Law no. 42/2004 of 18 of August

Published in D.R. number 194 (Series I-A) of 18 August 2004

Assembleia da República (Assembly of the Republic)

Law

(This is not an official translation of the law)

Law of Cinematographic and Audiovisual Arts

Pursuant to point c) of article 161 of the Constitution, the Assembly of the Republic hereby decrees the following, to be affective as general law of the Republic:

CHAPTER I
General provisions
 

Article 1
Subject

1 – The present law aims at establishing the principles the State shall apply within the framework of the promotion, development and protection of the arts concerning the cinema and cinematographic activities, as well as of audiovisual production.

2 – State action shall be governed by the principles of freedom of expression and freedom of creation, and for the respect to the viewer’s right to the choice of cinematographic and audiovisual works.

3 – As regards the definition of the action principles referred to in the preceding paragraph, the State shall promote the interaction with agents from the cinematographic and audiovisual sectors, the media, education and telecommunications.

Article 2
Definitions

For the purpose of application of the present law, the following definitions shall apply:

a) «Cinematographic works» shall mean intellectual creations expressed by means of a set of combinations of words, music, sounds, written texts or moving images, on any kind of support, intended as a matter of priority for the distribution and theatrical exhibition thereof, as well as for the public communication thereof by any other ways or form, by wire or wireless means;

b) «Audiovisual works» shall mean intellectual creations expressed by means of a set of combinations of words, music, sounds, written texts or moving images, on any kind of support, intended as a matter of priority for television broadcasting, as well as for the public communication thereof by any other ways or form, by wire or wireless means;

c) «Cinematographic and audiovisual activities» shall mean the set of processes and acts related to the creation, interpretation and performance included, the direction, production, distribution, exhibition and dissemination of cinematographic and audiovisual works.

Article 3
Objectives

1 – The State shall support cinematographic and audiovisual creation, production, distribution, exhibition, dissemination and promotion, as instruments for the full development of the human person, culture, affirmation of the national identity, protection of the language and enhancement of Portugal’s image worldwide, in particular as regards the further development of relationships with Portuguese-speaking countries.

2 – The State shall adopt support measures and programmes that aim at the development of the company structure and market for cinematographic and audiovisual works, in compliance with the principles of sound competition between the several agents thereto.

3 – The State shall promote and ensure the long-term maintenance of the cinematographic and audiovisual heritage, by means of measures that guarantee the preservation thereof.

4 – In the scope of matters governed by the present law, the State shall pursue the following aims:

a) To encourage the creation, production, distribution, exhibition, dissemination and editing of cinematographic and audiovisual works;

b) To promote the protection of copyright and rights of producers of cinematographic and audiovisual works, as well as the rights of artists, interpreters or performers thereof;

c) To encourage international co-production, through the conclusion of bilateral reciprocal agreements and of international conventions;

d) To enhance the cooperation with Portuguese-speaking countries in the scope of cinematographic and audiovisual production, distribution and exhibition sectors;

e) To develop cinematographic and audiovisual distribution and exhibition markets through the conclusion of bilateral and multilateral reciprocal agreements;

f) To develop cinematographic and audiovisual sectors through the establishment of incentives and other tax measures;

g) To promote the participation of the private sector in the development of cinematographic and audiovisual industry;

h) To encourage the dissemination and promotion of the cinematographic and audiovisual production, both at national and international level;

i) To encourage non-commercial dissemination and promotion of cinema and of audiovisual production, namely by supporting movie club activities as well as cinema and video festivals;

j) To promote the free movement of cinematographic and audiovisual works;

l) To promote the maintenance of national cinematographic and audiovisual heritage, as well as that existing in Portugal, to enhance it and to ensure permanent cultural access thereto;

m) To promote the participation of entities representing cinematographic and audiovisual sectors in the definition of policy measures concerning the cinema and audiovisual production;

n) To develop artistic training and continuous professional training as regards the cinematographic and audiovisual sectors;

o) To ensure equal access of citizens to all forms of cinematographic and audiovisual expression.

5 – The State shall support European cinema, in compliance with standards of international law in force, namely those established in the framework of the European Union (EU), of the European Convention on Cinematographic Co-production and of international treaties concerning intellectual property.

6 – The support and measures provided for in the present law shall be articulated with the support and incentive systems established in standards of international and Community law that bind the Portuguese State.

Article 4
Maintenance and access to heritage

1 – The State shall ensure the long-term preservation and maintenance of Portuguese cinematographic and audiovisual works or those existing in Portugal, a heritage deemed to integrate the country’s cultural heritage.

