LAW & REGULATION ON THE ICELANDIC FILM FUND

The Icelandic Film Centre operates according to a law (link in Icelandic only) dating from 2003. When dealing with funding applications for film or television projects, the Centre follows the Regulation on the Icelandic Film Fund.

No. 229/2003 CHAPTER I
GENERAL PROVISIONS

Article 1
Role
The Icelandic Film Fund shall operate under the auspices of the Icelandic Film Centre. The role of the Icelandic Film Fund is to promote Icelandic filmmaking by providing financial support. An Icelandic film is a film which is produced and sponsored by Icelandic parties or is a co-production of Icelandic and foreign parties. A project supported by the Icelandic Film Fund must have connections with Icelandic culture unless special cultural grounds exist for deciding otherwise.

Article 2
Allocation
The grants made by the Icelandic Film Fund shall be divided between the various branches of filmmaking as follows:
a. full-length feature films;
b. short films;
c. documentaries;
d. television fiction.

Information on grants from the Icelandic Film Fund and application documentation shall be published on the website of the Icelandic Film Centre. The Icelandic Film Centre shall send confirmation of the receipt of an application and information on application processing to applicants. The Icelandic Film Centre shall publish the allocation of all its grants as soon as possible on its website.

The director of the Icelandic Film Centre shall be responsible for ensuring that all the requirements for an allocation are satisfied. The director shall make the final decision on awarding grants from the Film Fund, after having received the written, artistic evaluation of film consultants, cf. Article 3.

Applications for grants from the Icelandic Film Fund may be treated in the following manner:
a. the application is denied a grant;
b. the application is given priority for a grant;
c. the application is given a grant or promised a grant.
No grants may be allocated to a film after principal photography has commenced, cf. however post-production grants pursuant to Article 9.

Article 3
Film consultants
Artistic evaluation of grant applications received by the Icelandic Film Centre shall be entrusted to film consultants, hired on a temporary basis by the director of the Film Centre. Film consultants must have knowledge of and experience in the film industry and may not have interests at stake concerning allocations or fulfil positions outside the Icelandic Film Centre connected with Icelandic filmmaking.
Film consultants shall make an artistic evaluation of an application and take account of financial and performance aspects, except in instances involving full-length feature films, cf. Point 3 of the first paragraph of Article 8, or involving applications for promotion grants.
The film consultants shall follow the progress of a film project, making sure it is in accordance with the provisions of the allocation agreement, cf. Article 4. Film consultants may request further documentation and hold meetings with applicants/grant recipients as necessary.

Article 4
Allocation agreements
Before making grant disbursements, the Icelandic Film Centre and a grant recipient must conclude a written allocation agreement on the arrangements for making payment of the grant awarded and on requirements for awarding the grant and for a letter of intent. The agreement shall, for instance, provide for the financing, financing procedure, progress of the project, requirements for payment of grants, delivery of promotional material and authorisation of the Icelandic Film Centre to use the work supported.

CHAPTER II
TYPES OF GRANTS, APPLICATION DOCUMENTS AND BUDGETS

Article 5
General
Grants from the Icelandic Film Fund can be made to support the writing of manuscripts, film development, production, including letters of intent concerning production grants, post-production, and promotion. The grants shall apply to full-length feature films, documentaries and short films, and television fiction, unless expressly stated otherwise in this Regulation. 

Article 6
Script grants
Script grants may be awarded to a manuscript writer, director working on his/her own manuscript, producer or a team of the above. In the case of a team, the author shall receive 80% of the grant amount and the producer 20%. A script grant may also be used for purchasing copyright to a work, upon which a script is to be based; such grants shall always be paid to a producer. A script grant for a documentary can be used to cover field and background research. The award of a script grant does not imply that further support will be granted.

Article 7
Development grant
A development grant may be awarded for the script development and further financing of a film project if further development is expected to substantially improve the artistic, financial or technical aspects of a project, or reinforce its position in other respects. A development grant may only be granted to production companies with experienced key personnel in the field of filmmaking. The award of a development grant is not a promise of further support.

