The head of Spain’s ICAA talks about the difficult challenges facing the Spanish film world.

The new director of ICAA, Susana de la Sierra has come to office in the most difficult time for the Spanish sector since democracy. Amidst a huge budget cut from the Government, the film sector has been hit hard by the crisis. ICAA, the institutional body that manages funds for films, has seen its expenses go down a dramatic 37% (42% according to other sources), and no longer backing screenwriting, animation or short film production.

To balance the situation, ICAA will announce soon the new tax deductions for private investors and at the end of the year will come the highly publicised patronage law that will help finance film festivals and non profit activities.

It looks like your job is not right now the best in the world. What led you to accept this responsibility?

I am not a politician and I meditated wisely on my decision. In Spain we are dealing with a very difficult situation not only in cinema. I have been studying all my life the finance of films in Spain and in the rest of the world and I think I got to the conclusion that it is a job that I am prepared to do…The director of ICAA has a great media presence and I am just beginning to get used to it. This is positive because it means that cinema is alive and it matters. It is time to find new solutions.

Cinema funds have been reduced almost 40% while you encourage private investors to step in. Is this the end of an era?

We still believe that the State has to support cinema, nobody is talking about eliminating public funds. We approach cinema as both culture and industry, for me it is very important to understand this duplicity. This year public funds have been cut as it has happened to every sector in culture and every department of State. Cinema funds will come back. It is my intention that we will see again money for screenwriting or short films. I really hope that we can go further next year with the budget.

The producers association, Fapae, claims that tax deductions should go up to 40% to be effective. Until now, they have had a very little impact with an 18% rate. You have suggested a 20%, maximum 25%.

 There have been almost 60 titles that have used those tax deductions since their approval at the end of 2007. Of course, we can go a ways longer in that figure. I think that when producers ask for a 40% they know that they are not being realistic. I think that we might get to a number that satisfies both parts, it will not be a 40% nor a 20%. We are just discussing this now and I am the first person interested to go as far as we can. On the other hand, it is not only about percentage but also about making paperwork much easier. We will simplify the system. Other countries of our environment are offering a 20% deduction and it’s working.

Last year the marketshare for Spanish films was barely a 14% and this year so far it is around 12%. What do you think about it?

I think we have a problem with the public opinion. We will have to do better films for the mainstream audience but will also will have to work hard on this PR problem. There are some old routines that must change.

Some journalists, producers or directors are talking about an apocalyptic situation.

I understand the worries of the producers as I understand the worries of other sectors because the situation is very complicated. It’s no time to play down the budget cut but it’s not a political decision. There is a very fluid relationship with the sector. There is a very clear road map that is the 2007 cinema law and we are still waiting for the European law that will come after summer. We are doing the best we can and we have been fast taking decisions. We have released the support for this year, not all of it but as much as we could.

We have just created this line of credit for film production with ICO that are managed by SGR Audiovisual (a public organisation formed by the ICAA in partnership wth audiovisual rights management body EGEDA ) where you can guarantee almost all the necessary operations because the redemptions calculated according to the box office will pay this credit. We are still working with the classic ICO lines of credit. Producers right now can get cash and be sure that they will be able to get the funds after the film opens. That’s why there is no need to panic. ICAA assures that funds will be there when needed.

What is the role of co-productions in this future panorama?

They are more than essential. Cinema is everyday a more international industry and we are very aware of it. We will work hard to make co-productions more attractive for Spanish and foreign investors. At this point, the ICAA will work closely with other departments as the department of industry or ICEX. Again, it’s not only about giving money, we have ways to make them easier and more profitable. Spanish cinema has every day a higher international reputation and we have great talent here. I am sure that we can appeal more and more international producers. Last year, Spanish films made more money outside Spain than in our frontiers. I want to make clear that ICAA will pay its bills, nobody will have a debt with us.

Shoots have been dramatically reduced, but will the coming months will be better?

We are going to see an increase of the shoots with these new lines of credit. I am not rejecting any responsibility, but it is also possible that shoots have decline due to other factors that are out of control of ICAA and go beyond the cinema situation. But we are working to improve that. We have to think globally.

What’s the philosophy behind the change of the ICAA’s model?

This is a warning call to the fact that is necessary to have more private investment in culture, not only from the economic point of view but also social. It is important that citizens regard culture as something important. In countries like France private participation is very important. Beyond the economic factor, there is this sense that we have to link civil society with culture. Patronage will be a law of social participation.

Have you had any response from the corporate world?

I have noticed a lot of interest in these ideas, there is a great interest for example in financing educative projects. We will work also in microfinance, there are ways as crowdfunding that can be very useful. The key factor is this sense of civil implication. We will also work to revitalize access to culture.

Piracy has been a constant worry in Spain. What expectations do you have with the new law against it?

Piracy is not our domain since the competence belongs to the secretary of cultural industries. I am very sure that the new committee of intellectual property will do a good job. For us, at this point, it is very important to help and promote the VoD sites as, or youzee. There are new business coming along and we will stand for them.

For years, the perception has been that Government was not interested in fixing that situation.

The last minister (Angeles Gonzalez Sinde) really had a bad time to create the law that has her name. I think that in the last Government there were different opinions but also outside pressures. There are no resolutions yet but a number of illegal sites have shut down as soon as they have received the lawsuit. We will be seeing the first results in the following weeks. We are very clear at this issue and will have no patience with piracy. When we talk about Spanish cinema and its success, it’s important to think about how many times those films are seen illegally.  There are a lot of people watching Spanish films and we will make them pay for that.

TV broadcasters are obliged by law to invest a 3% of their total income in cinema. Will this change as suggested?

The Brussels lawsuit filed by TVs against that law has passed this law and we are still waiting for the Tribunal Constitucional (Spanish high court) resolution. I expect the court to be comprehensive with the arguments of Brussels and confirm that decision. It’s true that it was suggested at some point but it’s not in the electoral programme. We might introduce some changes. For example, TV broadcasters must invest a 3% of their total income into cinema every year and maybe it’s good to count it in periods of three years. I conceive the audiovisual as a single unity and this must not change.

You have suggested that more funding should go to promotion.

In the US, we are seeing a very different business model in which almost 50% of the budget goes to promotion. Spain is the country in Europe that spends more money in production, 98%, and less in promotion and we want to change that. We are studying some options, as giving additional points to those films that have a good marketing plan.

Will ICAA still fund distribution?

The proof of our commitment with distribution is that we are still giving significant funds this year despite the cut of budget. For us, it’s fundamental that European cinema is exhibited in Spain in a scenario dominated by Hollywood and the power of majors. Those funds are also fundamental in the environment of the EU.

What is the importance of Latin America?

Latin America is a preferential territory for Spanish cinema. The programme Ibermedia for coproductions between Spain and the continent is still working and we would like to go deeper into it when the economy improves.