Film and Television Production Restart Scheme

The Film and Television Production Restart Scheme aims to support the film and television industry to restart production in the UK, by making direct compensation available to eligible film and television producers.

It is only available to producers that incur Covid-19-related losses during the course of producing eligible productions, in respect of which they would otherwise be unable to self-insure or access insurance or indemnity in the commercial market on commercially viable terms.

The Film and Television Production Restart Scheme aims to support the film and television industry to restart production in the UK, by making direct compensation available to eligible film and television producers. It is only available to producers that incur Covid-19-related losses during the course of producing eligible productions, in respect of which they would otherwise be unable to self-insure or access insurance or indemnity in the commercial market on commercially viable terms.

Who qualifies?

The scheme is available to pre-existing eligible productions that have had to delay or cease production and have been unable to restart (other than in anticipation of qualifying for this scheme). It is also open to new eligible productions that have been unable to commence production. It is only available when the factor preventing production is the lack of availability of insurance coverage for Covid-19-related risks on commercially viable terms.

Eligible participants

It is available to any producer (or co-producer) of an eligible production that is either:

• A company or other incorporated entity that, for tax purposes, is resident solely in the UK or an EEA (European Economic Area) state; or
• A partnership, all of whose profits are subject to tax in the UK or one or more EEA states.

Only one claim can be made if it is a co-production.

Eligible productions

• At least 50% of the production budget must be UK expenditure.
• It meets Cultural Test rules, having:
  • An interim certificate from the British Film Institute (BFI) for the relevant high-end TV, animation, children’s television or film tax relief; or
  • A signed declaration by an authorised representative of the production company confirming that the company has self-assessed as passing the Cultural Test.
• It meets commercial viability criteria, ie the producer:
  • Is not able to obtain insurance cover for Covid-19 risks under any insurance policy entered into in respect of the production.
  • Has sought to secure insurance cover for Covid-19 risks in respect of the production and the requests have been rejected or the offer made was not on commercially viable terms. This can be through any of the following methods:
    • Through one regulated insurance broker.
    • Directly, through at least two regulated insurers.
    • A group insurance policy, a self-insurance structure or another government fund or scheme in a jurisdiction outside of the UK.
  • Must hold insurance for non-Covid-19 risks (or have been agreed in principle).
  • Has a legally binding agreement for the production in place.
  • Principal photography has been unable to commence/restart, or it has restarted relying on the scheme (if the production was able to secure the release of funding and commence/restart principal photography only after the announcement of the scheme on 28 July 2020).
• It must not be an excluded production (see list below)
• It must comply with “social commitments” as follows:
  • Not to employ individuals on unpaid internships.
  • Ensure all employees are paid the National Living Wage.
  • Consider meaningfully how the company can:
    • For feature films: meet at least two of the BFI’s diversity standards and set of principles to tackle and prevent bullying, harassment and racism in the screen industries.
    • For TV programmes: meet any relevant requirements or policies relating to diversity, bullying, harassment and racism published by the commissioning broadcaster.
    • Where the above is not reasonably possible: develop and implement policies to promote diversity and tackle bullying, harassment and racism in the workplace and apply them.
  • Publish on the company’s website diversity targets and policies on bullying, harassment and racism in the workplace.
  • Where eligible for HETV or Film Tax Relief: meaningfully to consider making payments into the appropriate ScreenSkills funds.
  • Explore meaningfully the possibility of offering ScreenSkills or equivalent recognised training, organisation placements on shoots, or upskilling to their workforce.

Assessment of the commercial viability criteria

• Productions with budgets over £30m will be required to provide documentary evidence to the Department for Digital, Cultural, Media and Sport (DCMS) to demonstrate that the requirements have been met.
• Productions with budgets under £30m can self-assess as meeting the requirements, though DCMS may seek to verify this assessment.

Excluded productions include:

• Productions involving the reporting or discussion of news or current affairs, which are broadcast live;
• Productions that provide coverage of live events;
• Productions that are filmed (whether in whole or in part) in front of a paying live audience;
• Productions that are advertisements or other promotional programmes;
• Productions that are produced for training purposes that will not be publicly broadcast; and
• Productions that are pornographic in nature.

How do I qualify?

Registration process

• Submit an application in accordance with the process defined by DCMS, setting out the details of the production and how the production satisfies the eligibility criteria.
• Declare the full names of up to five people, each of whom must either be a key cast member or the director, for whom cast losses can be claimed.
• An eligibility certificate will be received if the application is successful.

