Capital Movements, Imports and Foreign Investments - Act No 43/1999 on Temporary Reimbursements in Respect of Film Making in Iceland

• See also: Regulation No 1011/2007 on Temporary Reimbursements in Respect of Film Making in Iceland.
• See also: Instructions to applicants

Act No 43/1999 on Temporary Reimbursements in Respect of Film Making in Iceland.

Translation from Icelandic

Art. 1
Objectives. Scope.

The objective of this Act is to enhance domestic culture and promote the history and nature of Iceland by temporarily supporting motion pictures and television programmes produced in Iceland.

Art. 2

Authorisation is granted for the reimbursement from the State Treasury of a proportion of the production costs incurred in the production of films and television programmes in Iceland.
When more than 80% of the total production cost of a motion picture or television programme incurs in Iceland, the reimbursement shall be calculated from the total production cost incurring within the European Economic Area.
Production costs refers to all costs incurred in Iceland deductible from the revenues of enterprises pursuant to the provisions of the Act on Income and Net Wealth Tax. Payments pertaining to employees and contractors are only to be included in production costs if they are verifiably taxable in Iceland

Art. 3

Application for reimbursement of production costs shall be submitted to the Ministry of Industry. The application, with enclosures, shall be submitted before production commences in Iceland. A special committee of four members shall examine applications and submit recommendations to the Minister for response. The Minister of Industry shall appoint the Committee and the Minister of Education and Culture, the Minister of Finance and the Icelandic Film Fund shall each nominate one member, the fourth to be appointed without nomination and serve as Chairman. Alternates shall be appointed in the same manner. In case of even votes, the Chairman has the deciding vote.
The Committee shall take into consideration that the motion picture or television programme promotes Icelandic culture, and, as applicable, contains references to Icelandic history and nature.

Art. 4

In assessing whether a proportion of the production costs of a motion picture or television programme shall be reimbursed, the following conditions shall be fulfilled:

a. the production shall be suited for promoting Icelandic culture and the history and nature of Iceland;

b. the production shall be suited for enhancing the experience, knowledge, and artistic ambition of the parties involved;

c. a specific company shall be established in Iceland for the production; an Icelandic branch or agency of a company registered in another Member State of the European Economic Area shall be considered a specific company;

d. information on the principal parties involved in the film or television programme shall be made available;

e. information on domestic parties and their share in the production of the film or television programme shall be made available;

f. an itemised estimate of the production costs and sources of funding shall be made available, together with confirmation by the funding parties and a declaration by the applicant to the effect that the production conforms to the aims of the Act;

g. information about the content of the proposed production of a motion picture or a television programme shall be made available, such as a script and information about filming locations;

h. a statement shall be made available to the effect that the material to be produced is intended for general distribution to cinemas or television stations;

i. the subject matter of the film or television programming should not violate the provisions of law relating to film inspection and the ban on violent films, nor the provisions of the General Penal Code concerning pornography.

In the event of a change in estimated production costs (cf. paragraph 1, item f) after production begins, a new cost estimate shall be submitted to the Ministry of Industry.

When assessing an application for reimbursement, the Committee established pursuant to Article 3 shall have the authority to procure an expert opinion regarding the purported artistic value of the production in question.

Material relating to advertisements and news, short films, recordings of sports events and entertainment events, and also the production of material that is primarily intended for showing in own distribution systems, shall not be regarded as material pursuant to item h of paragraph 1.

In the event that the production of a motion picture or television programme is not completed within three years from the date of approval of reimbursement granted pursuant to Article 3, the approval shall lapse.

Art. 5

The proportion of reimbursed production costs shall be 20% of the production cost pursuant to Art. 2.
A request for disbursement shall be sent to the Ministry of Industry. If the request is received after six months have passed from the end of the production of a motion picture or television programme, the request shall be denied. The Minister of Industry shall determine the reimbursement based on recommendation of the Committee pursuant to Art. 3. It is a condition for reimbursement that the applicant keep records of the costs he wishes to be reimbursed for in accordance with the Act on Accounting and the Act on Annual Accounts. Furthermore, the cost settlement shall be confirmed and endorsed by a certified public accountant who shall also confirm that the cost settlement is in compliance with the provisions of this Act and regulations issued pursuant hereto.
It is also a condition for the reimbursement that the production of the motion picture or television programme shall be completed, and no taxes or charges to the State and municipalities incurring from the production may be unpaid in Iceland.

Art. 6

In the event that an applicant has received a grant from the Icelandic Film Fund for the production of the same motion picture or television programme, the grant shall be deducted from the amount that is considered domestic production cost.
The total of a grant from the Icelandic Film Fund and a reimbursement pursuant to Art. 5 shall not exceed 50% of the total production costs of the same motion picture or television programme.

Art. 7

The Minister of Industry shall issue a regulation on the implementation of this Act. It shall, i.a., contain provisions on procedures for reimbursements as stipulated in this Act, the right of the Minister to defer reimbursements in excess of the amount allocated in the Government budget, conditions for reimbursements, applications, responses to applications and decisions on reimbursements.

Art. 8

Act No. 43/1999 on Temporary Reimbursements in Respect of Film-Making in Iceland shall cease to be in effect on December 31, 2011. Applications for reimbursements granted prior to that time, however, shall remain in force.

Transitional Provisions

Applicants who have been granted approvals of reimbursement prior to the entry into force of this act are entitled to apply again for reimbursement of production cost after the reimbursement proportion has been increased. However, this shall apply only if production has not yet begun.

Updated in February 2007