2000/821/EC: Council Decision of 20 December 2000 on the implementation of a programme to encourage the development, distribution and promotion of European audiovisual works (MEDIA Plus - Development, Distribution and Promotion) (2001-2005)
Date: 2000-12-20
Institutions: Council of the European Union
Subjects: EU programme, European audiovisual area, audiovisual communications policy, audiovisual programme, cultural transmission, financial aid

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II

(Acts whose publication is not obligatory)

COUNCIL

COUNCIL DECISION

of 20 December 2000

on the implementation of a programme to encourage the development, distribution and promotion
of European audiovisual works (MEDIA Plus — Development, Distribution and Promotion)
(2001-2005)

(2000/821/EC)

THE COUNCIL OF THE EUROPEAN UNION,

(3)

Having regard to the Treaty establishing the European
Community, and in particular Article 157(3) thereof,

Having regard to the proposal from the Commission,

Having regard to the opinion of the European Parliament,

(4)

Having regard to the opinion of the Economic and Social
Committee,

Whereas:

(1)

(2)

the digital age’

From 6 to 8 April 1998, the Commission, in coopera-
tion with the Presidency-in-office, held a European
audiovisual conference on ‘Challenges and opportunities
of
in Birmingham. This consultation
process revealed the need for an enhanced programme
of support for the European audiovisual
in
particular in the area of the development, distribution
and promotion of European audiovisual works. More-
over, in the digital age, activities in the audiovisual field
also contribute towards the creation of new jobs, partic-
ularly in the production and dissemination of audio-
visual content.

industry,

the Council,

On 28 May 1998,
in approving the
outcome of the European Audiovisual Conference in
Birmingham, highlighted the desirability of encouraging
the development of a strong and competitive European
audiovisual programme
taking particular
account of Europe's cultural diversity and the specific
conditions obtaining in restricted linguistic areas.

industry,

(5)

(6)

(7)

The Report of the High-Level Group on Audiovisual
Policy of 26 October 1998 entitled ‘The Digital Age:
European Audiovisual Policy’ recognises the need to
strengthen support measures for the cinematographic
and audiovisual industry, in particular by endowing the
MEDIA programme with resources commensurate with
the size and strategic importance of the industry.

The challenges of production, distribution and avail-
ability of European audiovisual content were the main
topics discussed at the Forum on Audiovisual Policy
entitled ‘European content for the digital millennium’,
organised in Helsinki on 10 and 11 September 1999 by
the
in cooperation with the
Commission.

Presidency-in-office

In the communication from the Commission to the
European Parliament and the Council of Ministers enti-
tled ‘Audiovisual policy: Next Steps’ the Commission
recognises the need for increased public support, partic-
strengthening the
ularly at Community level,
industry.
competitiveness of the European audiovisual

for

The Green Paper on the ‘The Convergence of the Tele-
communications, Media and Information Technology
Sectors, and the Implications for Regulation’ underlines
the risk of a shortage of good quality content on the
digital and analogue television market.

The Commission's public consultation on the Green
Paper, highlighted the need to establish a framework to
underpin the distribution and promotion of European
audiovisual content for the traditional and new media in
a digital environment.

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(8)

(9)

(10)

(11)

(12)

(13)

(14)

(15)

In its conclusions of 27 September 1999 concerning the
results of the public consultation on the Convergence
Green Paper (1), the Council called upon the Commis-
sion to take account of these results when drawing up
proposals for measures for the strengthening of
the
European audiovisual industry, including the multimedia
industry.

In its Communication of 14 December 1999 on ‘Princi-
ples and Guidelines for the Community's Audiovisual
Policy in the Digital Age’, the Commission defined its
priorities in the audiovisual sector for the period 2000
to 2005.

The Commission implemented an ‘Action programme to
promote the development of the European audiovisual
industry (MEDIA)
(1991-1995)’, adopted by Council
Decision 90/685/EEC (2), and which comprised in partic-
ular measures designed to support the development and
distribution of European audiovisual works.

‘Strategy options

to the Green Paper

the audiovisual policy of

Further
to
strengthen the European programme industry in the
context of
the European
Union’, the Commission submitted in November 1995 a
proposal for a Council Decision establishing a European
Guarantee Fund to promote cinema and television
production (3), on which the European Parliament deliv-
ered a favourable opinion on 22 October 1996 (4).

