News:Hobbit law change to be rushed through

Published: 5:18AM Thursday October 28, 2010 Source: NZPA

The government will put a bill through parliament under urgency today to seal the deal that has secured the $670 million Hobbit movies for New Zealand.

Prime Minister John Key announced the agreement with Warner Brothers last night after two days of negotiations with studio executives who had been worried about industrial disputes and wanted a bigger tax break than the standard 15% for big movies.

They got what they wanted with legislation that will clear up confusion about the legal status of contractors and employees, but the $20 million tax break was far short of what they argued for.

Key said that in financial terms there was no doubt Warner Brothers could have got a better deal from other countries, but the studio wanted to make the movies in New Zealand and so did director Sir Peter Jackson.

"They wanted a lot more, they argued for a lot more," he said.

"I made it clear we were at our limit, this is a better deal than we have had with other big movies made here in the past."

And the government has scored through an agreement that New Zealand will be promoted through all the marketing DVDs and other material that will be used to publicise the two Hobbit movies, as well as hosting one of the world premieres.

To get that it will offset $US10 million of Warner Brothers marketing costs.
Advertisement

"The strategic marketing opportunities for New Zealand from the movies will be worth tens of millions of dollars," Key said.

"In the financial sense, this is a good deal."

He said the labour law change was the most important issue for Warner Brothers, because the legal definitions of a contractor and an employee could have caused disputes and court cases that would have held up production and cost the studio many millions.

The change will cover only the movie industry.

"We're not taking rights away from workers," Key said.More here