Producers and film agencies have rejected the idea that there is “a subsidy race” going on across Europe.

Responses have finally been published this week to the European Commission consultation on State Aid for film.

Many of these will not make comfortable reading for the EC. Stakeholders are making it very clear that they take issue with several of the proposals in the 2012 Draft Cinema Communication.

In particular, producers and film agencies alike have rejected the idea that there is “a subsidy race” going on across Europe.

The British Film Institute is among the public bodies disputing the idea that a subsidy race between member states exists. In a sharply worded observation, the BFI points out that the Commission “has failed to bring forward any evidence to underpin the existence of such a situation.”

“We are extremely concerned that the changes proposed in the paper will lead to a withdrawal of subsidy measures by some Member States which will have a major detrimental effect on the wider European film industry taking into account the interdependency of the industry,” the BFI also comments.

“While welcoming the European Commission’s initiative to review and where appropriate update the Cinema Communication, the BFI remains hugely concerned that, taken together, the proposals set-out in the Draft Communication put Europe’s film culture and its industry at the most extreme risk. The proposals, as framed, would have a severely detrimental impact on the choice and diversity of films available to audiences across the European Union. We urge the Commission to reflect not only on the arguments made by the BFI but also the arguments made by the UK Government, the European Film Agency Directors (for example in their recent Cannes Declaration) and by the vast majority of other audiovisual trade bodies and industry professionals in the UK and Europe.”

The BFI also points to the “lack of financial sustainability” of the proposals and suggests they would significantly harm EU Member states’ ability to make films.

The BFI’s concerns are echoed in the submissions of many other agencies. For example, Cine-Regio (the European network of regional film funds) frets that the proposals may “limit” the ability for Europe to attract big budget films, (which) “will be truly harmful both to the sector and to the European taxpayers.”

The Danish Government also addresses the question of the subsidy race. The Danish government is not aware of the extent of the use of public subsidies that could lead to a subsidy race among the Member States. But a higher transparency for these schemes could be needed as an overview of the numbers of European and US films that are subsidised by these schemes.

On this question the Commission should be aware of not disturbing the conditions for European co-production and bilateral treaties with third countries,” the Danish State submission reads.

The Hungarians also strike a familiar chord, suggesting in its submission that “the dangers and threats articulated by the European Commission remained hypothetic and unclear.”

Privately, sources suggest that the EC is addressing the concerns voiced by so many stakeholders about the potential effect of its draft proposals on the European film industry, especially regarding the vexed issue of “territorialisation.”

By the time the new Cinema Communication is adopted in the last quarter of 2012, these stakeholders clearly hope that the draft proposals that have so alarmed them will have been revised substantially or excised.

Click here for the full list of responses