Article 8
Production grants
Production grants are divided into the following categories:
1. A letter of intent for a production grant may be given provisionally once a complete manuscript is available, together with a cost budget and financing plan. Such a letter of intent shall become a production grant once written agreements or confirmations that financing has been fully obtained, from parties other than the Icelandic Film Fund, are available. If financing from parties other than the Icelandic Film Fund has not been ensured prior to the expiration of the deadline, and the time limit is not extended, the letter of intent is automatically cancelled.
2. A production grant may be awarded once a complete manuscript is available, together with a cost budget and financing plan. It is a requirement for a production grant that written agreements or confirmations that financing has been fully obtained, from parties other than the Icelandic Film Fund, be available.
3. The director of the Icelandic Film Centre may award a production grant for a full-length feature film without recommendation from film consultants, if either the film director or producer has completed at least one full-length feature film and financing has been fully obtained, apart from the amount to be contributed by the Film Fund. It is a requirement for a production grant that written agreements or confirmations that financing has been fully obtained, from parties other than the Icelandic Film Fund, be available. Production grants awarded pursuant to this provision may not amount to more than 40% of the entire production cost, or a maximum of ISK 40 million. Furthermore, the total production cost of the dramatic film must be a minimum of ISK 50 million. Production grants as provided for under this Point shall as a rule take priority over other Film Fund grants.

Letters of intent and production grants are only awarded to independent producers who have experience and/or extensive knowledge of filmmaking. An independent producer is a company which has filmmaking as its principal activity.

The requirement for allocations to television fiction programmes is that the material be intended for television broadcasting and that broadcasting right has been ensured with a television station which has substantial distribution. The television station may not have a dominant holding in the production, nor may the television station have a dominant holding in an independent production company which applies for a grant for a television fiction, either as far as its ownership, shareholding or business position is concerned. It is regarded as a dominant holding if one television station owns more than a 25% share in a production company (or the holding of two or more television stations is 50% or more) or if more than 90% of a production company’s turnover for a three-year period is the result of co-operation with a single television station. Broadcasting rights shall revert to the producer within seven years of the signing of an agreement in the case of a pre-sale contract and within ten years in the case of a co-production contract.

In the case of a co-production involving more than one independent producer, the co-producers must appoint one of the parties to the co-production as the chief producer and authorise it to sign an agreement with the Icelandic Film Centre on their behalf.

Article 9
Post-production grants
Grants may be awarded for the post-production of full-length feature films under special circumstances, provided they have not received a production grant from the Icelandic Film Fund and their filming and editing is complete. Post-production grants may amount to a maximum of 40% of the total cost of a film, but never more than ISK 15 million.

Article 10
Promotion grants
Grants may be awarded for film promotion and marketing. The requirement for awarding a grant is that film production is complete and a plan and budget for its promotion is available.

Article 11
Application documentation and budget
Applications for grants for scripts, development, production, including letters of intent for production grants, post-production and promotion must be made in writing on the application forms of the Icelandic Film Centre intended for the purpose. The following documentation must accompany applications as appropriate and shall be specified on the Icelandic Film Centre’s application forms:
1. The applicant’s general outline of and approach to the film project.
2. A complete script and/or synopsis.
3. Schedules for pre-production, shooting and post-production and expected release date.
4. Plan for the production and progress of work.
5. List of key personnel and cast.
6. Budget compiled on a special form from the Icelandic Film Centre.
7. Written contracts or confirmation of financing.
8. A detailed financing plan, together with exhaustive information on other support applied for and/or received for the film project.
9. Cash-flow plan.
10. Information on all co-production contracts concluded or planned.
11. Plan for income distribution.
12. Letter of intent for theatrical distribution in Iceland.
13. Letter of intent for television transmission.
14. Marketing and promotion plan.
15. Agreements with all rightholders and authors of the film.
16. Curriculum vitae of the principal proponents and key employees.
17. Information on the production company.
18. Information on all other contracts concluded concerning the production and financing of the film.

All contracts concerning financing and co-production of films, including the own investment of producers, must be approved by the Icelandic Film Centre. A co-production agreement must give a detailed breakdown of how financing is to be divided between the co-producers and what rights the Icelandic producers shall have. If the contracts should change after an allocation contract has been signed, the producer must give notification of such and obtain the approval of the Icelandic Film Centre for such changes.

