National Film Office - Decree
On the basis of the authorization provided in section 37(1) of Act II of 2004 on Motion Pictures (hereinafter referred to as “the Act”) and section 67(2) of Act XCIII of 1990 on Duties, we order the following:
Section 1 (1) The National Motion Picture Bureau (hereinafter: the “Bureau”) is lead by the director in accordance with section 18(3) of the Act.
b) prepare the code of operation of the Bureau and its budget for the given year,
c) practice the rights of the employer in respect of the employees of the Bureau (with the exception of committee members),
d) represent the Bureau towards third persons and takes part in official motion picture discussions concerning the work of the Bureau,
e) select and appoints the members of the Age Limit Committee and the Motion Picture Industry Committee after the conclusion of an open application procedure,
f) take part in the meetings of the Motion Picture Coordination Council,
g) report every six months to the Minister of National Cultural Heritage (hereinafter: “the Minister”) on the operation of the Bureau,
h) make proposals to the Minister in the matters defined under section 33(3) of the Act.
Chapter II
Motion Picture Classification for Supporting Motion Picture Distribution
a) the contracts or other documents containing the consent of the authors of the work forming the basis of the motion picture production to the making of the motion picture,
b) the script of the motion picture production,
c) the list of artists participating in the making of the motion picture production, the artistic and technical staff and production locations (the casting) on the basis of the table in section 3 of the Act indicating the technical and artistic contributions of foreign countries participating in the production,
d) the budget and detailed financial plan of the motion picture production,
e) the scheduling of motion picture production,
f) in case of co-produced motion picture productions, the co-production contract, or in the lack of that, the pre-contract of the motion picture producers, which has to include the agreement of the parties on the sharing of revenues from utilization and the geographic allocation of distribution.
a) the list of motion picture producers, artistic and technical staff participating in the production,
b) the budget of the production,
c) the scheduling of the motion picture production.
Chapter III
Registration of Professional Motion Picture Organizations and Natural Persons
Section 7 (1) In accordance with sections 27 and 28 of the Act, the Bureau registers professional motion picture organizations and natural persons applying for state subsidy and the Hungarian enterprises participating in the production of motion pictures produced on order as defined in section 2, point 23 of the Act (hereinafter: motion picture producing enterprises).
(2) Registration requests can be filed prior to applying for state subsidy on the form of the Bureau or in electronic form. Changes in the data registered shall be reported to the Bureau in the same manner within 30 days of occurrence. Simultaneously with the filing of the request, the registration fee shall be paid.
(3) In addition to the data defined in section 28(2) of the Act, the organization requesting registration shall supply the year of its foundation; in case of a business association, the main activity as defined in the TEÁOR; in case of an other organization, the purpose of foundation and whether it requests registration as a motion picture producer, motion picture producing enterprise, motion picture distributor (and within this as a motion picture vendor, cinema operator or in other form), workshop or other organization.
(4) In addition to the data defined in section 28(3), the natural person requesting registration shall report its school qualification or possible professional qualifications.
Section 8 (1) Following the filing of the request for registration, the Bureau shall contact the supporting organizations defined in paragraph (2) which shall, in accordance with section 28(6) of the Act, declare to the Bureau within 15 days from such contact whether the organization or natural person requesting registration or the organization founded or owned by the owner or founder of the organization has any overdue payment or settlement obligations under the Act on Motion Pictures not performed towards the supporting organization. If such an obligation exists, the supporting organization shall declare the amount of such obligation indicating the amount of the state subsidy requested by the applicant and the activity or motion production supported.
(2) Following the filing of the registration request, the Bureau shall contact the following supporting organizations for the declarations defined in paragraph (1):
a) Hungarian Motion Picture Public Foundation,
b) Hungarian Historic Motion Picture Foundation,
c) Natural Cultural Base Program,
d) ministries.
(3) The Bureau shall contact the supporting organizations defined in paragraph (2) quarterly for the purpose of supply of the data defined in section 28(6) of the Act. The other organizations providing state subsidies belonging to the scope of the Act shall inform the Bureau of the professional motion picture subsidies provided or the overdue, non-performed payment obligations supported by them at the time of extending such subsidies or at the time of occurrence of the payment obligation. At the time of the supply of data, the supporting organization shall in addition to the data defined in section 28(5) also provide to the Bureau the data defined in section 9(4) of this decree provided that these data are known at the time of providing the subsidy.
Chapter IV
Register of Motion Pictures
9. § (1) On the basis of section 29(1) of the Act, the Bureau register the motion picture productions for the making of which direct subsidies were used.
