10: Trends in the European Film Industry: Coproduction

Cooperation between American and European film makers is but one trend that developed in the last twenty years. An equally important trend toward internationalization is coproduction among European nations. This brings together financial, artistic, and technical contributions from two or more countries under criteria established by formal bilateral governmental agreements, or with the expressed approval of the governments involved.¹

Coproduction is important to European film makers for a number of reasons. While broadening the base of financial investment in a picture, it assures a film two (or more) home markets where no import quotas are applied to it and where it is recognized as a “national” film for the mandatory screen quota. Another advantage is the dual base for calculation of the subsidy. If the coproducing countries have such a scheme, the film, by virtue of being “national” in each, is eligible to collect two production subsidies.

Last, coproducing permits the inclusion of a greater range of stars and other artistic and technical personnel without endangering the nationality of a film. That is, a coproduction has access to personnel of each partner country, while a purely “national” picture generally must confine its cast and technicians predominantly to domestic talent. And over-employment of foreigners can result in loss of nationality.

The 1966 coproduction agreement between France and Italy is presented in Appendix B. It establishes the legal and economic mechanics of the coproduction system and sets criteria films must meet. Treaties such as this have been the basis for close to eight hundred French-Italian films.

The coproduction trend, which started in the postwar period, gained momentum during the 1950’s and now has become an integral part of European film making. Table 1 shows the growth and importance of coproduction in France, Italy, Spain, and West Germany, the four continental nations which are the chief film producers. During the 1960’s, approximately 67 percent of French, 52 percent of Italian, 40 percent of Spanish, and 36 percent of German films were coproduced. By 1966, the purely national film had been eclipsed by the coproduction in each of these nations.

The rationale for coproducing asserts that all possible means must be used to make quality films. As such pictures often demand high budgets, it is imperative that their cost be absorbed by more than one producer. The collaboration of production teams and resources from two (or more) countries fulfills this need.² It also could be said that covertures are an attempt to compete with the American presence in Europe through the making of high quality, high budget films with international appeal.

The availability of more capital for a given film increases the likelihood of greater attention to production details, use of color and scope processes, lavish production methods, as well as more well-known (and more highly paid) international stars. Considered on this basis, coproduction may not only be a result of rising costs in general, but their cause, for certain films. Moreover, in instances to be pointed out presently, coproductions must not cost less than prescribed amounts.

Data from France indicate a relationship between coventures and more elaborate production methods. Using 1961 and 1966 as examples (even a five-year spread demonstrates the point), Table 2 reveals that French coproductions have twice as often as national films been in color and in a scope process. The use of these cinematic devices obviously results in higher production costs, especially for color where special attention must be given to sets, costumes, lighting, and matching in editing. In Spain, between 1950 and 1966, 60 percent of the coproductions were in color, but this was true for only 32 percent of the national films.

It also is possible that the higher the budget for a film, the more attention can be paid to details of its making and the more care can be taken in shooting it. A reciprocal relationship might be at work. The more money available, the more opportunity to reshoot a scene until something more than just adequate results are obtained. On the other hand, an obsession with details in the production, and extensive reshooting can force up the cost.

TABLE 1

Feature Film Production and Coproduction in France, Italy, Spain, and West Germany

The only relevant and obtainable data come from Great Britain’s National Film Finance Corporation.³ Although they pertain only to films assisted by the Corporation and only to British “national” pictures, they suggest a relationship between cost and care of production which seems applicable to coproductions. Taking films started and finished between March 31, 1966, and March 31, 1967, the figures consider three cost ranges: $56,000 to $210,000; $210,000 to $350,000; and over $490,000. (There were no films between $350,000 and $490,000.) For films in the first, and cheapest, category, average screen time was 77 minutes and the average amount of this shot per camera day was 3 minutes and 51 seconds. Films in the second group had an average running time of 95 minutes with the average amount of screen time per camera day of 3 minutes and 10 seconds. Films in the third, and most expensive, group had an average screen time of 103 minutes while the average amount of this shot per camera day was only 1 minute and 58 seconds. Thus, a typical high-cost film is not only longer in actual running time, but a proportionately smaller share of it is shot per camera day. If this is true for coproductions, which generally are more expensive than national films, then it tends to support the point that coproductions are related to greater care in production and more attention to detail.

