Multi-movie Avatar deal lands in NZ, production could see 25% in rebates

Rumours can be laid to rest that James Cameron is taking his Avatar movies offshore.

This morning John Key confirmed the next three Avatar movies will be filmed here and the movies’ productions, with a combined budget of at least $NZ500 million, could see up to 25% in rebates on production expenditure.

The government has signed a memorandum of understanding with Lightstorm Entertainment and Twentieth Century Fox Film Corp.

The Avatar sequels will provide hundreds of jobs and thousands of hours of work, Economic Development minister Steven Joyce says in a press release. About 90% of the live action crew are expected to be New Zealanders, according to the statement.

The companies plan to spend at least $NZ500 million in New Zealand including most of the live action shooting and visual effects. 

The memo follows the separate announcement today by the government that it is boosting screen production incentives for both overseas and New Zealand productions to encourage more film and TV to be made in New Zealand.

Incentives call for raising the baseline rebate from 15% to 20%. Productions will get points for specific benefits to New Zealand, which may entitle some to an additional 5% rebate.

If the upcoming Avatar films fulfil the requirements set out in the memorandum, they could qualify for a total rebate of 25%.

The memo outlines an agreement between the Crown, Lightstorm and Twentieth Century Fox to foster a long-term relationship to build the screen sector in the country.

It calls for New Zealand to host at least one official red carpet premiere and featurette on New Zealand to be included included in DVD and Blu-Ray editions.

Mr Cameron and Jon Landau could also serve as founding members of a new screen advisory board, which will provide advice and guidance to New Zealand screen and film makers looking to make their marks internationally.

NZ Game Developers Association CEO Stephen Knightly tells NBR the government missed a trick by not by not including an Avatar video game in the deal.

"The new scheme places great emphasis on New Zealanders developing and owning their own IP, exporting it and being open to new digital distribution platforms.  These are exactly the ingredients that fueled the growth in the local video games industry. It will give local screen producers more commercial leverage when they seek global deals," Mr Knightly says.

"International best practice when you're exploiting your IP is to include video games in the mix. It's just a no-brainer. Today's announcement is a philosophical step in that direction but it's a missed opportunity for the wider screen sector that they haven't addressed gaming yet.

"All the countries a cabinet paper compared New Zealand's film incentives to also integrate digital gaming into their screen strategies."

Mr Cameron, soon to be a New Zealand resident, told a briefing in Wellington the producers would have had to look offshore if incentives weren't sweetened.

"I'm glad it never came to that," Mr Cameron says.