j

LIBRM!

THE MUSSUNI OF MODERN ART]

Received:

Scanned from the collection of

The Museum of Modern Art Library

Coordinated by the

Media History Digital Library www.mediahistoryproject.org

Funded by a donation from

University of St Andrews

Library & Centre for Film Studies

Scanned from the collection of

The Museum of Modern Art Library

Coordinated by the

Media History Digital Library www.mediahistoryproject.org

Funded by a donation from

University of St Andrews

Library & Centre for Film Studies

Digitized by the Internet Archive

in 2013

http://archive.org/details/minutesevOOhmso

BOARD OF TRADE

Minutes of Evidence

taken before the

Departmental Committee on Cinematograph Films

together with

Appendices and Index

First to Fourth Days

Crown Copyright Reserved

LONDON

PRINTED AND PUBLISHED BY HIS MAJESTY'S STATIONERY OFFICE

To be purchased directly from H.M. STATIONERY OFFICE at the following addresses:

Adastral House, Kingsway, London, W.C.2; 120 George Street, Edinburgh 2;

York Street, Manchester 1; 1 St. Andrew's Crescent, Cardiff;

80 Chichester Street, Belfast;

or through any Bookseller

1936

Price 95. od. Net

PRINTED AND PUBLISHED IN GREAT BRITAIN

BOARD OF TRADE

Minutes of Evidence

taken before the

Departmental Committee Cinematograph Films

together with

Appendices and Index

on

First to Fourth Days

Crown Copyright Reserved

LONDON

PRINTED AND PUBLISHED BY HIS MAJESTY'S STATIONERY OFFICE

To be purchased directly from H.M. STATIONERY OFFICE at the following addresses:

Adastral House, Kingsway, London, W.C.2; 120 George Street, Edinburgh 2;

York Street, Manchester 1; 1 St. Andrew's Crescent, Cardiff;

80 Chichester Street, Belfast;

or through any Bookseller

1936

Price 95. od. Net

CONTENTS

Page

MINUTE OF APPOINTMENT OF COMMITTEE ' iii

LIST OF WITNESSES ,v

MINUTES OF EVIDENCE 1

INDEX TO EVIDENCE... 95

Ill

DEPARTMENTAL COMMITTEE ON CINEMATOGRAPH FILMS

MINUTE OF APPOINTMENT

The Board of Trade are pleased to appoint the following persons, viz. : —

The Rt. Hon. Lord MOYNE, D.S.O. (Chairman),

Mr. ALAN CHARLES CAMERON, M.C.,

Mr. JOSEPH STANLEY HOLMES, M.P.,

Mr. JAMES JOSEPH MALLON,

The Hon. ELEANOR MARY PLUMER,

Lt.-Col. Sir ARNOLD WILSON. K.C.I.E.. C.S.I.,

C.M.G., D.S.O., M.P.,

to be a Committee to consider the position of British films, having in mind the approach- ing expiry of the Cinematograph Films Act, 1927, and to advise whether any, and if so what, measures are still required in the public interest to promote the production, renting and exhibition of such films.

The Board are further pleased to appoint Mr. W. H. L. Patterson to be Secretary to the Committee.

(Signed) WALTER RUNCTMAN.

Board of Trade

25th March, 1936

IV

LIST OF WITNESSES

Interest represented.	Names of Witnesses.			Page.
Associated Realist Film Producers, Ltd.	Mr. Paul Rotha					59
Association of Cine-Technicians ...	Mr. S. H. Cole ... Mr. D. Dickinson Mr. G. H. Elvin					}•'
Board of Trade	Mr. R. D. Fennelly					1
Cinematograph Exhibitors' Association of Gt.	Mr. T. H. Fligelstone .					} »
Britain and Ireland.	Mr. W. R. Fuller
Film Producers' Group of the Federation of	Mr. F W. Baker					]
British Industries.	Mr. M. N. Kearney Mr. A. Korda ... Mr. N. Loudon ...					y 34
	Capt. The Hon. R. Norton				J

MINUTES OF EVIDENCE

TAKEN BEFORE THE

COMMITTEE ON CINEMATOGRAPH

FILMS

FIRST DAY Tuesday, 5th May, 1936

Present : The Rt. Hon. Lord MOYNE, D.S.O. (Chairman).

Mr. A. C. CAMERON, M.C., M.A.

Mr. J. S. HOLMES, MP.

Dr. J. J. MALLON, LL.D., J. P.

The Hon. ELEANOR M. PLUMER, Lt.-Col. Sir ARNOLD WILSON, K.C.I. E., C.S.I. , C.M.G., D.S.O., M.P.

Mr. W. H. L. PATTERSON (Secretary).

Mr. R. D. Fennelly, representing the Board of Trade, called and examined. The Committee had before them the following memorandum by the Board of Trade:-

I. — The position before the Cinematograph Films Act, 1927.

1. It has been estimated that in the year 1914 some 25 per cent, of the films shown in Great Britain were made in this country. Under stress of war conditions, however, production declined not only in the United Kingdom but in the chief Con- tinental countries, and the United States were able to obtain almost a monopoly of the world markets in a form of entertainment which was rapidly grow- ing in public favour. The dominating position thus secured by the United States made the recovery of film production in the United Kingdom after the war increasingly difficult, and although in the year 1923 it is estimated that about 10 per cent, of the films exhibited in this country were British, yet the proportion of British films displayed about the beginning of 1927 was not more than about 5 per cent. Of the balance 85 to 90 per cent, were of United States origin. Whereas in the year 1924 the total number of " feature " films made in this country appears to have been about 58, the output had fallen in 1925 to 34 and in 1926 to 26, together with perhaps three or four from the Empire over- seas. There was in fact some danger of production in this country ceasing altogether.

2. The domination of United States films in the post-War period was due to the following factors amongst others —

(i) There was in the United States a vast and growing home market. There were by 1926 some 22,000 cinema theatres in the U.S.A. as compared with about 3,000 in this country.

(ii) The opportunities offered by the industry induced reputable people to sink a very large capital in the industry.

(iii) The best technicians and the best " stars T' were consequently attracted to the United States, and the large home market enabled the production of costly films to be undertaken.

(iv) In technical methods and research the United States consequently progressed during the War and after it far beyond producers in other countries.

