- FILM & PEOPLE
- Location Incentive
Guideline on Location Incentive for Foreign Audio-Visual Works 2022
1. Project Purpose
1. Attraction of location shooting at Korea to encourage tourism and enhance economic effects by hiring local staff and actors
2. Attraction of foreign audio-visual works for globalization of Korean film production system and establishment of film production network
2. Support Details and Qualifications
1. Support Scale
2. Qualifying Production Expenditure
|Qualifying Production Expenditure||
3. Application Requirements
|Application and Evaluation
4. Application Period and Application Method
3. Support and Selection Procedure
1. Support Procedure Flowchart
- 요강발표 및 공고
- 사업신청 및 접수
- 사전지원 평가
- 위원회 의결
- 약정서 체결
- 최종지원 평가
- 위원회 의결
- e나라도움 등록
- 보조금 지급
※ In pre-support evaluation, there will be an interview on contribution to positive image of Korea and tourism promotion.
2. Selection Procedure
(1) Pre-Support Evaluation
- When the applicant submits the pre-support form and related dobuments to KOFIC, the qualification, eligibility, and appropriateness in qualifying production expenditure (QRE) shall be evaluated to determine the support and supportable QRE (estimate). The QRE shall be determined by Review Committee within the remaining project budget as of the evaluation date.
- KOFIC shall deliberate upon the evaluation results of the Review Committee and make the final decisions and notify the applicants accordingly. KOFIC shall have the final authority on the eligibility and the amount, and its decision is not subject to appeal. However, provided that an application previously rejected has been edited to meet the requirements, may be resubmitted.
- In case of pre-support, KOFIC and applicant shall sign a support agreement.
- There shall be 3 copies of agreement (including one copy for notarization) and the applicant shall be responsible for the notarization cost. When the shooting does not start within 3 months from the shooting date stated in the shooting plan, KOFIC may cancel the support agreement for the efficient management of the budgets.
- If deemed necessary, the applicant may request a one-time partial settlement of the grant before the production is completed by submitting documents required by KOFIC including a certificate of performance bond and audited expenditure statement
(2) Final Support Evaluation
- After the shooting and settlement, the applicant shall submit the documents including final support application form, audited expenditure statement, and subsidy project verification report. In receiving the documents, Review Committee shall make a final evaluation on support and subsidy.
- Final Review Committee shall re-evaluate the qualification and eligibility ([Tourism Expansion], [Korean Film Industry Contribution], [Foreign Engagement]) based on the related documents submitted by the applicant and shall determine the final subsidy in consideration of appropriateness of qualifying production expenditure (QRE) application details.
- If the actual production proceeded differently from the plan set forth in the pre-application and such production is deemed inappropriate by the re-evaluation of the Review Committee, KOFIC shall cancel the decision on support and shall not pay the qualifying production expenditure (QRE) (estimate) notified in advance.
- KOFIC shall deliberate upon the evaluation results of the Review Committee and make the final decision and notify the applicants accordingly. KOFIC shall have the final authority on the eligibility, and its decision is not subject to appeal.
- The qualifying production expenditure (QRE) shall be paid after KOFIC’s final deliberation on the evaluation by Review Committee
- The applicant shall register the subsidy execution and settlement matters to “Integrated Management System for the Government Subsidy” by Ministry of Economy and Finance
4. Procedures and Regulations on Government Subsidies
1. Procedure and Method of Subsidy Distribution
- KOFIC shall send the grant to the applicant’s bank account in accordance with the finalized production costs, check on whether the grant has been used for the original purpose during final support evaluation, and may determine whether to grant depending on the results.
- The grant shall be managed and executed by using a separate bank account and deposit account of the ‘Integrated Management System for the Government Subsidy’, and the grant shall be executed and settled in accordance with the regulations established by KOFIC.
- The applicant shall submit the documents required for granting by KOFIC and documents required for confirmation on necessary procedures.
