Tonight a majority UK voters chose to leave the European Union which as of this writing is leading to a meltdown in financial markets and wild drops in foreign currencies agains the US dollar. There’s been a bit of chatter amongst many in VFX as to the ramifications for those who work in UK VFX facilities which is made up of many migrants from the EU.
In my view, while most experts agree that #Brexit is a great evil, it might be advantageous for the UK VFX industry. The UK along with the rest of the global VFX industry relies heavily on massive subsidies offered to Hollywood studios which send work to locations which offer the most amount of free money. While this blog has a negative view of subsidies, many in the UK look at subsidies for US studios as a necessary “deal with the devil” in order to win work for the UK and make it competitive.
One advantage #Brexit will bring is the removal of EU restrictions on UK film subsidies for US producers. The EU mandates that member subsidies offered for film have a cultural test to distinguish it from anti-competitive subsidies that it cracks down on for other products. This is why you see many films adding some component of either mentioning the UK or blowing up London. It’s meant to pass a cultural test mandated by the EU so producers can get access to free money. By leaving the EU the UK can remove the cultural test allowing any film to be a candidate for those subsidies.
(Update: Variety has an article that supports my view.)
Another advantage is the UK avoids having their film subsidies reviewed by the EU every few years which is a requirement. A few years ago the EU actually proposed capping the film subsidies in the UK as this blog reported. Furthermore, the EU actually responded to a statement I sent to them supporting UK subsidies being curtailed. So you’d probably wouldn’t be a big fan of the EU if you were protective of UK film subsidies.
While a steep fall in the Sterling seems to be apparent, if this is a long term trend then it would probably be another necessary evil for luring more production work to the UK. A strengthening US dollar against the UK would make it cheaper to do VFX work there. Three years ago Australian VFX facility Rising Sun Pictures along with artists living there cheered the steep drop in the Aussie dollar:
The bad news for UK VFX artists is that #Brexit may weaken some EU mandated labor laws meant to protect them. For example the EU mandated a 48 hour work week limit which many UK facilities ask their workers to opt out of. This might be a good catalyst for many of you in the UK to seek membership in BECTU which has actively working on a unionization effort in the UK.
Another potential negative ramification from #Brexit could be on EU migrants in the UK. It seems voters who wanted to Leave have used immigration as a scapegoat for their problems similar to conservative voters in the US who have made Donald Trump the nominee. This may lead to legislation that makes it harder for EU migrants and other immigrants to attain a visa to work in the UK’s VFX industry. However some international VFX artists have expressed support for having to be displaced around the globe every few years as it gives them a chance to see the world. If immigration to the UK becomes tougher you can bet that UK facilities and US producers especially will be more than happy to see artists move to Canada where recently trimmed subsidies pay around 55% of resident salaries.