36452

3. Arising out of the fact that they were dis- tributing the best films in the world the United States subsidiary renting organisations in this country took advantage of the position to obtain a strong hold over the exhibitor. A much advertised film was only hired to him if he contracted to take with it a number of other films, many of which he had not even seen and some of which might not even have been made. This was the system known as " block " booking and " blind " booking and the effect was to tie the exhibitor to one or more renters for a long period ahead. Moreover, these renting organisations could afford to advertise a film so thoroughly that an exhibitor was almost driven to hire it.

4. As a result when a good film was produced in this country so many exhibitors were booked up for long periods ahead that the producer could not place the film and had to stand out of his money over considerable periods. This naturally put a brake on production, and it was not easy to attract money to the industry. British films, too, began to be booked before they were actually made, and the budget of production costs was assessed on the bookings — with at times unfortunate results for the exhibitor.

5. By 1925 the depressed state of the British industry was causing general concern. Apart from the purely industrial aspect of the matter, it was felt that from the point of view of British culture and ideals it was unwise to allow the United States to dominate the cinemas of this country. At that period nearly every film shown represented American ideas set out in an American atmosphere, and the accessories were American houses, American materials, American manufactures, etc. Whatever the position to-day, cinematograph audiences then were made up of the most impressionable sections of the community, and it was felt to be of the utmost importance for our prestige, for our trade and, it was even asserted, for our morals that they should see at least some proportion of British films. In other words, it was felt that a British film industry was a national asset. Protracted discussions took place between the Board of Trade and the Federa- tion of British Industries and the trade organisa- tions concerned, and an attempt was made by the industry to secure an increased exhibition of British films by voluntary effort.

COMMITTEE ON CINEMATOGRAPH FILMS

5 May, 1936.]

Mr. R. J>. Fennelly.

[< <,i i tinned .

6. While this voluntary experiment was going on the question of British films was considered by the Imperial Conference of 1926. The report of the Gen- eral Economic Sub-Committee appointed by the Conference drew attention to the small proportion of films of British Empire origin shown in the several parts of the Empire. In Great Britain and Northern Ireland the proportion was about 5 per cent., and in the Irish Free State was probably no higher. In Australia the proportion by number of British Empire films imported in 1925 was slightly in excess of 8 per cent., although on a basis of total feet imported it was considerably less. In New Zealand some 10' per cent, of Empire films appear to have been shown. The proportion in Canada, South Africa, and the remaining parts of the Empire was known to be very small although statistical details were not available.

7. The Sub-Committee attached great importance to the increased production within the Empire of films of high entertainment value and outstanding educational merit, and to their wide exhibition throughout the Empire and the rest of the world. They pointed out that in foreign films the conditions in the several parts of the Empire and the habits of the people, even when represented at all, were not always represented faithfully, and were at times misrepresented. Moreover, the constant exhibition of foreign scenes or settings and the absence of any corresponding showings of Empire scenes or set- tings powerfully advertised foreign countries and foreign goods. The Sub-Committee suggested certain remedial measures including effective Customs duties, ample preference or free entry for Empire films, legislation for the prevention of " blind " and " block " booking and the imposition of require- ments as to renting or exhibiting of a minimum quota of Empire films. They also pointed out that, as Great Britain and Northern Ireland was the largest producer of films and also the largest Empire market for films, any action taken in this country would undoubtedly be < of the greatest assistance to other parts of the Empire in dealing with the film problem.

8. The Report of the Sub-Committee was approved by the Imperial Conference, which unanimously adopted the following resolution: —

" The Imperial Conference, recognising that it is of the greatest importance that a large and increasing proportion of the films exhibited throughout the Empire should be of Empire pro- duction, commends the matter and the remedial measures proposed to the consideration of the Governments of the various parts of the Empire with a view to such early and effective action to deal with the serious situation now existing as they may severally find possible."

9. When the position was surveyed in the United Kingdom after the Imperial Conference it was found that the voluntary experiment had admittedly failed and the Government accordingly passed the Cine- matograph Films Act, 1927, which was not only intended to safeguard the position in this country but also to give a lead to other parts of the Empire.

II. — The Purpose of the Cinematograph Films Act, 1927.

10. It should be explained that the cinematograph lilms industry in Croat Britain and Indeed in all countries is organised on the three-tier basis of maker (or producer), renter (or distributor) and exhibitor. It may be added that, although they are three separate entities for the purpose of the Act, there is considerable financial and other interlocking in Great Britain between the various sections of the trade. This is dealt with in the later sections of the memorandum.

11. The purpose of the Act was to build up a. healthy film-making industry so that British films

could find their due place on the screens not only of Great Britain and the Empire but of foreign coun- tries. The two main objects of the Act were: —

(i) to impose certain restrictions on " blind " and " block " hooking so as to release the ex- hibitor from the hold acquired over him by the United States renting organisations;

(ii) to assist production in the United King- dom and elsewhere in the Empire by placing an obligation on renters in the United Kingdom to acquire and on exhibitors to show an increasing proportion of British films during the currency of the Act.

III. — Blind Booking, Advance Booking and Block Booking of Films. 12. This subject was referred to in a paper on " The Future of the Films Act " which was read by Mr. Simon Rowson, at a conference of the Cinemato- graph Exhibitors Association held at Cardiff in June, 1935. The following extracts have been taken from that paper.

" ' Blind ' booking had for some years been denounced as one of the most serious evils intro- duced by the renters into the commercial prac- tice of the film trade. It led to the sale of films before they could be seen in this country, and often before they were made. The producer announced a series of subjects — his programme — and the distributor responsible for selling this producer's output opened his sales campaign. The programme would consist of 20 to, perhaps. 50 subjects. Sometimes ' stars ' were specified alongside of certain subjects ; at other times the ' stars ' would be designated before any subjects were allotted. Two or three of the sub- jects might be made and shown to the trade before the sales campaign began. The salesmen were ordered to sell the programme on the strength of these first productions as representa- tive samples of the entire programme. It was rare indeed that the later subjects realised ex- pectations, much less the representations of the enthusiastic salesmen. Frequent changes were the almost invariable rule in the fulfilment of the unmade portion of the programme. And the exhibitor's disappointment was the more acute because not only did the later pictures prove less good than the earlier ones, or fail to materialise at all, but he was often compelled to accept substitutes from which the promised stars were absent and sometimes even the sub- jects themselves were different. And there was or could be no effective remedy lor the exhibitors, because at any given date the supply of alterna- tive subjects is a strictly limited one. The exhibitor had in fact to consider, not so much the 700 or 800 films which in those days repre- sented the year's total output of the American studios ; but rather had he to pay attention to an average of 14 or 15 films which made an appearance each week. By the sales system then and still in vogue, practically all these subjects, and certainly the most attractive ones, were already contracted for by various exhibitors. The only resource of the disappointed showman was either to substitute with a film which he was willing to play concurrently with other exhibitors, or to play a film as ' second run which had proved exceptionally successful in some neighbouring theatre one or two weeks earlier, or show a much inferior film. These alternatives were frequently attended with ex- ceedingly unsatisfactory results.

