Local Content Production in Brazil: Regulation and Funding Models Luís Paulo Bogliolo Piancastelli de Siqueira Department of Intellectual Rights Ministry of Culture

O UTLINE A brief history of audiovisual production in Brazil Guiding principles and regulation Funding models International cooperation Challenges and opportunities

A B RIEF H ISTORY OF A UDIOVISUAL P RODUCTION IN B RAZIL Cinema Television Cable and satellite Digital media

R EGULATION Constitutional Principles: Article 221. The production and programming of radio and television stations shall comply with the following principles: I - preference to educational, artistic, cultural and informational purposes; II - promotion of national and regional culture and fostering of independent production aimed at their diffusion; III - regionalization of cultural, artistic and journalistic production, according to percentages established by law; IV - respect for ethical and social values of the person and the family.

B ROADCASTING Free and open to the public Property and editing responsibilities of broadcasting organizations restricted to nationals Public concession of broadcasting services: 15 years for television 10 years for radio Complementarity between private, public and state broadcasting

B ROADCASTING At least 5% of time must be dedicated to news service Maximum 25% of time for publicity and advertising At least 5 hours a week for educational programs  Verticalised production is the norm

Cinema: Incentives, Regulation and Supervision by ANCINE Screen quotas: First established in the 30s Currently set by ANCINE

Cable and satellite (subscription-based services) Late development in Brazil Law /2011: a new legal framework Liberalization of subscription-based services Quotas for local content and independent productions Tax on subscription-based services to extend funding of local and independent productions

Law /2011: Qualified channels must display 3:30h of local content on prime time For each 3 qualified channels at least 1 must be Brazilian At least 2 channels must display at least 12 hours of local content made by independent producers

I NCENTIVES Indirect Incentives Tax deductions Law 8.313/1991 Law 8.685/1993 (Audiovisual Law) FUNCINES Direct Incentives Automatic incentives Based on economic results or artistic quality Selective incentives

F UNDING M ODELS CONDECINE (Contribution for the Development of the National Film Industry) Production, distribution, licensing and comunication of audiovisual works for commercial purposes Subscription-based (cabel and satellite) services Publicity/advertisement works Financial transfers to foreign producers, distributors or intermediaries

Audiovisual Sector Fund (FSA) Created in 2006 Part of the National Fund for Culture (FNC) Source of revenues: CONDECINE Federal Budget Telecommunications Supervision Fund Fees, fines and investment profits Directed at all segments of the audiovisual industry F UNDING M ODELS

Main actions: Investment, with participation in commercial results Financing Equalization: reduction of financial charges on financing transactions; non-recoverable values, provided for only in exceptional cases. PRODECINE - Support Program for the Development of Brazilian Cinema PRODAV - Support Program for the Development of the Brazilian Audiovisual A UDIOVISUAL S ECTOR F UND (FSA)

Incentives brought by Law 12/485/2011: At least 10% destined to independent productions made for community, university or Brazilian programmed channels At least 30% destined to Brazilian producers in the North, North-East and Centre-West regions A UDIOVISUAL S ECTOR F UND (FSA)

S TRENGHTENING I NDEPENDENT P RODUCTION Works produced with tax incentives or under direct incentives are subject to special rules: Independent producers must be given a minimum percentage of revenues from the exploration of work (equal to its participation in the rights to the work) Assignment of some rights is limited to a 5 years period Limitation of the scope of rights that can be assigned Decision powers over derivative works must remain with the producer

C OPYRIGHT L AW 10 years time limit on the exclusivity of an assignement for the making of audiovisual works

Participation of local independent producers in open and subscription-based television

I NTERNATIONAL C OOPERATION International coproductions Bilateral agreements Germany Argentina Canada Chile Spain France India Italy Portugal Venezuela

I NTERNATIONAL C OOPERATION Multilateral agreements Conference of Ibero-American Cinematographic Authorities (CACI) IBERMEDIA Fund Latin American Cinematographic Coproduction Agreement Rio Content Market

I NTERNATIONAL C OPRODUCTIONS

S UMMARY BROADCASTING Verticalised production Mostly private initiative Financed by publicity and advertisement SUBSCRIPTION-TV (CABLE AND SATELLITE) CINEMA Screen quotas Taxes and government funding

C HALLENGES AND O PPORTUNITIES Strengthen demand for local content Self-sustainment of the national audiovisual industry Expand access and diversity of audiovisual production Increase local and independent content production Widen the range of platforms and technologies for commercialisation of content Collective management of rights for audiovisual works

Thank you! Luís Paulo Bogliolo Piancastelli de Siqueira