Paramount Pulls Films From Venezuela Because of New Currency Exchange Rules

5:42 PM PST 07/26/2011 by Agustin Mango, Pamela McClintock
Paramount
"Transformers: Dark of the Moon"

A volatile government, reeling from inflation, restricts how many U.S. dollars can be repatriated out of the country.

Paramount Pictures has suspended distribution of all of its films in Venezuela because of drastic new rules restricting how many U.S. dollars can be transferred out of the country each month.

The revised currency exchange regulations were imposed after a deep devaluation of the Bolivar earlier this year, and are having an adverse impact on multinational companies, which are finding it impossible to recover any revenue generated in-country in a timely fashion.

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Paramount issued a statement late last week in Venezuela explaining its decision.

"We understand that this may be disappointing to many consumers, but we will continue to evaluate future opportunities to work in-country as they emerge," the statement said. "Paramount is proud of our long history in Latin America, and we will continue to work with our partners in the region to make our films as widely available as possible.

"We offer our most sincere apologies for the annoyance or inconvenience this may cause. Paramount appreciates your interest in the titles, which is why we will disclose more information when we have it."

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Paramount had already given signs of withdrawal from Venezuela when it refrained from releasing Transformers: Dark of the Moon there.

The decision to cancel all distribution comes amidst a context of strict economic control by the Venezuelan government, which is struggling to manage a growing inflation rate that is reportedly around 30% a year.

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The new currency exchange regulations are said to restrict and delay the repatriation of earnings of all multinational companies. It's not yet clear what measures other Hollywood studios are taking.

Agustin Mango reported from Buenos Aires; Pamela McClintock reported from Los Angeles.

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