" The adoption of a similar system by British producing companies proved even more vicious in its consequences. Here the far-forward system of bookings was attended with the fol- lowing result. On 1st January, say, bookings were taken in connection with a subjeel to be released maybe 15 months later. The picture

MINUTES OF EVIDENCE

.5 May, 1936.]

Mr. R. D. Fennelly.

[Continued.

itself was, for various reasons — but principally to avoid the loek-up of capital for too long — not put into production in the studio till towards the end of the year. Far too often, the budget of production cost was revised in line with the bookings taken and was made lower than was at first intended, and the picture resulting was, naturally, much less attractive than the ex- hibitors .who booked it could reasonably expect.

" The exhibitors had therefore two evils to contend against both arising from the ' blind ' and ' block ' booking practices. By the time the American films reached the British screen they were ' dated,' and the clothes worn by the favourite stars had become old-fashioned. Similarly, the British film was less attractive than had been promised.

" The Government decided to meet the grievance by making ' blind ' booking an offence which rendered the contract invalid and the parties to any such arrangement guilty of a mis- demeanour and liable to money penalties. A ' blind ' booking was, in effect, defined as one which related to a film that had not been trade- shown in London. Though the exhibitor might not have seen the film himself, the trade show guaranteed that it had a physical exist- ence, that is would be delivered as shown, and that, if he desired, he could obtain a report of its suitability and value from the agent, or from the trade papers which make the reviewing of every new film a principal function of their existence.

" Closely related to the ' blind ' booking provision of the Act was the attempt to deal with the advance-booking evil. There were many at the time who felt that this part of the Act was superfluous. The argument was that if business could be inaugurated only after the physical existence of the film was established and all the expense of production had been in- curred, sufficient inducement existed to secure the maximum reduction of the interval between trade show and sales-dates and exhibition dates. The producer (through his agent the renter) would naturally exert the maximum pressure to secure the earliest possible play-dates, especially as, in contrast with the prevailing practice in other countries, no payments on signing contracts or at any date in advance of playing, ever form part of the exhibitor-renter contract in this country. But the Government thought otherwise, and insisted on their clause for the reduction, by easy stages, of the maximum interval between the sales-date and play-date from 12 to 6 months.

" It may be possible to give convincing proof that they were right who believed the advance- booking clauses of the Act were unnecessary. It is much easier to prove, however, that these clauses have been ineffective, and have at all times been more honoured in the breach than in the observance. Every salesman in the trade knows that booking arrangements are made every day for films which will be played long after the legal date. Sometimes they are called reservations only, at other times they are ' gentlemen's agreements,' at still other times the illegal interval is bridged by a series of one or more transfers of dates. Most frequently contracts are signed by the exhibitors, left with the salesman with power to insert a date when the contract is assumed to have been executed and confirmed by the renter. It is undeniable that this procedure is illegal. It is equally certain that both parties are equally guilty of this illegal practice. But though the existence of this illegal practice is known throughout the trade, and is also, I think, not unknown to the Board of Trade, I cannot recall

a single case in which the Department has in- stituted proceedings, and what is, perhaps, even more striking, I believe there has not been a single occasion when the validity of such contracts has been questioned in a court of law."

13. Part I of the Cinematograph Films Act, 1927, seeks to remedy the abuses referred to above by prohibiting the blind booking and the excessive advance booking of films. The restrictions imposed necessarily affect the booking of films in blocks, but block booking as such is not specifically pro- hibited or controlled.

14. 7?//'//'/ Bonking. — Section 1 makes it illegal to enter into an agreement to rent, or imposing an obligation when called on to rent, any film to which the Act applies until the film has been registered or a valid application for its registration has been made, and Section 5 (1) prohibits the exhibition of a film or a part of a serial film or series of films unless the film has been registered. Under Sec- tion 6 (4) an application for registration is not valid until the film has been trade shown.

Modifications of these prohibitions are made in the following circumstances: — ■

(a) The booking of a film which has not been previously exhibited to exhibitors or to the public for exhibition at one theatre only on a number of consecutive days and also the ex- hibition of a film at one theatre only on a number of consecutive days. The first of these exhibi- tions constitutes, for registration purposes, the statutory trade show (definition (b) under Section 32 (1)).

These relaxations of the general provisions recog- nise and permit the common trade practice of giving, generally at prominent Metropolitan theatres, early and special pre-release exhibitions of some of the more important films for longer periods than is usual at the ordinary cinema.

(b) After the first three parts of a serial film or series of films have been registered, or valid applications for their registration have been made, the whole serial or series may be booked without trade show of the remaining parts.

15. Advance Booking. — Section 2 prohibits the excessive advance booking of films by limiting the period between the date of the contract and the date of exhibition. The authorised period was reduced by stages from 12 months for contracts made before 1st October, 1928, to six months for contracts made since the 1st October, 1930.

In the booking of a serial film or series of films the authorised period applies only to the first three parts.

16. Penalties. — Under Section 3 contravention of Sections 1 and 2 renders the offender liable, on summary conviction, to a fine not exceeding £50. Any agreement in contravention of Sections 1 and 2 is invalid.

17. The Board of Trade have received from many sources information that Sections 1 and 2 are being widely contravened. They understand that it is a common practice for a renter to arrange with one or more exhibitors in an area to take the whole or agreed parts of his supply of films. In some cases the renter may refuse to rent any films unless the exhibitor agrees to take the whole or a stated part of his supply, including films not yet registered. In other cases actual terms may not be discussed or formal contracts signed until after the films con- cerned have been registered, thus leaving the exhibitor in a position to reject the films if their quality or the terms offered should be unacceptable to him.

