L.S. 478.03(R) Regolamenti dwar Inċentivi Finanzjarji għall-Industrija Awdjoviżiva Imħassrin bl-Avviż Legali 17 tal-2023

(1)In these regulations, unless the context otherwise "the Act" means the Malta Film Commission Act; "certificate of provisional approval" means the certificate issued in terms of regulation 7 following receipt of relevant application and supporting documentation and duly assessed in accordance with the relevant Guidelines; "the Commission" means the Malta Film Commission; "the Commissioner" means the Film Commissioner; "completion" means the termination of filming activity or animation or VFX in Malta of an audiovisual production and "completed" shall be construed accordingly; "co-production" means a qualifying production which is the subject of a co-production agreement between two

(2)or more co-producers; "cultural product" means an audiovisual production in respect of which the Commissioner has established that the content of the audiovisual production is cultural against a predetermined list of cultural criteria; "difficult audiovisual works" means an audiovisual production as established by the Commissioner in accordance with the Guidelines; "eligible expenditure" means the items of expenditure incurred by the qualifying company in relation to the qualifying production that are eligible as established by the Commissioner in accordance with the Guidelines; *Repealed by Legal Notice 17 of

1. Cap.
2. 1 2 FINANCIAL INCENTIVES FOR THE AUDIOVISUAL INDUSTRY [ S.L. 478.03 "EU Member State" means a member state of the European Union as defined in the European Union Act; "final approval" means the approval granted in terms of regulation 9; "the financial incentive" means the financial benefit provided for in regulation 5; "Guidelines" means the guidelines that may be issued by the Commission from time to time; "the Minister" means the Minister responsible for the film industry; "principal photography" means the filming of major or significant components of an audiovisual production which involves lead actors or the commencement of animation or VFX work partially or wholly completed in Malta; "qualifying company" means a qualifying company that satisfies the conditions established in regulation 4; "qualifying production" means a qualifying production that satisfies the conditions established in regulation 3; "Regulation" means Commission Regulation (EU) No 651/2014 of 17 June 2014 declaring certain categories of aid compatible with the internal market in application of Articles 107 and 108 of the Treaty, as amended by Commission Regulation (EU) 2017/1084 of 14 June 2017 amending Regulation (EU) No 651/2014 as regards aid for port and airport infrastructure, notification thresholds for aid for culture and heritage conservation and for aid for sport and multi-functional recreational infrastructures, and regional operating aid schemes for outermost regions and amending Regulation (EU) No 702/ 2014 as regards the calculation of eligible costs, and by Commission Regulation (EU) 2020/972 of 2 July 2020 amending Regulation (EU) No 1407/2013 as regards its prolongation and amending Regulation, and as may be subsequently amended; Cap.
3. "State Aid Monitoring Board" means the State Aid Monitoring Board constituted under article 57 of the Business Promotion Act; "undertaking" means an entity carrying out an economy activity; "VFX" means visual effects.

(2)Words and expressions used in the Act, shall in these FINANCIAL INCENTIVES FOR THE AUDIOVISUAL INDUSTRY [ S.L. 478.03 regulations have the same meanings assigned to them in the Act. 3. An audiovisual production shall be considered a "qualifying production" for the purpose of these regulations if the audiovisual work meets the conditions established in article 25 of the Act, the Schedule to the Act and the Guidelines, which the Commissioner may publish from time to time. Qualifying production. 4.

(1)The qualifying company shall be the entity responsible for all activities involved in making a qualifying production and having access to full financial information for the total production worldwide, which can be made available to the Commissioner upon the latter’s request: Qualifying company. Provided that there shall be only one qualifying company with respect to a given qualifying production.

(2)Provided that if the qualifying company is a: (

1. a)Foreign Qualifying Company, the qualifying company shall be either a special purpose corporate vehicle or a company which carries on, or intends to carry on in Malta, a trade or business which is considered as a qualifying production; (
2. b)Local Qualifying Company, the qualifying company shall have an audiovisual production as its main purpose and activity and it shall be duly registered as an audiovisual production company in Malta, having at least one

(1)director or one

(1)major shareholder of the company who is a Maltese, or European Union citizen; (c) an audiovisual studio or facility, it’s main purpose and activity shall be animation and, or VFX and shall be duly registered as an audiovisual studio, or facility in Malta, having at least one

(1)director or one

(1)major shareholder of the company who is a Maltese or European Union citizen.

(3)When the qualifying production is a co-production, the co-producers shall appoint one

(1)of the co-producers amongst them to act as the qualifying company in respect of the qualifying production for the purpose of these regulations and the appointed coproducer shall be deemed to be the entity responsible for all activities involved in making the qualifying production: Provided that the co-producers shall be jointly and severally liable for their obligations under the Act and these regulations. 3 4 [ S.L. 478.03 Financial incentives. Cap. 123. FINANCIAL INCENTIVES FOR THE AUDIOVISUAL INDUSTRY 5.

