Island of Cyprus Joins the Battle for Foreign Filmmakers With Incentives

The Mediterranean island of Cyprus has a long, sometimes bloody history that has placed it at the center of conflicts across three millennia. Today, the modern nation of Cyprus has joined another kind of arms race: the competition to attract film production through the implementation of increasingly aggressive incentives programs. 

Boasting a balmy climate and plenty of sunshine, Cyprus is “a natural studio,” says Lefteris Eleftheriou of Invest Cyprus, the organization that chairs the country’s film commission. Locations include snowcapped mountains, sandy beaches and Roman and Ottoman ruins. 

In the incentive scheme it introduced last fall, Cyprus offers a cash rebate or tax credit of up to 35% on qualifying local spending for feature films, TV series, animation, documentaries and other projects that promote Cyprus and its culture, provided they meet certain financial criteria and pass a cultural test. The minimum spend per film is €200,000 ($230,000), and €100,000 ($115,000) for TV projects. Qualifying spending can be a maximum of 50% of the total production budget. 

Cypriot officials expect to sign off on the first projects to take advantage of the incentive scheme in the coming weeks. 

Demand has been high: Just months after the program was introduced, the government is already planning to lift its annual cap, which is at $1.7 million. Eleftheriou says that number is expected to rise to north of $23 million, putting the island nation “in a position to attract huge productions from the United States and elsewhere.”

For an industry with a modest regional footprint that produces just a handful of feature films every year, the incentives should give a boost to domestic production, while also opening doors for more minority co-productions and production services on the island. Local bizzers are already seeing an impact.

Hailing from a small nation with a developing film industry was “my main problem as a producer when I was pitching projects,” says Marios Piperides, who wrote and directed the comedy “Smuggling Hendrix,” which won best international narrative feature at the Tribeca Film Festival last year. The movie was produced in part by German company Pallas Film. “German [producers handle] 200 films a year, and we do one per year,” Piperides says. “It was very difficult to convince them to invest, or to come on board as co-producers.”

Piperides notes his 14-year-old AMP Filmworks is seeing more opportunities on the horizon, buoyed by the new incentive scheme as well as the breakout success of “Hendrix.” Two of the four feature films the company is developing are international co-productions, something that would have been harder to pull off in the past. “Because we didn’t have the tax incentives, [potential partners] were going somewhere else,” he says. “Things are changing.” 

Cyprus doesn’t yet have the studio facilities or crew base of a country like Malta — a sister Mediterranean island — but local companies have a solid track record of servicing international shoots, predominantly from the Middle East and North Africa regions, as well as Eastern Europe. 

The incentive scheme will most likely go a long way toward helping the small island nation enjoy its moment in the sun. “We might [offer a] 35% [incentive], but we still have to prove that we can deliver,” says Piperides. “And we can.” 

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