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New Russian Initative Plans to Counter Internet Piracy by working with Pirates, Taxing Internet Providers, and Risks Destroying The Film and TV Industries

CANNES – SUNDAY 18TH MAY 2015: The Association of Film and TV Producers of Russia, supported by the Producer’s Guild, expressed grave concern at the ROSKINO hosted Co-Production: NEW PROSPECTS, NEW PARTNERS panel, as the panelists discussed the latest proposed law from the Russian Copyrights Holders’ Union – led by Nikita Mikhalkov - which suggests relinquishing the fight against piracy by taxing the internet and working with pirate websites.

The proposed new anti-piracy law, which was submitted to the Russian Government recently, aims to change Russian law so that unified taxes are paid by internet providers for a global license, so that internet users can look at any content they want – legal or illegal. The income earned from the tax would then be distributed to copyright holders using a vague and questionable system of remuneration.

Katriel Schory, Head of Israel Film Fund said: “Essentially the new law will see pirates go unpunished, and law-abiding citizens will pay to cover the costs. What’s worse is that the business will suffer. It’s a lose-lose situation and makes no business sense. This is about a return of communism in the technical age.”

Julian Lowenfeld, copyright lawyer with an international practice in New York and Moscow said: “There are two points about this proposed new law. The first is that all copyright licenses are territorial, and therefore overseas rights could not be taken away in any case so there would be non-stop litigation, which the original rights holders would almost certainly win. The second thing is, increasingly, as we just heard, films are done in international co-productions with foreign partners. Russia has Bilateral Investment Treaties with 32 countries. If any owners, of any of the rights, are from any of those countries, that’s yet another basis for long and nasty litigation, and based on what I heard today, again the rights holders would win, and the law’s proponents might even be individually sued. At any rate the lawyers will be dealing with this for decades if this goes through.”

The heated event, which took place in the Russian Pavilion in Cannes, gathered leading producers, film fund directors, and Ministers of Culture and Tourism together who slated the proposed new law as ‘market destroying’ and expressed their shock at not being consulted. The main concerns voiced were as follows:

  • Cinemas would be hit with crashing revenues as movies would be watched online before and during theatrical release. It is anticipated that 80% of cinemas could close
  • The TV business would also be hit with crashing revenues because internet users could watch shows without adverts and ratings and ad sales would fall as a result
  • Legal sites, that have worked hard for the last 10 years to build a legal playground, would be forced to close
  • It is a tax on the internet, and is in direct conflict with the ‘international norms’ of the World Trade Organisation
  • Copyright holders would lose out on sales of their content from more profitable sources

Sergey Selyanov, Head of the Association of Film and TV Producers of Russia said: “The Russian film and TV industries are upset and nervous. This law has every chance of being passed and if it is, it will destroy Russian distribution and fundamentally our whole business. I’m just stunned that the industry has not been consulted on something this important that affects us all. The only representative who was invited to attend a discussion at the Ministry of Culture was a top producer at ‘ThreeT Productions of Nikita Mikhalkov’ and Nikita, who is still a respected Director is the only industry professional lobbying the proposed law, and this worries us!”

Vlad Ryashin, Co-Chairman of the Association of Film and TV Producers of Russia said: “It’s going back to communism – taking everything from everyone then sharing it in a ‘fake fair’ way. We are here to announce our position of the two main professional guilds Association of Film and TV Producers and Producers Guild of Russia that unites all the Russian TV and Movie professionals.”

Moderated by ROSKINO CEO, Katya Mtsitouridze said: “As head of Roskino – a company that unites everybody in the industry and enables collaboration - I really worry about this proposed new law because it could destroy everything we have built over the last 15 years. We will lose all the progress we have made internationally because of these proposed unified taxes and it’s completely anti-capitalist. I support the main producers and filmmaker unions entirely.”

Renat Davletyarov, President of Producers’ Guild of Russia added: “We consider this initiative as a robbery and is total indulging the pirates. We invest in our productions and we take calculated risks, it is therefore crucial that we are able to execute our plans for each project without operating in a restrictive and destroying infrastructure.”

Speakers at the event who contributed to the debate included Anna Mansi (British Film Institute), Katriel Schory (Executive Director of the Israel Film fund), and Simone Baumann (German Films) Sergey Bespalov (Aldamisa Entertainment, Co-Chairman/producer USA) Natalya Drozd – (CTB Film Company, producer, P.O.V foundation, organizer of B'EST education program, Russia)


Additional information and photos:

- Sophie Hunt, DDA Public Relations Ltd
+ 33 (0) 6 66 67 69 58;

- Elena Barkova, press secretary ROSKINO
+ 7 926 996-41-45;

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