2 – The State shall promote public access to works that integrate the national cinematographic and audiovisual heritage for purposes of artistic, historic, scientific and educative investigation, submitting such access to the rules on heritage maintenance, safeguarding the legitimate interests of patrimonial or commercial right holders.

3 – The State shall also ensure public exhibition and exposition, according to museographic criteria, of cinematographic and audiovisual works that already constitute or shall constitute in the future heritage thereof, in compliance with the right of citizens to cultural fulfilment.

4 – The State shall promote the deposit, preservation and restoration of national movie and audiovisual heritage, as well as of the most representative international movie and audiovisual heritage.

5 – The State shall maintain a collection which aims at including all national and similar movies, as well as foreign movies of an acknowledged historic and artistic importance.

6.  The State shall promote the museographic element of movie and audiovisual heritage.

Article 5
Legal deposit of cinematographic and audiovisual works

The legal regime concerning the legal deposit of “moving images”, which includes namely the definition of the patrimonial status of such images, the legal deposit obligation, the creation of conditions for the investment in preservation, continuous storage and restoration, and for public access and consultation, shall be provided for by law.

Article 6
Services and bodies

In the scope of matters concerning the provisions of the present law, the Minister for Culture shall supervise the Public Administration services and bodies as well as further entities responsible for the application of measures of support as regards cinematographic and audiovisual sectors.

CHAPTER II
Cinematographic and audiovisual arts
 

SECTION I
Cinematographic and audiovisual production
 

Article 7
National production

1 – The State shall encourage the production, the accomplishment of co-productions, the promotion and national and international dissemination of cinematographic and audiovisual works, through the establishment of annual production plans, financial support, creation of investment obligations and of access to credit, tax measures, sponsorships and cooperation agreements.

2 – The State shall establish financial and credit mechanisms that encourage the development of the industrial structure in the cinematographic and audiovisual sectors.

3 – The State shall support script writing and the development of projects, as well as the production of innovating cinematographic and audiovisual works.

4 – The State shall promote measures that ensure the access of people with disabilities to cinematographic and audiovisual works.

5 – The State shall establish prizes that aim at the public acknowledgement of works and professionals of the cinema and audiovisual sectors.

Article 8
Support programmes

1 – With the purpose of encouraging the creation and renovation of cinematographic art, a programme is hereby established, which aims at script writing regarding fiction feature films, at the development of projects concerning series and animated films, and at the development of documentaries.

2 – With the purpose of encouraging the production of works of acknowledged cultural and artistic worth or of an experimental nature, a programme is hereby established, which aims at the production of fiction feature films, first works of fiction feature films, short fiction subjects, animation series and documentaries.

3 – With the purpose of supporting financially the production of fiction feature films of directors who present relevant curricula for the promotion and enhancement of the Portuguese culture and language, a complementary programme is hereby established.

4 – With the purpose of promoting the sustained development of undertakings of the cinematographic and audiovisual sector and of encouraging the development thereof, namely through the emergence of new production undertakings, it is hereby established a financial support programme for multiannual production plans of cinematographic producers and independent television producers that develop, on a permanent basis, medium or long term production strategies.

5 – With the purpose of encouraging reinvestment in new productions of fiction feature films and animation for the cinematographic market, it is hereby established an automatic programme that attends to ticket results in the course of the exhibition period in theatres and the commercial operation income of the preceding work of the same producer.

6 – With the purpose of encouraging co-production, a programme is hereby established, which aims at the co-production of fiction feature films, animation films and series and documentaries with a minority Portuguese participation.

7 – With the purpose of enhancing cooperation with Portuguese-speaking countries, a programme is hereby established, which aims at the co-production of fiction feature films, animation films and series and documentaries.

8 – In compliance with the strategic principle of diversity, the effectiveness of annual and multiannual production plans implies the harmonious, proportionate and full accomplishment of all financial support programmes.

9 – The support programmes provided for in the present law have the nature of legally approved multiannual plans, pursuant to article 25 of Decree-Law no. 155/92, of 28 July.

Article 9
Financial support

1 – The financial support to be granted in the scope of support programmes established in the present law has the nature of a loan or of non-repayable grant.