TABLE 2

Use of Color and Scope Processes¹ in French Film Production

That the typical coproduction consistently has been more expensive than a national film is substantiated by data from France. From 1952 through 1966, the mean cost of a coproduction has exceeded that of an entirely French film. Table 3 indicates the magnitude of difference in the form of an annual ratio, with the base of 100.0 being used for the average cost of a French national film. The cost of a coproduction is from about one and one-half to at least three times as great as that of a national film. With only four years as exceptions, the average coproduction has cost more than twice as much as an all-French film. The year of greatest difference was 1962 when the cost of an average French film was $196,000 while that of a French coproduction was about $635,000. In 1965 (the year of least difference and the year in which costs of pure French films hit a peak), the cost of the average coproduction was almost $476,000, while that of a national film was about $290,000. The latter figure excludes one unnamed, entirely French, film with an exceptional budget (presumably Is Paris Burning?).

TABLE 3

Ratio of Cost
French Coproductions Compared to French National Films¹

Another way of illustrating this is to examine the actual budgets of coproduced and French national films. Data from the Centre National de la Cinématographic indicate that, compared to entirely French films, a greater proportion of coproductions have high budgets. Table 4 presents these two groups of pictures broken down by budgets for 1956 and 1966. Although the cost categories are not precisely comparable, they are sufficiently similar to support the point. In 1956, 3 percent of the national films had budgets over $570,000 while almost 36 percent of the coproductions exceeded that figure. In 1966, 13 percent of the French national films had budgets greater than $612,000 while the figure for coproductions was 43 percent.

Table 4 also points out that a smaller proportion of films with low budgets are being made now than a decade ago. In 1956, almost 76 percent of the national films had budgets less than $285,000, as opposed to the 36 percent which had budgets under $204,000 in 1966. The same is also true for coproductions, although the degree of change is not as great.

Data presented so far disclose that the frequency of coproduction has increased in magnitude over the last fifteen years and that, at least for France, the cost of coproducing is rising, since substantial proportions of these films are high budget productions. However, one must ask whether the increase in cost of the typical coproduction has been at a rate comparable to that for national pictures.

TABLE 4

Production Budgets of French Coproductions and French National Films

Table 5 reveals that the yearly average production cost for national films has increased somewhat faster than that for coproductions. In only one year (1962) was the relative cost of the average coproduction higher than that of the average national film. While costs have risen for both types, the cost of making a French national film has increased the most sharply, presumably because there was more room for expansion into higher budgets from the relatively small ones in the early 1950’s. In addition, it could very likely be that cheap productions have been forced out by competition and that there is a smaller market for them today. Thus by 1966 the mean cost of a national picture was four times what it was in 1952, while that of a coproduction was only about three times more.

Investment in coproductions also must be considered, and Table 6 indicates significant growth in this area. In 1952, for every 100 francs in French national pictures, there were only 29 invested as the French share in coproductions. The turning point was 1959 when 109 francs were channeled into coproduced films for every 100 put into national films. The peak was 1963 when 342 francs went into coproductions for every 100 into national pictures. Since then, the difference has diminished somewhat even though the share of French films which are coproduced has increased. This is due, in one respect, to the rise of the tripart coproduction which splits the cost three ways instead of two.

TABLE 5

Average Production Cost Index¹ for French Coproductions and French National Films

TABLE 6

Ratio of French Investment in French Coproductions to Investment in French National Films¹

Considering the magnitude of capital channeled into films, Table 7 reveals there was 12 times more French money invested in coproductions in 1966 than in 1952. But for national films, 1966 showed only a two-fold increase over 1952. This suggests that even the costs of national films have climbed, although their number has declined.

TABLE 7

French Investment in French Coproductions and National Films ($000,000)

With the French data as background, the matter of which countries coproduce with what other countries can be surveyed. Some noteworthy trends are apparent which bear on cost, investment, and international policy.

The first coproduction agreement was signed by Italy and France in October, 1949, and over the years they have been each other’s most frequent partners. Seventy percent of French coproductions have been with Italy. Second in importance to France are tripart films, accounting for about 14 percent, followed by those made with West Germany and with Spain.

Table 8 also indicates that of all Italian coventures made from 1950 through 1965, some 66 percent were produced solely with France. The peak occurred in 1961 when eighty-eight films were made in this way. More recently, Italian data⁴ reveal that in 1965 only forty-seven Italian-French films were produced, and information from the Centre National de la Cinématographic indicates that only forty-three were made in 1966.