The Community strategy for developing and strength-
ening the European audiovisual industry was confirmed
under the MEDIA II Programme (1996-2000), adopted
by Council Decision 95/563/EC (5) and by Council
Decision 95/564/EC (6). It is appropriate, on the basis of
the experience acquired from the Programme, to ensure
its extension, taking into account the results obtained.

the Commission considers

In its report on the results obtained under the MEDIA II
(1996-2000) programme, from 1 January 1996 to 30
the
June 1998,
programme meets the principle of the subsidiarity of
Community aid to national aid, since the areas in which
MEDIA II intervenes complement the areas in which
national support mechanisms traditionally intervene.

that

It is necessary to take cultural aspects of the audiovisual
sector into account in accordance with Article 151(4) of
the Treaty.

In accordance with the negotiating mandate given to the
Commission by the Council, during the forthcoming
World Trade Organisation (WTO) negotiations
the
Union should ensure, as in the Uruguay Round, that the
Community and its Member States maintain the poss-
ibility to preserve and develop their capacity to define
and implement their cultural and audiovisual policies for
the purpose of preserving their cultural diversity.

(1) OJ C 283, 6.10.1999, p. 1.
(2) OJ L 380, 31.12.1990, p. 37.
(3) OJ C 41, 13.2.1996, p. 8.
(4) OJ C 347, 18.11.1996, p. 33.
(5) OJ L 321, 30.12.1995, p. 25.
(6) OJ L 321, 30.12.1995, p. 33.

(16)

(17)

(18)

(19)

(20)

(21)

Taking the same approach, the European Parliament, in
its Resolution of 18 November 1999, recognised the
European audiovisual sector's special role in sustaining
cultural pluralism, a healthy economy and freedom of
expression, reaffirmed its commitment to the freedom of
action in the sphere of audiovisual policy obtained at the
Uruguay Round, and took the view that the General
Agreement on Trade in Services (GATS) rules on cultural
services, in particular in the audiovisual sector, should
not jeopardise the cultural diversity and autonomy of
the WTO contracting parties.

In order to increase the added value of the Community
measures,
is necessary to ensure complementarity
between the measures taken at Community level and
national forms of support.

it

It
is necessary to establish consistency between this
Decision and the action of the Commission on national
measures to support the audiovisual sector, especially in
the interests of preserving cultural diversity in Europe,
by enabling national policies to develop adequately the
potential for production in Member States. In addition,
Community support can be combined with any public
support.

The emergence of a European audiovisual market neces-
sitates the development and production of European
works, i.e. works originating in the Member States as
well as works originating in European third countries
participating in the MEDIA Plus programme or having a
cooperation framework satisfying the conditions set out
in Council Directive 89/552/EEC of 3 October 1989 on
the coordination of certain provisions laid down by law,
regulation or administrative action in Member States
concerning the pursuit of television broadcasting activi-
ties (7).

In the next few years the digital revolution will mean
that European audiovisual works will become more
easily accessible thanks to new ways of transporting
audiovisual content, and will become more widely avail-
able outside their country of origin.

the audiovisual programme
The competitiveness of
industry depends on the use of new technologies at the
programme development, production and distribution
stages. It is therefore appropriate to ensure suitable and
effective coordination with the measures undertaken in
in particular the Fifth
the field of new technologies,
Framework Programme of the European Community for
research, technological development and demonstration
activities (1998-2002), as adopted by Decision No 182/
1999/EC of
the
Council (8), the future Sixth Framework Programme, and
new opportunities for multilingual production, in order
to make for consistency with the measures to be under-
taken under those programmes, focusing in particular
on the needs and potential of small and medium-sized
enterprises (SMEs) operating on the audiovisual market.

the European Parliament and of

(7) OJ L 298, 17.10.1989, p. 23. Directive as amended by Directive
(OJ L

the European Parliament and of

the Council

97/36/EC of
202, 30.7.1997, p. 60).
(8) OJ L 26, 1.2.1999, p. 1.

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(22)

(23)

(24)

(25)

(26)

(27)

(28)

(29)

(30)

(31)

(32)

(33)

(34)

(35)

(36)

In order to support European audiovisual projects, the
Commission will examine the possibility of additional
funding under other Community instruments, notably in
the framework of ‘e-Europe’ and the initiatives resulting
from the Lisbon European Council conclusions, such as
the European
the European Investment Bank (EIB),
Investment Fund (EIF) and the research framework
programmes. The professionals in the audiovisual sector
should be informed of the various support arrangements
available to them within the framework of the European
Union.

