In mid-February 2018, upon proposal of the Ministry of Economy, the Government of the Republic of Serbia adopted new Decree on Incentives to Investors for Producing Audiovisual Works in the Republic of Serbia (“New Decree”), by which it increased the amount of refund to investors from 20% to 25% of qualified (eligible) expenses realized in Serbia, which practically means that 25% of project’s expenses are financed from the budget.
The condition that an investor must fulfil in order to have grounds to request payment of incentives, is to invest in the realization of project at least:
- 300,000 EUR for feature film, TV film and TV series, whereas budget intended for realization of TV series cannot be less than 100,000 EUR per episode;
- 150,000 EUR for animated film, audio and/or visual post-production of an audiovisual works;
- 100,000 EUR for special-purpose film;
- 50,000 EUR for documentary film and documentary TV program.
New Decree, as well as previous one, defines minimum duration of audiovisual work as additional requirement for approving incentives. Therefore, investor is entitled to incentives for production of feature, animated, documentary and TV film with duration of at least 70 minutes, TV series must be composed of at least three (3) episodes with duration of not less than 120 minutes in total, and duration of documentary TV program must be at least 40 minutes. Also, audiovisual work must not contain content that is immoral, contrary to public order and public interest of the Republic of Serbia, that it discredits the Republic of Serbia, or that it promotes violation of human rights or hate speech. Aforesaid requirements apply to both foreign and domestic investors, whereas New Decree specifies that state bodies and organizations of the Republic of Serbia or of municipal bodies, public enterprises, funds and directorates, as well as institutions founded by Serbia and municipal authorities, are not entitled to incentives, having regard that they are already beneficiaries of budget funds. There were no amendments in the New Decree regarding qualified (eligible) expenses, or expenses that are not recognized as qualified. Detailed explanation of eligible and non-eligible expenses is provided in the rulebook that is in force since the period in which the previous Decree on Incentives was applied. For each calendar year, Serbian Government determines the budget for incentives’ program for production of audiovisual works. For 2018, the budget for incentives is increased from 400 to 800 million dinars (cca. 6,7 million EUR or cca. 8,3 million USD). The purpose of increasing amount of available funds is to increase competitiveness of Serbia as location for filming and producing audiovisual works. Regarding the procedure, New Decree, as well as previous Decree on Incentives, firstly defines submission of request for approving incentive, and then submission request for payment of incentive, with one change. Now, requests for payment of incentive should be submitted not later than 30th September 2018, and this deadline previously applied to requests for approving incentive. Requests received after said date will be considered as requests for next budget year. The purpose of this amendment is to achieve that payments are performed from funds intended for current budget year, and that procedure of submitting requests, approvals and payments of incentives, becomes more efficient than in the past. The Commission formed by the Serbian Government decides on approving incentives, whereas administrative and technical tasks (processing of requests and supporting documentation, etc.) are assigned to Film Center Serbia. For less than three (3) years of applying incentives for production of audiovisual works, Serbia imposed itself as one of most tempting destinations in the region for filming and production. On the top of these incentives, excellent conditions in Serbia offered to investors certainly add value (high quality of professional services, reasonable costs of doing business, efficient application of regulations in this field, etc.).