Meanwhile, Spanish producers are becoming increasingly important as partners to the Italians. Table 8, while indicating that about 16 percent of Italy’s coproductions have been solely with Spain, obscures the strong recent trend in this direction. For example, 60 percent of the 190 Italian-Spanish films were produced between 1962 and 1965. The Unitalia catalogue lists forty such films for 1966, and the Uniespana catalogue mentions forty-eight for 1967.

TABLE 8

Coproduction Partners of Italy, France, and West Germany¹

Third in importance for Italy are tripart films. These involve Italy in partnership with, generally, France and Spain, and to a smaller extent with France and West Germany, and with Spain and West Germany. Tripart Italian films increased sharply after 1962, with 80 percent of them having been made since then. Production with West Germany alone represents only 4 percent of Italian coventures, although there is a slight trend toward an increase of this type.

Considering West Germany, a different picture emerges. Ranking first in importance for it are tripart productions, representing a third of all German coproductions. These are German partnerships predominantly with France and Italy, and to a smaller degree with Spain and Italy, although West Germany has been involved in tripart films with Yugoslavia and France, and with Spain and France. The data reveal that Austria is an important partner for West Germany, accounting for 17 percent of German coventures. Ranking third and fourth in importance are Italy and France, representing 16 and 13 percent, respectively, of German coproduction activity.

Based upon these figures, it is apparent that the three countries considered have coproduced some 254 films with Spain (excluding tripart productions). The total number of Spanish coventures between 1950 and 1966 has been 412. On this basis, about two-thirds of all Spanish coproductions have been with these three countries. If tripart films were included, then the share would approach at least 80 percent.

Looking at Table 8 from a different perspective, it is evident that members of the European Economic Community are their own most important partners for film production. About 90 percent of French coventures have involved other EEC members. For Italy the share is about 70 percent, while that for West Germany is about 60 percent. This relates to a point to be made later in this chapter.

Another facet of the coproduction phenomenon concerns the amount of domestic film capital channeled into activity with various nationalities. Data from Italy in Table 9 illuminate this aspect. About 76 percent of Italian money invested in coproduction has been put into Italian-French films whose total cost accounted for almost 72 percent of the expenses of all Italian coventures. However, only 67 percent of Italian coproductions have had France as the sole partner. This means that Italian-French pictures are more expensive than those made by Italy in partnership with other nations.

TABLE 9

Italian Coproductions, 1950-1965

For 1950 through 1965, the average cost of an Italian-French film has been $485,000, substantially more than the average for any other bipart production. The data further indicate that Italy has supplied 52 percent of the investment for Italian-French films. Not apparent in the table is the recent increase in cost to make these pictures. Prior to 1961, the mean cost was $461,000. But for 1962 through 1965, it rose to almost $530,000 per film.⁵

Considering Italian-Spanish productions, these 190 films represent 10 percent of Italian investment in all coventures but 16 percent of all coproduced pictures. The average cost has been around $278,000 per picture, with a slight increase to $289,000 in the 1962-1965 period.

Figures for tripart production point out that while these pictures accounted for 12 percent of all coproductions, Italy’s investment in them represented only 10 percent of its financial share in all coventures. The average cost of Italian tripart films has been $521,000, an amount higher than that for Italian-French pictures and substantially greater than other types. However, Italy contributed but 35 percent of the total costs of these 141 films, about $180,000 per picture. This is much less than the Italian share in Italian-French films and just a shade more than its contribution to Italian-German films.

In view of this, it is not surprising that Italian bipart production with France is declining, while tripart and Italian-Spanish production is increasing. France may be pricing itself out as a coproducer, especially because of the more attractive lower wage scales in Spain. In 1966, Italy and Spain were joined in 50 bipart and tripart films while in 1967 the figure was seventy.⁶

In any case, the tripart film is a superb demonstration of the value of coproduction. By pooling resources, a more elaborate picture with bigger stars can be made than if only one country were financing it. This also explains why tripart production has increased within the last five years. While lavish production techniques, color, scope processes, and big stars are not necessarily prerequisities for good films, they do perform the vital functions of attracting audiences in several nations and competing on more or less even terms with the costly productions from other countries, notably the United States. Thus, bipart and tripart films may be considered as bargains in cost terms, in that producers in two or three countries receive revenue (and subsidies) from a bigger film than any could afford to produce separately.