18. The Board have been able to take proceedings under Section 3 in only one case. On that occasion, in 1928, they obtained possession of a copy of a post- card to exhibitors in which a renter stated that he

36452

A 2

COMMITTEE ON CINEMATOGRAPH FILMS

5 May, 1936.]

Mr. R. I>. Fennel j,y.

[Continued.

had booked to certain specified theatres a film which, at the date of the circular had not been registered. Since then the Board have found it impossible to obtain evidence on which they could found a prosecu- tion, the difficulty being mainly that the only per- sons who could furnish such evidence are the parties to the illegal agreement. Moreover it has been alleged to the Board by exhibitors who have com- plained of these practices that if they facilitated pro- ceedings the renter concerned, and possibly other renters, might interrupt his supply of films and thus prejudice his livelihood.

19. Furthermore, the producer-renter-exhibitor combines exhibit the majority of their films at their own theatres. The reservation of dates for those films may involve, in some cases, the equivalent of excessive advance and even " blind " booking, but it would obviously be impracticable to institute pro- ceedings in such cases.

20. While it must be admitted that in this matter the Act has proved to be largely ineffective and un- enforceable, the existence of the statutory restrictions prevents renters from compelling exhibitors to enter into legally enforceable contracts of the kind which Parliament intended to prevent, and to that extent affords exhibitors opportunities of reconsidering and repudiating unduly burdensome agreements if they wish to do so.

21. Certain proposals to improve the position were made by the Advisory Committee in the Report which is before the Departmental Committee.

IV. — The " Quota " Provisions of the Act.

22. As pointed out above, the Act sought to assist the production of films by imposing an obligation on renters to acquire and on exhibitors to show an in- creasing proportion of British films. These provisions are shortly summarised in the following paragraphs.

23. Under Section 27 (3) of the Act a British film is defined as one which has been made by a Biitish subject, or subjects, or by a British company (which is, for this purpose, one constituted in any part of the British Empire, the majority of the directors of which are British subjects). The studio scenes must have been shot in the British Empire ; the author of the scenario must have been a British subject and, generally speaking, not less than 75 per cent, of the salaries, wages and payments specifically paid fo"r labour and services in the making of the film (ex- cluding payments in respect of copyright and to one foreign actor, actress or producer) must have been paid to British subjects or persons domiciled in the Empire. The statutory requirements are dealt with at length in Appendix I.

24. The Act provides that no film shall be rented or exhibited unless it has been registered by the Board of Trade either as a British film or as a foreign film, and prohibits the renting or exhibiting of films in the absence of a licence issued to the renter or exhibitor, as the case may be, by the Board of Trade.

25. As regards the actual quota provisions, the Act provides that a renter in each of the quota years shall acquire for the purposes of renting at least a specified percentage of British films, the per- ceiltage being specified both as regards the long films (3,000 feet or upwards) and also in respect of all films, long or short (the latter being those of less than 3,000 feet). It is thus possible for any de- ficiency in British short films to be satisfied by a corresponding increase in the length of the British long films acquired. Provision is also made for small renters to combine for quota purposes with the per- mission of the Board of Trade. Renters are re- quired to keep records of the films acquired by them for renting and to make returns annually to the Hoard of Trade. The return which is made at the end of the renters' quota year shows all the films acquired by them and also the extent to which they have been booked for exhibition. The renter is

also required to make a supplementary return 12 months later, giving additional details of the book- ings that have been taken. This enables the Board to ensure that films which are acquired late in a quota year have been bona fide acquired for the pur- poses of renting and not merely for quota purposes. The Board are empowered to inspect the records kept on renters' premises and also to examine the returns made to them in order to satisfy themselves that there has been compliance with the provisions of the Act.

26. In the case of exhibitors, the Act similarly provides that during each quota year a specified percentage of the total length of films exhibited shall be British. As in the case of renters the obligation is in respect of long films and all films separately. It may be noted, however, that whereas in the case of renters the quota is based on the total length of the films acquired for renting, in the case of exhibitors the basis of the quota is the total length of the films exhibited multi- plied by the number of times such films are exhibited during the hours when the theatre is open. As in the case of renters, provision is made for exhibitors to keep prescribed records with regard to the films exhibited which are open to inspection, and for annual returns to be made to and examined by the Board of Trade.

27. The quota scales laid down in the Act are as follows: — [The renters' quota year ends on the 31st March and the exhibitors' quota year on the 30th September].

	Renters' quota	Exhibitors' quota
	Percentage.	Percentage.
1929	n	5
1930	10	n
1931	10	n
1932	m	10
1933	15	12J
1934	17J	15
1935	17 J	15
1936	20	20
1937	20	20
1938	20	20

The difference in the renters' and exhibitors' quota years is due to the fact that there is always a con- siderable time lag before a film acquired by a renter is available for general distribution to exhibitors. It will be observed that at the present time the maxima quotas laid down in the Act have already been reached and that for most purposes the Act expires, so far as renters are concerned, at the end of March, 1938, and, so far as exhibitors are con- cerned, in September of the same year.

28. Provision is also made for prosecution, either in a summary manner tin or indictment, of renters or exhibitors who fail to comply with their quota obligations. In the case of a third offence, the renter or exhibitor may be deprived by the Court of his licence to rent or exhibit films, as the case may be. Provision is also made for a certificate to be issued by the Board of Trade where failure to comply with the quota was due to reasons beyond the control of the renter or exhibitor, such as the character of the British films available or their cost.

29. The Act was designed to promote the making

in this country of the fictional or dramatic films which form the bulk of the programme in the ordinary cinema and necessitate the use of studios and the employment of artistes, technicians and general labour to a considerable degree. It was accordingly deemed necessary to exclude certain classes of films from the operation of the Act. as otherwise renters of foreign films would have been able to meet their obligations by acquiring cheaply- produced films with little or no studio work. The excluded classes, which are enumerated in Section

MINUTES OF EVIDENCE

5 May, 1936.]

Mr. R. D. Fennelly.

[Continued.

27 (1) include films depicting mainly news or current events, natural scenery, commercial advertisement, films wholly or mainly depicting manufacturing pro- cesses and scientific, including natural history, films.