2 – The rules for financing the production of cinematographic and audiovisual works shall be established in a regulatory instrument to the present law, having regard to the following assumptions:

a) To ensure equal opportunities of interested parties;

b) To ensure the compliance with the principles of justice, impartiality, collaboration and participation in the procedures concerning application, selection and decision to grant support;

c) To define objective technical criteria for selection, in order to guarantee transparency in the procedure to grant support;

d) To publicly disclose the annual financing amounts, according to the budget approved;

e) To ensure the support to works of an acknowledged cultural and artistic worth, to first works and works of an experimental nature;

f) To attend, as regards multiannual programmes, to the sustained development of the activity of cinematographic and audiovisual producers, as well as to the diversity thereof;

g) To encourage the production of works that contribute to an increased interest of the public, by granting automatic support, based on ticket results in the course of the exhibition period in theatres and the commercial operation income in any other support.

Article 10
Beneficiaries

1 – Duly registered producers may benefit from financing and other types of support provided for in the present law.

2 – Only independent television producers may benefit from financial support to audiovisual production.

3 – Script writers and directors may benefit from financial support in the cases provided for in a regulatory instrument to the present law.

Article 11
National cinematographic and audiovisual work

1 – For the purposes of the present law, cinematographic and audiovisual works shall be deemed as “national works” where they meet the following requirements:

a) At the least 50% of the authors shall be Portuguese nationals or nationals of any EU Member State;

b) At the least 50% of the technical staff shall comprise Portuguese nationals or nationals of any EU Member State;

c) At the least 50% of the leading roles and of the main and supporting roles shall be played by Portuguese actors or by nationals of any EU Member State;

d) At the least 50% of the time of the making-of or of the production shall be spent in Portuguese territory, except where the script does not allow so;

e) The original version shall be in Portuguese, except where the scrip does not allow so.

2 – For the purposes of the present law, “national work” shall also mean the work with a Portuguese production or co-production, under the terms of international agreements that bind the Portuguese State, bilateral agreements for cinematographic co-production and the European Convention on Cinematographic Co-production, and further applicable Community legislation.

SECTION II
Cinematographic and audiovisual distribution, exhibition and dissemination
 

Article 12
Access to distribution, exhibition and dissemination markets

1 – The State shall adopt measures to support producers for the distribution, exhibition, dissemination and promotion of cinematographic and audiovisual works in the national and international markets, namely by granting financial support to copy-making, and incentives to the commercial exhibition of cinematographic works with quality classification, and by creating measures that enhance the association between producers and national distributors and their foreign counterparts, specially those of Portuguese-speaking countries.

2 – The granting of support shall pay due regard to the application of new technologies and of measures that ensure the access to the referred works by people with disabilities.

3 – The State shall adopt measures to support cinematographic exhibitors that present a regular programming of Portuguese or Community works, as well as documentaries, short fiction subjects and animation cinema.

4 – The State shall supervise theatres, aiming at ensuring the functional adequacy thereof.

5 – The State shall support non-commercial cinematographic exhibition, aiming at contributing to the creation of an alternative exhibition network, through the dissemination of:

a) National and Community works;

b) Less known cinematographic works.

6 – For the purposes of the preceding paragraph, «non-commercial exhibition» shall mean that which is performed out of the normal marketing operation of theatres, namely:

a) Sessions organized by public entities;

b) Sessions free of charge;

c) Privative sessions, organized by cultural associations, movie clubs and schools;

d) Paid public sessions, when organized by cultural associations, movie clubs, schools and other bodies acting with a non-profit purpose.

7 – The State shall adopt measures that encourage the collaboration between local authorities and cinematographic exhibitors, with the purpose of creating and recovering theatres, especially in districts where there is no regular exhibition activities.

8 – The State shall adopt measures that encourage collaboration between local authorities, educational establishments, cultural associations and cinematographic exhibitors, with the purpose of promoting the dissemination of cinematographic art as a fundamental good for the cultural development of the community.

Article 13
Distribution license

1 – The distribution, including selling, renting or lending, of cinematographic works intended for commercial operation depends of a prior license issue.

2 – For the license referred to in the preceding paragraph shall be due the payment of a fee, on the part of the distributor, which shall be deemed as a revenue of the broadcasting entity.

3 – The movies classified as quality movies shall be exempted from the payment of the distribution fee.

4 – National movies exhibited with less than six copies shall be exempted from the payment of the distribution fee.

5 – The determination of the amount, the methods for the settlement thereof, the collection and supervision of amounts to be collected with the distribution fee shall be the subject of a separate statutory instrument.

Article 14
Exhibition of national works

The commercial distribution and subsequent exhibition of at the least 60% of national works supported by the State shall be annually ensured by all cinematographic distributors and exhibitors with commercial activity within national territory, under the conditions established in a regulatory instrument to the present law.