Coproduction takes place within the framework of bilateral treaties among partner countries. The treaty’s value is that it establishes the context for such activity while formalizing the responsibilities of the commercial partners and the states involved. It is essential for setting requirements on a long-term basis for such things as the minimum financial participation of partners, minimum budgets, the employment of artistic and technical personnel, and the permissible places of shooting and laboratory work.

A brief survey of a few recent Italian coproduction agreements illustrates some of these requirements.⁷ These establish three broad classes of bipart films: normal coproductions; coproductions of artistic value; and coproductions of exceptional entertainment value.⁸

According to the 1966 Italian-French agreement, films in the first class must have a budget no less than $285,000, and the minority financial contribution must be at least 30 percent of the cost. In addition, the minority party must supply at least a writer, an assistant director, an actor in a main role, and one in a secondary role. The Italian-West German agreement of 1966 has almost the same requirements except that the minimum budget can be $274,000, while the minority partner must supply one technician in place of the assistant director. The 1966 Italian-Spanish agreement established the minimum budget at $240,000 (increased to $250,000 in 1967) and further specified the personnel each party must contribute to the picture.

The second class, films of artistic value, provides exemption from the minimum cost requirement and lowers the minority party’s financial participation to 20 percent of the production cost. In addition, the Italian agreements with France and West Germany provide for waiving of requirements for technical and artistic personnel.

Considering the third class, Italian-French productions must have a minimum budget of about $509,000, although the investment of one of the partners can be as low as 20 percent. The minimum technical and artistic personnel requirements also are relaxed. The agreement between Italy and West Germany is similar, except that the budget can be as low as $499,000. The Italian-Spanish treaty provides for a minimum budget of $400,000 with at least 20 percent of it coming from the minority partner. The technical and artistic obligations conform to those for normal Italian-Spanish pictures.

Now these standards are in force when Italy produces a film with only one partner. They become baroque when the responsibilities and obligations of three parties are involved. As an example, consider a tripart production in which Italy has the majority investment. If the film is made with France and either Germany or Spain, the minimum budget must be $530,000. If France does not participate, and the other partners are Germany and Spain, then the budget must be at least $480,000. When France is involved, the major partner’s share of the cost can be no less than 40 percent and the minority share can be 20 percent. The minimum artistic and technical contribution is an actor in a major role, or a qualified technician, or a writer. Similar requirements exist for Italian tripart pictures when the majority partner is France, Germany, or Spain.

Criteria also exist for quadpart Italian productions, films produced by Italy and three partners. Admittedly, pictures of this type are now rare. However, twenty years ago even coproduction was unusual, and only ten years ago the tripart film was a novel experiment. In a quadpart Italian picture with, say, France as the majority partner, the budget cannot be less than $710,000. The majority partner’s financial participation must be no smaller than 30 percent while the least a minority partner can contribute is 20 percent. The minimum technical and artistic contribution is an actor in a principal role, or a qualified technician, or a writer. Regulations of a similar kind cover quadpart films when the majority party is Italy, Germany, or Spain.

These elaborate and complex rules are essential, in one way at least, for the granting of nationality, because this implicitly decides which films can be eligible for subsidization and other benefits.

The nature of coproduction has resulted in a labyrinth of overlapping bilateral treaties among film making nations. The meaning of this becomes clearer if only the major producing nations of the European Economic Community are considered.

France began coproduction in 1949 after signing its first treaty with Italy. Since then, ten other nations have enacted agreements with France, the most significant recent one being the French-British pact of 1965, renewed in May, 1967. (Interestingly, the first film to be completed under this agreement was The Night of the Generals, produced by Sam Spiegel and distributed by Columbia Pictures.) Italy has nine agreements in force and has been discussing coproduction arrangements with Canada, Bulgaria, and the Soviet Union. West Germany counts seven pacts, and five others are in the discussion stage with the United Kingdom, Sweden, Denmark, Brazil, and Greece.

Eliminating double counting, these three nations have twenty-four bilateral production treaties among themselves and with third countries. (This does not take into consideration bilateral film trade agreements such as France has with the Soviet Union and Mexico, or Italy has with Poland, Japan, and East Germany.) Included in this total are the six agreements governing coproduction among only four members of the Common Market (France, Italy, West Germany, and Belgium), the fourteen additional treaties between France, Italy, West Germany and seven other European nations (Spain, Yugoslavia, Austria, Great Britain, Sweden, Rumania, and Switzerland), and the four treaties they have with western hemisphere nations (Argentina, Brazil, and Canada).