In accordance with the conclusions of the Lisbon Euro-
pean Council, the Council and Commission are to report
by the end of 2000 on the ongoing review of EIB and
EIF financial
instruments in order to redirect funding
towards business start-ups, high-tech firms and micro-
enterprises, as well as other risk capital initiatives and
guarantee arrangements proposed by the EIB and the
EIF. In this connection, particular attention should be
paid to the audiovisual industry, in order to improve its
access to capital markets and increase its competitive-
ness.

In its report
to the European Council, entitled ‘Job
Opportunities in the Information Society’, the Commis-
job-creation potential
sion referred to the major
provided by the new audiovisual services.

in
In its Communication on Community policies
support of employment, the Commission recognised the
MEDIA II Programme's positive impact on employment
in the audiovisual sector.

It is appropriate therefore to facilitate the development
of investment in the European audiovisual industry and
to call on the Member States to encourage job-creation
in that industry by various means.

The MEDIA Plus programme should allow the establish-
ment of an environment conducive to entrepreneurial
skills and investment, so as to guarantee a place for the
European audiovisual sector in the global economy and
the effective promotion of cultural diversity.

The contribution that SMEs can make to the develop-
ment of the audiovisual sector should be turned to good
account.

There is a need to improve the conditions for distrib-
uting and promoting European cinematographic works
on the European and international markets. Cooperation
between international and national distributors, cinema
owners
encouraged;
networking by distributors, in particular SMEs, should
also be encouraged, and support should be given to
concerted action to promote common programming
measures at European level.

producers

should

and

be

There is a need to improve the television broadcasting
prospects of European works on the European and inter-
national markets. Given the leading role which television
channels can play in disseminating European works and
the inadequate time they currently devote to such works
in their scheduling, it is important that European broad-
casters (as defined in Article 2 of Directive 89/552/EEC),
encourage the European transmission of programmes by
purchasing works produced in other Member States.

There is a need to facilitate market access for indepen-
dent European production and distribution companies,
and to promote both European works and European
companies in the audiovisual sector.

Public access
to the European audiovisual heritage
should be improved, in particular through its digitisation
and networking at European level.

European content holders should be encouraged to digi-
including their
tise and network their catalogues,
archives and cinematographic heritage.

Support for development, distribution and promotion
should take account of structural objectives, such as
developing potential in countries or regions with a low
audiovisual production capacity and/or a restricted
linguistic or geographical area, and/or the development
in
of an independent European production sector,
particular SMEs.

The associated countries of Central and Eastern Europe,
as well as Cyprus, Malta, Turkey and those EFTA coun-
tries which are parties to the EEA Agreement are recog-
nised
Community
programmes on the basis of supplementary appropria-
tions and in accordance with the procedures to be
agreed with those countries.

participants

potential

as

in

The other countries of Europe which are parties to the
European Convention on Transfrontier Television are an
integral part of
the European audiovisual area and
should therefore be enabled to participate in this
Programme on the basis of supplementary appropria-
tions, in accordance with the procedures to be estab-
lished in the agreements between the interested parties.
Those countries should be able, if they wish, and regard
being had to budgetary considerations or the priorities
of
to participate in the
industries,
programme and to benefit under a more limited
cooperation formula, on the basis of supplementary
appropriations and specific arrangements to be agreed
between the interested parties.

their audiovisual

(37)

The opening-up of the Programme to European third
countries is subject to prior examination of the compati-
bility of their national legislation with the Community
acquis, in particular with Council Directive 89/552/EEC.

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(38)

Cooperation with non-European third countries, devel-
oped on the basis of mutual and balanced interests, may
enable the European audiovisual industry to derive an
added value in terms of the promotion, market access,
distribution, dissemination and exploitation of European
works in those countries. The inclusion of third coun-
tries will increase awareness of the cultural diversity of
Europe and promote the spread of common democratic
values. Such cooperation should be developed on the
supplementary appropriations and specific
basis of
to be established in the agreements
arrangements
between the interested parties.

(39) A financial reference amount, within the meaning of
point 34 of the Interinstitutional Agreement of 6 May
1999 between the European Parliament, the Council and
the Commission on budgetary discipline and improve-
ment of the budgetary procedure (1) is included in this
the programme,
Decision for the entire duration of
the budgetary
without prejudice to the powers of
authority as defined by the Treaty.