All cost items in the budget shall be entered at market price. The cost budget must include administrative costs, which may not, however, exceed 7.5% of the total cost budget, less 10% for contingency allowance and less the producers’ fee. A producer’s fee shall be based on the nature and scope of the project and subject to the approval of the Icelandic Film Centre.

 

CHAPTER III
GRANT DISBURSEMENTS, SETTLEMENT, ETC

Article 12
Grant disbursements
Production grants for full-length feature films are paid as follows:
1. 5% on the signing of the allocation contract,
2. 92% on the first day of principal photography, and
3. 3% when the producer submits the final production accounts and related documents, cf. the second paragraph of Article 14.
Production grants for other film categories shall be paid in instalments as the work progresses, in accordance with the provisions of the allocation agreement.

Article 13
Final production accounts and delivery
Final production accounts must be delivered within six months from the time a work is considered complete in accordance with the allocation agreement. The Icelandic Film Centre may demand a grant recipient provide production accounts attested to by a certified accountant.

The production accounts must contain the same items as the original budget and include the budget amounts for purposes of comparison.  The production accounts must also include a special list of financing funds, including grants, investments, advance sale of screening rights, as applicable.

If substantial changes are made to a script, financing or budget from those of the application, a grant recipient should notify the Icelandic Film Centre thereof. In such cases the director [of the Film Centre] shall take the final decision as to whether repayment of a grant, in part or in full, shall be demanded or whether any grant amount still unpaid shall be reduced.

A work shall be considered complete when a grant recipient has completely satisfied his/her obligations under the allocation agreement with the Icelandic Film Centre. Should a grant recipient fail to complete a project for which a grant has been awarded within the agreed time limit, he/she must repay the grant awarded, after deducting verifiable and justifiable costs incurred due to the project, in the estimation of the director.

If a grant recipient or company to which he/she is a party has previously been allocated a grant from the Film Fund, the grant recipient must provide all final financial details of project before a new allocation can be made. If a work is in progress, a grant recipient must deliver interim production accounts and report on the status of the work before a second grant may be allocated.

A grant recipient must deliver complete and final production accounts to the Icelandic Film Centre no later than six months after release date. The Icelandic Film Centre may request accounts attested to by a certified accountant.
 
Article 14
Rights of the Icelandic Film centre, etc.
The Icelandic Film Centre may, in connection with cultural events, screen a film which has been awarded a grant for audiences both in Iceland and abroad. The Film Centre must inform the producer of any such screenings.

The producer shall provide the Icelandic Film Centre with still photographs, posters, clips, sample copies, trailers and music from a film receiving a grant for promotion in Iceland and abroad. The Film Centre may also use the above-mentioned material for its promotional publications. The Film Centre may have a copy made for its own use of a film which has received a grant.

A producer must inform the Film Centre if there are any restrictions on the use of a film which has received a grant or promotional material connected with it. The Film Centre may promote the work by means of information and press releases, unless otherwise agreed upon.
The Icelandic Film Centre logo must always be included in the beginning and final credits of a film which has received a grant. Mention should be made of the support of the Icelandic Film Centre on all marketing material for the film.

A work receiving a grant from the Icelandic Film Fund must be promoted as an Icelandic work at film festivals and on markets abroad. In co-productions, the Icelandic nationality of the produced film must be mentioned together with any others.

Article 15
Entry into force
This Regulation is issued on the basis of an authorisation in the second paragraph of Article 7 of the Filmmaking Act, No. 137/2001, and shall enter into force immediately. As of the same date Regulation No. 460/1993 on allocations from the Icelandic Film Fund, as subsequently amended, shall be repealed.

Temporary provisions
Despite the provisions of Article 15, allocations from the Icelandic Film Fund, resulting from letters of intent issued in 2002 and due to be paid out in 2003, shall be made in accordance with the provisions of Regulation No. 460/1993.

Ministry of Education, Science and Culture, 31 March 2003

Tómas Ingi Olrich
Guðmundur Árnason