English language production?
Cultural hubs: 3 points. e.g. is the studio or location shooting based in the UK? FX &/or Post P in UK?
Cultural practioners: 8 points for Director, Writer, Producer, composer, actors, staff & crew from within the European economic area

The new rules as revised by the EC have increased the weighting for subjective British “cultural content”.
The new test introduces:
a process for pre-qualification (an interim DCMS letter of elligibilty)
increased points for shooting in the UK
increased points for music recording
reduced points for the location or setting
added a points catergory for producers
provides a straight forward pass mark of 50% (i.e. 16 points out of 31 points)

The new tax credit applies to productions commencing principal photography on 1 January 2007. The new cultural test will determine which ‘British films’ are considered eligible for new tax relief and the intention is to provide better targeted support for drama, animation and documentaries.

The tax relief only applies to film intended for theatrical release when they are first planned. It is still a little unclear exactly what this means in different contexts. For instance a lot of documentaries are iintended for theatrical release. Presumably the filmmakers intentions can be ascertained if an international sales agent has been appointed or a UK distributor is on board.

Giving an overiew to PACT members on 15 December 2006 Dr Harris Policy Advisor Film, HM Revenue and Customs, noted the new system envisaged huge efficiency savings, smaller Exchequer costs and that it would work better for the producer. While accepting the requirement for cinematic relase was backward looking Harris said "producers should keep an optomistic view - you'll come out better." The PACT seminar also noted that core expenditure costs can be thought of as actual "manufacturing" costs of making a film, thereby excluding development costs, marketing costs and professional fees.

Script costs. Industry discussions are continuing with Dr David Harris, about what is, or is not, a claimable production cost, including the costs of writing the script (whether script right costs are within core expenditure and claimable against tne new tax relief). HM Revenue and Customs also indicated in mid December 2006 that it is willing to look at a more generous defintion of what is included as UK expenditure. In January 2007 Harris acknowledged that the new tax credit will allow some script costs, as the screenplay is clearly heavily used throughout filming, even though it is not strictly "core expenditure". The actual percentage will vary demending on how much of the screeeenplay is used and consumed in the UK. Therefore the cost of each individual script will neeed to be apportioned in each case and the appropriate method for doing this may vary from film to film.

DCMS Guidelines: The Department of Culture Media and Sport (DCMS) has begun to issue new guidelines, including: an overview of how it's supposed to work in practice; what the main stages of production are and how key terms are defined; and the impact on international co-productions (see below). Ref: See www.culture.gov.uk www.culture.gov.uk/tax_relief The final guidelines were published in due course but there has been ongoing uncertainty in the industry over the continuing attractiveness of the UK for co-productions. As a result the UKFC is lobbying for an addtional £5m as a new co-production fund to re-balance the impact of the new tax credits. The UKFC is also proposing an additional completion fund for market testing and remedial finance.
Back to top

International co-production agreements
For films to qualify as co-productions for the purposes of claiming the new UK tax relief, it is suggested they should be made under the official co-production treaties of the "European Convention on Cinematographic Co-Production". This is because it is difficult in practice to just rely on the definition of a British Film as set out in Schedule 1 of the Films Act 1985. Nevertheless if an international co-production passes as a British Film as set out in Schedule 1 of the Films Act 1985 it does not also need to pass the new cultural test.

The UK’s co-production agreements currently in place are with the following jurisdictions:
• UK/Australia
• UK/Canada
• UK/France
• UK/New Zealand
• UK/Norway
• UK/South Africa
• UK/Morocco

The DCMS continues to make progress on the UK’s initiatives to set up co-production treaties with China, India and Jamaica.