You must apply by the registration cut-off date which is the earlier of either:

• 23:59 on 30 April 2022;
• The date on which DCMS decides to close the scheme to new applicants because it determines that the aggregate value of estimated claims payable is nearing the scheme limit of £500 million.

Applications made after 1 April 2021 must be made before principal photography has meaningfully begun.

For this purpose, principal photography will be considered to have meaningfully begun once at least 5 days, or 20% of the total number of days scheduled, have taken place – whichever is lower.

The fee for registering for the scheme is 1% of the production budget for productions registering up to 31 October 2021, and 2.5% for those registering thereafter.

Note: if a production is a co-production then the fee is 1% or 2.5% (as applicable) of the aggregate value of the financial interests of every co-producer who is eligible and wishes to participate in the scheme.

What does it cover?

All compensation available under the scheme is provided at the sole and absolute discretion of DCMS.

Two categories of losses are covered:

1. Cast losses are losses that the producer incurs when a production has to be interrupted, postponed or abandoned, as a result of:

• One or more members of the cast or crew (whose roles are necessary elements in the production) contracting Covid-19 and having to stop working (either through death or illness);
  • Note: a producer will need to demonstrate that the affected individual has had a Coronavirus PCR swab test as soon as reasonably practicable.
• One or more of the five named individuals (as declared on the original application for the scheme) needing to take time off work because of the death or critical illness of a member of their immediate family due to Covid-19. This does not apply if the named individual is over 70 at that time unless a Specific Age Extension has been agreed with DCMS (see below).

2. Civil authority losses are losses that the producer incurs when a production has to be interrupted, postponed or abandoned, as a result of:

• Actions of the UK government (eg local lockdowns affecting a filming location).
• One or more members of the cast or crew (whose roles are necessary elements in the production) being unable to perform their jobs because they are acting in accordance with regulations (eg must self-isolate).

Eligible losses are measured as:

• Additional costs to complete the production above those originally budgeted, for productions interrupted or postponed.
• Production costs which have been rendered entirely valueless, in abandoned productions.

Losses will not be eligible where:

• The losses were incurred after the closure date of 30 June 2022.
• The losses are recoverable under an existing insurance arrangement or under a non-UK scheme with a similar purpose to this one.
• The losses arise from breaches of British Film Commission / PACT safety guidelines, or from individuals breaching UK or overseas restrictions designed to control the spread of Covid-19.
• The losses could reasonably have been avoided. Any producer using the scheme must take reasonable steps to minimise any losses arising.
• Principal photography has not meaningfully begun by 23:59 on 30 April 2022, unless this is solely for a reason set out in the definition of cast losses or civil authority losses above.
  • For this purpose, principal photography will be considered to have meaningfully begun once at least 5 days, or 20% of the total number of days scheduled, have taken place – whichever is lower.
• Principal photography is paused due to public holidays or production scheduling and is scheduled to continue in 2021, but principal photography does not then resume within 8 weeks of when it first commenced, unless this is solely for a reason set out in the definition of cast losses or civil authority losses above.

Limits

• For postponement/interruption: up to 20% of production budget.
• For abandonment of production: up to 70% of production budget.
• The maximum for any production will be £5 million.

Note: for co-producers, the limits are apportioned based on financial interest.

Receipt on successful application

• The producer will be entitled to recover its eligible losses less the scheme’s defined retention.
  • The retention equals the greater of £1,000 or 10% of value of losses.
• Claims will need to be made by the cut-off date of 30 September 2022.

Specific Age Extensions

• As noted above, compensation is not normally available to a producer for cast losses involving an individual over 70 years of age.
• A Specific Age Extension may be agreed with DCMS for an additional fee of 0.25% of the production budget.
• This extends the cover to the named individual over 70 only, subject to an additional retention of 5% for losses involving that individual.
• A maximum of two Specific Age Extensions may be obtained by a single production, to cover two individuals.

Note: if a production is a co-production then the fee for a Specific Age Extension is based on the aggregate value of the financial interests of every co-producer who is eligible and wishes to participate in the scheme.

For advice on this scheme, please contact Stephen Bristow, E: [email protected] or alternatively speak to your usual Saffery partner.

Further information on the various government support measures, together with other Coronavirus resources for individuals and businesses, can be found here.