Calls for Asia completion bonds increase
Lawyers, producers want region to develop its own systemBUSAN -- Lawyers and producers Monday added their voices to the recent calls for Asia to develop its own system of completion bonding for movies.
“For films that have international ambitions, completion bonds are necessary because that is what your partners abroad will require,” said U.S. lawyer Howard Frumes at a seminar on modern film financing organized by the Korean Producers Guild. “This doesn’t need to be done in the exact same way as in the U.S. or Europe, it needs to be adapted and localized. (But) it needs to happen for the future development of Asian film financing.”
“One of the reasons for the decline in Hong Kong movie production from the time when we were producing over 300 films a year was the lack of financial sophistication,” Nansun Shi, a leading producer from Hong Kong. “I remember having to seek out banks for contract discounting.”
Satoru Iseki, who recently produced “Rainfall,” the Gary Oldman-starring detective story that was the first Japanese-produced movie to use a completion bond, said he had first encountered bonds in Europe in the 1970s and that he had first been involved with one when Nippon Herald was part of 1983 movie “Merry Christmas Mr. Lawrence.” But in Japan, where “production committees” of equity investors dominate bonds are largely absent. “Now we need gap financing, bank involvement and contract discounting in Asia,” he said.
A similar call was made earlier this week by Yi Chi-yun, one of the co-producers of “Red Cliff.” He asked for governments to set up local bond companies.
After the recent slowdown of CineFinances, there remain only two bond providers operating on a worldwide scale -- Film Finances and International Film Guarantors -- and a handful of others on a national scale in Canada and Australia.