Guideline for the Croatian Cash Rebate This guideline does not have the force of law and does not constitute a replacement of the Regulations to Encourage Investment in the production of Audiovisual works, nor does it, in all instances, constitute a full statement of the law as it applies, or has applied. This guideline should only serve as a reference to the producers in the Cash Rebate application process. In case of doubt, only the Regulations to Encourage Investment in the production of Audiovisual works are legally applicable. Unless stated otherwise, all statutory references are to the Regulations to Encourage Investment in the production of Audiovisual works Type of Incentive? Refundable cash rebate. Total funding per year? 20,000,000.00 Kn, paid out on a first-come-first-serve basis Eligible entities? Croatian companies in the role of a producer, co-producer or production service provider who: 1. Either own the copyright to the screenplay or are the production service provider of the company that owns the copyright to the screenplay. 2. Have, within the last 3 years, produced at least one publically showcased AV work. 3. Have no outstanding balance/amount owed to any government department and are not in the process of liquidation or bankruptcy. 4. In case of a co-production, are registered as the Croatian co-producer of the work Maximum benefit? Up to 20% of the qualifying local expenditure Project cap? 20,000,000.00 Kn (roughly €2,674,000.00) of qualifying local expenditure per project. Projects exceeding 20 ml. Kn in qualifying local expenditure may apply to the Croatian Audiovisual Centre for an additional rebate, however, the decision and amount depends on the available reserves. Eligible projects? Feature Films, Documentaries, Short Films, Television Drama and Animation. The Rebate does not apply to Commercials, Reality Television, Game Shows and Soaps. What constitutes qualifying expenditure? Croatian cast and crew working in Croatia, as well as goods and services purchased in Croatia. Page 1 of 6 Project criteria? Minimum local spend. in which case it can go up to 80%. scheduling. Qualifying test .00 Kn per episode of a TV drama What does the Qualifying test comprise of? The qualification test comprises three categories: ‘cultural content’. budgeting.000. including the Cash Rebate. Page 2 of 6 . casting. at least 50% of the cast and crew hired must be Croatian citizens. of which at least 7 points must be scored in Section B (Creative Collaboration) and at least 4 points in Section C (Production/Use of Croatian Resources). including locations scouting.00 Kn for Documentaries 500. and for a final certificate upon completion of the production in Croatia. ‘creative talents’ and ‘production’. and is responsible for compliance with prescribed formal requirements. How does it work from the foreign producer’s point of view? The foreign producer must team up with a local Croatian co-producer or production service provider. funding restrictions Minimum local spend per project? 2.00 Kn for Feature films 300.necessary requirements? The project must score a minimum total of 15 points (from a maximum of 37). If the project is partly realized in Croatia. The Croatian partner provides the full range of production services. must not exceed 50% of the total production budget. The cumulative level of the state-aid in each European country.00 Kn for Animations 1.00 Kn for TV films 750.000. Financial requirements Projects must secure at least 70% of the total production budget before applying for the rebate.000. The Croatian entity also applies to the Croatian Audiovisual Centre (HAVC) for a provisional certificate before the start of production. at least 30% of the cast and crew hired in Croatia must be Croatian citizens.000. hiring quota.000.000.000. crewing and takes full responsibility for all production services carried out in the State throughout the life-span of the production. Hiring quota If the project is realized entirely in Croatia. qualification test. except in cases of “lowbudget and difficult” films. the Committee will examine whether these costs are directly connected with the production of the work. The Application will not be considered filed if any of the required documents is missing or incomplete.Procedure Filing the Application 1. 3. In addition to determining whether the submitted documentation complies with all legal and formal requirements. The Application and all its pertaining documents must be submitted in Croatian (Co-production and Service Agreements must be submitted in the form of a certified translation into Croatian). taking into consideration the shooting plan. The provisional certificate does not automatically guarantee payment of the rebate. The Croatian Audiovisual Centre reserves the right to request any additional documents it deems necessary in order to evaluate the Application. 3. Qualifying test and complete documentation (see “Application Documentation”) must be sent to the Croatian Audiovisual Centre no later than 30 days prior to the start of production in Croatia. comprising of 5 members. which is conditioned on the full compliance with prescribed formal requirements. 2. 5. 4. comprising of the completed Application Form (signed and notarized by the applicant’s legal representative). Changes to the Application The Applicant is required to promptly inform the Croatian Audiovisual Centre of any changes to the information provided in the initial application. 2. The Committee. 4. the conditions and deadlines under which it will be awarded. 