- The grant shall be made upon a separate application after signing a contract. However, in case of reasons for redeeming after granting, the principal will be redeemed with a separate disciplinary measure.
2. Execution of Subsidy
- The applicant shall execute and settle in accordance with the regulations established by KOFIC.
- The applicant shall submit required documents and bank account transaction details in ‘Integrated Management System for the Government Subsidy’, so that KOFIC can check on the granting.
- KOFIC may inspect on execution and settlement of grant and may request the Third Party of the inspection if necessary. In this case, the applicant shall respond actively.
- The applicant shall not use the grant on certain types of business such as clubs and bars where the corporate card use is limited.
3. Duty to Notify for Approve
- The applicant shall get the approval from KOFIC in case of significant changes as follows.
- Change on contents due to changes in the situation, extension of the period, or change in the distribution of costs required for the project (including the project change).
4. Command of Execution
- The applicant shall fulfill the support project in accordance with [Subsidy Management Act], Enforcement Decree of Subsidy Management Act, [Guidelines for Managing the Operation of Governmental Subsidies] by Ministry of Culture, Sports and Tourism, [Regulations on Film Development Fund and Subsidy Management] of KOFIC, and other accounting-related legislations and delivery conditions.
- If the applicant fails to fulfill the project in accordance with legislation, decisions on granting, or KOFIC’s regulations, KOFIC may issue necessary orders or investigate the applicant.
5. Submission of Performance Report and Settlement Report
- The applicant shall submit the performance report and settlement report in the form required by KOFIC within the expiration date of the contract.
- Scope of Settlement : Amount executed in Korea for location shooting
- Period of Settlement : Within 3 months from completion of production in Korea
- Submission Documents : Result report, settlement report, detailed execution statement, evidential materials, accounting verification report, final visual material, etc.
※ Detailed matters shall be based on the agreement
Distribution and Exhibition Agreement
- In order to prove that the production is complete and therefore the work is ready for release or broadcasting, the recipient must submit the work with the credits attached.
- In the event that the production is not completed, the work must be submitted in the form of the edited version that is equivalent to the final version.
- In the event that the visual materials are not provided, KOFIC shall be allowed to attend the screening of the work.
- A distribution/exhibition agreement between the foreign production company and local distributors or a certificate thereof shall be submitted.
“Audited Statement of Expenditure” and “Certificate of Subsidy Settlement Report”
- In accordance with the Article 27 of the Subsidy Management Act and the Article 12 of the Enforcement Decree of the Subsidy Management Act, the recipient must submit an audited statement of expenditure and the certificate of subsidy settlement report on all claimed QPEs and the auditors as is qualified by the Article 3 of the Act on External Audit of a Corporation must meet the following requirements :
- Shall not be the recipient's shareholder, investor, full-time officer, employee or employer
- Shall not be subject to the restrictions under Article 33 of [Certified Public Accountant Act]
- The auditor shall certify on the expenditure statement that (1) he meets the aforesaid qualifications; and that (2) he has thoroughly fulfilled his auditing role by checking whether production expenses spent in Korea have been administered in accordance with the KOFIC Location Incentive ‘Standard for Qualifying Production Expenditure’ and the support documentation has been lawfully prepared. The auditor shall also state the total amount of the QPE, and shall attach the following documents as well as the audit report in accordance with the guideline for Verifying of the Subsidy Settlement Report and the detailed criteria of auditing the subsidy recipient, as it is stated in the guidelines for Managing the Operation of Governmental Subsidies (Ministry of Strategy and Finance, 2017 June 1):
- A copy of summary on production expenses spent in Korea (Refer to “Production Cost Budget” and fill out all major categories)
- A copy of detailed expense report on production expenses spent in Korea (Refer to “Production Cost Budget” and fill out all minor categories)
* The recipient must submit the computer files (excel) and execution evidential materials on above materials.
