The Chamber of Deputies, Brazil?s lower house, passed Tuesday, April 16, Provisional Measure (MP) 17/01, amending MP 2228/01 and introducing new rules for the audiovisual industry. The measures significantly affect content providers including pay-TV programmers and film makers as well as broadcast TV. The bill now goes to the Senate. Here are the main points affecting pay TV:
1) Brazilian programmers exempt from Condecine tax on foreign remittances, paying only to register imported titles.
2) Foreign programmers exempt from Condecine, provided they deposit 3% of remittances in a special account with Banco do Brasil for investment in independent production. The funds will automatically be transferred to the National Film Agency (Ancine) if they aren?t spent within 270 days. These contributions are expected to amass some 20 million reals per year (now about 8.7 million US dollars).
3) Programmers investing in local production to be eligible for 70% income-tax rebate as of 2003 (Audiovisual Act).
4) Pay-TV operators exempt from Condecine on foreign commercials and commercials screened in small and medium cities (enabling legislation will provide more details).
5) Foreign content for any means of distribution may be purchased only by a company incorporated in Brazil, which will be responsible for the content exhibited, but payment can be made directly to the programmer?s parent company abroad.
6) Operators liable for ensuring that content exhibited is registered with Ancine but not for payment of Condecine.
7) The bill defines international programming as content produced and transmitted abroad, while national programming is produced and distributed in Brazil even if the content is foreign.
8) Films, video clips and similar content is national when produced in Brazil by a Brazilian production company and Brazilian professionals, or when coproduced in Brazil with at least 40% of the rights belonging to Brazilians and Brazilians accounting for two-thirds of the technical and artistic labor employed.