One of the world’s fastest-growing film markets, the local box office in Russia exceeded $1bn for the first time in 2010. This was thanks to a fast-modernising exhibition sector and a growing middle class increasingly hungry for US blockbusters and privately bankrolled home-grown comedies.

However, despite the box-office boom, the local industry has been in restructuring mode since the Russian Cinema Fund (RCF) took over from the Ministry of Culture as the lead source of state film funding in 2010. With a total annual film subsidy of $88.3m (rub2.8bn), the Cinema Fund, headed by executive director Sergei Tolstikov, has a remit to expand collaboration between Russian and foreign producers.

“Russian film-making is particularly Russian-centric,” explains Elena Romanova, the head of the RCF’s international department. “The relationships between Russian and international producers need strengthening. We need to be more international. Last year, the RCF had 17 applications for co-production funding. Next year we expect at least 30 applications, at least 22 of which I know are strong productions with substantial European partners.”

‘Relationships between Russian and international producers need strengthening’

Elena Romanova, Russian Cinema Fund

Five projects have received RCF funding from $207,000-$923,000 (€157,000-€700,000) in 2011. They include Arik Kaplun’s $4.6m (€3.5m) tragicomedy Eternity Water, a co-production between Germany’s X-Filme Creative Pool, Russia’s Studio FAF and Israel’s Evanstone Films. Romanova says she expects this number to rise significantly in the next few years.

Crucially, several key international co-production treaties have also been signed this year, notably with Germany, which is Russia’s most frequent co-production partner. Russia already has agreements with Canada, Italy, Bulgaria, France and the CIS countries.

In June, three German film funds, the German Federal Film Board (FFA), Medienboard Berlin-Brandenburg and Mitteldeutsche Medienförderung (MDM), signed a $198,000 (€150,000) annual co-development agreement with the RCF.

“Arthouse projects often seem to be the common ground when it comes to co-productions with Russia,” says Peter Dinges, CEO of the FFA. “Most of the projects the FFA receives applications for with Russia are arthouse.”

“The Russian Cinema Fund has really changed things for the better,” says German producer Simone Baumann, who is also German Films’ Eastern Europe representative and German chairperson of the German-Russian Film Academy. “I am very optimistic about the future of co-productions with Russia. The current system is more transparent than in previous years. There have been 11 co-productions between Russia and Germany since 2006. We hope there can be at least three each year going forward.”

For countries signed up to the European Convention on Cinematographic Co-production or that have bilateral international co-production treaties with Russia, getting co-productions off the ground is relatively straightforward. And for the co-productions that fall outside these criteria, the rules have now changed to make it easier to qualify for state support from the RCF. Now, just 50% of a film’s funding needs to come from Russia (it was previously 70%) and fewer key creatives are required to be Russian. RCF support also comes tax-free.

“The new streamlined approach to film funding is very important for co-productions,” confirms Baumann, who was an associate producer on 2011 Russia-Germany-Ukraine co-production Innocent Saturday. “It is a very different approach to what went before.”

The RCF is also exploring the possibility of introducing regional incentives for projects that shoot in Moscow, St Petersburg, Perm, Krasnodar Krai and Primorsky Krai, with it becoming a centre for the regional film commissions.

The Fund is eager to attract more international productions to shoot in Russia. Summit’s The Darkest Hour and Paramount’s Mission: Impossible — Ghost Protocol recently made use of Russian locations.

To service these productions, the film infrastructure needs to be strengthened. Russian World Studios has an impressive facility in St Petersburg to complement its large Moscow operation and is developing further facilities. The delayed 30,000 square metre Glavkino studio complex is also now under construction near Moscow. But progress is slow: “Visas, different banking methods, language, different production methods — the age-old obstacles are still there,” admits the FFA’s Dinges of shooting in Russia. “But we’re in a learning process right now.”

Russia has certainly embraced a raft of international initiatives this year. In March, the country became a member of Eurimages and for the first time this year three Russian producers gained entry to the European Producers Club.

‘We are closer to Moscow than Los Angeles’

Chris Curling, Zephyr Films

In July, the RCF unveiled the Moscow and Paris-based French-Russian Film Academy, dedicated to organising seminars and workshops to increase opportunities for Franco-Russian co-productions and to support emerging talent in both countries.

Last month the Academy announced the first two projects eligible for grants of $52,750 (€40,000) each: Rémi Chayé’s Longway North (Tout En Haut Du Monde), produced by Sacrebleu Productions, and Alexei Popogrebsky’s Lost Rooms, produced by Koktebel. Both are looking for international co-production partners. The next session of the board will be held in Russia next year.

Over the summer, the Cinema Fund sent 10 Russian scriptwriters to participate in workshops at the New York Film Academy, which became an official partner of the RCF. The fund intends to sign long-term agreements with US and European film schools and is in talks with the MPA about the first-ever US co-production treaty.

UK producer Chris Curling of Zephyr Films shot The Last Station as a Germany-Russia-UK co-production in 2009 and is developing a further Russian co-production. He is cheered by the progress being made by the RCF.

“A lot of the production firms in Russia are led by directors, so that makes them very appealing to work with,” he says. “There is a good level of private equity. Things are evolving — Russia will become a stronger market for English-language films. It is going to become easier to work with Russian partners.

“As a European producer I have just as strong ties with Russia as France, Germany and Spain. After all, we are closer to Moscow than Los Angeles.”

2011 international co-production projects backed by the RCF

Elementary Love

Family comedy

Countries Italy (60%), Russia (40%)

Production companies Centro Sperimentale film school, Zori Film

Producer Ulyana Kovaleva

Director Sergio Basso

Budget $2.2m (rub70m)

RCF support $621,000 (rub19.6m)

Eternity Water

Tragicomedy

Countries Germany (49%), Russia (35%), Israel (16%)

Production companies X Filme Creative Pool, Studio FAF, Evanstone Films

Director Arik Kaplun

Budget $4.4m (rub139m)

RCF support $887,000 (rub28m)

Friends From France

Adventure drama

Countries France (47%), Germany (30%), Russia (13%), Israel (10%)

Production companies Films du Poisson, Vandertastic Films, Studio Rock, Pie Films

Directors Anne Weil, Philippe Kotlarsky

Budget $4.1m (rub129m)

RCF support $380,000 (rub12m)

The Queen Of Spades

Thriller

Countries Russia, TBC

Production company Lungin Studio

Director Pavel Lungin

Budget $9.5m (rub300m)

RCF support $887,000 (rub28m)

The Stroll

Melodrama

Countries Italy (70%), Russia (30%)

Production companies Vivo Film, Studio Rock

Producers Gregorio Paonessa, Alexei Uchitel, Kira Saxaganskaya

Director TBA

Budget $950,000 (rub30m)

RCF support $199,000 (rub6.3m)