The go-ahead covers more than $45m (£22m) in grants each year, which are aimed at supporting 'culturally British films'. The definition of a 'culturally British film' was originally approved by the Commission when it allowed the UK film tax incentive scheme to go ahead in November 2006.
The money will be administered by the UK Film Council, Scottish Screen, Northern Ireland Screen and the Film Agency for Wales. In addition to film production, the schemes also support the development, distribution and promotion of culturally British films.
The three largest schemes - the Premiere Fund, the New Cinema Fund and the Development Fund - are all administered by the UK Film Council and provide funding for feature film projects.
EU Competition Commissioner, Neelie Kroes, said, 'Many of us are touched in some way by the films we watch, whether in cinemas, through video-on-demand, on DVD, on television ... even perhaps on our mobile phones. Therefore, I am pleased to be in a position to approve the UK support schemes for films showing aspects of European culture, as they are in line with EU state aid rules.'
EU state aid rules for film and audiovisual production are governed by the European Commission's Cinema Communication. Approval is based on a commitment by UK authorities to implement any required changes should relevant state aid rules be amended during the period until Dec 31, 2012.