On film, journalism, and the order of things...

Some essential reading, every bit as true of the 'micro' level of governance as it is of the level of the macro geopolitical order.

http://www.guardian.co.uk/commentisfree/2012/aug/26/compliance-authority-failure

and

http://www.salon.com/2012/04/08/u_s_filmmaker_repeatedly_detained_at_border/

Whos, Whys and Wherefores

Looking at the origin of some recent traffic I discovered that someone nominated Irish Film Portal for the 2012 Blog Awards, in the 'Best Blog of a Journalist' category. When I say 'someone' you may take it from me that I didn't nominate the blog myself, nor do I know who did the nominating.

I have never tried to publicise Irish Film Portal, so whatever following it has generated over the last few years has come about organically, so to speak. I don't 'tag' or 'label' posts and I've not done the whole facebook viral thing, although it has been suggested to me. Nevertheless, the number of page views has passed the 60,000 mark and they're not all Ciarán Hinds or Gabriel Byrne stalkers fans looking for the latest news.

So what is Irish Film Portal about?

It's about the culture of Irish film culture. It asks why we - the Irish people - assign millions of Euros to film and TV drama production each year, what we expect to result from our generosity, and what the actual outcome is.

The only reason I'm doing the asking is because no one else is doing it. Instead there is a wall of PR called 'news' which is circulated and endlessly repeated until it calcifies in the archives. Hardly anyone asks any meaningful questions from an objective position, reflecting on the cultural outcomes of state policy.

Most of what is written about film in Ireland or elsewhere is concerned with profiling and reviewing the tide of films produced and released each year.  There is little space given for one of the most basic questions - why?

Why do we have funding policies for film? Why did those production companies go bankrupt? Why were those directors fired? Why was this project not funded? Why were these other productions funded? Why do we reduce the amount of money for the Film Board while the tax break can cost us any amount over €50 million each year? Why does the total public cost of the tax break not go into the films it funds? Why do Irish audiences not go to Irish films? Why are Irish film and TV production companies so dependent on public subsidy? Why do Irish producers earn very generous fees from production and hardly anything from sales? [Would the 'industry' not be more functional if producers had to earn their money at the 'back end'?] Why are industrial relations so appalling and work practices so outmoded.

Our Section 481 tax break allows high earners to save 41% of their tax liability on €50,000 of their income in any calendar year. So, they get to keep €20,500 that would otherwise have gone into the exchequer to pay for public services. TM Productions/VK Productions series The Vikings, for instance, has raised approximately €22,348,484 in Section 481 funding this year. The quid pro quo for the loss to the exchequer of approximately €9,162,878 in tax revenue is the spin off to the economy, although only €6,257,576 of the tax revenue foregone is likely to actually go into the production.

However, while The Vikings 'Irish' spend may be reckoned at €22,348,484, the official definition of 'Irish' spend includes payments to all EU-based cast and crew as well as spend on Irish employees, goods, and services. That said, there are ways around the required 'Irish' spend on goods and services. Does a service qualify as Irish spend if, for example, an Irish company contracted by the production gets some of the work done in the UK by a sub-contractor?

Here's a current example, from the film processors Deluxe Soho in London (my emphasis in bold) - Deluxe Soho are delighted to announce the launch of our newest film stock and processing package, Film First. Created exclusively for the Republic of Ireland, Film First is a new processed paid film stock delivery service run in conjunction with Fuji Motion Picture. Available as both 16mm and 35mm packages, Film First makes shooting on Film financially and logistically viable for all productions shooting in the Republic of Ireland. The price of the Film First package includes film stock, processing and return delivery with just one invoice, in Euros, issued through Fujifilm Ireland keeping the spend 100% Irish. All film originated projects are eligible for the deal and the turnaround times are swift, with an order of 2,000 feet or more being returned within 24 hours and smaller consignments of less than 2,000 feet taking just 48 hours.The price for 35mm stock is 50 Cents per foot (200 Euros per 400ft roll or 500 Euros per 1000ft roll), with 16mm film costing 40 Cents per foot (160 Euros per 400ft roll). Visit Film First for further information.

I have no doubt that these arrangements conform with the letter of the regulations, and will have been fully checked with the Revenue Commissioners by Screen Scene, Windmill Lane, Fuji and couriers Aerly Bird - the Irish parties to the scheme. And I have little doubt that they conform with moves at a European level to de-territorialise the spending requirements of national funding regimes for film.

But where is the public discussion about this movement of funds from the Irish exchequer to a business outside the jurisdiction. Are the business interests of the participant companies the same as the wider public interest? Why doesn't Deluxe set up a lab in Dublin if it wants our money? (Ok, that's rhetorical, I know film processing is fast becoming archaic). What has changed since the Revenue Commissioners came down hard on sub-contracting arrangements entered into by the Concorde Anois Studio on productions for which Merlin Films had raised millions in Section 481 funding?

Irish Film Portal poses these seemingly quixotic questions.  Occasionally there are also answers.

Magma Films - in liquidation

What follows is the three-page "Estimated Statement of Affairs" circulated to creditors at the Magma European Scripting House Ltd (t/a Magma Films) creditors meeting a week ago on July 31st. The accuracy of the unsigned estimated statement of affairs was contested by some creditors at the meeting.  The company has not filed accounts beyond the year ending 31 December 2008.

The listing of secured and unsecured creditors does not include loans totaling €3 million from the Irish Film Board because, I am told, they are 'non-recourse' loans that are only repayable from revenue deriving from IFB-supported production and development assets.  Therefore, any income flowing from those assets is not available in the first instance to the company's liquidator in order to discharge the company's debts to creditors.  My own impression, having attended the meeting, is that this was not made clear to creditors.

To summarise, Magma Films owes €3 million to the IFB which is repayable only from film, TV and certain intellectual property revenues.  Magma Films has a further €5 million in debts made up of preferential creditors, secured creditors, trade and other creditors, and director and shareholder loans.

The company appointed Eugene McMahon of Mazars Tierney, Galway, as liquidator. Mazars are auditors to a related company, Abbeygate Productions Limited, which is the special purpose vehicle company through which Section 481 funding was raised with Anglo Irish Bank in 2007 for an animation series, Simsala Grimm II.  Transactions between MESH Ltd and Abbeygate Productions Ltd continued into 2011.