Australia’s film industry has inspired a robust series of international co-production agreements since the nation signed its first co-production Memorandum of Understanding(MOU) with France in 1986. To date, Australia has twelve official treaties and two MOUs, the most recent being a co-production treaty established with India in November 2023.
Among these international partnerships, the Australia-Canada treaty has been the most productive, yielding 72 co-productions since 1990, with budgets reaching $625m. The Australia-United Kingdom treaty follows as the next most active partnership, producing 51co-productions, reaching budgets of $563m.
The motivation behind these treaties varies, but to a mutually beneficial end: the governmentbenefits from building cultural and trade relationships with the partner country, while forfilmmakers and producers, the treaty represents an opportunity to increase funding,distribution and creative avenues, increasing the likelihood of getting their project to greenlight.
Emerging Opportunities for Co-Production
In an IF interview following the announcement of her appointment as POCU (Producer Offset and Co-Production Unit) Advisor in March, Michele McDonald commented on the increase in Australian co-production applications, saying “Co–productions are becoming more important than ever for the future success of the sector.”
In November of 2024 an Australian delegation attended the Goa Film Bazaar, which hosted an Australia-India matchmaking initiative. As the official country of focus at the International Film Festival of India (IFFI), the matchmaking initiative provided financial support to producers with co-production experience, further demonstrating the value of international collaboration. While Lion, a celebrated Australian film featured at IFFI, was produced before the Australia-India treaty, its success helped pave the way for the 2023 agreement.
Since its establishment in 2008, the UK-India co-production treaty has facilitated suchnotable films as Slumdog Millionaire and The Best Exotic Marigold Hotel, evidencing treaty co-productions are a valuable program for all nations.
Canada Connect, a curated co-production program similar to the Australia-India matchmaking initiative, is scheduled for 5th May 2025, preceding the Screen Forever conference on the Gold Coast. Following previous programs like UK Connect and Ireland Connect, Canada Connect will bring together 30 producers from Canada and Australia with the goal of fostering global partnerships and providing opportunities to access additional funding streams for their projects.
Co-Production Benefits and Requirements
Treaty co-productions offer significant advantages to both participating parties by qualifying as local productions in both countries. This dual qualification enables access to government financial support from both nations, including Screen Australia and State grants and equity funding, and Offset support in Australia, along with corresponding federal and state incentives in the partner countries. It also means the production will meet local content quotas.
Such a creative and technical collaboration has the potential to extend market reach, while building international partnerships. However, producers must weigh these benefits againstincreased complexity, sharing of ownership and increased costs brought on by additionalproducers, legal, audit and travel expenses, which should be considered in any risk benefit analysis. For these reasons, co-productions are generally best suited for experienced filmmakers and not ideal for low-budget or first-time filmmakers.
Launching a Successful Co-Production
For any successful co-production venture, the narrative and creative elements should align for each of the partner countries, and both producers must share a unified vision for the project.
While there will typically be a lead producer who brings the original works to the table, they may not be the majority partner, particularly if principal photography occurs predominantly in the partner country.
Screen Australia’s online eligibility tool is a great way to understand how your co-production may come together. With the help of this tool, producers can:
• Evaluate key creative contributions from each country to establish percentage splits.
• Calculate financing and spend requirements that must align with creative splits.
• Ensure compliance with minimum contribution thresholds, typically 30% for minor co-producers. India’s threshold is currently at 20%, with potential future treaty amendments moving toward a universal 20% standard.
Financial and Legal Considerations for Co-Productions
Once the producing partnership is established and the value of the co-production has been determined, both producers must coordinate timely applications to their competent authority to obtain provisional certification, while optimising the financing and distribution opportunities that come with the certification.
On completion of the film, a final certificate will be issued. It is very important that the final applications happen in parallel; the producer may consider making this a condition outlined in the co-production agreement.
Between greenlight and delivery, consolidated accounting and cost reporting become critical elements of managing your co-production. Maintaining accurate percentage spend splits and monitoring all incentives and spend across the entire production will help to ensure you are able to easily meet the audit requirements for qualification on delivery. To navigate this complexity effectively, it is recommended that the lead producer engage a financial controller who will oversee and review consolidated cost reports throughout production.
Adding to this accounting complexity, rules around qualifying spend for the Producer Offset and the partner country incentives may not follow the co-production spend definitions. This gap means the producers must carefully consider the contracting of key creatives and cast. It is important to note that the MEAA (Media Entertainment Arts Alliance) agreements for cast have a co-production loading which will increase the minimum fee rates for local talent.
Furthermore, the partner countries in each treaty have different qualifying conditions and key creative point systems to Australia. To minimize financial risk, closely monitor multi-currency cash flows, exchange rate fluctuation and the tax implications for overseas personnel.
Partnering for a Successful Co-Production
Co-productions offer a unique opportunity to access additional funding, expand market reach, and build lasting international partnerships. However, they require careful financial planning, legal oversight, and strong creative alignment.
The increasing importance of co-production reflects the evolving nature of our industry, and Australia’s growing network of co-production agreements strengthens its position as a leader in international filmmaking, celebrating the cultural diversity that proudly resides in Australia, one which the audiences of the world continue to embrace.