Laws


http://www.planalto.gov.br/ccivil_03/LEIS/L8685.htm

Known as Lei do Audiovisual (Law of the Audiovisual Sector), law number 8.685 encourages companies to fund the audiovisual sector by granting income tax rebates to companies that opt to sponsor the production or to invest in the production or co-production of Independent Brazilian content.

Article 1
Article 1 provides that companies may deduct amounts spent purchasing Audiovisual Investment Certificates for the production of Independent Brazilian content, up to 3% of their due income tax.

The funding resulting from Article 1 is available for the production of short, medium or feature length cinematographic audiovisual projects, destined primarily for theatrical distribution.

Article 1-A

Article 1-A provides that companies may deduct amounts spent sponsoring the production of Independent Brazilian content, up to 4% of their due income tax. These amounts must be used to sponsor projects for the production of Independent Brazilian content, which must have been previously approved by ANCINE. Companies opt to sponsor such projects in order to use tax money to increase exposure to their brands.
The funding resulting from Art. 1-A of the Audiovisual Law shall be available to:

  • Short, Medium or Feature length cinematographic audiovisual projects;
  • Miniseries and other Audiovisual series;
  • Telefilms (documentary, fictional or animation) with a maximum length of 25 minutes and produced for primary electronic distribution;
  • Cultural and Educational TV shows.

ARTICLE 3
Article 3 provides that foreign companies receiving royalties originating from the commercialization of foreign audiovisual works in Brazil may deduct up to 70% of the withholding tax (25%) due upon remittance of such royalties, provided that these amounts are used to fund the development or co-production of Independent Brazilian content, previously approved by ANCINE. In practice, this rebate is mostly used by foreign audiovisual distribution companies that are taxed when receiving monies from Brazil. Foreign distribution companies use this mechanism as a way to convert tax money into ownership in Brazilian co-production.

The funding resulting from Article 3 shall be available for:

  • The development (investment) in audiovisual projects for the production of feature length cinematographic audiovisual works;
  • The co-production of short, medium and feature length cinematographic audiovisual works; miniseries and telefilms (documentary, fictional or animation) with a maximum length of 25 minutes and produced for primary electronic distribution.

ARTICLE 3-A

Article 3-A provides that foreign companies receiving royalties originating from the broadcasting of any audiovisual works in Brazil may deduct up to 70% of withholding tax (15%) due upon remittance of such royalties, provided that these amounts are used to fund the development or co-production of Independent Brazilian content, previously approved by ANCINE. Foreign Pay-TV programming companies use this mechanism as a way to convert tax money into ownership in Brazilian co-production.

The funding resulting from Art. 3-A shall be available for:

  • The development (investment) in audiovisual projects for the production of feature length cinematographic audiovisual works;
  • The co-production of short, medium and feature length cinematographic audiovisual works; miniseries and telefilms (documentary, fictional or animation) with a maximum length of 25 minutes and produced for primary electronic distribution.

http://www.planalto.gov.br/ccivil_03/leis/L8313cons.htm

The Rouanet Law allows companies to deduct up to 4% of the income tax due part of the amounts intended for donations or sponsorships in cultural projects.

ARTICLE 18

Article 18 of the Rouanet Law allows legal entities to deduct from the income tax due 100% of the value used to sponsor or donate short and medium-length audiovisual works, festivals and projects for the preservation and broadcasting of audiovisual works.

Projects of short and medium-length films may be approved by ANCINE to use Rouanet Law benefits, provided that the proponent has requested the framing of the same project in other incentive mechanisms (such as the Law of the Audiovisual Sector).

The funding resulting from the Rouanet Law is available for short and medium-length, national and international festivals and diffusion and preservation projects.

ARTICLE 25

Article 25 allows legal entities to deduct from the income tax 30% of the value used in sponsoring projects and 40% of the amounts donated to audiovisual projects.

The funding resulting from article 25 is available for:

  • Feature-length audiovisual works;
  • Telefilms, miniseries, series;
  • Educational/cultural television programs.

http://www.planalto.gov.br/ccivil_03/mpv/2228-1.htm

The Provisional Measure no 2.228-1 created a tax contribution called CONDECINE, which gathers funds destined for the development of the national audiovisual industry.

CONDECINE is due:

  • Upon registration of an audiovisual work for exhibition/distribution in Brazil, including advertising content, for each market segment;
  • Upon remittance of royalties from Brazil to foreign Pay TV Programmers.

Article 39-X of the MP provides an exemption from CONDECINE upon remittances to foreign Pay TV Programmers that opt to invest 3% of the amount of each remittance to fund independent Brazilian production projects previously approved by ANCINE. This exemption is widely used by foreign Pay-TV Programmers, that opt to use these funds to coproduce independent Brazilian content, mostly dedicated to fulfilling the weekly quotas imposed on their own channels.

The funding resulting from Art. 39, X of the MP shall be available for:

  • Co-production (co- production) of short, medium and feature length cinematographic audiovisual works;
  • Miniseries and telefilms (documentary, fictional or animation) with a maximum length of 25 minutes and produced for primary electronic distribution.