Czech production sector on precipice following suspension of incentives

The market for international filming in the Czech Republic is "on the edge of a precipice", says Vratislav Slajer, the head of the country's main industrial group, Assn. Audiovisual Producers.

Speaking to industry colleagues Sunday at Karlovy Vary Intl. Film Festival, Czech producers have warned they are witnessing the imminent loss of more than a decade of progress in introducing foreign filming - and the prospect of billions flowing to other countries.

The Czech government this year, citing a spending crisis prompted by the need to rescue businesses hit by COVID-related losses and take in more than 300,000 war refugees from Ukraine.

But, says Slajer, "That's a false argument."

Booming film productions would provide plenty of jobs for Ukrainians, for one thing, he posits. "We can help solve the crisis - we can bring in more money."

What the government has lost sight of, he adds, is how incentives generate rich returns: "It's an investment. It's not like a grant or a gift. If you invest more, you get back more."

Czech Film Commission Director Pavlina Zipkova echoed this sentiment, calling for the sweetener system to be strengthened.

“Production incentives are an essential part of the green filming system, without which we lose our competitiveness in Central Europe,” she says. “It's as simple as that. Despite the difficult times, we still hope that this fight will result in the opening of the production incentive program at the earliest.”

Over the past year, the incentives have generated record profits, with local production companies raking in "incredible" revenues of around $505 million and high-profile shoots including the action franchise. Netflix spy "The Gray Man", Amazon fantasy "Wheel of Time", "Extraction 2" actor and "Carnival Row" season 2, all major Czech filming.

With his bloated budget for car chases, explosions and shootings filmed in the streets of Prague, 'The Gray Man' alone spent some $105 million on its 91-day shoot, estimates producers' association, while "Wheel of Time" spent $185 million and "Carnival Row" some $164 million.

These shoots employed hundreds of people and gave a major boost to the Czech economy at a time when it had only just opened up to international trade again.

When these projects opted for the Czech Republic, the prize pool for 20% rebates on overseas spending was around $33 million per year, although production companies were able to lobby to obtain significant increases in the fund in the event of high demand.

In fact, $54 million would be a more realistic annual investment in refunds, Slajer says, and codifying the fund into law so it can't suddenly be suspended overnight.

"It's a broken system that really doesn't work," says Slajer.

Now, with no incentive available for the foreseeable future, major sets are canceling plans to come to the Czech Republic en masse.

While the rest of Europe is fighting hard for productions, the Czech Republic is losing major productions every month, producers say, citing 'The Devil in the White City', produced by Martin Scorsese and Leonardo DiCaprio, Amazon 3's "Patriot" season, HBO Max sci-fi series "Dune: The Sisterhood," "Hunger Games" prequel starring Jennifer Lawrence, Lionsgate actor "Shadow Force" starring Kerry Washington and the HBO plot "Londongrad", starring Benedict Cumberbatch.

All looked at the Czech Republic, but have now forgotten about it, says the Association of Czech Producers.

With neighboring countries like Poland offering 30% rebates for foreign productions and Slovakia 33%, it is clear that unless the Czech government can restore competitive incentives, companies will continue to lead to greener pastures, local industry leaders say.

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