Article 15
Ticket office control

With the purpose of enabling the pursuit of the competences of the State and with regard to the legitimate interests of the commercial activity, the owners of halls for cinematographic exhibition shall comply with the procedures legally established regarding the issue of tickets, namely in order to ensure the effective control of income and the information on the exhibition period for each film and the number of spectators.

Article 16
Cinema, television and video

The conditions for the dissemination in television and for the videographic edition of cinematographic works shall be established in a regulatory instrument to the present law.

CHAPTER III
Artistic and professional training
 

Article 17
Artistic and professional training

The State shall grant support to professional training and encourage the teaching of cinematographic  and audiovisual arts in the educational system, in areas such as specific projects, investigation and development (I&D), innovation in the production and dissemination of cinematographic, copyright and related rights, with the purpose of stimulating, enhancing and diversifying the continuous training of professionals from the cinematographic and audiovisual sectors.

Article 18
International cooperation

The State shall promote the participation of Portuguese public and private bodies and of professionals in international partnerships and projects in the area of cinematographic and audiovisual arts training.

CHAPTER IV
Register and registration
 

SECTION I
Register of cinematographic and audiovisual works
 

Article 19
Purpose of the register

The State shall organize the register of  cinematographic and audiovisual works, aiming at the security of juridical commerce.

Article 20
Subject of registration

1 – Cinematographic and audiovisual works which are produced, distributed or exhibited in national territory shall be subject to registration, irrespective of their type, format, support and duration.

2 – The State shall promote the registration of all works financially supported and produced as from the entry into force of Law no. 7/71, of 7 December, until the register is effectively established.

3 – The rules to be complied with regarding registration shall be established in a regulatory instrument to the present law.

SECTION II
Register of cinematographic and audiovisual undertakings
 

Article 21
Register of cinematographic and audiovisual undertakings

1 – The register of cinematographic and audiovisual undertakings regularly formed is hereby created.

2 – The register referred to in the preceding paragraph is compulsory for all natural or legal persons with place of business or fixed establishment in national territory, the commercial operation of which concerns the production, distribution and exhibition, as well as for making-of, dubbing and subtitling laboratories and studios as well as for of equipment undertakings and those dealing with technical means.

3 – The legal regime for the register shall be established in a regulatory instrument to the present law.

CHAPTER V
Financing
 

Article 22
Financing

The State shall ensure the financing of the promotion and development of cinematographic and audiovisual arts, under the terms established by the present law and by regulatory statutory instruments thereto.

Article 23
Contribution and investment contracts

1 - The financing of the promotion and development of cinema and of audiovisual production shall be ensured through the collection of a contribution which shall equal 5% of income regarding the provision of services of television operators and distributors of conditioned access services.

2 - The financing of the promotion and development of cinematographic and audiovisual arts shall also be ensured through multiannual investment contracts signed between the Minister for Culture and the television operators and distributors referred to in the preceding paragraph, in which case the contribution provided for in the present article shall not be applicable.

3 – The provision of the preceding paragraph shall comprise any distribution or dissemination platform used, namely cable, satellite, digital terrestrial, fixed access by wire or wireless means, or any other that may come to exist.

4 – The determination of the investment subject of investment contracts shall take due regard to the annual turnover of television operators and distributors referred to in the preceding paragraph 1, the respective market share and the needs for annual investment as far as the cinematographic and audiovisual sectors are concerned.

Article 24
Settlement

1 – The contribution referred to in paragraph 1 of the preceding article shall be settled, by tax substitution means, through undertakings providing services.

2 – Upon the contribution amount referred to in the preceding paragraph shall not fall any imposition of a fiscal or copyright nature.

3 – To the settlement and contribution payment shall apply, in the alternative, the provisions of the General Tax Law and of the Code of Tax Procedure and Process.

Article 25
Investment of television operators in the promotion and development of cinematographic and audiovisual arts

Without prejudice to other obligations provided for under the law, the participation of television operators in the cinematographic and audiovisual production shall be ensured through contracts of multiannual investment to be made to the capital investment fund intended for the promotion and development of cinematographic and audiovisual arts, referred to in the following article.

Article 26
Investment fund

1 – The result of the contribution and of investments subject of contracts, provided for in article 23, shall be consigned to an investment fund to be created in a separate statutory instrument, intended for the promotion and development of cinematographic and audiovisual arts, constituting the fund’s own revenue.

2 – The participation of the State shall be ensured through the body of the Ministry for Culture with responsibilities in the fields of cinema and audiovisual arts.

Article 27
Distribution investment in the cinematographic and audiovisual production

1 – The participation of distributors in cinematographic and audiovisual production shall be ensured through an annual investment of an amount of not less than 2% of revenues accruing from the distribution of cinema, a percentage that may be revised, annually, by means of a separate statutory instrument.

