The Government has announced the ‘Film & TV Production Restart Scheme,’ a £500m fund to cover Coronavirus-related losses suffered by film and TV productions. The fund will compensate producers that have restarted shooting and subsequently suffer delays or disruptions – or are even forced to abandon production – due to COVID-19.
With pandemic-related restrictions increasingly easing in the UK, film and TV production may now strictly speaking be in a position to resume but a significant obstacle until now has been the inability to secure insurance for COVID-19 related losses. This lack of financial certainty has prevented many productions from starting up again and has prevented the industry from properly getting back on its feet.
The fund is therefore a welcome lifeline not only for producers but for the many thousands of people across the country who work in the industry. It serves as a valuable vote of confidence in the UK film and TV industry at a critical time, and is a welcome follow-up to the Government’s recent introduction of an exemption to quarantine rules for film and high-end TV productions.
The fund will be available to productions where at least half of the budget is spent in the UK. Subject to EU state aid approval, the intention is that eligible productions will receive compensation for costs caused by Coronavirus delays up to a value of 20% of the production budget. Abandonment of productions due to Coronavirus will be covered up to 70% of the production budget. There will be a total cap on claims per production of £5m.
Further details on the mechanics of claiming under the scheme will be released soon, but the Government has said productions will need to pay an excess when seeking to claim under the scheme, as well as a fee when joining the scheme. They will also need to purchase insurance to cover non-Coronavirus risks to ensure their production is adequately insured.
The Government has made it clear this is a temporary measure only, supporting productions which commence filming before the end of the year. It will cover losses through to the end of June 2021. It will be possible to back date any future claims for eligible losses to today’s date.
While the fund is extremely welcome, producers should still ensure they are minimising Coronavirus-related losses in the first place, and insulate themselves as much as possible against the financial risks of a widespread lockdown being imposed again, key cast or crew falling ill or being required to self-isolate during shooting, or key locations becoming unavailable. The Safe Filming Guidelines should be closely followed, and social distancing strictly enforced as much as possible. Ideally producers would also minimise costs paid up front to third parties.
From a legal perspective there are a number of ways to minimise this risk. Contracts with all third parties should be carefully considered from a Coronavirus perspective before they are entered into, with particular attention paid to the force majeure provisions. All agreements should now contain a force majeure provision, and many producers are specifically referencing COVID-19 as an event of force majeure.
Contracts with individuals, locations and even agreements for hiring equipment should ensure that producers are entitled to either suspend the production entirely, selectively suspend certain individuals, or suspend the hire of specific locations and expensive equipment, if an outbreak occurs during production.
It was once fairly common to agree that an individual would be suspended for an event of force majeure only if other individuals were also suspended. This should ideally no longer be agreed, as it is possible that parts of filming can continue without a particular individual who has been suspended while they are ill or self-isolating.
Producers should also be wary of agreeing that a particular individual will not be suspended more than once for the same event of force majeure, since there may be multiple outbreaks of COVID-19 during any particular shoot.
As much as producers may be able to mitigate the financial risks due to COVID-19, it is nevertheless extremely helpful to have the Government’s insurance fund available, and hopefully this will serve as a tool to kick-start productions in a post-pandemic world.