Even a superficial reading of these agreements discloses that while they are essentially the same in purpose, language, and structure, therefore largely duplicating each other, they occasionally differ on details. This was apparent in the Italian agreements cited earlier. While this condition in the late 1960’s for international film production may seem unique, it is identical to situations existing more than one hundred years ago for other media of communication—international postal service and international telegraph service.

George A. Codding, Jr., has pointed out that by the middle of the nineteenth century, a European nation’s normal postal relations required at least a dozen treaties.⁹ As late as 1873, Germany had seventeen bilateral postal agreements regulating its international mail service with its neighbors and other nations. France was signatory to sixteen bilateral agreements, Belgium to fifteen, and Great Britain to a dozen. Even the United States had at least nine agreements to expedite mail. Just as is true now for coproduction agreements, all these postal treaties served the same purpose—the international transport of mail and parcels. Yet their bilateral nature produced a veritable jungle of weights, rates, letter sizes, and routes.¹⁰

International telegraph service also began in a maze of bilateral treaties.¹¹ Prussia and Austria concluded an agreement in 1849. By 1850, two other Germanic states had been bound by bilateral treaties and in the same year the four formed the Austro-German Telegraph Union. Five other states joined this Union in the years up to 1854.

Meanwhile, France had signed bilateral telegraph treaties with four other states who, in 1855, formed the West European Telegraph Union. Relations between it and the Austro-German Union were formalized in 1858 with a convention regulating service between them. In spite of this, a telegram sent from, say, France to Prussia, was subject to rules from three conventions—the West European Telegraph Union, the Austro-German Telegraph Union, and a third applying to relations between the Unions.

This confusion was ended in 1865 when the International Telegraph Union was formed, embodying one convention to which all states became signatories. In addition to eliminating bilateral and multilateral treaties, it established rates and service standards while simplifying and clarifying responsibilities of members toward each other. The Union, known today as the International Telecommunications Union, embraces telegraph, telephone, and radio communication.

The founding of the ITU and what it did for electrical communication provided impetus for the creation in 1874 of what is known today as the Universal Postal Union. To quote Codding:

… a treaty was drafted and signed that transformed the territories of 21 nations into a single unit for the exchange of postal correspondence, standardized and simplified postal rates and procedures, and created the second oldest international organization.¹²

Virtually all nations of the world are members today.

The experience of the ITU, the UPU, and much later the Benelux Union, the Coal and Steel Community, Euratom, and, indeed, the Economic Community itself, can be the framework in which the numerous bilateral coproduction treaties can be merged into a single convention, perhaps under the aegis of the EEC. Just as there is a movement among EEC members to standardize subsidy schemes, thought also is being given to unifying bilateral production agreements. Because the EEC nations are each other’s most frequent partners in film making, it would seem that benefits could be derived from the ultimate merging of these numerous agreements.

While the first step toward greater uniformity among them is already under way, it is apparent that a Community Coproduction Convention might be a possibility. One such treaty could eliminate the present bilateral agreements among France, Italy, West Germany, and Belgium, while standardizing the responsibilities among them. It also would simplify the relationship between non-EEC members in Europe (such as Spain, Austria, Yugoslavia, and Great Britain) and Community members, for the adherence of Spain, say, to the convention would automatically establish coproduction links with all Community members on an equal basis.

Of course, numerous problems seem to block the path to such unification. Not the least of them are labor matters and differences in living standards, which manifest themselves in, for instance, the cost of film making. The convention also would have to consider the problem of American investment in EEC films. While Community members have welcomed American finance, there is a general fear of American domination of the kind present in the United Kingdom, for economic dependence usually leads to cultural colonialism.

Another difficulty is that film industries are privately-owned as opposed to the publicly-owned postal and telecommunications services. However, that increasing harmony is being achieved in subsidy programs dispels the pessimism which declares that coproduction agreements cannot be merged. In one way, the very fact that an agreement can exist between France and Yugoslavia, with different living standards and, indeed, different governmental and economic systems, suggests that barriers are not too great for one agreement among EEC members. If postal and telecommunications services, as well as even broader economic relations, provide a model, then the merging of coproduction agreements (subsidy plans and production financing schemes, too) is inevitable.