13/01/2011

The European Commission (EC) has launched a loan guarantee fund aimed at making it easier for film producers to gain access to bank financing. The €8m MEDIA Production Guarantee Fund will be run by the EC in tandem with two operators with long-standing expertise in this area: the French Institute for the Financing of Cinema and Cultural Industries (IFCIC) and Spain's Guarantee Society for the Audiovisual Sector (Audiovisual SGR).

The MEDIA Production Guarantee Fund will be available to support film producers throughout Europe. For example, it will help cover a proportion of a loan in the event of non-payment by a producer due to bankruptcy.

The Fund will run until the end of 2013. IFCIC and its Spanish counterpart will receive a total of €4m each from the Fund. The EC estimates that, thanks to the leveraging effect of the Fund, over €100m will be freed up for loans to film producers, many of whom are small or medium-sized businesses.

In the event of a default, a bank would be able to recover up to 55% of its loan from IFCIC and up to 50% from Audiovisual SGR, with funding from their own resources and from the Fund.

The maximum funding available from the Fund is €8m. Any money that is not used from the Fund will be returned to the EU budget.

Film producers are eligible for support from the Fund if they are established in any of the 32 countries that currently participate in the MEDIA Programme: the 27 EU Member States, countries in the European Economic Area (Norway, Iceland, and Liechtenstein) as well as Switzerland and Croatia.

Full details about the MEDIA Production Guarantee Fund will soon be available on the IFCIC and Audiovisual SGR websites.

This Fund is a part of the MEDIA Programme, which is contributing €755m to support Europe's film industry from 2007-2013. The funding helps improve the distribution and promotion of European films and strengthen the competitiveness of the sector.