30. It was recognised, however, that some such films might be of importance and that their exhibition should be encouraged on cultural grounds. It was accordingly provided that the Board of Trade could allow films of any of these classes to be registered for the purposes of the renters' and exhibitors' quotas on the ground of " special exhibition value ". A small number of films are registered under this pro- viso every year, after consultation with the Advisory Committee. Further, in order to assist their ex- hibition in the cinemas, British films falling within the excepted classes, other than those depicting mainly news or current events and commercial ad- vertisements, are entitled, although not required, to be registered for the purposes of the exhibitors' quota only. There is a growing registration of such films in view of the increased output of documentary and " interest " films which are not covered by the Act.

31. For the purposes of advising the Board of Trade on the administration of the Act provision is made for the appointment of an Advisory Committee consisting of two representatives of film makers, two representatives of film renters, four representatives of film exhibitors and five independent members (one of whom is to be Chairman and one must be a woman). Under the Act the Advisory Committee has certain statutory functions to perform. For instance, all cases of quota default on the part of renters or exhibitors must be submitted to them for advice before a decision to refuse a certificate that the defaidt was due to circumstances beyond their control is reached by the Board of Trade. In practice, however, the Board consult them on other questions also.

V. — The Position of the Producers.

32. The makers or producers of films are combined for trade association purposes in the Film Producers' Group of the Federation of British Industries (Secre- tary : Mr. M. Neville Kearney).

33. There has been a very large increase in the facilities available for making films in Great Britain since the passing of the 1927 Act. The Film Pro- ducers' Group in the course of their evidence will presumably be prepared to furnish details of the number of studios and stages which are now in existence as compared with 1927. There is no doubt however that since that date old studios have been rebuilt and re-equipped and new studios erected which on the technical side compare favourably with those of the United States. Considerable amounts of capital have been put into film production by the investing public and a number of new important producing companies have appeared.

34. A list of the principal makers of fiction and dramatic films in this country is given in Appendix III. Among the leading producers are: —

Gaumont-British Picture Corporation, Ltd., with studios at Shepherd's Bush and Islington.

Associated British Picture Corporation, Ltd. (formerly British International Pictures, Ltd.), with studios at Elstree and Welwyn Garden City.

London Film Productions, Ltd., who are erect- ing large modern studios at Denham, Bucks.

British and Dominion Film Corporation, Ltd.

35. In addition there are a number of producers making interest, scientific, educational, etc., films, which do not in general fall within the ambit of the Act.

36. It will be observed from Appendix III that there are a number of production companies or units which do not own studios. These companies or units are usually formed for the production of one or more films which are made either in the studios of other producers, as stages become available for letting during intervals in their own production programmes, or in studios owned by companies who specialise in letting and make few, if any, films themselves.

37. Before he embarks upon the cost of producing a picture the producer wishes, if possible, to be certain of his market. For this reason the important production companies, especially those which own studios, are in association with distributing com- panies. The connection between the producing and renting companies is shown in Appendix IV. The independent production units usually make an arrangement with a renter before embarking on a film. These arrangements vary in character. Some- times the renter will make an advance towards the cost of the picture; in other cases the renter pays a lump sum down on delivery of the negative which may or may not be combined with an arrangement whereby the maker and renter share the proceeds of the distribution of the film in certain proportions; and in other cases the renter takes the picture on a sharing basis without any lump sum payment.

38. In the case of Gaumont-British Picture Cor- poration, Ltd., and Associated British Picture Cor- poration, Ltd., the process of vertical combination is carried a stage further in that they also control circuits of cinemas amounting to 330 in the case of the former and 225 in the case of the latter. The control of these cinemas assures, of course, a definite market for their product through their associated renting organisations.

39. It is understood that the Fox Film Company of America have a considerable holding in the Gaumont-British Picture Corporation which, how- ever, does not amount to control, but apart from this there is, so far as is known, little foreign capital invested in the production side of the United Kingdom industry. Only three United States rent- ing organisations (Fox Films, and Warner First National jointly) have acquired studios in this coun- try for the production of the films required to meet their obligations under the Act. The remain- der obtain their films from various sources — mostly from independent producers who hire studios for the purpose of making them.

40. The following tables " A " and " B " show the number and length .respectively of British and foreign long and short films registered for renters' quota during the years since the Cinematograph Films Act, 1927, became operative: —

Table A. Number of films registered.

Period		Long.			Short.			All Films.
(years
ended
March 31).	British.	Foreign.	Total.	British.	Foreign.	Total.	British.	Foreign.	Total.
1929	128	550	679	150	663	829	278	1,213	1,491
1930	96	506	602	180	885	1,065	276	1,391	1,667
1931	122	556	681	53	976	1,058	175	1,532	1.7H7
1932	153	464	618	44	917	977	197	1,381	1,678
1933	159	481	643	41	741	841	200	1,222	1,422
1934	190	484	679	48	647	707	238	1,131	1,369
1935	189	477	667	67	697	820	256	1,174	1.430
1936	212	506	718	85	578	663	297	1,084	1,381

COMMITTEE ON CINEMATOGRAPH FILMS

5 May, 1936.]

Mr. R. D. Fennelly.

[Contin tied.

Table B. L> ' iiijlh of films registered (in thousand feet).

Period		Long.			Short.			All Films.
(years
ended
March 31).	British.	Foreign.	Total.	British.	Foreign.	Total.	British.	Foreign.	Total.
1929	904	3,400	4,304	170	922	1,092	1,074	4,322	5,396
1930	624	3,331	3,955	150	1,204	1,354	774	4,535	5,309
1931	789	3,649	4,438	60	1,160	1,220	849	4,809	5,658
1932	928	2,962	3,890	59	1,071	1,130	987	4,033	5,020
1933	961	3,057	4,018	47	893	940	1 ,008	3,950	4,958
1934	1,180	3,115	4,295	60	769	829	1,240	3,884	5,124
1935	1,183	3,116	4,299	68	891	959	1,251	4,007	5,258
1936	1,379	3,316	4,695	96	756	852	1,475	4,072	5,547

41 . It will be seen that as was to be expected there was a considerable output of British films in the first year of the Act. In 1930 and 1931 production was to a certain extent disorganised by the introduction of sound, but British producers had made so satisfactory a start that they were able to surmount this obstacle and after 1931 pro- duction increased rapidly. The number of British films produced has always been far in excess of those required to meet the statutory quota on the foreign films registered.

42. It will be observed that on the other hand there has been a decrease with slight fluctuations in the foreign long films registered both as regards number and length since the first year of the renters' quota. This reduction is probably ac- counted for partly by economic conditions in the U.S.A. and partly by the fact that the increased production of British films and the cost of pro- viding quota has made it unprofitable to bring to this country certain poorer quality American films which could profitably be distributed under the con- ditions which prevailed before the Act came into force and during the first year or two of its opera- tion.