Throughout 2006 the DCMS re-negotiated the existing official agreements with Australia, Canada, France and New Zealand. The updated treaties "better reflect the reality of modern day co-production, and will aim to maximise the cultural and film-making benefits to the UK and its partner countries." www.culture.gov.uk/co-production_agreements

The folowing bi-lateral treaties were allowed to lapse, Italy from 2 May 2006, Germany from 1 December 2006 and Norway from 24 May 2007. Italian/UK partnerships will still be eligible under the European Convention on Cinematographic Co-Production CETS No.: 147 www.conventions.coe.int

IA new South African and British co-production treaty was signed at the Cannes International Film Festival in 2006 to enhance the opportunities between our two countries and to establish conditions for mutual benefit. It is still to come into effect.

Germany introduced a film tax rebate system in 2006 which closely follows the new UK model. It's envisaged the rebate will be part of the closing finance. In other words a film must already have 70% finance in place before applying, the finance must be "closed" within a certain timescale and principal photography must commence shortly after the rebate is paid out. It is also being proposed that non-German producers will have to engage a German co-producer to acess the scheme covering production costs incurred within Germany. Producers must have made a film within the EU within the last five years, have a leading distributor on board and plan to release at least 30 prints (15 prints for a first time director) alower threshold applies for documentaries. For German co-productions, the German partner must contribute 20% of the budget up to a budget ceiling of €25m (but if the budget is more than €25m the German partner need not pay more than €5m). German culture minister Bernd Neumann unveiled their new tax-rebate system. €60 million (US $75 m) a year until October 2009 in the form of tax rebates. Qualifying feature, documentary and animated films will be able to claim 16-20% of their production costs incurred in Germany. German films shot mostly overseas will still qualify providing they spend at least €15m (£10m) iinside Germany (cf UK new trax credits only covering UK spend - see above).
Back to top

Australia's new draft guidelines for international co-productions
Screen Australia already offers a 40% film tax rebate, known as the producer offset, and from July 2010 international co productions will be managed in a new Co-production-Offset Unit. The guidelines are being made more flexible to boost production levels at a time when the Australian dollar has strengthened against other currencies.

Proposed changes include allowing:
- Writers from outside the co-producing partner countries to contribute to a screenplay as long as they are not a credited writer of the screenplay
- An increase in the total number of points for qualifying productions including an increase in discretionary points for the contribution of creatives e.g. visual effects and sound designers
- The nationality of the source material to be taken into account
- Producers better access to finance by issuing an early letter of compliance confirming a production meets the co-production guidelines

Ref: See www.screenaustralia.gov.au/coproductions
(updated 18.06.10)
Back to top

UK Budget reduces sideways loss relief.
U.K. Chancellor in March 2008 announced a new "purpose test" to ensure that the use of sideways loss relief is only used for "genuine reasons". For those meeting the purpose test there will be an annual limit on the amount of relief that can be claimed. These new rules will affect those spending an average of less than 10 hours a week personally engaged in the trade (non-active sole traders). Those failing the purpose test will not be eligible to claim any sideways loss relief. The new rules extend last years 2007 budget which ended the use of artificial arrangements by "partnerships" to create trading losses to offset other income. The 2008 budget extends that to include "sole traders." The move is designed to prevent individual film investors' tax returns from offsetting predicted losses in film against profits in other sectors. The U.K. Film Council confirmed the only specific UK tax relief for the production of films is the UK film tax relief (updated 14 March 2008).

Background: In the first week of March 2007 the UK Treasury unexpectedly announced reductions to "sideways loss relief" affecting GAAP (Generally Accepted Accounting Principles) schemes which had been one of the most popular tax breaks used to bankroll UK productions. It had allowed partners to use losses in one business, to set off against income derived elsewhere for tax purposes. But now rich individuals will be eligible to invest just $48,000 (£25,000) into partnership enterprises that are expected to make losses. After intensive lobbying by the UK's film industry, the IR has issued clarification that it will not apply to losses derived from film sale and leaseback schemes which are being phased out. The initial indications were that if it did apply to film sale and leaseback schemes it would adversly affect UK film finance companies including Ingenious Media, Scion, Future, Prescience and others. But on Wednesday 7th March 2007 the Inland Revenue clarified that sale and leaseback deals are not affected and the department ammended it's original notification statement.

