German exhibitors are considering taking legal action against the new Film Funding Law (FFG) which is set come into effect on January 1, 2004.
The law means that cinemas will be obliged to contribute an average of 2.7% of their gross turnover to the financing of the Federal Film Board (FFA), the German film funding body.
In the runup to last week's final reading of the FFG in the Bundestag, exhibitors were lobbying hard for reductions to the levy.
Exhibitors' association HDF even launched an Internet website and distributed flyers in cinemas to generate an awareness among cinemagoers about how the proposed increases in the levy would be detrimental to a sector which has seen boxoffice revenues fall by 13.3% compared to 2002.
Some concessions have been made by Germany's State Minister for Culture Christina Weiss, although they are clearly not enough to mollify increasingly angry exhibitors who have now announced that they are considering a legal review to decide whether the new FFG is unconstitutional.
In a statement this week, the exhibitors stated that "a serious, impartial discussion of the HDF's arguments had not taken place on the part of the Federal Government" and pointed out that the negative effects of an increased levy had either been "played down or denied"
Answering HDF's threat to take legal action, Christina Weiss told the dpa news agency that "either there will be this film funding support or there won't be any whatsoever anymore. The cinemas have another problem other than that of film funding. Their crisis has come about from the tickets which weren't sold. I would have been very grateful if they had spoken with me about their real problems."
She pointed out that what was at issue was an additional three cents per ticket of which half was met by the distributors. "The problem I see with a [legal] action is that the result could be that there won't be any film funding whatsoever. I don't think that that is the goal."
"I can understand that the cinema industry has been hit by drops in turnover in the first half of this year and an increase in the levy causes disquiet", Weiss remarked in the Bundestag last week. "I cannot understand that our levy is supposed to lead immediately to critical existential crises, as the trade associations claim. The campaigns which accompanied the revision of the FFG were populist and misleading and were damaging for the common goal."