What Brexit Would Mean for Hollywood

Illustration by Arthur Mount

It's Michael Caine vs. Patrick Stewart as lines are drawn among U.K. actors and showbiz players.

It's not just politicians pleading with British citizens about the June 23 referendum to determine if the U.K. remains part of the European Union. Hundreds of stars and showbiz insiders also are growing vocal about what such a move would mean for the entertainment industry.

More than 250 British celebrities — including Patrick Stewart, Benedict Cumberbatch, Chiwetel Ejiofor, Keira Knightley, Jude Law and director Steve McQueen — signed a "love letter" June 2 urging Brits to oppose exiting the EU (known as a Brexit, an initiative sparked over concerns ranging from competitiveness of British business to immigration). "Our global creative success would be severely weakened by walking away," the letter asserts.

They believe the fate of Hollywood's favorite overseas backlot (currently home to Fox's Assassin's Creed and Disney's new Star Wars films) could be jeopardized if lucrative EU-backed film subsidies are lost and the British government decides not to fund a competing incentive program. And it's not just blockbusters at stake, the British stars point out. A large number of indie hits — including Oscar-winning documentary Amy, Todd Haynes' Carol and kids features Paddington and Shaun the Sheep — all tapped Brussels for funding. "From the smallest gallery to the biggest blockbuster, many of us have worked on projects that would never have happened without vital funding or by collaborating across borders," reads the open letter.

But not all creatives see things that way. Oscar winner Michael Caine argues Britain would be better off alone, free of European regulation and "being dictated to by thousands of faceless bureaucrats." Downton Abbey creator Julian Fellowes calls the 28-nation EU an "autocratic and anti-democratic" institution that should not influence Parliament.

For Hollywood studios and talent, the impact of a Brexit would depend on how much independence Britain retains following a decision to leave. The main incentive for big-budget features to shoot in the U.K. is its tax credit, which gives qualifying films and TV series a rebate of up to 25 percent on production expenses incurred in Britain. Studios could fare well if the credit can be maintained post-Brexit — or possibly even strengthened.

But an internal document assessing the impact of Brexit on the entertainment industry, created for the British Screen Advisory Council and seen in draft form by THR, questions how much freedom the U.K. really will have outside the EU to write its own laws. "Precedent suggests that a U.K. exit scenario would not necessarily result in discernible advantages for the U.K. audiovisual sector," the draft letter reads, arguing that a post-Brexit Britain still might have to comply with EU laws in order to continue trading with Europe. The draft cites Norway, which is not a member of the union but still has to comply with many EU statutes to trade with the powerful multination bloc.

This story first appeared in the June 17 issue of The Hollywood Reporter magazine. To receive the magazine, click here to subscribe.