The S&L schemes have attracted investors to existing Section 42 and 48 partnerships arrangements, which funded recent award winning British films including "The Queen" and "Casino Royale". The IR clarification came only after PACT and other film bodies lobbied urgently for a change of heart, by highlighting that those most effected would be individual producers putting their neck on the line to cashflow sale and leaseback schemes according to established practice. This means the last of the film S&L schemes will continue to will run their course until they are phased out this year as orginally intended.

Meanwhile the introduction of the new lower threshold for "sideways loss relief" mean it will be uneconomic for film partnerships to allocate mush smaller losses of just $48,000 (£25,000) to an investor who could have previously offset those losses against their tax bill or other income or capital gains. Originally the IR stated that "the proposed (new) restrictions apply to partnership trading losses which arise from film production in the same way as those arising from other activities." Earlier an Inland Revenue spokesman denied the proposals would effect legitimate film investments. When the unexpected announcements were first made, the UKFC initially said that while it was all part of an ongoing government crackdown on tax avoidance, they went on to emphasise there is a generous new UK tax system in place for films.

The new film tax breaks can also be combined with an Enterprise Investment Scheme (EIS), which effectively lowers the threshold for making a profit and provides incentives to realise substantial financial rewards. The March 2007 budget announced new financial caps of £2 million for EIS schemes (updated 28.03.07). With all these changes worries remain about the wider effect on confidence in the industry, which in turn raise questions about the sustainability of the UK's independent sector. Financiers and investors are said to remain nervous because of the poor timing and lack of government consultation or foresight leading to the recent confusion over S&L deals. More specifically industry veterans are questioning why the decision to end sideways loss relief wasn’t made in April at the beginning of the tax year, to enable the industry to adapt, rather than announcing it in March when it was presented as a fait accompli. Concerns have also been expressed that it's been made clear by recent events that the Government can turn around and do the same thing again. The UKFC says the UK industry can now bank on a "state of clarity" on which to build future production. (updated 15.03.07). For IR issued statements see: www.hmrc.gov.uk/films
Back to top

UK tax relief as producers equity
PACT, the UKFC, BBC Films and FilmFour announced in May 2007 they are willing to treat the new tax credit as pari-pasu equity (pro-rata pari-pasu, pound for pound basis along with other equity recoupment positions) instead of treating it as cash to be refunded. C4 initally suggested they share a revenue corridor with the producer, whereas PACT and the UKFC supported the new tax credit being treated as producers equity, rather than a way for the broadcasters to get off risk faster. Peter Watson at the Recording Picture Company noted the new system gives producers the chance to own a slug of equity in their film for the first time. The UKFC says for the first time, we will all start with the principal that the value of the tax break belongs to the producer, not the financiers.

In June 2007 doubts are emerging about it working in practice and since the initial anouncement reservations have grown over recognising UK tax relief as producers equity. With some saying the proviso renders it meaningless and that the new initiative was counter productive. This follows news that the broadcasters and the UKFC will only treat it as producers equity &uot;where possible". And as the potential new producers corridor will not be coming out of the UKFC, BBC Films or FilmFour's own recoupment position, some industry observers have claimed it makes British films even less attractive to financiers. PACT are following developments (updated 19.06.07).
Back to top

Professional practice and copyright - frequently asked questions

Professional practice in the film and TV industry
Each medium and genre has it’s own custom and practice. So if your only familar with one, and want to work in another you need to find out what the standard deals are. There is also a seperation between production and post production work. With production, including development and pre-production, a contract is usually used. This covers Writers, Directors, Producers, Designers in costume, production and set, Graphic Artists and Cinematographers. In all these roles contracts are more common, whereas in post-production, it’s more common to do the job and then invoice.

What to do when something goes wrong?
Get advice and support, rely on the professionals around you. Don’t pretend you know something if you don’t - it’s a highly spoecialsed industry and to excell at any one part you need to acknowledge when you need assistance.

