The Brazilian Film Agency (Ancine) addresses public policies to leverage growth of the audiovisual industry

Brazil has a vast potential for attracting foreign audiovisual productions due to its diverse landscapes and vast technical and creative capacity. However, international producers looking to film in Brazil must adhere to an extensive list of regulations and requirements. 

Public policies and incentives play a crucial role in funding audiovisual productions in Brazil, and are regulated and supervised by the Brazilian Film Agency (Ancine). The agency has the main responsibility of releasing federal public funds for audiovisual productions, since it evaluates and approves or rejects projects.

Story Productions discussed the topic with two members of Ancine: Daniel Tonacci, the Coordinator of International Programs, and Guilherme Bomfim, the market development manager. With their expertise, they provided us with valuable insights into how foreign producers can take advantage of film financing in Brazil.

Main incentive laws for film productions in Brazil

There are two types of public financing film productions, indirect and direct. Under indirect funding, companies and individuals can use part of their income tax (IR) to incentivize film productions. The main incentive laws fall under the indirect funding category:

Cultural Incentive Federal Law (Lei Rouanet)

Approved in 1991, the Rouanet Law was designed to promote culture by offering tax incentives for cultural projects. Under this law, a company sponsoring a project can provide support with up to 4 per cent of its income tax and get a corresponding deduction. Similarly, an individual can sponsor a project with up to 6 per cent of their IR.

Audiovisual Law (Lei do Audiovisual)

The Audiovisual Law, created in 1993, shares similarities with the Rouanet Law — it’s another form of indirect funding. It’s also based on income tax deductions: companies and individuals are eligible for a deduction of up to 4 per cent and 6 per cent, respectively.

Photo by Lê Minh for Pexels

Paid TV Law (Lei da TV Paga)

Since 2011, the Paid TV Law seeks to encourage independent Brazilian audiovisual production by mandating that all television channels in the country, both on open and paid, must broadcast a minimum of three hours and 30 minutes of Brazilian content weekly during prime time, with at least half of that being produced independently. Paid TV packages must provide at least two channels with a minimum of 12 hours of independent Brazilian audiovisual content per day.

Main public direct funding mechanisms available

The direct type of public funding for audiovisual projects occurs when the government, at municipal, state, or federal levels, opens a call for proposals and offers a specific amount of funding for eligible projects. Interested producers can submit their proposals, which are evaluated based on specific criteria and selected by the government.

The main public direct funding mechanisms currently available are:

Audiovisual Sector Fund (FSA)

The Audiovisual Sector Fund (FSA) is a federal fund that plays a vital role in supporting the audiovisual industry in Brazil by investing in all stages and activities associated with the sector, including project development, production, distribution, exhibition, and infrastructure. The FSA sets out lines of action that involve TV content production in both the areas of audiovisual production and distribution.

Photo by Cytonn Photography for Unsplash

Cash and tax rebates

Rebate programs are incentives offered by local governments that allow audiovisual projects to be reimbursed for eligible expenses. The goal is to encourage film production in their respective regions and contribute to the growth of the local audiovisual industry. Refunds can be provided by tax deduction at the end of the project, or by cash in advance.

How international productions benefit from such incentives

Foreign producers can access Brazilian public funding primarily through co-productions, which require a formal partnership with Brazilian producers. Ancine sets criteria to recognize a co-production in order to ensure that it benefits both parties.

A minimum of 40 per cent equity participation is required, with two-thirds of technical participation being Brazilian. Once recognized, the international co-productions can benefit from the same incentive mechanisms available for national projects, since they receive the same treatment as Brazilian ones.

It’s worth noting that the FSA's Management Committee has expressed particular interest in international co-productions, as reflected in the 2022 and 2023 action plans that have allocated a specific budget of R$40 million for this purpose. Additionally, there are plans to allocate another R$25 million for international co-productions through binational calls for projects.

Furthermore, Ancine has established bilateral and multilateral agreements with many countries. These agreements simplify the process of co-productions and provide flexibility by relaxing certain requirements. For instance, instead of the standard 40/60 equity participation, it could be 20/80. Technical participation becomes proportional in these cases. The terms of each agreement can vary depending on its specific terms.

Finally, there are cash rebate programs focused on foreign producers. In 2021, São Paulo implemented the first cash rebate program in Brazil to encourage international filming. It provides a reimbursement of 20 per cent to 30 per cent of eligible expenses for productions in the city.

In 2022, Rio de Janeiro launched its own cash rebate program, allowing productions from other states and international productions to receive up to 35 per cent of the amount spent in Rio's capital.