(40)

The measures necessary for the implementation of this
Decision should be adopted in accordance with Council
Decision 1999/468/EC of 28 June 1999 laying down
the procedures for the exercise of implementing powers
conferred on the Commission (2),

HAS DECIDED AS FOLLOWS:

(e) development of

the audiovisual sector in countries or
regions with a low audiovisual production capacity and/or
a restricted linguistic or geographical area and strength-
ening networking and transnational cooperation between
small and medium-sized enterprises;

(f) the dissemination of new types of audiovisual content

using new technologies.

Those objectives shall be realised in accordance with the
detailed arrangements set out in the Annex.

Article 2

Specific objectives of the Programme in the development
field

In the development
Programme shall be as follows:

field,

the specific objectives of

the

(a) to promote, by providing financial support, the develop-
ment of production projects (dramas for cinema or televi-
sion, creative documentaries, animated films for television
or cinema, works exploiting the audiovisual and cinemato-
graphic heritage) submitted by independent enterprises, in
particular small and medium-sized, and aimed at the Euro-
pean and international markets;

(b) to promote, by providing financial support, the develop-
ment of production projects that make use of new creation,
production and dissemination technologies.

Article 1

Article 3

Establishment and objectives of the Programme

Specific objectives of the Programme in the fields of
distribution and dissemination

referred

A programme,

1.
‘the
(hereinafter
Programme’), is hereby established to encourage the develop-
ment, distribution and promotion of European audiovisual
works within and outside the Community, to run from 1
for the purpose of
January 2001 to 31 December 2005,
industry.
strengthening the European audiovisual

to

as

2.

The objectives of the Programme shall be as follows:

(a) an improvement in the competitiveness of the European
audiovisual sector — including small and medium-sized
enterprises — on the European and international markets,
by supporting the development, distribution and promo-
tion of European audiovisual works, taking account of the
development of new technologies;

(b) strengthening the sectors which help improve the transna-

tional movement of European works;

(c) respect for and promotion of linguistic and cultural diver-

sity in Europe;

(d) enhancing the European audiovisual heritage, in particular

by digitisation and networking;

(1) OJ C 172, 18.6.1999, p. 1.
(2) OJ L 184, 17.7.1999, p. 23.

In the fields of distribution and dissemination, the specific
objectives of the Programme shall be as follows:

(a) to strengthen the European distribution sector in the field
of cinema by encouraging distributors to invest in the
production, acquisition, marketing and promotion of
distribution rights and promotion of non-domestic Euro-
pean cinema films;

(b) to foster the wider transnational dissemination of non-
domestic European films, on the European and inter-
through initiatives to stimulate their
national markets,
inter alia by
distribution and their screening in cinemas,
encouraging coordinated marketing strategies;

(c) to strengthen the distribution sector for European works on
media intended for private use, by encouraging distributors
to invest in digital technology and in the promotion of
non-domestic European works;

(d) to promote the movement, in the Community and outside
it, of European television programmes produced by inde-
pendent companies by encouraging cooperation between
broadcasters, on one hand, and independent European
distributors and producers, on the other hand;

(e) to encourage the creation of catalogues of European works
in digital format intended for exploitation on new media;

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(f) to support the linguistic diversity of European audiovisual

and cinematographic works.

programme (1996-2000), shall be allocated to the require-
ments of the MEDIA Plus Programme.

Article 4

Article 7

Specific objectives of the Programme in the field of
promotion and market access

Implementation of this Decision

In the field of promotion and market access, the Programme
shall aim to:

(a) facilitate and encourage the promotion and movement of
European audiovisual and cinematographic works at trade
shows, fairs and audiovisual festivals in Europe and around
the globe, insofar as such events may play an important
role in the promotion of European works and the
networking of professionals;

1.
The measures necessary for the implementation of this
Decision concerning the matters referred to below shall be
adopted in accordance with the management procedure
referred to in Article 8(2):

(a) the general guidelines for all the measures described in the

Annex;

(b) the content of the calls for proposals, the definition of the
criteria and the procedures for the selection of projects;

(b) encourage the networking of European operators, by
supporting joint activities on the European and inter-
national markets by national public or private promotion
bodies.

(c) questions concerning the annual internal breakdown of the
Programme resources,
including the breakdown between
measures in the development, promotion and distribution
sectors;

(d) the arrangements for monitoring and assessing actions;

Article 5

Financial provisions

Beneficiaries of Community support shall provide a
1.
substantial proportion of
funding, which may include any
other public funding. Community funding shall not exceed
50 % of the cost of operations. However, in the cases expressly
provided for in the Annex, this proportion may reach as much
as 60 % of the cost of operations.