43. It will be further observed that British short films showed a considerable decrease both in num- ber and length until 1933 when some slight degree of recovery took place. This decrease in short films has been apparent however not only in British but also in foreign films. The small output of British short films is probably due largely to the unfavourable economic conditions under which they are made and sold. In the case of foreign films it is probably due in considerable measure to the increasing extent to which programmes shown to the public consist of two long films and a news reel instead of one long film and several short films. There has. however, in the last two years been a considerable increase in the output of short " interest " and documentary films, many of which have been registered Eor exhibitors' quota. Forty-six short films were registered in this way in the year ended 31st March, 1936, as against three long films.

44. The Board of Trade are not in a position to estimate either the capital invested in the pro- duction side of the industry or the cost of British films. In order that the Board may be in a posi- tion to assure themselves that the requirements of the Act in relation to British films have been complied with, the producer has to furnish particu- lars of the salaries, wages and other payments made to persons directly employed in the making of a

film. The total expended in this way in respect of British films made in the quota year 1935-6 amounted to £2.750.000. This total excludes pay- ments made in 95 cases to foreign artists and pro- ducers (usually highly paid). It does not include cost of sets and other materials, studio hire where paid, and general overheads. The total amount expended in production in 1935-6 may therefore have been of the order of £5,000,000 or more, but the figure is suggested with all reserve.

45. The particulars of British films given in para- graph 40 include films made not only in the United Kingdom but elsewhere in the Empire. The follow- ing table " C " gives particulars of the films made outside Great Britain which have been registered for full quota as British since the Act came into force. Practically all these films were acquired by foreign- controlled renters. It will be seen that in the quota year 1935-6, for instance, only 11 of the long films registered as British under the Act were made outside Great Britain. Six of these came from Australia while three were Indian silent films made some years ago and not hitherto registered in this country.

Table C.

	No. of films.
Quota Year.
	Long.	Short.
1928-9	8	1
1929-30	7	-
1930-1	9	5
1931-2	6	1
1932-3	9	8
1933-4	9	4
1934-5	11	-
1935-6	11	-
Total	70	19

Full details are given in Appendix V.

VI. The Position of the Renters.

46. The renters or distributors of films are com- bined for trade association purposes in the Kinematograph Renters' Society (Secretary. Mr. F. Hill).

47. A- already stated, renters who distribute films

fcol which the Act applies must lie in possession of an

MINUTES OF EVIDENCE

5 May', 1936.]

Mr. R. D. Fennelly.

[Contih hi ,1 .

annual licence issued by the Board of Trade. The number of licensed renters in recent years has been : —

1933-4 51

1934-5 55

1935-6 65

A considerable number of these renters only register one or two films or none at all (22 renters acquired no registered films in 1935-6), and the number of renters who registered more than six long films was 22, 16 and 19 in the years mentioned above. A list of the principal renters is given in Appendix IV. Nine are subsidiary companies in the United King- dom of the chief United States producers' organisa- tions, as follows: —

Columbia Pictures Corporation, Ltd.

First National Film Distributors, Ltd.

Fox Film Company. Ltd.

Metro-Gold wyn-Mayer Pictures, Ltd.

Paramount Film Service, Ltd.

Eadio Pictures, Ltd.

United Artists Corporation, Ltd. *Universal Pictures, Ltd.

Warner Brothers Pictures, Ltd.

In the renters' quota year ended 31st March, 1936, these nine foreign companies hetween them distri- buted 342 out of a total of 506 long foreign films registered in that year. They also distributed 113 out of 212 British pictures.

48. The chief renting companies associated with British producing firms are: —

Associated British Film Distributors, Ltd. British Lion Film Corporation, Ltd.

* See note on General Film Distributors to para. 48.

Butcher's Film Service, Ltd. Gaumont-British Distributors, Ltd. ^General Film Distributors, Ltd. Pathe Pictures, Ltd. Wardour Films, Ltd. Twickenham Film Distributors, Ltd.

Gaumont-British Distributors, Ltd., mainly dis- tribute British films produced by Gaumont-British Picture Corporation, Ltd., and Wardour Films, Ltd., and Pathe Pictures Ltd., those made by Associated British Pictures Corporation, Ltd. These renters, however, all occasionally distribute British films made by independent units. Between them they were responsible for distributing 86 out of 212 British films registered in 1935-6, and 87 out of 506 foreign films.

49. As already stated, every renter is under an obligation to acquire each year a certain proportion of British films in relation to the total films acquired. The following table " D " taken (with some modifications and the addition of figures for 193-5-6) from a paper recently read by Mr. S. Rowson before the Royal Statistical Society, shows the quota during each of the years ended March from 1929 to 1936, together with the corresponding number of British and foreign films registered for renters' quota during that period.

* This is a new renting organisation which distributes films made by a number of independent film units. It has recently become associated with a group under Lord Portal which has bought into Universal Pictures, the United States producing concern, and has taken over the distribution in the United Kingdom of Universal films.

Table D. Comparison of British Films produced with minimum quota requirement.

	1	2	3 British shorts	4 British shorts	5	6	7	8 Minimum length of	9 Actual length of	10 Exc<	11 ?ss of
Year	Quota	Foreign shorts	required if there	regis- tered	Deficiency in	Foreign Longs	British Longs	British Longs	British Longs	British proc	Longs uced.
ended	per cent.	regis- tered	were a separate	for renters'	Col. 4.	regis- tered.	required for quota.	required for quota	regis- tered for
March
31.			quota on	quota.				Col. 7 +	renters'		Per cent.
			shorts.					Col. 5.	quota.	Length.
		'000 ft.	'000 ft.	'000 ft.	'000 ft.	'000 ft.	'000 ft.	'000 ft.	'000 ft.
1929	H	922	75	170		3,400	276	276	904	628	230
1930	10	1,204	134	150	—	3,331	370	370	624	254	70
1931	10	1,160	129	60	69	3,649	405	474	789	315	66
1932	121	1,071	153	59	94	3,962	566	660	928	268	40
1933	15	893	158	47	111	3,057	540	651	961	310	48
1934	m	769	161	60	101	3,115	661	762	1,180	418	55
1935	m	891	189	68	121	3,116	661	782	1,183	401	51
1936	20	756	189	96	93	3,316	829	922	1,379	457	50

50. It will be observed that since the year ended March. 1930, there has been a deficiency in British short films calculated on the basis of the quota percentage of the length of foreign short films registered. So far as the combined quota of long and short films is concerned, there has been, how- ever, in each year a considerable excess of British long films registered over the actual length of British

long films required to meet the quota both in long films and in all films. The liability for quota is, however, generally speaking, an individual one. Table K shows the quota liability for all films of the main British and foreign renting companies in this country during the quota year ended March, 1935, together with the actual length of British films registered by them during the year in question.