In the event that KOFIC requests additional documents such as settlement evidential materials, the applicant shall submit the documents within 5 days. Any delay may result in cancellation or deferral of the application.
- When the granted subsidies are returned voluntarily, the rights and duties automatically expire
- Carrying the subsidy forward is not allowed in principle. However, in case of subsidy carried forward due to inevitable reasons, carrying the subsidy forward for 3 fiscal years is not allowed.
7. Cancellation of Granting
- In case of applying to Article 21 of [Subsidy Management Act], violating the subsidy granting conditions, or applying to any of the following Sub-Paragraph, KOFIC may cancel all or part of the final decision if any of the following acts are found.
- If the applicant filed a false application or received grants by unlawful means.
- If the applicant used the grants for other purposes.
- If the applicant violates the rules or legislation or violates KOFIC’s measures taken in accordance with granting conditions or legislations,
- If the preconditions directly related to the grants are not met after approval.
- If the applicant received the subsidy from other institutes or private organizations with the same or similar project plans. (The granting may be cancelled when the source of subsidy granted by other institutes applies to national treasury or funds. The granting may be granted when the source of subsidy applies to local government or private organizations)
- If the results for submission of performance repot (including interim report and monthly report) and subsidy settlement are unsatisfactory.
- If the applicant loses the ability to perform the project or if the copyright is voluntarily transferred to the Third Party.
- If the applicant fails to handle the matters on closing, default on national tax and local tax, and credit default.
- If the applicant accrues wages of the film staff or violates the duty of working condition clarification in accordance with Article 3-4 of [Promotion of the Motion Pictures and Video Products Act], the whole or part of the granting may be canceled.
- If the person sentenced to imprisonment or medical treatment and custody disposition in accordance with Article 2 of [Act on Special Cases Concerning The Punishment, Etc. of Sexual Crimes] (the person whose sentence in accordance of Article 7 of Act on the Lapse of Criminal Sentences has not been lapsed yet) is the member of the work or group (except the case where the person is simply a member not involved in representation or business execution authority or decision-making process).
* Imprisonment over 3 years : 10 years, Imprisonment less than 3 years, Fine: 2 years
- If the person is sentenced to imprisonment or fine in accordance with Sub-Paragraph 2, Paragraph 2, Article 37 of [Equal Employment Opportunity and Work-Family Balance Assistance Act] (the person whose sentence in accordance of Article 7 of Act on the Lapse of Criminal Sentences has not been lapsed yet).
* Imprisonment over 3 years : 10 years, Imprisonment less than 3 years, Fine: 2 years
- If the person or member of the applicant is under investigation or prosecution in relation to Article 2 (Sex Crimes) of [Act on Special Cases Concerning the Punishment of Sexual Crimes] and Sub-Paragraph 2, Paragraph 2, Article 37 of [Equal Employment Opportunity and Work-Family Balance Assistance Act] who has not been finally convicted (except the case where the person is simply a member not involved in representation or business execution authority or decision-making process) and KOFIC deems such person or member is ineligible in executing the project.
8. Disciplinary Measures and Punishment for Cancellation on Subsidy Granting Decision
- If the granting decision is cancelled due to non-fulfillment of duty or illegal receipt of grants by the applicant, following disciplinary measure and punishment may be sentenced in accordance with [Subsidy Management Act].
- Return of grants and interests in accordance with Article 31 of [Subsidy Management Act]
- Exclusion from performance in accordance with Article 31-2 of [Subsidy Management Act]
- Penalty (up to 5 times the subsidy) in accordance with Article 33-2 of [Subsidy Management Act]
- Announcement of the list in accordance with Article 36-2 of [Subsidy Management Act]
- Rules in accordance with Article 40 or Article 41 of [Subsidy Management Act]
9. Information Disclosure
- According to Paragraph 1, Article 26-10 of [Subsidy Management Act] and Article 11-2 of Enforcement Decree, the applicant whose total amount of subsidy is over 10 million won shall publicly announce the project information to Integrated Management System for the Government Subsidy within 4 months from end of the fiscal year.
