The Spanish parliament has approved a new law that lowers the maximum level that private TV broadcasters are obliged to invest in film from 5% of their annual revenue to 3%, with the caveat that they invest more in independent projects.

The General Audiovisual Communication is intended to appease both the broadcasters who have voiced their disapproval of the quota system and local film producers who have been asking for TV investment to be spread more evenly.

Broadcasters will no longer be able to invest the full quota in one big project, as has been the case in the past, especially with Telecinco in films such as Agora (pictured), Pan’s Labyrinth and Che Parts One and Two. Instead they will now have to spread the money around to different producers with at least half the 3% going to projects where the independent producer has the majority stake.

“In other words we can only invest up to 49% in one project,” Ghislain Barrois, head of acquisitions at Telecinco Cinema told Screendaily. “In theory this is fine as it means more producers get a share of the TV money, but it is going to be hard for the producers to find the remaining money for their projects with advancements for international rights having shrunk in recent years. As a result budgets for projects will inevitably decrease. Furthermore, we will be investing less money as a result of the reduced quota and because our annual turnover has decreased.”

Barrois believes there will now be fewer commercial films like Agora, Che and Planet 51 being made in Spain. He added that it flew in the face of the original intent of Ignasi Guardans, the director-general of government film funding body the ICAA that originally backed the bill.

“Without TV funding in film there would be no Spanish cinema,” Guardans said when reached by Screendaily.

But one local producer insists this is a step in the right direction. “It is no secret that the broadcasters aren’t overly keen in investing in or pre-buying independent European projects, preferring instead US or major local titles, but hopefully that will now change.”

Meanwhile public broadcaster TVE has seen its obligation to invest in film rise from 5% to 6%. The broadcaster has been very active with pre-buying both low and high- profile films recently, including Mateo Gil’s Blackthorn, Alejandro Gonzalez Inarritu’s Biutiful and Alex De La Iglesia’s Balada Triste De Trompeta.

In a further twist, Spain’s Supreme Court openly questioned the legality of the quota system altogether in response to a complaint made by the private broadcaster lobby Uteca back in 2004. The Court has referred the quota system to Spain’s constitutional authorities to see if they think it breaches the constitution.