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Brexit: changes for the production industry

25 November 2020

The conversation in the film and TV production industry has been largely dominated by COVID-19 for (what feels like) an eternity. However, as we march towards 2021, Brexit looms closer and we all need to be prepared for what that means.

The UK has now officially left the EU and the transition period ends on 31 December 2020.

This note sets out some key areas relevant to film and TV producers which will be changing and other areas which, at least for now, are staying the same on a practical level and maintaining the current EU approach.

Employees: Changes

In a post-Brexit world, EEA and non-EEA citizens will be treated the same, so if your production or business needs to engage people who are based in the EEA, you will need to ensure they have the right to work in the UK. A new ‘points based’ immigration system will replace the current rules for workers from outside the UK. The new system will not apply to EEA citizens already employed in the UK.

Assisting people to continue living in the UK
If your business employs individuals from the EEA who currently live in the UK (but who do not already have indefinite leave to remain), an application can be made by those individuals for them and their families to continue living in the UK after 31 December 2020. The application should be made through the EU Settlement Scheme, which is now live and open – see here. The deadline to apply is 30 June 2021 (giving a grace period of six months after the end of this year) and applicants must have started living in the UK by 31 December 2020 to qualify.

Sponsorship Route for Workers
From 1 January 2021, if you want to recruit anyone from the EU for your production, the sponsorship route which currently applies for non-EU cast and crew will also apply to cast and crew from the EU.

As per the current rules for non-EU workers, if you want to engage skilled workers from the EU for your production, you can sponsor skilled workers on either a long-term basis (under the Tier 2 sponsorship route) provided such individuals meet a set of criteria to earn themselves sufficient points to qualify, or, for skilled workers in the creative industries, on a temporary basis (under the Tier 5 sponsorship route, which remains unchanged), which allows individuals to work as entertainers or artists or for certain other production work for up to two years. The Government has produced a guide to employers on becoming a licensed sponsor of skilled workers, which you can access here. It is also worth noting that employers can use the option of using a specifically licensed company (such as CoSmopolitan PS) who can act as an ‘overarching sponsor’, alleviating the need for a production to acquire its own licence; this may be particularly beneficial for production companies which set up SPVs for their productions and not wish to apply for a new licence for each production.

The Government is also hoping to secure a reciprocal arrangement to allow UK citizens to undertake some work activities in the EU on a short-term basis without a work permit. Currently, EU citizens will be entitled to continue to travel to the UK as non-visa nationals for the purpose of tourism for up to six months. The EU will also continue to apply its existing rules for UK nationals travelling to certain EU countries without a visa for short visits, and this covers certain business trips, not just tourism. There is a possibility that the number of business activities covered by this route might be broadened by agreement between the EU and the UK, which might lead to the UK agreeing to treat EU citizens coming here for certain business purposes as ‘non-visa nationals’ without a visa for up to three months (and vice versa). Each EU member state has designated individual categories of activities it permits people to visit for visa free, so the advice is to check the website of the relevant country to see their approach to your proposed business travel plans. The UK also allows non-UK productions to bring individuals to the UK to shoot on location without a visa for limited periods of time.

Providing production services in the EU: Changes

If you are a UK production company providing production services to EU countries, then after 31 December 2020, you will need to check the national regulations of the country you’re doing business in to understand how to operate. This will vary on a case-by-case basis, depending on the rules that individual EU country applies to the UK. Guidance can be found here.

Shooting in the EU: Changes

Producers planning to film in the EU from 1 January 2021 should take into account the guidance on ATA Carnets for temporarily exporting goods (such as filming equipment). The regime currently applies to goods temporarily transported outside of the EU for business purposes, but after 31 December 2020, it will also cover such transportations from the UK to the EU. An ATA Carnet allows businesses to take various equipment, such as film recording and audio equipment, to the EU, on a duty free basis. More information can be found here.

There are certain administrative changes which producers will need to think about when sending people from the UK to shoot or otherwise work on productions in the EU, to ensure operations run smoothly. For example, European Health Insurance Cards will only be valid up to 31 December 2020, so any individuals working in the EU will need to have appropriate healthcare and travel cover. Individuals required to drive in Europe may also need extra documentation, including an international driving permit for some countries, and if you will be taking your own vehicles, you will also need a ‘green card’ and a GB sticker. More information can be found here.

If you provide your talent or crew working on location with free mobile phone services, be aware that, from 1 January 2021, the guarantee of free mobile phone roaming throughout the EU will end. Different mobile operators will apply different rules though many have said they have no current plans to change their mobile roaming policies, but this is not guaranteed and may change over time. The Government has committed to protect users from unexpected increases.

There are also new rules coming in about passports – until 1 January 2021, individuals can continue to travel to the EU with UK passports without any additional considerations. After that, UK individuals must have six months left on their passport in order to travel to most EU countries.

Funding – Creative Europe Funding and Eurimages: Changes

The UK’s Withdrawal Agreement confirms that any UK projects which have secured funding from the existing EU Creative Europe programme will continue to be funded after 31 December 2020. However, because the UK will not be participating in the next Creative Europe MEDIA programme, future funding for new UK projects will not be available (though some awards made available to EU sales agents and distributors will continue to be available to UK films). Certain EU-based industry initiatives and training courses falling under the new programme will also be accessible from the UK in the medium term.

Continued access to Eurimages, the cultural support fund of the Council of Europe, is also being considered by the UK. The Eurimages scheme is currently under reform and the BFI’s current view is to wait until the new programme has been implemented before concluding whether the UK should pursue future membership.

