A Producer Offset loan is a loan from EFIC to a production company to finance eligible Australian film, documentary and television productions with international distribution agreements.
Producer Offset loans from EFIC complement the Australian Government’s Producer Offset incentive, which provides refundable tax offsets (rebates) for producers of qualifying Australian feature films, television and other projects.
The loan is specifically designed to help smaller productions that are eligible for the Producer Offset but may have difficulty in attracting finance in the commercial market. EFIC may also be able to assist in the financing of larger productions, subject to additional due diligence.
Who is eligible?
To apply for a Producer Offset loan, applicants need:
- A demonstrated track record of delivering similar, successful film, documentary or television productions
- A special purpose vehicle (SPV) production company established in Australia
- A Provisional Certificate from Screen Australia stating the estimated level of qualifying Australian production expenditure (QAPE)
- A written legal opinion in respect of chain of title documentation confirming that you hold all the necessary rights to undertake the production
- Written evidence that the entire budget for the project, other than the funds to be provided by the Producer Offset loan, is committed, including:
- Copies of signed, legally binding international distribution agreements with an overseas distributor
- A detailed budget
- Finance plan
- A funding drawdown schedule showing that a minimum of 70% of all funding, excluding EFIC’s loan, will be injected before drawdown of EFIC funds
- Copies of other funding/investment agreements or letters of intent
- Confirmation of investment by a federal or state government film funding body
- The production schedule
- A completion guarantee (bond) through an acceptable completion guarantor with agreement to bond 90% or more of QAPE.
What are the benefits?
- Provides cash flow to assist in funding your production
- Upfront access to funds for your film production, bridging the funding gap between when you incur production costs and when you receive the Producer Offset.
How does a Producer Offset loan work?
- You provide EFIC with a Provisional Certificate from Screen Australia and other necessary documentation in respect of the film production
- You provide EFIC with security for the Producer Offset loan, including: a completion guarantee, a registered General Security Interest over all the SPV’s assets, and a guarantee and indemnity from the company holding the producer's rights to distribute the movie together with a registered General Security Interest over the production specific assets
- EFIC provides the Producer Offset loan to you
- After you complete the film production and receive a Final Certificate from Screen Australia (stating the final value of QAPE), you submit a tax return and the Final Certificate to the Australian Taxation Office (ATO)
- The ATO pays the Producer Offset and your tax agent deposits it into a designated bank account controlled by EFIC
- The EFIC loan is repaid from the funds in the designated bank account.
TERMS AND CONDITIONS
Terms and conditions will be negotiated during the application process. The following guidelines provide an indication of typical requirements: Loan amount
EFIC will lend an amount equal to up to 90% of the estimated Producer Offset Rebate, based on the Provisional Certificate. The minimum loan amount is $100,000, and the maximum is $500,000. Term
Flexible terms of up to two years. Fees and charges
Fees and charges will vary depending on a number of factors, including EFIC’s risk assessment, the amount and term of the loan and the complexity of documentation required. Security
EFIC’s requirements as security are:
For more information:
- A completion guarantee;
- A registered General Security Interest over all the assets of your SPV production company;
- A guarantee and indemnity from the company holding the producer's rights to distribute the movie;
- A registered General Security Interest over all the guarantor’s assets in respect of the film production;
- Offset Bank Account Deed;
- Interparty Agreement for the benefit of EFIC;
- Pledgeholder Agreement from the tapehouse holding the master stock;
- The tax agent (an authorised agent acceptable to EFIC) must provide an irrevocable undertaking to deposit the ATO refund into the designated bank account.
On Producer Offset loans, contact EFIC on 1800 887 588 or make an enquiry to EFIC.
On the Producer Offset, contact Screen Australia on +61 2 8113 1042 or visit www.screenaustralia.gov.au/producer_offset
NOTE: Information on terms and conditions is supplied as a guideline only. EFIC’s compliance with legislation and OECD guidelines, together with its credit assessment and other policies, influence the actual terms and conditions that may be applicable to any eventual transaction with EFIC. The information provided does not comprise advice or a recommendation and EFIC makes no representation or warranty relating to it. To the maximum extent permitted by law, EFIC will not be liable for any direct or indirect loss or damage suffered or incurred by any person on the basis of this information.