2 – The investment of cinematographic distributors in cinematographic production may take any of the following forms:

a) Participation in the financial setting of a movie, as co-financer, with no involvement in the production;

b) Participation in the production of the film, as co-producer;

c) Advances on production, in the form of minimum guarantees.

3 – The distribution investment in cinematographic and audiovisual production shall also be ensured by the participation of videogram distributors, through an annual investment of not less than 2% of revenues accruing from that activity.

4 – The provision of the preceding paragraph shall not comprise videogram renting or exchange activities.

5 – The investment of videogram distributors in cinematographic production may be applied in the forms provided for in points a) and c) of paragraph 2 of the present article.

6 – The amounts provided for in paragraphs 1 and 3 that, in each civil year, are not allocated to investment in production shall be rendered, by each distributor, to the investment fund referred to in article 26.

Article 28
Exhibition fee

1 – The commercial advertisements exhibited in movie theatres and disseminated in television, comprising advertisements, sponsorships, telepromotions, teletext, on scene displaying of products, and also advertisements included in programming electronic guides, irrespective of the broadcasting platform, shall be subject to an exhibition fee of 4% on the amount paid, the burden of which shall fall upon the advertiser.

2 – The settlement, collection and monitoring of amounts to be collected with the exhibition fee shall be defined in a separate statutory instrument.

Article 29
Retention on ticket prices

1 – Cinematographic exhibitors shall retain 7,5% of the amount of the price at which cinema tickets are to be sold to the public.

2 – The amounts resulting from the retention referred to in the preceding paragraph shall be applied as follows:

a) 5% aim exclusively at the promotion of cinematographic exhibition and at the maintenance of the theatre wherein the revenue was produced, it shall be managed by the exhibitor and shall be comprised in a separate accounts;

b) 2,5% aim at ensuring the participation of cinematographic exhibitors in the investment fund referred to in article 26.

3 – The participation referred to in point b) of paragraph 2 may also be ensured, having regard to the amounts provided for therein, through multiannual investment contracts signed between the Minister for Culture and the cinematographic exhibitors referred to in the preceding paragraphs, in which case the contribution provided for in the present article shall not be applicable.

4 - The investment contracts provided for in paragraph 3 may take any of the following forms:

a) Participation in the financial setting of the movie, as co-financer, with no involvement in the production;

b) Participation in the production of the movie, as co-producer;

c) Advances on production, in the form of minimum guarantees.

5 – The percentage established in paragraph 1 shall not be considered for the statement of revenues accruing from movie exhibition, without prejudice to the fulfilment of tax obligations that fall thereupon.

CHAPTER VI
Final and transitory provisions
 

Article 30
Repealing provisions

Decree-Law no. 350/93, of 7 October, is hereby repealed, as well as all legal provisions that are not in line with the present law.

Article 31
Transitory provision

The following statutory instruments shall remain in force until the rules for the application of the present law have been approved:

a) Bases XLVII to XLIX of Law no 7/71, of 7 December;

b) Articles 53 to 65 of Decree-Law no. 184/73, of 25 April;

c) Decree-Law no. 296/74, of 29 June;

d) Administrative Law no. 45-D/95, of 19 January;

e) Administrative Law no. 366-A/95, of 27 April, except for Chapter III of the regulation thereof;

f) Administrative Law no. 315/96, of 29 July;

g) Administrative Law no. 515/96, of 26 September;

h) Administrative Law no. 278/2000, of 22 May;

i) Administrative Law no. 280/2000, of 22 May;

j) Administrative Law no. 1047/2000, of 27 October;

l) Administrative Law no. 1060/2000, of 30 October;

m) Regulatory Decree no. 3/2001, 5 February;

n) Administrative Law no. 1165/2001, of 4 October;

o) Administrative Law no. 1167/2001, of 4 October;

p) Administrative Law no. 1265/2001, of 2 November;

q) Administrative Law no. 317/2003, of 17 April;

r) Administrative Law no. 653/2003, of 29 July;

s) Administrative Law no. 878/2003, of 20 August.

Article 32
Entry into force

The present law enters into force 30 days following the date of publication thereof.

Approved on 1 July 2004.

The President of the Assembly of the Republic, João Bosco Mota Amaral

Promulgated on 2 August 2004.

Let it be published.

The President of the Republic, JORGE SAMPAIO.

Counter-signed on 5 August 2004.

The Prime Minister, Pedro Miguel de Santana Lopes.