EU probes French tax break for games


BRUSSELS, Belgium -- European Union regulators said Wednesday they're investigating France's proposed tax break for video game makers to see if it's an illegal subsidy.

France wants to give a tax credit worth 20% of the cost of making video games with cultural value -- saying these must satisfy a test that the games provide a quality and original contribution to "European cultural diversity and creativity."

French officials say video games can be as artful as cinema. But the European Commission said the standards were so broad they could include video games that are not strictly cultural.

"At this stage, it cannot be ruled out, for example, that simulation video games or video games based on motor car races might benefit from the measure," it said.

Regulators also said they needed to check if the tax break might give an unfair advantage to French companies over rivals in other EU countries.

The EU executive is responsible for upholding laws that prohibit governments from favoring one sector, or one company, over others in Europe. Subsidies to support art and culture are only allowed within a strict set of circumstances.
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