(2) The register of motion picture productions requiring direct subsidies is prepared by the Bureau on the basis of the data supplied by the motion picture producer in accordance with section 6 and the supporting organization in accordance with section 8(3).
(3) The motion picture productions requiring indirect subsidies is prepared by the Bureau on the basis of the data supplied by the motion picture producer in the procedure defined in Chapter V.
(4) The Bureau registers motion picture productions with an identification number that must be indicated on all documents issued by the Bureau in relation to the motion picture production. In addition to the data defined in section 29(2) of the Act, the register shall also include data on the name of the producer, director, script-writer, composer, cameraman, leading actors and distributor of the motion picture provided that these persons are known at the time of the data supply.
Section 10 (1) On the basis of section 29(3) of the Act, the Bureau registers all motion picture productions to be distributed.
(2) The register of the motion picture productions to be distributed is prepared by the Bureau on the basis of the data supplied by the motion picture distributor in the procedure defined under section 2(1).
(3) In addition to the data defined in section 2(1), the Bureau also keeps records of the number of viewers and the ticket revenues reached as a result of the distribution of the motion picture in Hungarian cinemas, the number of screenings of the motion picture in a breakdown per cinema operators and the number of copies sold in the distribution of the motion picture on various data carriers and the sales revenue realized.
(4) The register of the Bureau defined in paragraph (3) is based on the data supplied by motion picture distributors (distributors and cinema operators). The distributor shall provide data to the Bureau on the number viewers of the motion picture production concerned, the number of copies in cinema distribution, the number of shows, the revenue realized from cinema distribution, the number of copies of the production sold in distribution on various data carriers and the sales revenue realized, and the cinema operator shall provide data to the Bureau on the number of viewers of the motion picture production concerned in a breakdown per cinemas, the number of shows and the revenue realized. Data should be supplied by the tenth day of every month in respect of the previous month. If the Bureau establishes that the reports provided by the motion picture distributors contain untrue data, it shall inform the supporting organizations of this fact.
Chapter V
Registration of Motion Picture Productions Requiring Indirect Subsidies, Issuing of Subsidy and Investment Certificates
Section 11 (1) On the basis of section 31(3) of the Act and points 36 and 37 of section 4 of Act LXXXI of 1996 on Corporate Income Tax and Dividend Tax (hereinafter: the Act on CIT), the Bureau registers the motion picture productions requiring indirect subsidies and issues the subsidy and investment certificates qualifying for receiving indirect subsidies in the procedure defined in the present chapter.
(2) For the purpose of registration of the motion picture production in accordance with paragraph (1), the motion picture producer and the motion picture producing enterprise shall, in addition to the items defined in section 6(4) of this decree, also file with the request the following
a) the Hungarian production plan of the motion picture,
b) an extract from the Company Registry not older than 30 days of the Hungarian enterprise participating in the production in case of motion pictures produced on order, or of the Hungarian motion picture producer in case of motion pictures not produced on order,
c) the contract concluded between the Hungarian enterprise participating in the production and the foreign motion picture producer (the ordering party) in case of motion pictures produced on order,
d) the budget on the direct costs of motion picture production arising in Hungary (countersigned by all co-producers, sponsors and investors) and its financial plan,
e) in case of motion pictures not produced on order, the documents certifying the cover of the direct motion picture production costs arising in Hungary,
f) an extract from the general ledger for the exclusive ledger account assigned to the motion picture production for the last day of the month preceding the current month,
g) a request of the motion picture producer or the motion picture producing enterprise regarding the scheduling of the issue of the subsidy and investment certificates by the Bureau out of the options provided in section 13.
(3) Prior to the issuing of the resolution on registration, the Bureau examines whether the budget of the production complies with the facts stated in the documents and declarations filed. Provisions of sections 6 (6)-(7) shall be applied for the registration procedure.
(4) The resolution on registration can only be issued if the Bureau has previously registered the motion picture producing enterprise in case of motion pictures produced on order and the Hungarian producer of the motion picture in case of motion pictures not produced on order. The resolution shall contain the amount of direct eligible motion picture production costs incurred in Hungary in respect of the motion picture production and the respective permanent registration fee.
(5) Those costs that can be taken into account as direct motion picture production costs, which create income (with the exception of royalties) for the beneficiary of the payments pursuant to the Act on Personal Income Tax or the Act on Simplified Entrepreneurial Tax or the Act on Corporate Income Tax and Dividend Tax.
