Malta’s fantastic and logistical geographical location, unique scenery with historical backdrops and a guaranteed supply of extras, render it a perfect location for a multitude of film productions. The proactive attitude of the local authorities to make available the local scenario for the film industry together with a serious investment in the existing film facilities, have attracted film producers of international repute to Malta. Recently, blockbusters with Oscar nominations and award winning films such as the Da Vinci Code, Gladiator, Alexander and Munich have been shot in Malta for the reasons outlined above. Malta is also becoming a favourite location for the filming of commercials for high end and luxury products.
Film producers have been attracted to Malta because of the plethora of incentives provided by the local authorities for the film industry, including favourable tax incentives, as outlined hereunder.
A first incentive takes the form of a cash grant given to eligible productions on the qualifying expenditure incurred in Malta. Up to 25% of the eligible expenditure can be obtained as a cash rebate by a qualifying production company once filming is complete. Feature film and television productions, mini-series, animation and documentaries are all eligible for the incentives, provided that they are at least partially produced in Malta. A qualifying production ought to present an application to the Malta Film Commission, including a detailed projection of the Malta budget for the production and completion of the Cultural Test. Upon the assessment based on specific guidelines and performance in the Cultural Test, the Commission would grant a provisional approval no later than 3 weeks after receipt of the application.
The final approval would be granted upon review of a final application, including audited accounts and a detailed analysis of the production expenditure in Malta, after shooting is completed. The cash rebate is forwarded to a qualifying production no later than 5 months from the date of receipt of the final application.
Expenditure incurred during production in Malta on EU services is eligible for a cash rebate, including the following items:
EU below-the-line labour, accommodation, transportation equipment and hire, location fees, catering services, per diems, leasing of offices, computer equipment, props, property, animals, equipment, vehicles, and boats. Other qualifying expenditure includes wardrobe rentals, courtesy payments, telecommunications, craft service, laundry and cleaning services and professional services.
Presentation of expenditure should be net of VAT. This is charged at 18% and is fully refundable on all goods and services.
Investment aid for audio-visual facilities is also available under the pertinent Malta legislation. The aid is offered in the form of tax credits to a qualifying company in respect of an initial investment project and in relation to qualifying expenditure.
VAT stands at 18% and is fully refundable to productions on all goods and services.
Investment aid for audiovisual facilities and qualifying companies is offered by Malta Enterprise Corporation. Investment Aid for Facilities for filming and audiovisual productions shall include:
- the production of audio visual productions consisting of feature films, television films, advertisements and documentaries, as may be approved by Malta Enterprise;
- the provision of film studio and film sets, editing facilities and filming equipment required in the production of feature films, television films, advertisements and documentaries, as may be approved by Malta Enterprise.
Furthermore, companies engaged in the above mentioned activities are required to have their project preapproved by the Malta Film Commission to ensure that the applicant satisfies the minimum standard in the sector.
Malta is a member of the European Convention on Cinematographic Co-production, which convention aims to promote the development of European multilateral cinematographic co-productions, to safeguard the creation and freedom of expression, while defending the cultural diversity of the various European countries. In order to obtain co-production status, the work must involve at least three co-producers, established in three different parties to the Convention. The participation of one or more co-producers who are not established in such parties is possible, provided that their total contribution does not exceed 30% of the total cost of the production. The co-produced work ought to meet the definition of a European cinematographic work.
Given these conditions are fulfilled, the Convention assimilates all co-productions, which have been given the prior approval of the competent authorities of the parties, with national films. Consequently, they are entitled to the benefits granted to the latter.
The Convention also tackles a number of issues including the minimum and maximum proportions of contributions from each co-producer; the right of each co-producer to co-ownership of the original, the picture and the sound; the general balance of investments and compulsory artistic and technical participation; the measures to be taken by the parties to facilitate the production and export of the cinematographic work and the right of each party to demand a final version of the cinematographic work in one of the languages of that party.
On 23 September 1997 representatives of the Government of Canada and the Republic of Malta signed an agreement on audiovisual co-productions. The agreement applies to all films produced by independent producers for exploitation in cinemas, on television, videocassette or by any other form of distribution, whether now known or to become known and irrespective of the film genre (feature film, animation or documentary), the length and the format.
Under Article 3(1) of the agreement, the proportion of the co-producers’ respective contributions to a co-produced film may vary between 20 % and 80 % of the final costs of the film. The technical and creative contributions should be in proportion to the investment. The producers, scriptwriters and film directors, as well as the technicians and other participating production personnel must be Canadian or Maltese citizens or persons permanently residing in either of the Contracting States. Any departure from this principle is subject to the joint approval of the competent authorities of both countries, namely the Minister of Canadian Heritage and the Maltese Minister of Education and National Culture.
Article 7 of the agreement stipulates that the original soundtrack of the film must be produced in English, French or Maltese. Dubbing or subtitling must be carried out either in Malta or Canada. Here, too, any exceptions are subject to the approval of the competent authorities of both countries.
What we Offer
WDM International can assist in providing tailor made advice on the existing incentives for the film industry on the local scenario, together with the necessary application/s for the attainment of such inventives. We can also provide consultancy services in relation to the following matters:
- pertinent contracts and required permits;
- attainment of the required licenses, custom clearance and ATA Carnet for importation of film production equipment, as well as any required clearance from the Maltese Health Authorities;
- employment matters in relation to the employment of extras including minors, social security contributions for local and foreign employees, visas and work permits;
- tax incentives applications including application for tax refunds where applicable;
- back office services before and during the production stages, including on site accountants where required.