Tax Incentives (Probable Changes) and Co-Productions (No Changes)

After the 31 December 2021, the UK’s right to access EU incentives will operate on a case-by-case basis depending on the rules put in place by the relevant member state. The British Film Commission is currently working on a document to set out the level of incentives in various EU countries which will be available to UK producers and aims to publish this in the coming weeks. The worst case scenario will be that the UK will be treated as any other non-EU country, so producers can model these scenarios by considering, for example, how a U.S. production would qualify in Spain or Croatia. The BFC is hopeful that some member states will offer incentives to the UK which are preferential to other non-EU countries (or even to match the current levels enjoyed by the EU).

The UK’s own Creative Sector Tax Reliefs for film, high-end television, animation and children’s television will continue to be available to EU productions provided they pass the UK’s cultural test (and the UK’s cultural tests will continue to recognise EU content and personnel).

Co-productions, including official co-productions under either the European Convention on Cinematographic Co-Production (ECCC) or a relevant bilateral co-production treaty will continue to remain in force. This is because the UK will continue to be a party to the ECCC, which is governed by the Council of Europe rather than the EU, and the bi-lateral treaties are enshrined under UK legislation, so they exist outside of the UK’s EU membership.

Copyright Law: Limited practical changes for now (but some differences may emerge)

A substantial part of UK copyright law is derived from the EU copyright framework. Because of this, there are references in the UK law to the EU and there are also existing EU cross-border copyright arrangements where EU counties provide reciprocal protections and benefits between member states for the approach to copyright. References to the EU are being removed from UK legislation to ensure the UK law continues to have legal effect after Brexit.

Some reciprocal arrangements with EU member states will be amended or ended on 31 December 2020, with new regulations coming into force on 1 January 2021. However, most UK copyright works (such as books, films and music) will still be protected in the EU and the UK because of the UK’s participation in the international treaties on copyright and, vice versa, most EU copyright works created before 1 January 2021 will continue to be protected in the UK. In addition, the regimes which apply for the qualification for copyright and the duration of copyright protection will not change from 1 January 2021; currently, EEA works are given the same copyright duration in the UK as UK works (and for works from outside the EEA, copyright lasts for the term granted in the country-of-origin or the term granted to UK works, whichever is less).

However, there are some areas where differences are likely to emerge. After Brexit, the UK courts will no longer have to follow the CJEU (the EU’s highest court), so there may be some differences in approach as cases on intellectual property start being heard. Also, the UK has said that it does not intend to implement the EU Copyright Directive, which contains various perceived controversial provisions benefiting rightsholders, meaning that UK copyright law may start to diverge from the EU’s in this regard. Finally, EU law provides for cross-border portability of digital content (more on this below), meaning that digital content available in one member state must be available in all. This portability will no longer apply to the UK after Brexit, which will probably mean that UK rightsholders will have to implement new licensing arrangements for their works to be made available in the EU.

Personal Data: Some changes (and watch this space)

Personal data is any information that can be used to identify a living person, including names and HR data, such as payroll. From January 2021, producers who receive personal data of individuals based in the EU may need to put in place new mechanisms to ensure that they are allowed to legally receive data from the EU. Currently, the position is that all countries in the EU are assumed to meet certain adequacy standards for their approach to handling personal data, meaning that personal data can be freely transferred around the EU. An assessment is currently being made by the EU as to whether the UK will continue to meet the adequacy standards – the UK Government is hopeful that free flow of data will continue between the EU and the UK but, if the EU doesn’t grant the adequacy status to the UK, organisations will be required to put in place transfer mechanisms to ensure that data can continue to legally flow.

In terms of legislation, although the GDPR originated as EU law, the Government has confirmed that it will be retained in UK law after 31 December 2020 and will continue to operate alongside the Data Protection Act 2018, with some technical amendments to ensure it can function in the UK.

Broadcasting and Video on Demand: Changes

Whilst unlikely to be directly relevant to the day-to-day work of most UK producers, changes to the broadcasting landscape will have a considerable impact on the TV industry as a whole.

The Department for Digital, Culture, Media and Sport recently provided guidance on how the rules might change for broadcasters and video-on-demand platforms after 31 December 2020. This clarified that the Audio-visual Media Services Directive (AVMSD), which contain the current rules, will no longer apply to transmission services under UK jurisdiction broadcast into the EU. The AVMSD contains the ‘country of origin’ principle, which means that providers of broadcasting channels and video on-demand services based in one country are only subject to one set of rules and regulations from a ‘country of origin’. However, the European Convention on Transfrontier Television (ECTT) framework will still continue to apply. In broad terms, this means that the 20 EU countries which have signed up to the ECTT must allow UK transmission and broadcast services to be received in their countries (and cannot restrict the retransmission of compliant programmes in their territories) and, vice versa. This is known as ‘freedom of reception.’ However, the ECTT has a more limited scope than the AVMSD, since it relies on countries signing up to it and it only applies to linear services and not to on-demand or OTT live streaming.

This means that on-demand services will not be able to benefit from freedom of reception meaning that, for UK-based on-demand services provided in the EU, additional authorisations may be required in order for those services to be available to EU audiences, in compliance with local law.

The Government is also looking at introducing rules to clarify when video-sharing platform services will fall under UK jurisdiction.

The full details of how Brexit will impact broadcast and streaming is complex and will depend on the nature of the services and the locations they are provided, so relevant businesses will need to carefully navigate the new landscape to make sure they don’t get caught out.

What can you do?

The key message is: be prepared. The Government has provided a helpful tool on its website to help UK businesses gear up for the post-Brexit changes and identify those which might impact them, which you can read in more detail here.

Ask us any questions: we are specialists in film, television and theatre production. We also have dedicated employment, immigration and broadcast lawyers who can help guide you through the process.

Note: the use of the term ‘EU’ in this article might mean EEA or EU, depending on the context. Please check the relevant guidance for the specific terminology or ask us for more information.

 

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