2.
The financial reference amount for implementation of the
Programme for the period referred to in Article 1(1) shall be
EUR 350 million. An indicative breakdown of that amount by
sector is set out in section 1.5 of the Annex. The annual
appropriations shall be authorised by the budgetary authority
within the limits of the financial perspective.

3. Without prejudice to the agreements and conventions to
which the Community is a contracting party, undertakings
benefiting from the Programme must be owned and continue
to be owned, whether directly or by majority participation, by
Member States and/or by nationals of Member States.

Article 6

Financial support

(e) any proposal for the allocation of Community funds in
excess of EUR 200 000 in the case of development, or
EUR 300 000
and
case
EUR 200 000 per beneficiary and per year in the case of
promotion. These thresholds may be reviewed by the
Committee in the light of experience;

distribution

the

of

in

(f) the choice of pilot projects provided for in Article 10.

The measures necessary for the implementation of this
2.
Decision concerning all the other matters shall be adopted in
accordance with the advisory procedure referred to in Article
8(3). This procedure shall also apply to the final choice of
technical assistance offices.

Technical assistance shall be governed by the provisions

3.
adopted pursuant to the Financial Regulation.

4.
The Commission shall give the European Parliament and
the Council regular and timely notice of the implementation of
this Decision, in particular the use of the available resources.

Article 8

Committee procedure

1.

The Commission shall be assisted by a committee.

Financial support under the Programme may be granted in the
form of conditionally repayable advances, or subsidies, as
defined in the Annex. The repayments under the Programme,
together with the repayments from operations carried out
under the MEDIA programme (1991-1995) and MEDIA II

2. Where reference is made to this paragraph, Articles 4 and
7 of Decision 1999/468/EC shall apply.

The period laid down in Article 4(3) of Decision 1999/468/EC
shall be set at two months.

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3. Where reference is made to this paragraph, Articles 3 and
7 of Decision 1999/468/EC shall apply.

tions, in accordance with conditions to be established in the
agreements between the interested parties.

4.

The committee shall adopt its rules of procedure.

Article 9

Consistency and complementarity

1. When implementing the Programme, the Commission
shall,
in close cooperation with the Member States, ensure
other
general
Community policies, programmes and actions that impinge
upon the audiovisual field.

complementarity with

consistency

and

2.
The Commission shall ensure that there is effective liaison
between this Programme and programmes and actions in the
audiovisual field being carried out under Community coopera-
tion with non-member countries and the relevant international
organisations.

Article 10

Pilot projects

1.
Pilot projects shall be implemented throughout the dura-
tion of the Programme aimed at improving access to European
audiovisual content and at taking advantage of opportunities
arising from the development and introduction of new and
innovative
including digitisation and new
methods of dissemination.

technologies,

2.
In selecting the pilot projects to be implemented, the
Commission shall be advised by technical consultation groups
composed of experts designated by the Member States. The list
of potential projects shall be submitted to the Committee
regularly in accordance with the procedure laid down in Article
8(2).

Article 11

Opening of the Programme to non-member countries

1.
The Programme shall be open to the participation of the
associated countries of Central and Eastern Europe in accord-
ance with the conditions laid down in the association agree-
ments or their additional protocols relating to participation in
Community programmes concluded or to be concluded with
those countries.

2.
The Programme shall be open to the participation of
Cyprus, Malta, Turkey and those EFTA countries which are
members of the EEA Agreement, on the basis of supplementary
appropriations, in accordance with the procedures to be agreed
with those countries.

3.
The Programme shall be open to the participation of the
countries which are parties to the Council of Europe Conven-
tion on Transfrontier Television other than those referred to in
paragraphs 1 and 2, on the basis of supplementary appropria-

4.
The opening-up of the Programme to the European third
countries referred to in paragraphs 1, 2 and 3 shall be subject
to prior examination as to the compatibility of their national
legislation with the Community acquis, including the second
subparagraph of Article 6(1) of Directive 89/552/EEC.

5.
The Programme shall also be open to cooperation with
other third countries on the basis of supplementary appropria-
tions and the specific arrangements,
including cost sharing
under agreed procedures,
to be established in agreements
between the interested parties. The European third countries
referred to in paragraph 3 which do not wish to participate
fully in the Programme may be eligible for cooperation with
the Programme under the conditions set out in this paragraph.