Why is © so important? - Copyright is a right to prevent unauthorised exploition
The © owner can allow or prevent others from using your work for a period of time. There are a number of exceptions and qualifications but bascially, a © owner controls the works exploitation. If someone claims your infringing their © or you are unsure, whether you own or have permission to use material - get independent legal advice.

Myth 1 Do you have to register to get copyright protection?
- No it’s automatic providing you fall into one of the established catergories.

You need to be aware of © theft, but there are procedures you can follow to minimise the risk. There are a number of UK script registration services including BECTU’s . In France you can register with CNC (Centre Nationnal de la Cinematographie) and in the USA you can register scripts with the Library of Congress.

You should always keep your creative ideas confidential until they are permanetly in recorded form. In other words written down or recorded in some kind of media. This is crucial because your copyright can only be protected if you can prove ownership and under UK law it has to be in a permanent form.
Back to top

Dealing with broadcasters and production companies before you have a written commitment
If you have a script - it can be protected. If you haven’t got that far then you need to find a balance between setting out enough detail to make your idea original without disclosing too much. You can circulate your project/script/proposal with conditions . For example sending it with a letter explaining why it is being sent, that it is “confidential”, or “not for circulation” or “for their eyes only”.

It’s always preferable to make contact before circultaing your material, rather than sending it unsolicited, and always keep records.

Non-disclosure and confidentiality agreements are becoming more common. Ask the person your showing it to to sign it, stating the proposal will be treated in confidence, they will not divulge it to a 3rd party without consent, and if the discussions move forward both parties will negotiate in good faith.

The Britsh broadcasters have all signed up to a standard procedure for submitting programme proposals (copies are avilable from their websites) and from the relevant trade associations.
Back to top

Some situations and practical examples of is and what’s not covered by copyright
Works in the Public Domain. A potentially difficult area as it includes works which have fallen out of copyright or never been in copyright as well factual material about actual events (cf a news article which is © in itself). If your proposal subject is in the public domain, and your working in factual programmes, it is epecially difficult to demonstate has been copied without permission.

A word of caution. If you haven’t a written record of your project, one area to watch out for is when someone overhears your detailed pitch - if someone overhears it, the story’s probably in the public domain...while you can follow it up, by sending more details in writing before you meet again. It would be better to send it in advance and keep to the conversation to what’s all ready recorded. If it’s spontanious meeting - follow it up in writing as soon as you can. Set out -who- what-where -when , to confirm what was discussed.
Back to top

Myth 2. Drama stories based on living people - do you need their permission?
No not true under current UK law. You might need it for other countries that have privacy legislation. The usual UK defamation and libel laws apply.

Fair dealing covers limted circumstance when the © owners permission is not used
(a) Criticism & review proviso- if there is sufficent acknowledgement. This does not apply to photographs.
(b) Reporting current events
There is also an exception for private study and the rights of use by libraries and public institutions.
Back to top

Myth 3. The 30-40% rule if you alter a work by 40% then it’s OK?
Not true - is infinged wheter the whole or a substantial part is used without permission - and some cases have recognised a relatively small area as being substantial. It’s question of quality not quanity

Incidental inclusion. There is a provision when artistic works can be used in a film if it’s merely incidental. But before you think this could cover a mulitude of uses, remember the producer is usually responsible for what is or isn’t in the programme, So in practice it would be very difficult to claim it was actually incidentally included.

Logos brand in shot Public buildings Remakes of old films Showreels

To reiterate - There is no copyright in an idea, rather it is the expression of the idea that can be copyright protected - The reasoning - to encourge the free flow of ideas in society.
Back to top

Literary & Dramatic work
The collaborative process is at the heart of our business - it needs to be respected. If writing a project with someone else or your commisioning a group of writers -from the beginning establish what will happen to ownership of copyright in the work...

Also need to acknowledge script changes and contributions for the chain of title e.g. Based on an original idea by...

