SCREEN FILM SUMMIT: International panel talks China opportunities, but warns about tough US market.

A UK-China co-production treaty is edging closer to reality, a British Film Institute executive told the Screen Film Summit today.

BFI Chief Executive Amanda Nevill is currently visiting China with the Prime Minister’s delegation.

BFI Head of International Isabel Davis [pictured] said this morning of that trip: “A cultural agreement has been signed, with intention to sign a co-production agreement. We’re extremely close in all honesty….It’s good news for British film that it’s being taken so seriously. I’m confident we’ll get there quite soon on having a treaty.” [DCMS later confirmed that Secretary of State for Culture, Media and Sport Maria Miller and Chinese Minister for Culture Cai Wu signed a cultural agreement in Beijing that starts a five-year programme of cultural exchanges.]

A co-production treaty would be important because it would let British co-productions qualify for revenue-sharing releases in China outside of the usual quotas. “A co-production treaty opens up that opportunity to give UK co-produced films a much larger opportunity in the marketplace,” Davis said.

She did caution that any co-production agreement in the future would need to be used sensibly. “Not that many projects will genuinely make sense for [a true co-production],” she added. “We’ll spend some time figuring out each other’s audience taste, as we have done with India for instance.”

David Garrett of sales company Mister Smith said that there was a lot of talk about China so far, but not meaningful business being done with Western independents: “China, I feel, is still a bit of a Trojan horse.”

Denmark-based Noemi Ferrer Schwenk of the Danish Film Institute was also cautious: “Is China really a place where something can materialise, or is it ‘the new black’?”

Looking west

The US market is also a tough one. “The US is still not an easy market to penetrate, that’s not just film, that’s literature, that’s music…it isn’t easy,” Garrett added. “Americans like films that are culturally specific to their own culture, most people do. It’s harder and harder to secure domestic distribution in the US [particularly on unfinished films].”

He warned: “I wouldn’t factor a US deal into your finance plan if you are making a British movie.”

Garrett said that financing is tougher as ancillary revenues dry up from home entertainment and free and pay TV deals. “That revenue is diminishing, films don’t generate the same kind of audiences and advertising revenues they used to on broadcast channels and subscription channels. Also because of piracy, films don’t generate the same kind of revenues from home entertainment, pay TV and free TV.”

He said that “equity players now take a larger part of the risk,” and that high-net worth individuals are still drawn to film, partially by the glamour.

Ferrer Schwenk, international producer at the Danish Film Institute, said that in Denmark as filmmakers become more ambitious, producers are having to look for foreign finance – and not just with the usual Scandinavian partners.

“Budgets are going up, it’s not enough to find financing in Denmark or call our friends in Sweden and Norway, so you need to be more inventive.”

She did warn that the UK system posed more complicated paperwork than producers are used to in Scandinavia.

Producer Andrea Calderwood of Slate Films said any cross-border work has to make sense creatively. “We don’t start from the funding sources we start from the story…We have international friends – but unless you can find a film that actually works, it’s a pointless exercise.”

One of the films that did work as an international patchwork was Biyi Bandele’s recent feature Half of a Yellow Sun, which was partially financed with Nigerian private equity.

Slate’s other recent production is Alan Rickman’s A Little Chaos, starring Kate Winslet and Matthias Schoenaerts, about rival gardeners working when Versailles was being built. “The original assumption was that it would be a European co-production, but it was going to be more complicated and expensive,” so it ended up just being a UK project. “It was a more creatively effective way to shoot,” she said.