Article 12

Monitoring and evaluation

1.
The Commission shall guarantee that measures taken
under this Decision are subject to prior appraisal, and to subse-
quent monitoring and evaluation. It shall ensure the accessi-
bility of the programme and the transparency of its imple-
mentation.

2.
After the completion of the projects, the Commission
shall evaluate the manner in which they have been carried out
in order to assess
and the impact of their implementation,
whether the original objectives have been achieved.

3.
After two years' implementation, the Commission shall,
after bringing the matter before the Media Committee, present
to the European Parliament, the Council and the Economic and
Social Committee an evaluation report on the impact and
effectiveness of the Programme on the basis of the results
obtained. This report shall be accompanied, if need be, by any
proposals for adjustments.

On completion of the Programme the Commission shall
4.
submit
the Council and the
Economic and Social Committee a detailed report on the
implementation and results of the Programme.

to the European Parliament,

Article 13

Entry into force

This Decision shall take effect on 1 January 2001.

Done at Brussels, 20 December 2000.

For the Council

The President

É. GUIGOU

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ANNEX

1.

MEASURES TO BE IMPLEMENTED

1.1

In the development of audiovisual works sector

In order to respond to business strategies reflecting the diversity of production structures and of projects, the
Programme measures aim to provide financial assistance for enterprises in the audiovisual sector submitting:

(a) proposals for developing project packages for companies with a larger investment capacity, or

(b) proposals for developing project packages for companies with a smaller investment capacity, or

(c) proposals for developing audiovisual works presented project by project.

The selection criteria will take account chiefly of the European and international nature of the projects, in particular
of their:
— production potential;
— potential for transnational exploitation, and the marketing and distribution strategies envisaged;
— quality and originality.

Support for development will be granted on terms that require, once a project enters the production phase, the
support for the project to be reinvested in the development of new production projects.

The contribution will generally be limited to 50 % of project costs but may be raised to 60 % for projects which
contribute to the enhancement of European linguistic and cultural diversity.

In the report provided for in Article 12, the Commission will evaluate the comparative results of the systems
referred to in this Annex with regard to the programme objectives. It will submit to the Committee, in accordance
with the procedure laid down in Article 8(2), appropriate proposals for the implementing rules for the rest of the
Programme.

1.2

In the distribution and dissemination sector

1.2.1 C i n e m a d i s t r i b u t i o n :

The following lines of action will be implemented in order to achieve the objectives outlined in Article 3:

(a) a support scheme in the form of a conditionally reimbursable advance for distributors of European cinemato-

graphic works outside their production territory. The aim of this scheme is to:
— encourage the networking of European distributors in conjunction with international producers and

distributors,

in order to promote joint strategies for the European market;

— encourage distributors in particular to invest in promotion and adequate distribution for European films;
— support the multilingual aspects of European film-making (dubbing, subtitling, multilingual production and
international sound tracking). That part of the support intended to finance the linguistic diversity of works
will take the form of a subsidy.

The criteria for selecting beneficiaries may include provisions to distinguish between projects according to their
budget category. Special attention will be given to films that enhance European linguistic and cultural diversity.

(b) a system of ‘automatic’ support for European distributors proportional to the number of seats sold for
non-domestic European films in States participating in the Programme, up to a fixed ceiling per film and
adjusted for each country. The support thus generated may be used by distributors only for investment in the
following:
— the coproduction of non-domestic European films;
— the acquisition of the screening rights, for example by means of minimum guarantees, of non-domestic

European films;

— editing costs (copying, dubbing and subtitling), promotion costs and publicity costs for non-domestic

European films.

Reinvestment arrangements will generally be limited to 50 % of project costs, but may be raised to 60 %,
particularly for investment in the production stage and in films that are of interest in enhancing European
linguistic and cultural diversity.

(c) a system to assist European companies specialising in the international distribution of cinema films (sales
agents) according to their performance on the market over a reference period of at least one year. This type of
assistance may be used by sales agents for investment in acquisition (minimum guarantees) and in costs arising
from the promotion of new European works on the European and international markets.

(d) appropriate assistance to encourage operators to screen a significant proportion of non-domestic European
films in première cinemas for a minimum screening period. The support shall be made conditional on showing
a minimum number of European films. The level of support may take account of the number of admission
tickets sold for non-domestic European films during a reference period up to a fixed ceiling.

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Support may also be granted for the creation and consolidation of networks of European operators running
joint schemes to encourage such scheduling.

Support may be used for the development of educational activities and for raising awareness amongst young
cinema-goers.

