France's National Cinema Centre (CNC) has given provisional approval for A Very Long Engagement - the Warner Bros France backed film by Amelie director Jean-Pierre Jeunet - to qualify for access to French state funding.

However, the approval does come with some caveats.

The $50 million film is set to be produced by a new company, 2003 Productions, created by Warner Bros France president Francis Boespflug and owned 32% by Warner Bros.

Since the project was announced it has been stirring up controversy in the French industry over whether or not the company qualifies under French law as a French entity. This grants it access to state funding and the ability to create a 'compte de soutien.'

That 'compte de soutien' account is a revolving fund set up at the CNC where a percentage of each ticket sold for a particular film is then available for use in funding future productions by the film's producer. It is only open to French producers.

In July, the committee charged with approving films for this aid met to study the dossier but decided to push a formal decision back to early September. Last week a second meeting at the CNC declared that the film would be approved with the stipulation that the financial structure behind 2003 Productions be studied in order to determine that the company is indeed majority controlled by the French.

As it stands, the company is 32% owned by Warner Bros. and 16% by Boespflug with the rest divided up amongst individuals who work for 2003 Productions. Other, minority, producers involved in the film are TF1 Films Productions and Jeunet's company Tapioca.

In order to make a final decision the dossier will be further studied and new regulations may be put in place so as to avoid similar problems in the future. It is largely believed that if Warner Bros France film succeeds in being approved, other US majors may attempt to set up similar types of production companies.

Didier Duverger of French financier Coficine told that the recent approval by the CNC of Oliver Stone's mega production Alexander The Great - which is being produced by French group Pathe - had helped.

Despite the fact that Alexander will be shot in English outside France and with a cast and crew not entirely French, the film was granted French status by the CNC thanks to the fact that Pathe is a qualified French company. In comparison, Jeunet's film is set to be shot entirely in French, in France and with French cast and crew. The Oliver Stone film, "allowed the balance to shift in Warner's favour," says Duverger.