Poland expects contributions from VoD broadcasters
by Marta Bałaga
- As part of the fight against the effects of the coronavirus pandemic, the Polish government has decided to introduce a compulsory contribution from VoD broadcasters
While the European film sector struggles to keep its head above water, changes are being made to ensure its survival in the post-COVID-19 era. This is also the case in Poland, which is now eyeing the VoD market. “Thanks to the efforts of Deputy Prime Minister and Minister of Culture and National Heritage Piotr Gliński, a note regarding the 1.5% contribution fee collected from broadcasters of on-demand audiovisual media services has been incorporated into the new update of the anti-crisis shield,” announced the Polish Film Institute on 28 April, while adding that the decision was long-awaited by the film community. “This widely expected and necessary change was possible thanks to the consensus of the industry, which was a reaction to the crisis in the Polish film world caused by the current epidemiological situation. In addition, it’s a response to the challenges posed by technological development in the audiovisual market.”
The planned 1.5% contribution fee collected from VoD broadcasters is not a digital tax. Paid to the Polish Film Institute, it would then be included in the pool of funds later allocated to various cinematographic projects, from film productions to the organisation of festivals and other movie-related events. “It does not place the burden on the end user, which is the viewer, but rather the entity that provides the VoD service,” it was underlined in the statement, which also mentioned that a similar fee is currently paid by, among others, television broadcasters, cinema owners and distributors, meaning all the entities that “derive revenues from the exploitation of the achievements of Polish cinematography”.
The president of the Polish Filmmakers Association, Jacek Bromski, found the initiative satisfying. “Apparently, the owners of VoD platforms rebel against these solutions. They would like to use film repertoires for free and profit from bearing minimal costs, because they do not employ as many people and do not pay rent like cinemas, plus the cost of maintaining a digital platform is incomparably lower than all other forms of distribution,” he stated on the association’s page. “Now, in the era of the pandemic, VoD platforms are experiencing a real boom: their revenues have increased significantly, and this trend will probably last a long time,” he said, while calling their attitude “deeply immoral”. “I hope they will come to their senses in their greed. Or maybe the bishops will explain to them that it is not Christian to profit from someone else’s work without bearing any costs,” he summed up, quoting Ecclesiastes 2:21. “For there is a man whose labour is with wisdom, with knowledge and with skilfulness; yet he shall leave it for his portion to a man who has not laboured for it. This also is vanity and a great evil.”
It is not yet known if the contribution will be a temporary solution or whether the government will abandon it after the epidemic eventually runs its course. “The proposed changes are the purest manifestation of the selective fiscal policy of the Polish state, as the new fiscal burden affects one sector (audiovisual) without taking into account its place, significance and function within the entire legal and economic system of the Polish economy,” protested IAB Poland, a Polish advertising industry organisation that unites and represents entities in the interactive industry, while also noting some of the initiative’s shortcomings: “It does not define the key concept of the ‘entity providing an audiovisual media service on demand’. Meanwhile, under Polish law, there is no single definition of this concept. In order to achieve even the bare minimum level of legal certainty, it should be clarified. It is also unclear why the fee was set at 1.5%. Any argumentation that it is analogous to the amount of charges imposed on other entities would be completely arbitrary, since the amount of such a fee must be carefully justified,” it was noted. “It is obvious that in the event of an excessive burden on a certain group of payers, their economic growth will be limited, which in the current crisis caused by the coronavirus will be destructive.”
Still, while commenting on this information, president of the Directors Guild of Poland Andrzej Jakimowski told the Polish Press Agency that Polish filmmakers support Deputy Prime Minister Gliński on this matter. “This is a smart and modern solution already used in countries where the best films are made,” he added. A similar proposal was presented in March last year, when it was suggested that all streaming platforms should be charged, including Netflix, HBO and Facebook. It has been estimated that the planned contribution would bring in revenue of approximately 15 million PLN (€3.3 million) by the end of 2020 and at least 20 million PLN (€4.4 million) annually in subsequent years.
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