Overview:
What are foreign levies?
Foreign levies are fees collected by foreign countries in part to compensate rights holders for the effects of copying, rental and retransmission of their films and television programs. The rights holders under foreign law include the authors of motion pictures and television programs.
Where do foreign levies come from?
Beginning in the 1980s, various European countries adopted laws imposing levies on blank videocassettes, recording equipment, home video rentals and in some cases cable retransmission to ensure that authors received a fair payment from the private copying and use of their work. This has since been expanded to other blank media such as DVDs. Foreign levies have been collected and provided to the DGA for distribution from 20 countries, in Europe and Latin America.
Who collects the levies?
Laws enacted in various nations authorize private "collecting" societies in each country to allocate and distribute the levies to the rights holders of the affected films and television programs.
Why are directors entitled to foreign levies?
Copyright laws in many countries recognize directors and writers as "authors" of motion pictures, as opposed to U.S. copyright law, which recognizes the employer (e.g. the Studio as the sole author under the American "work for hire" doctrine.
How are foreign levies different from residuals?
Residuals are a form of deferred compensation that companies are contractually obligated to pay under the DGA Basic Agreement and Freelance Live and Tape Television Agreement. Foreign levies are not contractual payments. They are statutory assessments created by and collected under the copyright laws of certain foreign countries.
How many countries collect foreign levies?
There are now 19 countries in Europe (Austria, Belgium, Czech Republic, Denmark, Estonia, France, Germany, Hungary, Italy, Latvia, Lithuania, Netherlands, Poland, Portugal, United Kingdom, Ukraine, Slovakia, Spain, Sweden, and Switzerland), and one country in Latin America (Argentina) remitting levies to the DGA.
Program History
How did the DGA come to receive these monies?
Without the successful efforts of the DGA, along with the WGA, to negotiate agreements with the foreign collecting societies, no director or writer would receive any compensation from foreign levies money collected by the Studios.
The Studios asserted that they were the sole "authors" of the films and television programs that they had produced, and on this basis the Studios demanded that they receive all of the foreign levies. The Studios based this position on U.S. copyright law (the "work for hire" doctrine), the assignment and results and proceeds clauses in their personal services contracts with directors and writers, and their collective bargaining agreements with the Guilds.
In 1988, the DGA and WGA challenged the Studios' claim to 100% of the authors' levies. The Guilds asserted that directors and writers were the authors under European copyright law and thus were entitled to the authors' share of the foreign levies.
When did the DGA's foreign levies program begin?
On June 1, 1990, the Guilds and the Studios entered into a Foreign Levy Agreement, which formally provided for the allocation of the authors' share of foreign levies among writers, directors and the Studios. This Agreement also provided that each party would enter into agreements with private collecting societies to handle the collection of levies, and that disputes under the Agreement would be resolved by arbitration. The Foreign Levies Agreement has been renegotiated several times in subsequent years and now provides that the writers and directors receive 50% of foreign levy collections – 25% distributed by the DGA and 25% by the WGAW. (A more detailed version of the history of the program can be read here.)
How much money has been distributed to date?
The DGA has distributed over $305 million including over $36 million to 8,300 non-members.
Non-Covered Works
Why does the Guild collect and distribute foreign levies for non-members?
After the Guilds and the Studios reached their agreement and went to foreign collecting societies to ask them to start distributing money to the U.S., it became clear that the foreign collecting societies desired to send the U.S. directors' share to one recipient only. For example, authorities in Germany, the largest European market, conditioned their approval of the settlement between the Guilds and the Studios on the requirement that levies on all American films and television programs should be distributed to the DGA and WGA without regard to whether the director or writer was a member or non-member of the Guild. The subsequent agreement with the German collecting society required that the DGA would receive and distribute levies collected on all American films and television programs. Later agreements in other countries followed the German model. Although the DGA agreed to this requirement, at no time has the DGA claimed to represent non-members and in fact the collection agreement expressly states the DGA does not make any representations regarding its representation of non-members.
What percentage of levies is for non-DGA works?
The number varies from country to country, but approximately 14% of foreign levy remittances received by the Guild are for non-DGA works.
Why is it so difficult to find non-member directors?
Because these directors are not members of the DGA, the DGA has no base of information from which to contact them. The DGA must start from scratch with each of these non-members to try to locate them. Additionally, some non-member directors who are entitled to foreign levies directed only one project during their careers, often many years ago. Some directed documentaries, animated programs or films, or other small or obscure projects, often produced by defunct companies. All of these things make it hard to find these non-member directors now. Additionally, some directors have died, so the DGA must try to locate their beneficiaries in order to pass along the foreign levies to which they are entitled.
How does the DGA find non-member directors?
The DGA has employees whose work includes locating non-member directors (or their beneficiaries) who are entitled to foreign levies. The DGA has also employed the services of an outside search firm to locate directors (or their beneficiaries) to whom foreign levies are owed. Even with these extensive efforts, a non-member director can be very difficult to find and even when located, may not respond to our letters. The DGA has launched this dedicated web page that lists the names of those non-member directors who have not yet been located so that they, or anyone who has information about them, can contact the DGA.
What was the Foreign Levies lawsuit in about?
In September 2005, a former member sued the WGA, alleging that the WGA was not entitled to receive foreign levies on behalf of non-members, and had failed to distribute the money to non-members. The next year, a non-member director sued the DGA, alleging that the Guild was not entitled to receive foreign levies on behalf of non-member directors, and had failed to distribute the money to non-members. The DGA considered the lawsuit to be completely without merit and continues to undertake all appropriate efforts to distribute the monies received from foreign levies to DGA members and non-DGA members alike.
What are the annual reports?
Starting with the 2006 fiscal year, the finances of the foreign levies program have been reviewed on an annual basis by the Guild’s accounting firms and that information has been posted on the Guild’s website in the column to the right of this page.