Contracts in the Film Industry

For films and other media projects, contracts or an agreement serve as shields and a protective layer for your project. They are very much crucial so you do not leave any room for confusion, risk misinterpretation, and miscommunication of the deal to the client, the producer, or the production house at every phase of the project from pre-production until the distribution process. The agreement must be formed, discussed, and established among the team first then the actors and crew people quite before the actual work begins.

This article focusses on the terms and the relationship between the contract holders. It details how contracts are formed, between whom it is executed, and the important clauses are required to be mentioned in the agreement. Basically, the three most important contracts in the film industry have been discussed in a detailed manner in this article. Anybody who is a part of a film project inclusive of the producer, the actors, the crew members, and the distributors need to undertake these contracts so that their rights and duties remain protected and will not have any chance of exploitation.

Introduction

Filming is generally all about making and displaying motion pictures on a screen. Therefore, the film industry or the so-called, motion picture industry essentially consists of technological and commercial institutes of film making process that is, animation, cinematography, photography, pitching, screenwriting, film studios, production companies, film directors, actors, pre-production, post-production, and others. From its conception on paper to its release on a multiplex screen the whole process of film production is huge and ongoing with a lot of people participating in it.

On the other side, the contract is the legally binding document that recognizes and governs the rights and duties of the participative parties to the agreement. It clearly defines who is entitled to own what, who will perform which rights, who owns the license for the same, who exercises the rights, and the manner of distribution of profits.

Since the Film industry hires so many people for each and every specific task, it gets very chaotic and unclear. To avoid risk or confusion it is a significant decision for every individual in this field of work to be clear with what is expected from him and to ensure this contract become essential.

Contracts in film industry deal with these following agreements:

A.    Film production agreement

Production is defined as a time frame of the movie-making process when the motion is created out of principal photography and the movie physically gets formed. This generally involves agreements with the hiring cast and crew, renting of a location for shooting, etc.

Film production agreements are of two different categories:

·         Acquisition agreement

These agreements are in execution for availing artists, crew members, and other people required for the production of the movie. The people who can be acquired or are required to be acquired through this agreement are:

  • Actors
  • Directors
  • Performing Artists
  • Line Choreographers
  • Art Directors
  • Costume Designers
  • Recording Artists

·         Licensing Agreement

These agreements are for licensing the rights and profits to the parties who are a part of the production to display the film. These agreements help protect the rights of the film. Licensing Agreements include:

  • Movie Licenses
  • Music license
  • License to merchandise
  • License to Remake
  • Character License
  • Image License

B.     Intellectual property agreements

These agreements are for the execution of the Intellectual property rights attached to the film making process and the movies. These generally include:

  • Obtaining intellectual property rights to scripts
  • Licensing the intellectual property rights to Distributors

C.    Distribution agreements

These agreement are put to execution in the post-production phase, which comprises:

  • Exhibition Agreement in cinema
  • Film Distribution on TV
  • Foreign Distribution
  • Film Distribution
  • Film Distribution on the Internet

Production Agreements

A Production agreement is a particular kind of service agreement wherein one individual let us assume, the producer or the production service provider, forms the contracts and gets it executed to produce an art or media project for the receiver or the client.

Production Agreements are generally formed between the two individuals or two entities or between an individual and a company which is generally status wise huge. For instance, it could be between two companies or sometimes between a meager client and producer.

Production agreement terms include provisions that allow surety and specificity to develop around a relationship formed which can include:

  1. What project the parties would be involved in and working on?
  2. What kind of movie will be produced and is needed to be shot?
  3. Which specific sound software is required with which the music needs to be mixed on?
  4. What type of camera will come for usage during the shoot time?
  5. What would be the schedule for the shoot?
  6. Business-oriented provision like the payment structure is also defined in it.

