Thursday, October 6, 2011

Magma - Section 481 - Etc

A commenter on my post detailing Section 481 amounts raised in 2010 says, Magma Films didnt get 481 money for Jack Taylor. Finder films did, a completly different company so your source is not correct and I dont see you point in putting this info out or where you got it...

I think it worthy of a more detailed reply than I was able to make to the comment so here goes.

Firstly, the information comes separately from the Revenue and the Department of Arts, Heritage and the Gaeltacht. The Department gives a list of projects and companies that have availed of the tax incentive, as it does gross figures for the scheme output in 2010, as follows -
Year 2010
Projects 57
Total spend €346.3m
Irish spend €164.6m
Section 481 Amount €160.2m

It's important to note that 'Irish spend' includes finance other than that raised through Section 481. It will include other local public sector monies such as Irish Film Board, BAI, and broadcaster funding. And possibly some MEDIA and Eurimages public funding, in addition to other public or private sector funding from outside the jurisdiction.

The 28% net benefit to these 57 productions from Section 481 was €44,869,843.20. whereas the 41% exchequer cost was €65,702,270.40.

To come back to Magma, the commenter refers to Finder Films. Finder Films Ltd was, I believe, the Special Purpose Vehicle company established in September 2009 by Magma to produce Jack Taylor: The Guards. It availed of €1,336,000 raised in Section 481 in 2009, some 28% of which would usually have been the net benefit to the production. This company was wound up in March of this year.

Finder Films 2 Ltd was, I believe, set up in August 2010 as the SPV company by Magma to produce Jack Taylor - The Magdalen Martyrs/The Pikemen. It availed of €2,370,000 Section 481 funding, some 28% of which would usually have been the net benefit to the production. This company is still in existence.

Both companies' registered addresses were 16 Merchants Road, Galway, the location of the offices of Magma Films which is the trading name of Magma European Scripting House Ltd (MESH).

MESH was the principal tenant of the building and had sub-let offices to some unrelated companies. It was liable to Galway City Council for rates on the premises. On 2 February 2010 the Council obtained a decree against Magma European Scripting House Ltd (MESH) in Galway District Court for outstanding commercial rates of €27,000 owing up to end 2009. That decree is still in place. The Council will not confirm if the total rates now owed is in excess of €60,000 but added in response to an email:

We understand from a letter by MESH Ltd to all creditors that although they had considered going into voluntary liquidation earlier this year, MESH now intends not to liquidate and to continue to exploit existing and future rights on its intellectual property. We also understand that Mr Paul Mee of Mazars in Galway is currently in discussion on behalf of MESH with the Revenue, with Anglo Irish Bank and others in relation to outstanding debts and other issues.

I have been told that no 'Magma' companies now remain at 16 Merchants Road. Magma Productions Ltd changed its name to Tidal Films Ltd and subsequently moved to Mayoralty House, Flood Street, Galway. It is producing Thor - the Edda Chronicles through the SPV company Thorsday Films Ltd and Niko - Family Affairs through another SPV company Niko Film Productions Ltd. A further company, Tidal Niko Films Ltd was registered on the 22nd September.

While the directors of Magma Productions Ltd changed before it changed its name to Tidal Films Ltd earlier this year it is not clear if the shareholdings in the company have been altered. Magma Productions Ltd shares were held 30% by the two newest directors, 40% by a former director (German), 28% by an Austrian/German shareholder, and 2% by a holding company associated with the 28% shareholder.

I am told that the 40% shareholder is the sole director of the German company that has co-produced the Jack Taylor projects.

This brings us to the task being undertaken by Mazars in Galway to establish what MESH rights assets might be used to repay the monies owed to the company's creditors which include the public interest through the Revenue, Galway City Council, Anglo Irish Bank, Enterprise Ireland and, presumably, loans outstanding from the Irish Film Board.

These are the Section 481 amounts raised by Magma projects in recent years:
2006 Feature 1,400,849 The Summer Of The Flying Saucer
2007 Feature 1,850,000 Niko - Way To The Stars
2007 TV series 2,459,478 Simsala Grimm 2
2009 TV movie 1,336,000 Jack Taylor : The Guards
2009 Animated film 1,015,664 Thor - The Edda Chronicles
2010 TV Movies x 2 2,370,000 The Magdalen Martyrs/The Pikemen
The tax revenue foregone on these projects is about €4.3m

The Magma website is headed MAGMA FILMS - 16 Merchants Road, Galway, Ireland - Phone +353 91 569142. Copyright is accorded at the foot of the page to Magma European Scripting House Ltd.

Production and development properties cited on the website include:
Summer of the Flying Saucer, Foreign Exchange, Paisean Faisean, Adharca Fada/The Grass is Greener, Lynch, The Pipeline, The Courtship Gift, Eco Cops, Beauty & the Beast, Mostly Ghostly, Morturi, Jack Taylor,
The Ugly Duckling and Me (feature and series), Niko and the Way to the Stars, Zombie Hotel, Lilly the Witch, Norman Normal, Things You Think, Simsala Grimm 2, Oops Noah is Gone (Feature & series), Bug Muldoon (feature & series), Dr Ella, Thieves, Thor the Edda Chronicles, R4U, The Cloud Scout.

Any contention that not all of these properties belong to MESH would seeem to rest on the premise that rights may have been legitimately assigned from one company to another, perhaps temporarily for the purpose of funding applications, on the basis of memorandums of understanding between companies which may have shared directors at the time of the assignment.


Anonymous said...

That is allot of funding.
You say "Jack Taylor: The Guards. It availed of €1,336,000 raised in Section 481 in 2009, some 28% of which would usually have been the net benefit to the production. This company was wound up in March of this year."
If the company has been wound up then who owns the rights now and who pays back European Media money and all the people who funded this and who will pay the film board and all the the funding it got for all the other work it made over 14 years?Surely its worth several million all these rights. They were a busy company and received several million on funding. I can't understand this.

Anonymous said...

Hi IFP, I've allways admired your work in relation to the Film Ind. I think what makes it fantastic is your not favoured to one side or the other , ie , production or union . You genuinely seem to have the Taxpayer at heart as well as the Industry . Do you not get frustrated as I do in the lack of transparency and accountability of the IFB , I mean it's a disgrace that accounts are delayed for publication regarding Production Loans by years . One has to ask WHY , is it because nobody cares , or is it they can't produce figures on all monies outstanding over years . Surely as a taxpaying Public these accounts should be easily accessable to anyone in the State . Why is it this Semi- Secret Society ( IFB ) thwart all inquires made by people and refer them to apply under Freedom of information Act , only to be refused ? Do you know how much money is owed back to IFB from Production Loans and what , how or do the IFB pursue these Producers to recoup these outstanding DEBTS . The more I follow your blog the more angry I get , as an industry worker of 20 years I'm astonished at how the industry has been intentionally DUMBED DOWN , the creativity stifled , jobs displaced , all for a minority of Producers involved in a Quango so they can return time and time again for Taxpayers Money . Please keep up the very good work you do , it's just sad that more people don't heed what you say . It's head in the sand syndrome , that's only down to people's fear If identified they'll be BLACKLISTED. You provide a voice for the Crews , that can't speak out for themselves .