Using an existing work.
There can be an infingement if an existing plot is copied in detail even if there is no direct copying of the text. In other words making lots of changes does not necessarily circumvent the setting and characters and their situations. Even though there is no copyright in the theme, plot or characters....

Fictional characters, Fanfic - aka fan fiction - Some writers see it as flattery others as legitimate treat to their economic rights.
It is a grey area but the BBC have succesfully chased websites to prevent them publishing it.

Adaptations. Can be a difficult area because if the underlying work is out of copyright...anyone can adapt it. Again the more detail your adaptation expresses - the more you can claim it’s your work. But it can’t stop others creating their own adptations. You are in a much stronger position and it’s obviously much easier if the underlying work is still in copyright and you option it.
Back to top

Musical works
Can contain several seperate ©’s in the music itself, the lyrics, the recording rights are seperate.
This is one of the biggest underestimated costs for low budget filmmakers. The use of music should be negotiated as early as possible- not for profit clearances e.g. just for the festival circuit

If your clearing rights or expecting someone else to, sort it out as soon as you can - even if it’s “in-princpal clearance.“ Don’t leave it until post production when knock on effects can be considerable and expensive.
Back to top

Internet and On-line

Myth 4. The normal copyright laws do not apply to cyberspace.
Wrong, the same laws about reproducing apply, the same procedures to clear rights applies and the same rules apply to the ownership of internet material.

Generally the fees to clear the rights are the same as other forms of promotion e.g. for photos or clips used on a website. Again talent will require a fixed fee. Archives and library clips also need to be cleared. Again music clearances are a lot more complex.
Back to top

Ways of dealing with works which do not attact copyright protection
There are alternative ways of dealing with works which do not attact copyright protection including Formats, Titles, Passing Off Breach of confidence

Formats e.g. for a game show. You can’t easily © a format partly because they don’t fall into the catergory of being either original enough, a dramatic work or a literary work. In other words they are not easily protected under our copyright system However there are steps you can take to protect them including contract law similar to franchising deals, trade mark law, and registering the title as a domain name.

Titles. (incl names parts of sentences ) de minimis principal Can’t © but you can register e.g. as a ® trademark through a patent agent. You have to show your trading in that specific category and you have to register each individual jurisdiction, and for a particular category which is costly. In the US a feature title would always be checked to see it hasn’t been used and you can contact the Title Registration Bureau at the Motion Picture Association of America MPAA.

Passing Off. Not part of intellectual property law but if the audience thinks it’s your work when its not, it is another legal way to try to stop someone commericially benefiting from passing it off as their own.

Breach of Confidence. Again not part of copyright law. If you make a verbal pitch to a potential buyer you must make it clear you own the material and that the discussions are stricly confidential.

If someome suggests your idea is similar to another project be very cautious. If your not willing to collaborate on an agreed and recorded basis it would be better to end the discussion. Otherwise it’s open to suggest you’ve used that persons ideas for your own.
Back to top

Copyright protection covers two types of rights

Economic rights These are the rights to exploit your work in the economic sense, to be paid a fee, get secondary payments.

Reproduction right - copying the work
Distribution right - issing copies to the public
Rental and lending right - to the public
Performing right - performing, showing or playing the work in public
Broadcasting right - broadcasting the work
Cable Programme right - including the work in a cable programme service
Adaptation right - making an adaptation of the work
Availability right - to authorise acess by the public from a place and time individually chosen by them

Moral Rights These are supposedly to protect how the work is used.

Moral Rights were intorduced to bring the UK into line with the Berne Copyright Convention
Once a work qualifies for © protection in addition to the economic rights, the authors of certain works are also granted moral rights.

The right of paternity or attribution when the work is copied or communicated - the right to be credited
The right of integrity to object to derogatory treatment
The right to object against false attribution
The right of privacy in comissioned photographs

In practice moral rights are nearly always waived under UK law, although a credit will be given as a contractual term.

