Colombia Takes Lead in Latin American Tax Incentives

By Peter Caranicas, Variety

When producer Mike Medavoy was pondering where to shoot "The 33," the feature centered on the 2010 mining accident in Chile that left 33 men trapped underground for 69 days while the world followed their plight on TV and social media, he faced several choices. One was to shoot the film entirely where it took place: Chile.

Another was to split the shooting between Chile and Colombia; Chile offers no tax incentives, while the Colombian government recently passed a law that lets producers save up to 40% on production and post-production services and an additional 20% on lodging, transportation and meals if they hire local production service companies.

For producer Robert Katz of Half Circle, the banner producing "The 33," the decision was a no-brainer. He says the movie will save a significant chunk of change by shooting partly in Colombia. In addition to the government incentives, he says, "rates in Colombia are very competitive for crews, as are other costs. It's much less expensive to shoot there than in the U.S., and even Chile, and it makes all the difference on whether you can make the movie or not."

"The 33" is now in pre-production, and shooting is slated to start Nov. 25, with production almost evenly split between the two South American countries. Patricia Riggen will direct an ensemble cast that includes Antonio Banderas.

As different jurisdictions vie for a slice of the worldwide production pie, some territories are outdoing each other in the race to attract film producers. Led by Colombia, Latin America has introduced some of the most aggressive programs.

And in Colombia, those efforts have paid off, according to Joe Chianese, exec VP of Entertainment Partners, the production payroll firm that also advises producers on state and national incentive programs and calculates comparative budgets based on shooting locations. "The incentive is barely a year old, and I've gotten maybe two dozen phone calls from people looking at Colombia," says Chianese. "The country has a perception issue dating from the '80s drug-lord culture, but the film commission has done a good job of changing those perceptions."

Chianese notes that other parts of Latin America — helped by more favorable exchange rates, growing economies and improving public safety — have also emerged as major shooting destinations. This includes Brazil, the largest Latin territory. And in the Caribbean, where Puerto Rico has long lured productions from the U.S. mainland with tax breaks and scenery, the Dominican Republic has also thrown its hat in the ring, bolstered by a newly built soundstage complex courtesy of U.K.-based Pinewood Studios.

On the other hand, Mexico, which also offers incentives, is today afflicted by drug wars the way Colombia was a decade ago. Despite scoring some recent gets, such as the Matt Damon starrer "Elysium," "the country is truly suffering from a safety issue," Chianese says.

"A lot of the kinds of movies that used to go to Mexico are now coming here," says Colombian film commissioner Silvia Echeverri. "We had to pass through the same history." Her office supports the year-old incentive program with tours inviting producers from the U.S. and elsewhere to visit Colombia and learn first-hand what resources are available, including production service companies, crews and locations.

But there are also limits to Colombia's incentives and resources. Consultant Jason Resnick, whose clients include film distributors and Colombia's Proimagenes film promotion agency, notes that the new incentive applies to features but not to TV series. "Colombia has a robust TV industry," he says. "If the incentive applied to television, all the local TV production companies would start applying for it."

Another shortcoming: Colombia has no large, sophisticated soundstages that could house major feature productions.

"We don't have huge studio areas needed for big films," commissioner Echeverri acknowledges. "But if a film is not huge we can offer TV production space in Bogota. But we mainly offer our crews and locations."