COMMITTEE ON CINEMATOGRAPH FILMS

5 May, 1936.]

Mr. R. D. F&NNELLY.

[' 'onttnued.

Table E.

Comparison of British films registered by the principal roiiijimiirs in \\)'.\\ 5 uiih their minimum quota require- ments.

	Quota	Length
	Liability.	Registered.
	('000 ft.)	('000 ft.)
British Companies.
Associated British Film Distri-
butors ...	51	43
Associated Producing & Distri-
bution Co.	7	23
British Lion Film Corporation ...	12	42
Butcher's Film Service ...	8	45
Gaumont-British Distributors ...	47	210
Pathe Pictures	38	39
Wardour Films ...	31	120
Foreign Controlled Companies.
Columbia Pictures Corporation	68	68
First National Film Distributors	49	49
Fox Film Co	69	69
Metro-Goldwyn Mayer Pictures
Ltd	89	89
Paramount Film Service	97	98
Radio Pictures	78	78
United Artists Corporation	27	52
Universal Pictures Ltd. ...	113	113
Warner Bros. Pictures ...	47	47

Detailed figures for the year ended March, 1936, will not be completely available until the renters' returns for 1935-6 have been received and examined, but preliminary estimates will show much the same result as in 1934-5, namely, that the foreign con- trolled companies tend to register just sufficient British films to meet their quota obligations, while the British companies in general acquire registered films far in excess of the obligation. Among the foreign controlled companies the exception is United Artists who act as distributing agents in this coun- try for the films produced by London Film Produc- tions Ltd. and British and Dominions Film Corpora- tion Ltd.

51. Although the question of the quality of British films will be discussed more generally at a later stage in the memorandum, it may be in- teresting at this point to compare the quality of the British and foreign films acquired by the British and the foreign controlled renters. The following table F is taken from the paper by Mr. S. Rowson to which reference has already been made.

Table F. Estimated ( Weighted) Average Marking of Films in 1934.

Registered by	British films.	Foreign films.
British Companies Foreign Companies	8 7	8

This table is based upon the markings assigned to films by the Cinematograph Exhibitors' Associa- tion Review. Markings are based on a maximum of 10, but the difference between seven and eight marks represents a considerable difference in esti- mated value.* This table shows that the foreign controlled companies get the best foreign films and the worst British films and contrariwise that the

* The markings may roughly bo grouped as follows : — Under 7 ... Bad.

7 — 7 J ... Second features for small country cinemas. 7 J — 7| ... First feature for small cinemas; some may

serve as second features elsewhere. 8 — 8£ ■•• First feature for most cinemas. 8J or over. Films of the " super " type.

British renting companies get the best British films and the worst foreign films. So far as these mark- ings are reliable, they also show that the British films rented by British companies were on the aver- age of as high a quality as the foreign films rented by the foreign controlled companies.

52. The following table G shows the number of renting firms in default with their quota in each of the years ended March, 1933, to 1935.

Table G.

Year ended	Number of	Number of	Number of
March 31	Renters licensed.	Defaults.	Prosecutions.
1932-33	45	8	1
1933-34	51	3	—
1934-35	55	6	—
1935-36	65	18	*

Most of the defaults occurred amongst small renters who register only one or two films and in many cases it is found that these renters go out of busi- ness before the end of a renters' year. Under the Act a renter who is in default is entitled to make a submission to the Board of Trade and to claim a certificate if he can show that the reasons for his non-compliance with the Act were outside his control. Before a decision is reached on the ques- tion of granting a certificate these cases of default are referred to the Cinematograph Films Advisory Committee as required by the Act. It will be observed that in only one case in the three years 1932-5 have proceedings been instituted. In the remaining cases no renter satisfied the Board of Trade that the circumstances of non-compliance were outside his control, but the defaults were not considered sufficiently serious to justify a prose- cution. The companies concerned, however, were warned that they must not expect similar leniency in the case of any future default.

VII. — -The Position of the Exhibitors.

53. The exhibitors are combined for trade associa- tion purposes in the Cinematograph Exhibitors' Association (secretary, Mr. iW. R. Fuller).

54. Under the Act every exhibitor showing films to which the Act applies is required to be in pos- session of an annual licence issued by the Board of Trade. This liability arises in respect of each cinema separately, and the licence is not transfer- able if the business changes hands during the course of a quota year. The numbers of licences issued by the Board of Trade to exhibitors in the course of the last three exhibitors' quota years have been as follows : —

Year ended

3Qth September.

1933 4,&52

1934 4,766

1935 4,855

These figures include a number of new licences which were issued in the course of a year when premises Changed hands and the total number of cinemas normally open in this country may be taken at about 4,400.

55. As already pointed out, the Gaumont-British Picture Corporation control, through various associated companies, some 330 cinemas, and the

Associated British Pictures Corporation some 225. None of the other British producing or renting con-

* The number of defaults is a preliminary estimate and may be reduced by combinations of renters under Section 14. Tho defaults will be examined on the basis of the Renters' returns due on May 1st and will then be brought before the Advisory Committee as necessary.

MINUTES OF EVIDENCE

5 May. 1930.]

Mr. R. J>. Fennelly.

[Com/..

cerns has, so far as is known, any financial interest iti cinemas. Among the foreign controlled renting organisations Paramount have a chain of about 12 theatres in key positions throughout the country, while several of the other companies control a theatre in the West End of London which serves as a shop window for their films.

56. Apart from the two major circuits referred to above there are several circuits of between 50 and 100 theatres and also a number of smaller circuits. In a few cases there are no financial arrangements between the companies constituting the circuit ; they are combined together for the purpose of booking films, presumably because their greater strength enables them to make better terms with the renters. The renters have now set their face against any extension of this practice.