The UK shares a common law tradition with the USA , Canada, Australia, New Zealand so there are some similarties. A simplfied owverview of USA German and French Copyright llaw is set out below.
Back to top

Contract basics

The Basic elements of a contract are:
Intention - to create a legally binding agreement
Offer & acceptance - to reach agreement
Consideration - an agreement to do something e.g. payment can be token £1

Myths 5. Sam Goldwyn “an oral contract's not worth the paper it’s written on”.
Well a verbal contract is a contact - it’s just very hard to prove what was or was not agreed if it’s not written down.

Written Contracts. Never sign a contract without understanding what your reading. If your not clear ask. Don’t be fobbed off with legalese. Ask what it means in simple English.

At what point do you need a contract?
Before you start work. Pretty simple but you shouldn't rely on a relationship in the absence of a written agreement.

In the course of employment / freelancing
There is a presumption that if the work is done in the course of employment it automatically belongs to the employer. But is not always clear who is or is not an employee - especially when freelancing. For example, if your work is done on a consultancy basis , the © remains with you....

There is a 3 step test
1. Was the work made by an employee?
2. Was it made in the course of employement?
3. Is there no agreement to the contrary?

Note section 11 (2) CDPA 1988 in the absence of an agreement to the contrary, where a literary, dra matic, musical or artistic work or a film is made in the course of employment, the employer is the first owner of any copyright in the work.
Back to top

Working outside the UK - Copyright in other jurisdictions - USA Germany France
Each jurisdiction has different traditions and laws although there are commom threads - here is a very simplified snapshot

USA - The 1976 Copyright Act Federal and State Laws

USA Moral Rights only covers works of visual arts .
(UK literary dramatic musical, artistic works and films).

USA Economic rights and terms of protection Broadly similar to the UK except where employees works are concerned (but very complex re pre 1976 works).

The USA is now a lot more in line than it used to be since joining the Berne Convention in 1989. In the case of works made for hire, the employer and not the employee is considered to be the author.

The American system is founded in the common law system so there are similarities with the UK as well as major differences (the UK is founded in the common law system). Both are property laws .

The beneficaries of protection are authors of original works of authorship (including sound recordings)’ and there is seperate protection for performers.

To constitiute orginality the must be “a modicum of creativity” (UK test is skill, labour judgement...and the UK protects some works which are not original) America also has a different orginality concept. With Moral Rights the main difference is the US only covers works of visual arts (where as in the UK covers literary dramatic musical, artistic works and films). Also differences in the scope of moral rights granted & their duration).

Broadly similar economic rights and terms of protection except where employees works are concerend (again very complex re pre 1976 works).

The US Fair Use provisions can be invoked for any copyright work. In the UK fair dealing only applies in limited circumstances.

The recent Digital Millennium Copying Act makes it illegal to bypass copy protection for any reason. This is broadly compareable to the EU’s Copyright Directive which has already been ratified in Denmark, Italy, Austria Germany and the UK.

 

Germany - Law on Author’s Right and Related Protection Rights

German Economic Rights for authors principally include exclusive rights of reproduction, adaptation, distribution, communnication to the public. There is a seperate catergpory rights for performers, phonogram producers and broadcasters.

German Moral Rights include divulgation, retraction and attribution and integrity rights for authors of works protected as intellectual creations. There are special provsions for films which only prohibit gross distortions or other gross mutilations of their work - Art 93.

German authors have an author’s right comprised of moral and economic rights (under the monist system) Comparatively few terms are defined in the 1965 law compared to the US and UK. These are based on the concept of the authors rights as springing from the "individual personality of the author". Therefore there is a strict division between the authors rights and the related rights of performers, sound recordings and film producers etc.

German law doesn’t specify who the authors of a film are but it does set out that any person who under takes to participate shall be deemed in cases of doubt to have granted to the producer and exclusive right to use the film work. According to jurisprudence the people considered to be the authors of a film are the director, the cameraman and the editor.

