During the last years, we increasingly often see leading international film industry players such as HBO, BBC and Warner Bros choosing the Baltic countries as the main shooting location for their projects. One of the main reasons for such impressive growth in the region’s film production industry is tax incentives and dedicated support schemes such as the Lithuanian Film Tax Incentive, the Film Estonia cash-rebate incentive and Latvian foreign films co-financing. We have prepared a concise overview of the main programmes and incentives available in Estonia, Latvia and Lithuania.
Lithuanian Film Tax Incentive
Introduced in 2014, the Lithuanian Film Tax Incentive has proven to be an effective policy measure to foster local and foreign film production in Lithuania. From the end of 2014 to 2018, investors provided free funds for production of 115 films, 47 of which were national films, 37 co-production films and 31 foreign films. During this period, more than EUR 17 million of Lithuania-based private investors’ funds were made available free of charge for film production. This encouraged companies such as HBO and the BBC to bring their projects to Lithuania. The Lithuanian Film Centre ‒ administrator of the incentive ‒ anticipates that in coming years the Lithuanian film industry will expand, attracting even more foreign investment.
Key aspects of the incentive:
- Benefit: up to 30% of the film production budget can be saved through a private investment scheme; in exchange, private investors allocating their funds for film making may reduce corporate income tax.
- Eligibility: only domestically produced, co-produced or commissioned films (produced under a service agreement), where at least 80% of eligible film production costs are incurred in Lithuania and the total amount of eligible spend in Lithuania is no less than EUR 43,000, may qualify for the Incentive. This includes production of feature films, TV dramas, documentaries and animated films.
- Content criteria: a film should meet certain approved cultural content requirements, eg it should reflect important Lithuanian or European values such as cultural diversity, solidarity, equity, minority rights, human rights, tolerance, environmental protection and respect for cultural and family traditions.
- Production criteria: certain requirements also apply to production of a film, eg at least three days of shooting should take place in Lithuania.
- Period of application: currently the validity of the Incentive is foreseen until 31 December 2023. Considering its positive impact on the growth of the Lithuanian film industry, an extension of the period may be expected.
Eligibility requirements and more information about the Incentive here.
Film Estonia cash-rebate incentive
The Film Estonia cash-rebate incentive is a co-production incentive supporting production of feature films, feature documentaries, animation films, animation series, high-end TV dramas and post-production of all these works. The most recent well-known applicant was Warner Bros, which shot Christopher Nolan’s latest feature film “Tenet” partly in Estonia. The incentive is established by the Estonian Film Institute and financed by the Estonian Ministry of Culture.
Key aspects of the incentive:
- Benefit: up to 30% of the costs of the Estonian production stage are reimbursed. The level of support is determined by the amount of Estonian production costs that are both eligible and directly spent on parties that are subject to Estonian taxation.
- How does it work: Support can be applied for by an entity registered in Estonia whose main area of activity is producing audio-visual works. The recipient of support is a foreign company who is cooperating with the applicant and whose principal area of activity is also production of audio-visual works.
- Eligibility: available to qualifying projects with production costs incurred in Estonia.
- Content criteria: Support is not granted for amateur film production, television programmes, educational, promotional or commercial films, games, pornographic films or projects promoting racism, hatred or violence.
- Production criteria: no minimum thresholds for mandatory production time or production costs in Estonia.
Eligibility requirements for the cash-rebate incentive and more information here.
Other funds and support schemes for international co-production projects
In addition to the Film Estonia incentive geared towards international co-production projects, regional funds and national support schemes exist in Estonia:
- Tartu, Viru and Estonian Islands film funds support projects with regionally incurred costs.
- Different categories of incentives such as script, production and distribution support are available for supporting Estonian cinema.
- Cultural Endowment of Estonia supports various audio-visual art projects, including development and production of domestic feature films.
National Film Centre support for foreign film producers
The Latvian Co-financing Fund is a co-financing programme administered by the National Film Centre of Latvia, which grants the filming of foreign films in Latvia co-financing through the state budget.
Key aspects of the programme:
- Production criteria: only films that are either completely or partially shot in Latvia and film production services that are provided by a natural or legal person registered in Latvia qualify for the programme.
- Budget criteria: The total budget of the film has to be at least EUR 711,436 for full-length features or animations and at least EUR 142,287 for documentaries.
- Financing criteria: Financing available to the producer on the day of submitting the project has to be at least 50% of the total costs.
More information about the Latvian Co-financing Fund here.
Riga City support for foreign film producers
Riga City Council has developed a co-financing programme “Riga Film Fund” for Foreign-National co-productions of feature films and TV Films, fictional or documentary. The minimum required total budget of the production must be at least EUR 700,000 and half of the funding has to be confirmed by the applicant when submitting the application.
Applicants can apply for funding of such expenses as film-related transport, location, and technical equipment rentals, catering, accommodation, public facilities, construction facilities, artistic and administrative services.
More information about the evaluation criteria, terms, applicable regulations, list of eligible expenses and Riga City location guide here.