2010 Terms of Trade

Screen Australia’s 2010 Terms of Trade took effect from 1 July 2010 and apply to all projects approved for funding from that date.

Download the 2010 Terms of Trade.

The 2010 Terms of Trade are largely unchanged from the draft released for comment in November 2009. They set out the core terms on which the organisation will transact business, simplifying wherever possible and enhancing consistency across all programs. Screen Australia believes these terms are fair and balanced, and anticipates that they will remain in place for the foreseeable future.

The main substantive changes are set out below.

Equity investment and the producer’s position: Under the current Terms of Trade (in place for projects approved before 1 July 2010), Screen Australia provides producers with a minimum recoupment entitlement of 35%, and where necessary contributes a share of its equity in favour of the producer to reach the 35% floor. Profit is shared in the proportion 50% to the producer and 50% to the other equity investors. The producer’s 50% share includes the profit attached to the Offset equity.

Under the new Terms of Trade (for projects approved from 1 July 2010), any minimum recoupment entitlement is eliminated. Producers will continue to receive the recoupment position associated with the Offset and any other equity they contribute, with no top-up. Once all equity investment is repaid, the producer will receive 50% of profits. Further, all equity investors (including the producer in relation to both the Producer Offset equity and any other producer equity investment) will share the remaining 50% pro rata, pari passu. Examples of how this would work are set out below.

Example scenarios: Equity, recoupment, profit share

FEATURE: Budget = $12m

DOMESTIC DOCUMENTARY: Budget = $400,000

Limits on Screen Australia’s investment: As a proportion of budget, total Federal Government support (the Offset and Screen Australia investment) will generally not exceed 75% in the case of documentaries, 65% in the case of feature films, 40% in the case of television drama and 45% in the case of children’s television. This simplifies the previous two-tier arrangements for television drama. Absolute caps on Screen Australia’s investment also apply; these are set out in the program guidelines.

Copyright: Under the new Terms of Trade Screen Australia will require a flat 1% interest in all relevant projects. This amends and simplifies a variety of different policies across the organisation.

Reversion of recoupment entitlements: Screen Australia will continue its policy of reverting its entitlement to gross receipts in favour of the producer, seven years after first delivery for all production investments approved by Screen Australia after 1 January 2009.
The approach to reversion for FAL, AFC and FFC titles, and for Screen Australia titles approved before 1 January 2009, is set out in guidelines available here.

Accessibility: In addition to requirements relating to captioning of feature films, the new Terms of Trade encourage producers of all screen content to budget for captioning and audio description to provide access to their projects for both hearing and visually impaired audiences.

Information requirements: For all projects with investment of any kind from Screen Australia, the producer will need to provide information about the project for research and analysis. This will help our Strategy and Research Unit keep the industry as a whole better informed, as well as help us refine and better target our programs.

Fees: Fees for production financing applications and administration will remain unchanged. Screen Australia will introduce fees for Producer Offset provisional certification but not as part of its Terms of Trade, as these terms apply to its direct funding programs. The new fees will come into effect once the Producer Offset Rules 2007 have been amended and tabled. The fee structure being incorporated into the Rules is available on the Producer Offset website.