Earlier this year, the former Czech Film Fund rebranded as the Czech Audiovisual Fund, a change driven by the adoption of the country’s new Audiovisual Act. Within the main changes to the national funding structure, that now extends to series and games, is a 3.5% investment obligation on all streaming platforms operating in the Czech Republic, including international majors like Netflix, Amazon Prime Video, and Disney+. Previously, only domestic platforms — such as Voyo — had obligatory contributions, set at a rate of 0.5%.
The investment obligation will be combined with a parafiscal levy (taxes on a specific product or service employed to fund a particular purpose, in this case supporting the Czech audiovisual industry). The obligatory levy will sit at 1%, while the remaining 2.5% will be divided between levy and direct investment. During its original announcement for the new structure, the Czech Film Center said: “This approach aims to ensure equity in the contributions made by content distributors, regardless of their origin, fostering a unified framework to support local content.”
The money collected from levies will be mirrored by a state contribution, with the additional revenue from this new model expected to increase the Czech Audiovisual Fund’s budget substantially and boost the funding available for domestic Czech projects and international contributions.
During a panel at Karlovy Vary Film Festival, linked to Variety’s recent special edition on the Czech Republic, industry leaders discussed the effects of this change — especially concerning the impact on how major streamers will (or won’t) invest in Czech content.
Jan Kallista, producer at Film Collective, said the local industry is “very much looking forward” to the changes, which “will allow the fund to support development schemes, which is very important for us as producers.” Kallista also believes the new funding structure will allow the local industry to increase their quality of production, feeding into better talent development and retention. “Film is always on the brink of industry and culture, playing on both sides, so we need to maintain it,” he added.
“Czech has always been a [shooting] destination since the 90s because of the quality of our crews,” Kallista emphasized. “Right now we are facing strong competition, especially from Hungary and other Eastern European countries. We are hoping to take back projects that have gone to countries like Hungary but the difference in incentives has been too big. Now we are hoping to become more competitive.”
“I think the goal of the government when they started looking into changing the audiovisual law was to make it more balanced,” said Jakub Čech, lawyer at A&O Shearman. “They wanted to bring the foreign streamers in as in the last five years they have become important players in the Czech industry so the government decided they should contribute.”
While the Czech and neighboring industries widely agree on the new approach of upping the contribution of major global streamers, experienced execs like Dariusz Jablonski, president of the Polish Film Academy and European Producers Club, reiterates that the negotiation with streamers can’t only be about mandatory contributions. “For European producers, rights retention is very important,” he said.
“It doesn’t work for producers when foreign streamers take all the rights because it makes them powerless in the future,” he highlighted. “The connection with the success in the series they’ve made makes it possible for them to develop new series,” continued the producer, citing France as the leading example to follow as rights go back to producers three years after the original streaming window. “No matter what, this element has to be included in the regulation because otherwise producers have less and less power in the industry.”
When talking about dealing with major American players, there is also the looming question of the controversial Trump tariffs. Back in May, the American president announced he would implement 100% tariffs on films produced outside the U.S., deeming foreign productions a “national security threat” to the American movie industry, and adding that they not only draw filmmakers out to other markets but also bring “messaging and propaganda” into the United States.
“I don’t have a crystal ball,” said Kallista when asked about the Trump tariff effect within the European production scene. “We were hearing [about] this in Cannes but time has now moved, and we have seen how [Trump] pushes for tariffs and then takes it back. I don’t know what the results would be but he would have to take back some of his proclamations.”
The producer added that the market has been “fragile” for independent productions in the last two years because of the “crisis in Hollywood.” “Because of what Trump said, the market in the U.S. is stone cold to produce, especially in L.A. The problematic here is that sales agents, private equity investors and banks are in an uncertain position to invest in the industry in general. They don’t know if there’ll be a tariff they’ll have to pay later on. It’s an unstable situation.”
“What might happen and what we are facing now is that there are a lot of productions coming to Europe,” he went on. “American producers use the advantage of [funding] schemes in Europe like Eurimages. There’s a new scheme in the U.K. and Ireland, and countries are trying to over take the Americans.”
Jablonski reiterated that he tells all producers in the European Producers Club to read the package Trump presented with Jon Voight. “It’s something every producer should read. He acknowledges the importance of audiovisual production. We should implement [something like it] in Europe. We have to have our own European package for film and series.”
Kallista emphasized he is not currently concerned with an European boiling pot if more American productions come to the country, adding that producers are constantly in conversation and employing crews from neighboring countries whenever there is a momentary shortage. “If 20 huge projects and series come to Prague we might actually start boiling,” he clarified. “But, as a producer you just need to think of your strategy for the next year or two. We see the tables and see the registration forms, we can see how many projects are there. I wouldn’t be afraid of having a boiling market now.”
Petr Dvořák, chairman of the Czech Audiovisual Fund, said that if there is more demand than offer in the European market, the prices of services will go up and crews can be better paid. “This means they can deliver better service, which [in turn] means the industry will grow, which is what everybody hopes for,” he concluded.