German authors do have moral rights, but the right of intergrity is limited to prohibiting any distortion (Entstellung) or other mutilation which jepordises their legitmate intellectual or personal interest in the work. An objective approach is used - Art 14. Performers also have moral rights to prohibit distortions which jeopardize their standing or reputation. Art 83.

German broadcasters are required to invest in co-productions, film project funding and advertising airtime under the German Federal Film (FFA) board's film and television agreement. Regional film funds have also welcomed broadcasters as financial partners and more than half of local German features are co-productions with a public or private broadcasters. Including Medeinboard Berlin-Branenburg, FFF Bayern and Filmstiftung NRW.

France - Law on the Intellectual Property Code

French Economic Rights - principally exclusive rights of reproduction, adaptation distribution, comminication to the public. Seperate category rights for performers phonogram producers, broadcasters.

French Moral Rights include divulgation, retraction, attribution and integrity rights for authors of "works of the mind". The right of attribution - the paternity right and the integrity right are perpetucal, innalienable and imprescriptible and as a genral rule cannot be vaived.

The author has moral and economic rights in works of the mind (“dualist “system). Based on protecting creative and artistic rights. Comparatively few terms are defined in the 1992 code compared to the US and UK.

The individual author is the initial owner of the authors rights. In audiovisual works, the basic rule is the natual persons who carried out the intellectual creation are the authors. The beneficaries of protection are authors of works of the mind; performers, phonogram producers and broadcasting organisations.

The following are assumed to be joint authors of a film unless proved otherwise: the scriptwriter, the writer of the adaptation, the author of the dialogue, the author of the musical composition with or with out dialogue and the director. They aslo assimilate the authors of any pre-existing work or script e.g the novel on which it is based. Art L 113-7

Again there is an automatic assumption that the authors assign to the producer the exclusive exploitation rights in the audovisual work Art L 132-24

France's film and television industries have strong traditional ties, with French broadcasters licences being dependant on investment in French film production. Arte, TFI, M6, France 2 and France 3 all have their own film departments which coproduce within France as well as internationally. Canal Plus and TPS are merging their satelitte platforms and will contine to re-invest annual revenues into producing french films.

Film financing and banking arrangements tend to be less paper orientated than in the UK. For example a UK bank will list 50 - 60 conditions precedent all of which need to be documented before the money will be cashflowed. Whereas in France many transactions are based on personal relationships and trust without the same dependance on legal documentation.
Back to top

Chain of Title - the layers of protected copyright involved in film production

To be able to economically exploit your completed film you will need to be able to prove the paper trail of the 'Chain of Title' so that the rights can be licensed commercially.

All the contracts and copyright relate to the Chain of Title.
- The Chain of Title covers all agreements relating to all the separate copyrights including all the underlying rights in the production.
- Film and television are defined in the UK Copyright act as film which covers moving images.
- Film Directors and Producers are recognised as co-authors in the completed film.

The Layers of protected copyright involved in film production (AKA the underlying rights)

Literary works
- pre exisitng novel

Dramatic work
- script(s)

Musical works
- pre-exisitng music
- comissioned music

Artisitc works

- set desgn
- costumes

Performances
- actor performances
- musical performances (in pre-existing music)
- musical performances (in commissioned music)

Sound recording
- of pre-exisitng music

Film
-e.g. special effects

How contracts and copyright work together
Of course © never operates in isolation - it’s usually a contractual issue and the underlying rights should be transfered in writing to the production company making the film.

While copyright protection is automatic,
assignments and licences must be in writing.
Waivers must be in writing.
Moral rights need to be asserted

Back to top

DISCLAIMER

Author’s notice. These frequeently asked questions and answes have been prepared as an introductory guide to some aspects of copyright for general information only as background reading. It is not intended to provide legal advice. The author cannot be held responsible for any losses or claims howsoever arising from its use or reproduction.

Malcolm Moore, as author of this work asserts his moral rights in accordance with sections 77 to 80 of the Copyright, Designs and Patents Act 1988.

© Malcolm Moore All Rights Reserved 2006 -2015

 



Celestial Globe
1693