Montreal: In an information bulletin published July 15, the Quebec Minister of Finance announced the removal of all cap limitations on refundable production tax-credits filed by private broadcasters and their affiliates for service productions, as well as for content productions "destined principally for commercial exploitation outside of Canada."

The changes effectively create a new tailor-made category of tax breaks for private broadcasters, namely content production destined for export. The new credit also opens the door to local production initiatives from TVA International which is actively developing and producing export-oriented tv movies, to date, primarily out of Vancouver. With the new tax credits in place - effective July 15 - and wider access to production incentives for private broadcasters, the stage may be set for TVA Group, TVA International's parent company, to acquire an independent Quebec-based film and tv producer. A spokesperson for tva says, "Officially, it's a huge rumor. We are out there, and we are listening and talking to people and that is why there are rumors. I can tell you (tva president and ceo) Daniel Lamarre has taken a very aggressive position on building TVA International."

In order to claim the newly designated "export" credit, valued at 15% of the Quebec portion of the budget, the copyright must be held by the private broadcaster or affiliate and the program may not be broadcast in Quebec by the same broadcaster for a period of three years following the delivery of the master or negative copy.

The finance department bulletin says specialty broadcasters are excluded from both tax credit extensions.

The apftq (producers association) is strongly opposed to the July 15 modifications.

The producers held talks with tva but say they were denied effective representation on the tax changes, although the association apparently was able to delay the announcement by at least two weeks.

According to the producers, the new tax credit extensions give private broadcasters an unfair advantage, specifically in the program export market, and disregard a June '98 agreement between producers and government which placed strict limitations on private broadcaster access to the Quebec tax credit during a five-year experimentation period.

In a compensatory gesture of "good will," TVA Group's Lamarre has assured the apftq 50% of tva's program schedule will be sourced from private-sector producers, according to apftq president and director-general Raymond Breard. Breard says the informal or "non-fiscal" program commitment from tva "doesn't give us any more (program licences)" but at least, he says, it reassures producers they won't lose even more ground in the future.

Breard says producers will prepare for a strategic meeting with finance minister Bernard Landry, perhaps by late August, with the hope of explaining in more detail the creative role and requirements of independent producers.

The June '98 modification capped (tax-credit) admissible production by private broadcasters or their affiliates, in both the content and services categories, at $20 million a year. There was also a formal fiscal commitment that half the saving would be reinvested by the broadcaster in original French-language feature film production. The Quebec tax credit restrictions on broadcasters spelled out last June still stand, but the July 15 modification does away with both the annual cap and reinvestment clauses in both the new export-content and service production categories.

The Quebec refundable tax credit program is managed by sodec through a protocol agreement between the finance minister and the agency.