The Latin American film business has been growing for decades. Local and international distribution of Latin American films are on the rise.
Several countries have become attractive production and filming hubs for foreign producers and filmmakers because of their film and television infrastructures, talented cast and crew, and local incentives for productions and filming.
How does the Latin American film market function, in terms of independent film production, financing, distribution, and revenue models? And which incentives – both tax-related and non-tax related – are there available? Which are the benefits and the challenges foreign producers and filmmakers may face in Latin America?
In this article, I will give a global description of the Latin American film market as a whole, without discussing any Latin American country in particular. That means that inevitably, I will have to generalize. However, please be aware that each country, and within each country, sometimes certain regions and cities, have their own, specific characteristics that will determine, for each country individually, potential benefits and challenges for foreign producers and filmmakers. I hope to write in future posts in more detail about the most emblematic Latin American countries and their attractive local film hubs and specific characteristics.
Let’s start by looking at how independent Latin American films are financed. Generally, films in Latin America obtain financing in the following ways, often being a combination of two or more:
Once financing is in place and the film is produced, the focus will be on the distribution of the film. Independent Latin American films usually look for the following means of distribution:
For domestic exploitation:
For foreign exploitation:
The purpose of distributing the film is to generate revenues and with those revenues, repay loans and investments, pay deferred producer and other fees, and if the film breaks even, to distribute profits amongst the profit participants. Independently produced Latin American films generate their income through a combination of revenue streams, depending on the distribution and exploitation channels available.
Revenues streams may be the following, often in this order of priority:
Now that we have a global overview of how independent Latin American films are financed and distributed, and how productions earn their revenues, let’s focus on the production incentives available in Latin America.
Production incentives are generally government-driven and are often applicable for a limited period of time.
The reason for countries to introduce production incentives can be multiple, amongst others: stimulation of the local economy, creation of jobs, cultural or touristic promotion, and support of the local film community.
Which type of incentives are there? I tend to define the following:
In the following paragraphs, we will focus on two groups of production incentives in particular: tax incentives and co-production treaties.
Tax incentives can consist of one specific tax-related incentive, or a combination of two or more tax-related stimulations. Roughly, tax incentives fit into the following two categories:
Each country in Latin America has its own tax incentives and for each country, the rules to qualify may differ.
A film co-production is a joint venture between two or more different production companies for the purpose of film production. In the case of an international co-production, production companies from different countries (typically two to three) are working together.
The benefits of a co-production may include:
Several Latin American countries have co-production treaties with each other or countries outside the region. An official treaty co-production is a partnership between two production partners that adhere to national or regional government-funded co-production requirements in order to receive the benefits of national status in the countries of both producing partners.
Also, there are co-production initiatives and treaties on an inter-governmental level. A good example is the Ibermedia program, which is a co-production initiative between most of the Latin American countries, Spain, Portugal, and since relatively recently, Italy.
We now know how independent Latin American films are financed, distributed and exploited, and also which incentives exist for production and filming.
Now, which are the benefits and the challenges for foreign producer and filmmakers?
Let’s start with the benefits:
The benefits to produce in Latin America are clearly there, but I should also mention some potential challenges for foreign producers and filmmakers:
In this article, we discussed film financing, distribution and revenue models of independent films in Latin America, as well as production incentives in Latin America available to foreign producers and filmmakers.
There are several benefits for foreign producers and filmmakers for producing or shooting an independent film in Latin America, including unique locations, production incentives, financing sources, cost reduction, presence of unique talent, and unique stories.
Also, foreign film productions may face several challenges in Latin America, which include language, cultural matters, infrastructure, safety issues, availability or effectiveness of incentive programs and climate-related issues.
Should you like to know more about film production in Latin America, feel free to reach out!
I have been working in film and TV since 2007. Through my consultancy firms XamanHaC and Zannoni Media Advisors, I have been involved as consultant and representative for amongst others Fintage House and Visualnet. For Fintage I negotiate agreements for films and television series, and am involved in business development and relationship management specifically in the US, Latin America and Spain. For Visualnet I expand their business globally and specifically in the US, and work on business development and client prospection.
My focus is business & legal affairs, business development and prospection, and production, distribution and financing in and from Latin America. I have given presentations, workshops and seminars at universities across the globe and at events such as the yearly conference of the National Association of Latino Independent Producers in the US (NALIP), the Winston Baker Film Finance Conferences, the Rio Film Market, the Bogota Audiovisual Market (BAM), and at the Rio Film Market and LATC Program in Los Angeles. Born in the Netherlands and a Dutch-Italian citizen, I am fluent in English, Spanish, Dutch and Italian, and basic in German.
More Stage 32 blogs by David Zannoni:
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