Section 12 (1) On the basis of the declaration of the motion picture producer or the motion picture producing enterprise on the completion of the Hungarian production phase of the motion picture production or a certain phase of production as defined in the resolution of the Bureau and the request for the issue of the subsidy and investment certificate, the Bureau performs the audit of the motion picture production and the budget established in the resolution on the permanent registration of the production.
(2) In the request or within 15 days of the receipt of the resolution establishing the acknowledged amount of direct motion picture production costs incurred in Hungary defined in paragraph (4) at the latest, the names, seats and tax numbers of the sponsors or investors shall be provided to the Bureau and the applicant shall also attach to the request documents verifying its eligibility for the application of the certificate, i.e. documents (contracts) certifying the existence of the subsidy or investment.
(3) The Bureau performs the audit of the motion picture production on the basis of the general ledger extract filed by the motion picture producer or the motion picture producing enterprise. In justified cases, the Bureau may also request accounting documents in relation to the production and may also review the accounting of the motion picture producer. In the course of the audit, the Bureau may eventually take into account the auditor’s reports regarding the motion picture production as well.
(4) At the request of the motion picture producer or the motion picture producing enterprise defined in paragraph (1), the Bureau establishes the total amount of direct eligible motion picture production costs incurred in Hungary or its proportionate part for the phase of production concerned and issues subsidy or investment certificates if the motion picture producer or the motion picture producing enterprise had reported the beneficiaries of the subsidy or investment certificate as described in paragraph (2). In case of several sponsors, investors, the Bureau issues the certificates by taking into account the limitation in points 36 and 37 of section 4 of the Act on CIT. The beneficiary of the subsidy certificate is the sponsor of the motion picture production or the investor and a copy of the certificate shall be sent to the motion picture producer or the motion picture producing enterprise.
(5) In addition to the items defined in points 36 and 37 of section 4 of the Act, the subsidy and investment certificates shall also contain the registration number of the motion picture production and the date of providing of the subsidy or investment.
(6) The Bureau shall preserve the documents received in relation to the subsidy and investment certificates for a period of ten years following the issuing of the certificate and shall surrender these at the request of eligible bodies.
(7) Subsidy and investment certificates can be issued if the motion picture producer or the motion picture producing enterprise performs motion picture production as its main activity and in the two years preceding the filing of its request for registration as defined in this section it prepared balance sheets and filed corporate income tax returns. If the last condition is not fulfilled the issuing of the certificate is subject to credible proof of the employment of an expert who has previously been the producer of at least two all-evening motion pictures.
13. § (1) The Bureau issues the subsidy or investment certificates following the completion of the Hungarian phase of the motion picture production in respect of the entire costs of direct Hungarian motion picture production, unless requested in a different scheduling, in several phases by the motion picture producer or the motion picture producing enterprise in accordance with section 11(2).
(2) If the motion picture production is not completed by 31 October of the year in which the request defined in section 11(2) is filed, the motion picture producer or the motion picture producing enterprise shall have the right to request the issue of the subsidy or investment certificate on the direct Hungarian motion picture production costs incurred by 31 October (the first phase of motion picture production).
(3) If the motion picture production is not completed within nine months from the filing of the request defined in section 11(2) or the direct production costs incurred in Hungary with respect to the motion picture production exceeds HUF 150 million, the motion picture producer or the motion picture producing enterprise shall have the right to request the issue of the subsidy or investment certificate quarterly.
(4) In case of applying the provisions of paragraphs (2) and (3), the amount indicated in the certificate (the aggregate amount in case of certificates issued to several sponsors, investors for the same motion picture) may not exceed 20 percent of the motion picture production cost incurred in Hungary until the issuing of the certificate.
Chapter VI
Other Tasks of the Bureau
Section 14 (1) On the basis of section 32(3) of the Act, the Bureau shall at the request of professional motion picture supporting organizations issue certificates on the settlement of direct motion picture subsidies received by the natural persons and organizations registered by the Bureau.
(2) In accordance with section 31(4) of the Act, the Bureau may issue certificates on other data of the organizations included in its register at the request of concerned parties or other public administration bodies.
(3) The Bureau shall establish and ,together with the regulation under section 15(2), publish the circle of data available free of charge and the method of access to such data.
Section 15 (1) On the basis of the authorization provided in section 32(1) of the Act, the Bureau perform professional motion picture data gathering and data management activities. In the course of these activities, it may request data from the organizations and natural persons concerned within the scope of data gathering defined by the National Statistical Data Gathering Program.
(2) Together with the management regulations of the databases prepared by it, the Bureau shall also publish on an annual basis the circle of data gather and managed by it in the Culture Journal.
