FILMMAKING IN NOVA SCOTIA

UNCLAS HALIFAX 000015

SIPDIS

FOR WHA/CAN
STATE PLS PASS USTR

E.O. 12958: N/A
TAGS: ETRD EINV EIND CA
SUBJECT: FILMMAKING IN NOVA SCOTIA


1. Summary: The issue of intellectual property rights (IPR) does
not rank high on the agenda of the Nova Scotia film industry.
Rather, the key issue is attracting increased film production to
the province. Film Nova Scotia is the provincially owned
development corporation through which the province has been
assisting and encouraging the development of a local filmmaking
industry for almost twenty years. Successive provincial
governments have seen this assistance--mainly in the form of tax
credits and small production grants--as an economic development
tool akin to those for any other industry. While these efforts
have produced some positive results, Nova Scotia lags far behind
the established Canadian film centers in Montreal, Toronto, and
Vancouver. END SUMMARY.


2. Consul General and Pol-Econ Specialist met with Anne
MacKenzie, President and CEO of Film Nova Scotia on April 7 to
discuss IPR issues concerning copyright legislation and the
local film industry. On the former, MacKenzie noted that the
issue was not a high priority and offered no opinion on the
likelihood of the Harper government actually passing copyright
legislation other than a brief comment that any development in
this area would likely take a long time.


3. MacKenzie then described the mandate of Film Nova Scotia,
explaining that it was set up in 1990 as an economic development
tool. Its mandate is to grow Nova Scotia's film, television and
new media (CD, DVDs and internet) industry and also to promote
the province and its worker force in global production markets.
Through direct assistance the corporation annually invests in
the range of C$15-20 million in programs for such things as
training and loans and grants for would-be filmmakers.


4. In addition to this assistance, the province offers a film
tax credit that Film Nova Scotia administers on behalf of the
provincial finance department. This provides for a fully
refundable corporate income tax credit based on labor costs. The
credit is designed to encourage the development, training and
hiring of Nova Scotia film workers (which amounts to some 2,000
to 3,000 individuals). The tax credit currently ranges from 50
to 65 percent, with the higher percentage going to films shot
outside the Halifax region. In the province's 2007-2008 fiscal
year, local producers received C$8.10 million in credits while
visiting (i.e., non-resident) producers received C$2.64 million.
MacKenzie pointed out that the various incentives have helped
grow the industry to where it is now the fourth largest in
Canada, coming in behind Vancouver, Toronto, and Montreal. In
its 2006/07 fiscal year, the industry saw over C$100 million in
production spending in the province, but that figure dipped to
C$76 million in 2007/08 due to increases in the value of the
Canadian dollar, labor unrest in the industry and increasing
competiveness among other jurisdictions.


5. COMMENT: While Film Nova Scotia has succeeded in carving out
for local production companies a small niche in the Canadian and
global film industry, the prospects of displacing Canada's
traditional production centers remain remote. END COMMENT.

FOSTER