This agreement is made when the parties want to enter into a production agreement. This agreement can be used for any type of art form, for example, the media or photography, cinematography project, etc. It outlines the kind of relationship and understanding which the parties would be having with each other. For instance, if a movie producer enters into a contract with a client to produce a full-length motion picture. The agreement will include the following clauses:  

  • Names and identification detail of the parties and other pertinent details of the contract too.
  • Description of the respective project work undertaken which describes the project. It could be described as a full-length motion picture i.e. a movie, a documentary, a video or a short film, etc. which would consist of the title and a brief description of what it would be and what it is about.  
  • Specification for the same is provided in the following mannerwhich states that:
  • The camera which would be used for  the movie shooting, and;
  • The format in which the movie will be made.
  • Time period required for the production is mentioned which goes as, “for the following time period, the project should be completed or will be carried out.” 
  • The budget is mentioned which tells the total budget required or decided for the complete movie production.
  • It also gives details regarding the compensation to be paid to the producer and also in what means and how the producer will receive his compensation is also mentioned. 

Actor Contract

Hiring actors is the most crucial part of the movie production process. It details the work that an actor is required to do and what the producer expects from him or her. The agreement protects the rights of the film by avoiding all the risks starting from the pre-production and post-production process, of a film. The contract is executed between (i) the actor and the producer of the movie, or (ii) the actor and the production company which is producing the film. 

The agreement consists of the following terms:

  • The schedules and the time slot of the shoot, 
  • Number of working days and off days are acquainted,
  • Number of hours the actor shall work on a daily basis, 
  • Condition of the agreement based on which the actor signs the agreement formed as per the producer’s or production company’s requirement, 
  • What all is required from the actor, 
  • The payment structure, 
  • Whether the contract is exclusive or not. 
  • The contract will also state the actor’s compensation. There are a number of ways by which the actor can be compensated those are:
  • Flat-Rate for the Job;
  • Pay per-hour;
  • Per-Scene; or 
  • Percentage of Profits.

Another important aspect that it states is whether the actor is hired exclusively or he can accept other employment offers too during the term of the present agreement. 

Distribution Agreement

After the shooting is over, the next thing to do in the film production process is promoting and marketing the produced film. To promote and market the film, a distribution agreement is required. The agreement is made on a specific date between the owner of rights in a movie that is, the producer and the person who will be granted those rights that is, the distributor for marketing and promoting.

The agreement basically will comprise of following terms:

  • Rights granted to the Distributor, 
  • Licensed Territory,
  • Distributor Fee, 
  • Discretion of the Distributor. 

The rights granted to the distributor includes all the rights that can be availed by the distributor. It also states whether those rights would be exclusive or not to the distributor. These rights may include:

  • Theatrical Rights
  • Non-Theatrical Rights
  • Video Rights
  • CVD Rights
  • DVD Rights
  • Pay Television Rights
  • Web Streaming Rights for example on Netflix and amazon prime etc.

The Agreement also determines the Licensed territory, the territory of the license, and whether it is limited to a certain country or not. Another aspect is the fee structure of the distributor. This clause states how much the distributor will be paid for the services which will be rendered by him. 

Lastly, the agreement also provides for the discretion of the distributor in marketing and promoting the movie of the particular production house with whom the contract has been formed. The Distributor shall have complete discretion along with control to decide the time, manner, and terms of distribution of the exhibition, licensing, exploitation, advertising, and marketing. Provided, that the Distributor shall consult with Production House with regard to the marketing and promotion strategy for the initial theatrical exhibition of the movie. After understanding and agreeing with it, the Distributor’s decisions shall be final concerning such matters.

Conclusion

Anybody who is a significant part of the production process or the film making journey, whether the person is the producer, actor, crew member or a distributor if fails to understand any document but sign on any such paper or agreement as mentioned above, it will surely come out as very dangerous if it fails to resonate with the clients’ expectations and requirements and is violating his/her rights. Therefore, it is important to make sure that the individual must address who will get to own the project or its rights mentioned therein. If the individual is new at this and unable to understand then he or she should have an attorney who would help in interpreting these contracts and agreements and also ensure that the language of the contract addresses each party’s rights and duties.

Reference

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