5. Evaluating the Application – Provisional Certificate 1. All submitted documents shall remain property of the Croatian Audiovisual Centre. In case of approval. the Committee reserves the right to evaluate individual cost items presented in the planned Croatian expenditure and to decide whether these costs are of the nature of Eligible Costs in terms of the objective and purpose of the Programme and in view of the binding rules. In evaluating the cost of items for goods and services. A hardcopy of the Application. the project will be awarded a provisional certificate stating the incentive amount. will evaluate the Application within 30 days of receipt of a valid Application. The Croatian Audiovisual Centre reserves the right to change its decision in the event that the legal Page 3 of 6 . The provisional certificate will be voided if the commencement of production in Croatia is postponed for more than 30 days. the crew sheet and other details provided by Applicant. and within the period prescribed in the Provisional Certificate. the Committee adjusts the amount due to make sure they reflect the actually incurred costs. These copies of receipts will be kept at the Producer’s premises. However. Based on the submitted evidence. audit of the final cost statement and evidence that all the requirements have been met. copies of receipts that serve as proofs of costs incurred by the Applicant in connection with the production of the work in Croatia. Final certificate – guarantee of payment 1. guaranteeing the payment of the total amount due. Upon completion of production in Croatia. The commencement date for the production in Croatia has been delayed for more than 30 days. The Croatian Audiovisual Centre will then issue the final certificate.upon the Committee’s request. In case of compliance. 4. The actual costs incurred in connection with the production in Croatia are smaller than the minimum required local spend per project. In case the production costs were lower than initially estimated. the Committee determines the Applicant’s compliance with all legal and financial obligations. 4. as well as whether the actual costs correspond with the projected costs submitted in the Application.grounds and the actual state of affairs have changed significantly in relation to the information provided in the application. . Disbursment The net benefit will be made available on completion of production. confirmed by an authorized auditor whose services shall be paid by the applicant. The applicant failed to comply with all of his financial and legal obligations in connection with the production in Croatia 3. Cancellation of payment in case of non-‐compliance The payment will be cancelled if: 1. the amount will remain the same as the one stated in the provisional certificate. including liabilities to the government. The payment will be made to the applicant’s designated account opened exclusively for the purpose of the production of the work for which the incentive is being requested.a complete statement of actual production costs incurred in Croatia. the amount due will be proportionally lowered. confirmed by an authorized auditor whose services shall be paid by the applicant. in the event the production costs were higher. The project did not secure the funding as announced in the application 2. Page 4 of 6 . 3. 2. the Applicant must provide the Croatian Audiovisual Centre with the following documents: . Certificate of Incorporation Issued by the Commercial Registry Office 4. including the exact amount of state subsidies provided by the Republic of Croatia and European Union member countries. must be sent by certified mail with return receipt requested along with a copy of the documents in electronic format 2. 3. the certificate must verify that the entity satisfied all tax obligations due to the State. confirmation of national support. including taxes. Enclose all items of evidence of financing (contracts. Page 5 of 6 . For feature films: a confirmation of the screening issued by a film distributor or screening company and an extract from a newspaper as proof of the screening in regular distribution. deal-‐memos. The Project Budget i. etc…) 8. 5. or a confirmation issued by a national television broadcaster of the broadcasting of the work. For animated. letters of intention. ii. detailed project budget ii. A financing plan for the production of the entire work The plan must state all sources of funding (whether local or foreign). A screenplay and synopsis of the work 6. Tax Clearance Certificate Issued by the Department of Revenue. Application form The completed form. along with the pertaining documents. the company’s founder or Director must have produced such a work. A list of planned production costs to be incurred in Croatia Includes details of each element of expenditure that may be accepted as an eligible cost incurred directly in Croatia on the employment of eligible individuals and on the provision of eligible goods. For international productions with a local production service provider: the total project budget amount 7. For local productions or co-‐productions and international co-‐ productions with a Croatian co-‐producer: a preliminary. Proof of the public screening of a work produced by applicant within the last three years: i. interest. charges and any other liabilities.Documentation 1. penalties. as well as the percentage of participation of each individual source in the total budget. short feature and documentary films: proof of screening within the official program of at least one international film festival In the event that the company lacks such credits. fees. services and facilities. signed and sealed by the applicant’s authorised signatory. decisions. Proof of security of financing for 70% of the Project’s production costs in Croatia Copies of contracts. Page 6 of 6 . A certified copy of the Preliminary Contract or Contract on Co-‐ production (for international co-‐productions) OR A Service Level Agreement between the original producer and a local production service provider (for international productions) 16. A production plan with the final completion date of the entire work 12. Applicant’s duly executed Statutory Declaration Wherein the Applicant consents to all the terms and conditions of the Regulations and provides a statement of truth verifying the facts provided in the Application. 10. Project cash flow forecast Schedule for the project’s disbursement and receipts 13. A list of all staff (crew) and personnel employed in the production of the work in of Croatia (crew list). A production plan for Croatia 11. preliminary contracts.9. A completed qualifying test from Annex 2 of the Regulations 15. letters of intent or commitment stating the exact amount 14.