As far as possible, support for cinemas and networks will encourage a balanced geographical distribution.

1.2.2 D i s t r i b u t i o n o f E u r o p e a n w o r k s o f f - l i n e

This is understood to mean the distribution of European works on media intended for private use.

Automatic support: a system of automatic support for editors and distributors of European cinematographic and
audiovisual works, excluding games, on media intended for private use (e.g. videocassettes and DVD) according to
market performance over a reference period of at least one year. The evaluation of that performance may take
account of the specific features of different national markets through appropriate weightings. The support granted
may be used by distributors only for investment in the following:

(a) the costs of editing and distributing new non-domestic European works in digital form; or

(b) the costs of promoting new non-domestic European works in non-digital format.

This system is designed to:

(a) encourage the use of new technologies in the production of European works intended for private use

(production of a digital master for use by all European distributors);

(b) encourage distributors in particular to invest in the promotion and adequate distribution of non-domestic

European films and audiovisual works;

(c) support the linguistic diversity of European productions (dubbing, subtitling and multilingual production).

1.2.3 T e l e v i s i o n b r o a d c a s t i n g :

Encourage independent producers to produce works (fiction, documentaries and animated films) involving no less
than two broadcasters, and preferably more, in several States participating or cooperating on the programme,
belonging to different language zones.

The criteria for selecting beneficiaries may include provisions that distinguish between projects by budget category
and type. Special attention will be given to audiovisual works that are of interest in enhancing European heritage
and linguistic and cultural diversity.

That part of the support which is intended to finance the linguistic diversity of works (including production of the
sound track - music and effects) will take the form of a subsidy.

1.2.4 D i s t r i b u t i o n o f E u r o p e a n w o r k s o n - l i n e .

This is taken to mean the distribution of European works on-line via advanced distribution services and new media
(e.g. Internet, video-on-demand). The aim is to encourage the European audiovisual
industry to adapt to the
development of digital technology, particularly as regards advanced on-line distribution services.

Introduction of incentives to digitise works and create promotional and publicity material in digital form, so
encouraging European companies (suppliers of on-line access, special-interest channels, etc.) to create catalogues of
European works in digital format for exploitation via new media.

1.3

Promotion

1.3.1 I n t h e f i e l d o f p r o m o t i o n a n d a c c e s s t o p r o f e s s i o n a l m a r k e t s :

The programme measures aim to:

(a) improve the conditions governing access by professionals to trade shows and professional audiovisual markets
within and outside Europe and via specific technical and financial support schemes as part of events such as:

— the main European and international cinema markets;

— the main European and international television markets;

— special-interest markets, particularly for animated films, documentaries, multimedia and new technologies;

(b) encourage the creation of a database and/or a network of databases on catalogues of European programmes,

intended for professionals;

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(c) whenever possible, encourage support to promote cinematographic works, as from the production phase of the

work in question.

To this end, the Commission is encouraging the networking of operators at European level, notably by supporting
joint initiatives involving public or private national promotional bodies.

Support will generally be limited to 50 % of project costs but may be raised to 60 % for projects that enhance
European linguistic and cultural diversity.

1.3.2 I n t h e f i e l d o f

f e s t i v a l s :

The programme measures aim to:

(a) support audiovisual festivals realised in partnership that screen a significant proportion of European works;

(b) encourage cooperative projects with a European dimension involving audiovisual events from at least eight
States participating or cooperating in the programme, with a common action plan to promote European
audiovisual works and their movement.

Particular attention will be paid to festivals which help to promote works from Member States or regions with a
low audiovisual production capacity and works by young European directors, and which establish an active policy
for promoting and encouraging the distribution of the European works featured.

Priority will be given to projects from networks which encourage lasting cooperation between events.

Support will generally be limited to 50 % of project costs but may be raised to 60 % for projects that contribute to
the enhancement of European linguistic and cultural diversity.

1.3.3 A c t i v i t i e s t o p r o m o t e E u r o p e a n f i l m s a n d a u d i o v i s u a l P r o g r a m m e s :

To encourage professionals, in close association with the Member States, to organise activities to promote European
cinema and audiovisual productions intended for the general public.

1.4

Pilot projects

Pilot projects, the objectives of which are defined in Article 10, may focus, inter alia, on the following areas, with a
view to the enhancement, networking and promotion of:

(a) cinematographic heritage;

(b) European audiovisual programme archives;

(c) catalogues of European audiovisual works;

(d) digital dissemination of European content through, for instance, advanced distribution services.

