Commentary: A trade show thrives as recession, competition supply the incentives


Just when you thought the tax-incentive game had peaked or the recession had made governments queasy about jumping into the film and television business, a new round of enticements are coming to the fore.

It makes the incentive race is as competitive as ever as the AFCI Locations Trade Show launches its 24th edition today in Santa Monica.

Iceland, which had a program offering a 14% reimbursement, raised its incentive to 20% on April 2. The nation is turning its melting economy into a plus, touting its weak currency as a positive for filmmakers. (When Clint Eastwood shot "Flags of Our Fathers" there in 2005, $1 equaled ISK$62; now, it's equal to ISK$120.)

Italy is days from enacting a complex scheme with a component that offers a 25% credit, limited to €5 million ($6.6 million) per production, for Italian production-services companies. The plan is retroactive to June.

"Italians love Machiavelli; nothing is simple here," says Marco Pugini, president of the country's Association of Production Services trade group. Nonetheless, he is hopeful the plan will attract foreign productions.

In the U.S., Alabama Gov. Bob Riley last month signed the Entertainment Industry Incentive Act, which provides income-tax credits of 25% and a 35% rebate for state residents. The bill targets productions that cost $10 million or less and has a music component.

Although the recession is making everyone scrutinize their bottom lines, it doesn't appear to have affected the annual trade show. According to AFCI chief Bill Lindstrom, the show has sold out earlier than in previous years, and as of last week, visitor preregistration was running 25% ahead of last year's pace.

Those scrutinized bottom lines actually are helping the cause.

"Because everyone is crunching numbers and looking at the offerings, information has become much more critical," Lindstrom says. "And when it comes to information, film commissions are the first in line for that."

That seems to bear out with the number of new groups popping up. The AFCI added 20 new members last year and saw the return of the Cayman Islands to the organization's fold for the first time in more than 10 years. The Caribbean is among the regions making strong plays for film productions, with a commission from the U.S. Virgin Islands joining last year and Panama and Puerto Rico aggressively courting new business.

In another corner of the world, Serbia is applying for membership.

"Areas around the former Yugoslavia are becoming better organized and more economically aware on how viable an industry this could be," Lindstrom says. "Serbia has come forward; I'm sure there will be others."

Japan has created its first national commission, a big move for a country that until recently had more than 100 unconnected local commissions handing out incentives and information in a hodgepodge manner. Japan has a thriving film scene and is a major movie territory for U.S. studios, and the formation of the national commission is seen as a measure to become competitive in attracting outside production. The country hasn't seen a notable U.S. production since 2003's "Lost in Translation."

Japan's commission is slated to be inaugurated this month but hopes to make a big entrance at the trade show.

Splashy seems to be a theme this year as regions and commissions throw more receptions than ever before, with shindigs at swanky consul residences, fancy eateries

and hotel restaurants hosted by New Mexico, Panama, South Africa, Chile, the Caymans, Japan, Italy, Hungary and others.

The growing list of cocktail affairs shows how the confab is evolving, mirroring the competitive nature of attracting productions as regions and commissions look to establish relationships by investing in the social scene.

"The show, the seminars, the social events ... it's like its own market film festival," Lindstrom says. "It appears we will see a fairly lively show this year."