(3) The Bureau is responsible for the gathering of Hungarian data in the field of motion picture production for the European Audiovisual Observatory and for the forwarding of these data to the Observatory.
Chapter VII
Appeals
Section 16 (1) In respect of the appeals filed against the resolutions issued in the proceedings of the Bureau, the provisions of Act IV of 1957 on Administrative Proceedings shall be taken into account with the exceptions defined in paragraph (2).
(2) Appeals against the resolution defined in section 2(4) shall be filed within 5 days of receipt and against the resolution defined in section 5(3) within 8 days of receipt.
(3) In appeal proceedings, if possible, the planned date for the start of the distribution of the motion picture shall be considered in both cases.
Chapter VIII
Administrative Service Fees Payable for the Services of the Bureau
Section 17 (1) The fee payable for the motion picture classification procedure defined in section 3 shall be HUF 50,000 per motion picture production, and HUF 25,000 in secondary proceedings.
(2) The fee payable for the motion picture classification procedure defined in section 5 shall be HUF 20,000 per motion picture production, and HUF 10,000 in secondary proceedings.
3) The fee payable for the motion picture classification procedure defined in section 6 shall be per motion picture production:
a) HUF 5,000 in respect of motion picture subject to section 6 (5), and HUF 2,500 in secondary proceedings,
b) HUF 20,000 in respect of all other motion picture production, and HUF 5,000 in secondary proceedings.
Section 18 (1) The fee payable for the registration procedure of professional motion picture organizations and natural persons defined in section 7 shall be:
a) HUF 5,000 in respect of natural persons, HUF 2,500 in secondary proceedings,
b) HUF 20,000 in respect of organizations, HUF 10,000 in secondary proceedings.
(2) In case of reporting changes in data, the fee payable for the registration procedure defined in section 7 shall be:
a) HUF 2,000 in respect of natural persons, HUF 1,000 in secondary proceedings,
b) HUF 5,000 in respect of organizations, HUF 2,500 in secondary proceedings.
Section 19 (1) The fee payable for the registration procedure defined in section 11 shall, in case of the registration of motion pictures produced on order (the issuing of subsidy certificates), be:
a) 0.2 percent, but maximum HUF 500 000 of the direct motion picture production cost incurred in Hungary in case of the scheduling under sections 13(1) and (2), the fee of the secondary proceeding is 0.1 percent, but maximum HUF 250 000 of the direct motion picture production cost incurred in Hungary.
b) 0.3 percent but maximum HUF 500 000 of the direct motion picture production cost incurred in Hungary in case of the scheduling under sections 13(3), the fee of the secondary proceeding is 0.15 percent, but maximum HUF 250 000 of the direct motion picture production cost incurred in Hungary.
(2) The fee payable for the registration procedure defined in section 11 shall, in case of the registration of motion pictures not produced on order (the issuing of investment certificates), be:
a) 0.1 percent, but maximum HUF 250,000 of the direct motion picture production cost incurred in Hungary in case of the scheduling under sections 13(1) and (2), the fee of the secondary proceeding is 0.05 percent, but maximum HUF 125 000 of the direct motion picture production cost incurred in Hungary.
b) 0.15 percent but maximum HUF 250,000 of the direct motion picture production cost incurred in Hungary in case of the scheduling under sections 13(3), the fee of the secondary proceeding is 0.07 percent, but maximum HUF 125 000 of the direct motion picture production cost incurred in Hungary.
Section 20 No reductions of or exemptions form the procedural fees of the Bureau are possible.
Section 20 (1) The fees payable for the procedure of the Bureau shall be paid to the target fund utilization framework account no. ……………………… of the National Motion Picture Bureau managed by the Hungarian Treasury indicating “Treasury Transaction Code ……. In case of the registration procedure defined in section 11 the identification number of the motion picture production shall also be indicated.
(2) For the management, accounting, recording and refunding of the fees the legal regulations pertaining to the reporting and accounting obligations of organizations operating on the basis of a budget shall apply.
(3) If the relevant fee is not paid in respect of any procedure of the Bureau, the client can be instructed to payment and warned; should the client fail to comply, the request will be rejected.
(4) The Bureau shall refund to the applicant the fee of appeal against the Bureau’s resolution for which resolutions the court establishes violation of law.
Closing Provisions
Section 22 This decree shall enter into force on the day of promulgation. For the issuing of the subsidy and investment certificates defined in section 11, the direct motion picture production costs arising after 1 April 2004 can be taken into account.