5. Other Duties
1. Improvement of Working Environment
- Prevention of Delayed Payment of Wages
- The applicant shall comply with the duties of the employer in accordance with the statutes of the Labor Standards Act in relation to the workers involved in this project. Especially, the applicant shall not be involved in the delayed payment of wages or illegal service contract disguised as employment contract
- Submission of Guidelines on Standard Wages
- When KOFIC requests on submission of materials on payment of wages to motion picture workers in accordance with Article 3-3 of [Promotion of the Motion Pictures and Video Products Act], the applicant shall comply with the requests.
- Employment Insurance of Artists
- If the applicant is legally responsible to pay employment insurance premium and report insured state in accordance with [Employment Insurance Act] and [Act on the Collection of Insurance Premiums for Employment Insurance and Industrial Accident Compensation Insurance], the applicant shall fulfill the duties.
- Health Right of Workers
- The applicant shall not expose film-related workers to acts harmful or dangerous to health and shall provide a sanitary and safe work environment. The applicant shall provide separate safety equipment if necessary and shall have a duty to take immediate measures such as appropriate compensation in case of accidents that occurred at work.
- Child Protection
- When an applicant legally hires a person (under 18) defined as a child in [Child Welfare Act], the applicant must provide separate cares to guarantee the right to learn, right to rest, and right to stay safe. The applicant must not be involved in the acts prohibited (Sexual abuse, physical abuse, emotional abuse, etc.) in Article 17 of Child Welfare Act.
2. Response and Prevention of Sex Crimes
- Preventive Measures Against Sexual Harrassment/Sexual Violence and Provision of Prevention Education
- The applicant shall take sexual harrassment/sexual violence prevention measures to all project participants (including producer, director, actor, freelancer, etc.) and shall submit pledge of sexual harrassment/sexual violence prevention and certificate of completing sexual harrassment/sexual violence prevention education. (In case of taking the education from [Korean Film Gender Equality Center], KOFIC supports the education fee. The detailed procedures will be notified separately)
3. Gender Equality Policy
- Submission of Participant Gender Ratio
- The applicant must submit the statistical data on participant gender ratio (Refer to annex format) at the point of time before starting the project and at the point of submitting the performance report or settlement documents.
4. Indication of Credit
- If the applicant gets cinematized and released, the recipient must indicate the fact that the work is supported by KOFIC (download a prescribed form from KOFIC website) on the promotional materials and the film and shall get prior approval from KOFIC.
|Format||With the support of the KOFIC Location Incentive|
5. Submission of Distribution Results
- The applicants must submit two(2) DVDs of the final cut after completing film production and/or after the release.
- After completing film production, the applicant must submit the distribution results including the release in overseas theaters, televisions or release via online.
6. Composition of Review Committee
- KOFIC shall construct a Review Committee consisting of no more than 7 people (from or outside of KOFIC) who shall decide on the eligibility, whether to reward the grant, the feasibility of the budget and its actual administration, and the grant amounts.
- KOFIC shall accept only those applications accompanied by all required documents. The Review Committee shall evaluate the applications in the order of acceptance.
- The Review Committee may make additional document requests to the applicant through KOFIC for a detailed evaluation. The evaluation shall take place only when the applicant submitted all required documents.
- International Relations Team, (48058) KOFIC, 130, Suyeonggangbyeon-daero, Haeundae-gu, Busan, Korea
|Project Name||Person in Charge||Contact|
|Support on Location Incentive for Foreign Audio-Visual Works||Kim Joeun||+82-51-720-4813|
|KOFIC Location Incentive Guidelines 2022|
|Standard for Qualifying Production Expenditure 2022|
|KOFIC Location Incentive AD|
※ Project schedule and details may vary depending on the circumstances of KOFIC.