(1)A rebate of up to forty percent (40%) of eligible expenditure may be given as a cash grant, which shall be exempt for the purpose of the Income Tax Act, to qualifying companies, upon completion of a qualifying production, in accordance with these regulations and the Guidelines: Provided that identifiable eligible costs claimed under any other publicly funded scheme (in Malta), cannot be claimed under this scheme: Provided further that the total State aid from which a qualifying production may benefit under this regulation or any other source shall not exceed the ceiling provided for in the regulation.

(2)The level of financial incentive shall be determined by the Commission in accordance with article 26 of the Act, the provisions of these regulations and the Guidelines. Cap. 123.

(3)Notwithstanding the provisions of sub-regulation

(1), rebates for difficult audiovisual works may amount to a cash grant of fifty percent (50%) of eligible expenditure, and shall be exempt for the purpose of the Income Tax Act, to qualifying companies, upon completion of a qualifying production, in accordance with these regulations and the Guidelines.

(4)The maximum aid incentives outlined in sub-regulations

(1)and

(3)shall also apply for co-productions. Application procedure 6.

(1)The application for the financial incentive shall be submitted to the Commissioner by the qualifying company or its local branch or agent in accordance with the Guidelines.

(2)The application mentioned in sub-regulation

(1)shall be submitted together with such documentation and information as may be required by the Commissioner, and shall include any documents and information listed in the Guidelines.

(3)The application shall be submitted at least thirty

(30)working days before the planned commencement of the production's principal photography or commencement of animation or VFX’s in Malta: Provided that if the application is submitted less than thirty

(30)working days before the commencement in Malta, it may only be accepted at the discretion of the Commissioner. Certificate of provisional approval. 7.

(1)Following the receipt of the application made in accordance with regulation 6, the Commissioner shall complete an assessment of this application within twenty

(20)working days after which a certificate of provisional approval shall be issued: FINANCIAL INCENTIVES FOR THE AUDIOVISUAL INDUSTRY [ S.L. 478.03 5 Provided that when the Commissioner requests additional information required in respect of the application, the twenty

(20)working days shall resume after the required information has been received.

(2)In case of any changes to the application submitted for provisional approval, the Commissioner shall be informed prior to the final approval. 8.

(1)If the final overall budget and overall qualifying expenditure exceeds the estimated overall budget and estimated qualifying expenditure as indicated in the provisional certificate, by more than ten percent (10%), the Commissioner shall be informed in writing. Significant changes in the budget.

(2)If the Commissioner finds that the final overall budget and overall qualifying expenditure exceed the estimated overall budget and estimated eligible qualifying expenditure as indicated in the provisional certificate, the Commission reserves the right to award the final incentive on not more than ten percent (10%) over and above the overall qualifying expenditure, as outlined in the provisional certificate.

(3)For the purpose of this regulation, if further allowances are made, the financial incentives will be granted at the discretion of the Commissioner. 9.

(1)Upon completion of the qualifying production in respect of which a certificate of provisional approval was issued in accordance with regulation 7, the qualifying company shall submit its final documents detailing expenses pertaining to the qualifying production where a benefit is being sought as outlined in the Guidelines. A full audit of expenses will be carried out by an auditor. Final approval.

(2)The submission of documents mentioned in subregulation

(1)shall be submitted together with such documentation and information as may be required by the Commissioner, and shall include the documents and information listed in the Guidelines.

(3)Following receipt of the final submission made in accordance with sub-regulations

(1)and

(2), the Commissioner shall issue a final certificate. 10.

(1)The qualifying company including its local branch or agent, shall ensure compliance with conditions and requirements set out in the certificate of provisional approval and, or the final certificate and in the Guidelines.

(2)If the qualifying company or its local branch or agent, fails to meet any conditions and requirements as referred to in subregulation

(1), the Commissioner may withdraw its provisional or final Obligations of the qualifying company. 6 [ S.L. 478.03 FINANCIAL INCENTIVES FOR THE AUDIOVISUAL INDUSTRY approval for the grant of the financial incentive. If the qualifying company or its local branch or agent, has already received the financial incentive and the Commissioner establishes that the conditions and requirements as referred to in sub-regulation

(1)have not been complied with, it shall refund the Commissioner the amount of the financial incentive received upon the Commissioner's request. Examination of records. 11. Where the financial incentive has been provided in terms of these regulations to an undertaking, the Commissioner may: (

1. a)from time to time make or cause to be made such examination of books, accounts, documents, premises and all other things and matters of that undertaking, its local branch or agency, as the case may be, as may be necessary to ensure that the provisions of these regulations and of the Guidelines, and provisional approval, and on which a certificate was issued and are complied with; and (
2. b)request such financial statement from the undertaking, its local branch or agency, as the case may be and as may be required. Database of assistance provided. 12. The Commissioner shall keep, for a minimum of ten

(10)years, a database of all the financial incentives provided to, or claimed by, undertakings in terms of these regulations in order to enable the Commission to: (

1. a)verify whether the provisions of the Act and of these regulations have been complied with; and (
2. b)provide the State Aid Monitoring Board with such information as it may require. Application of these regulations. Amended by: L.N. 48 of 2021. 13. These regulations shall apply to audiovisual productions in respect of which the aid was granted by 31st December 2023.