The pilot projects will give rise to exchanges of experience; their results will be publicised widely in order to
encourage the dissemination of best practices.

Once the programme has been implemented for two years, the Commission will verify the results of the pilot
projects and propose adjustments to the programme.

1.5

Breakdown of resources

The funds available will be broken down according to the following guidelines:

Development:

Distribution:

Promotion:

Pilot projects:

at least 20 %

at least 57,5 %

approximately 8,5 %

approximately 5 %

Horizontal costs:

at least 9 %

All the percentage figures are indicative and are subject to changes by the Committee provided for in Article 8, in
accordance with the procedure referred to in Article 8(2).

2

IMPLEMENTATION PROCEDURE

2.1 Approach

In implementing the Programme, the Commission will ensure compliance with the objectives set out in Article
1(2).

In implementing the Programme, the Commission, assisted by the Committee provided for in Article 8, will work
closely with the Member States. It will also consult the partners concerned and ensure that the participation of
professionals in the Programme reflects European cultural diversity.

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2.2

Funding

2.2.1 C o m m u n i t y c o n t r i b u t i o n

Community funding will not exceed 50 % of the final cost of the measures (other than in the cases expressly
provided for in this Annex, where a ceiling of 60 % applies) and will be granted in the form of conditionally
reimbursable advances or subsidies. Only costs directly linked to execution of the measure receiving support will be
eligible, even if the costs are defrayed in part by the beneficiary before the selection procedure. For multilingual
support, the Community contribution will be in the form of subsidies.

2.2.2 P r i o r a p p r a i s a l , m o n i t o r i n g a n d s u b s e q u e n t e v a l u a t i o n

Prior to approving a request for Community support, the Commission will carefully evaluate it to check that it
complies with this Decision and with the conditions set out in subsections 2 and 3 of this section of the Annex.

Requests for Community support must include the following:

(a) a financial plan setting out all the project funding components, including the financial support requested from

the Commission;

(b) a provisional work timetable;

(c) any other relevant information required by the Commission.

2.2.3 F i n a n c i a l p r o v i s i o n s a n d c o n t r o l

The Commission will set out the rules on commitments and payments for the measures undertaken pursuant to
this Decision,

in compliance with the appropriate provisions of the financial regulations.

It will particularly ensure that the administrative and financial procedures used are geared to the objectives pursued
and to the practice and interests of the audiovisual

industry.

2.3

Implementation

2.3.1 The Commission will implement the Programme. It may, to this end, call upon independent consultants and
technical assistance offices to be selected, after a call for tenders, on the basis of their expertise in the sector,
experience acquired in the MEDIA II programme, or other experience acquired in this area. The technical assistance
will be financed by the Programme's budget. The Commission may also conclude, in accordance with the procedure
referred to in Article 8(2), partnerships for operations with specialist bodies, including those which have been set
up under other European initiatives such as Audiovisual Eureka, EURIMAGES and the European Audiovisual
Observatory in order to implement joint measures that meet the Programme objectives in the field of promotion.

The Commission will make the final selection of the beneficiaries of the Programme and decide on the financial
support to be granted, in accordance with Article 8, on the basis of preparatory work conducted by the technical
assistance offices. It will give grounds for its decisions to applicants for Community support and ensure the
transparency of implementation of the programme.

In order to execute the Programme and, in particular, evaluate the projects benefiting from Programme funding and
networking activities, the Commission will draw on recognised, independent audiovisual experts in the fields of
development, production, distribution and promotion, who are, where necessary, proficient in the area of the
management of rights, especially in the new digital environment.

2.3.2 The Commission will take the necessary steps to provide information on the opportunities offered by the
Programme, and will ensure its promotion. The Commission will also provide via the Internet comprehensive
information concerning the support arrangements available under the European Union's policies which are of
relevance to the audiovisual sector.

In particular, the Commission and the Member States will take the necessary steps, by continuing with the activities
of the network of MEDIA Desks and Antennae and ensuring that their professional skills are enhanced, in order to:

(a) inform professionals in the audiovisual sector of the various support arrangements available under European

Union policies;

(b) publicise and promote the Programme;

(c) encourage maximum participation in the Programme's activities by professionals;

(d) assist professionals with the presentation of projects in response to calls for proposals;

(e) foster transborder cooperation between professionals;

(f) liaise between the various support bodies in the Member States with a view to ensuring that Programme

activities complement national support measures.