PolyGram calls for film bank

The European Union should set up an independent international financial institution to provide a range of incentives to make the European film industry more competitive and less dependent on US productions, PolyGram, the Netherlands-based global e ntertainment group, says.

In a memorandum sent to Jacques Delors, president of the European Commission, yesterday, the company urges that this body - which should be part of the existing European Investment Fund - should have a mandate from member states to provide long-term guarantees, cheaper loans and off-balance-sheet funding to European companies involved in film and television production.

Michael Kuhn, president of PolyGram Filmed Entertainment, recommended that further incentives be given to companies seeking funding for groups of films rather than one-off productions. This would allow lenders to spread their risk and to build a catalogue of European films that could compete on a worldwide basis.

The proposal was designed to encourage the industry to "restructure into a globally competitive business and thus allow Europe to be less dependent on imports", he said.

"Unlike subsidies, which have a role to play in promoting the cultural aspect of the arts, financial incentives have real, commercial objectives aimed at bringing economic and other benefits to the EU."