57. The renter normally hires his films to exhibitors on a percentage basis, that is bo say, he takes a certain proportion of the gross receipts of the cinema after entertainment tax has been paid. The percentage charged varies with the type and popularity of the film — from 25-40 per cent., and even higher. Where a complete programme is taken from a renter the percentage is adjusted accord- ingly, but where the second feature is hired from a second renter it is usually paid for at a flat rate, e.g. £25 for a week. On the average, however, the renter probably takes between 35 to 40 per cent. oJ the gross receipts, less tax.

58. The following Table H shows the total length of registered films exhibited in Great Britain in each of the exhibitors' quota years 1932 to 1935: —

Table H.

	Exhibitors'		British.		Foreign.		Total.
Year	Statutory Quota.
ending
30th Sept.	Per cent.	Short.	Long.	Total.	Short.	Long. Total.	Short.	Long.	Total.
					(In thousand millions of feet.)
1932 ...	10	0-24	6-89	7-13	4-37	21-49	25-86	4-61	28-38	32-98
1933 ...	12±	0-20	7-90	8-10	3-80	22-20	26-00	4-00	30-10	34-10
1934 ...	15	0-24	9-22	9-46	3-59	23-21	26-80	3-83	32-43	36-26
1935 ...	15	0-17	9-40	9-57	3-85	24-10	27-95	4-02	33-50	37-52

59. The next Table I based on the figures given by exhibitors in the same years in comparison with above gives the percentages of British films shown the statutory quota: —

Table I.

Year ending	Exhibitors' Statutory Quota.	Actual Quota of British Films Exhibited.
30th September.	All Films.	Long Films.	Short Films.
1932 1933 1934 1935	Per cent. 10 12i 15 15	Per cent. 21-60 •23 -70 26-09 25-51	Per cent. 24-27 26-20 28-42 28-07	Per cent. 5-13 5-26 6-28 4-21

Comparable figures for the years prior to 1932 are not available, but it will be observed that in each of the last four years exhibitors as a whole have slum n British films considerably in excess of their statutory obligations. It will also be seen that the quota in respect of long films is higher than that for all films. Where an exhibitor is working near to his quota limit he naturally tends to show more British long films in order to make up the deficiency in British short films.

60. It is often stated that the high proportion of British films shown by exhibitors as a whole is due to the fact that the figures are weighted by the high quotas of the two main circuits. This does not, however, seem to be the case. An examination of the returns furnished by the circuit theatres in respect of the quota year 1933-34 shows that their quotas were below the general average in that year.

61. It will be seen from Table I that after a period of three years during which the quota of British films exhibited tended to increase, there has been a slight fall in the year 1934-35 in the case of the all and long film quotas. The short film quota, which is not statutory, fell from 6-28 per cent, to 1-21 per cent. This decline in the exhibition of British shorts was apparently not due to any diminution in supply of such films, as the number

H6452

of British shorts registered in the renters' quota year 1934-35 was 123 as against CO in the previous year. Quite a number of these films, registered for exhibitors' quota only, were of the " interest " and instructional type, while many were of a musical character. An examination of the returns made by exhibitors shows that at 1,600 theatres, or one-third of the total number, no British short films were exhibited. It is difficult to account for this decline. It may be due to the character of the films avail- able or to the increasing number of theatres which are now showing two long films, a news reel and sometimes a short comedy as a complete pro- gramme.

62. It may he of interesl in record the quotas for England, Scotland and Wales separately in respect of the exhibitors' quota year ended 30th Sep- tember, 1935. The figures are: —

Country.	Long Films Quota.	All Films Quota.
England ... Scotland ... Wales	I'i r cent. 28-43 28-24 25-01	Pei- cent. 25-90 26-03 22-12

10

COMMITTEE ON CINEMATOGRAPH FILMS

5 May, 1936.]

Mr. R. D. Fennki.i.y.

[ ( toni

63. In spite of the striking figures shown above there are a considerable number of defaults amongst exhibitors every year. The following Table J shows the number of defaults amongst exhibitors in each of the quota years 1932 to 1935: —

Table J.

Quota Year ended 30th Sept.	Total Defaults.	Total in respect of complete year.	Number of Prosecu- tions.
1932 1933 1934 1935*	130 149 179 147	29 30 69 71	2 2 10 1

* Note. — The Cinematograph Films Advisory Committee have not yet been asked to consider a number of defaults which occurred in 1934—35.

64. It will be seen that a large number of defaults occur in respect of only part of a year. These defaults occur particularly where theatres are opened late in the quota year and sufficient films of the right kind are not available, or where a business changes hands or is closed down in the course of the year. It should be explained that the quota liability attaches to the individual exhibitor and not to the cinema.

65. As compared with the number of theatres (4,400) the number of defaults is not large, especially when account is taken of those cases where for special reasons compliances with the Act would have been extremely difficult and in some cases impossible. No particular importance can be attached to the fact that there was a large increase in prosecutions in respect of the quota year ended September, 1934.

66. In the normal way after a film has been shown to the trade it is; not released for general exhibition to the public for several months, though some out- standing films are shown for a short period soon after the Trade Show in the West End of London. The date of the general release varies between the Provinces and London, and even between North and South London so as, no doubt, to economise in copies of films. In the first week of its general release the film goes to the " first run " houses in the area which have booked it and in the weeks thereafter to the " second run," " third run," etc., houses.

67. In general, defaults on the part of exhibitors are attributed to the difficulty of obtaining a sufficient supply of Brilisli films of m»id quality com- bined in some cases with the contention that in par- ticular areas of the country — in particular the Fast End of London and parts of Glasgow — British films jr.' not in the public favour. The difficulty of securing adequate supplies of good British films arises

chiefly in those towns or districts where there a considerable number of " first run " houses in competition with one another, especially when- go of these bouse- belong to the main circuits. The circuit cinemas naturally show most, if not all, of the films made by their connected producing organi- sations and. through their booking power, are able to obtain other British films in competition with independent exhibitors who have only one or two cinemas. The number of British films available to the independent exhibitor is materially reduced and the residue left to him includes most of the films of poor quality. Even if he were prepared to show a particular film of good quality at the same time as his competitors, he is in many cases prevented from doing so by a system of " barring," that i-. his competitor has an arrangement with the renters that no other cinema within a certain area will be allowed to exhibit the film during the same period. This system of " barring " is also in existence be- tween " second run " houses and even in some cases a definite period is insisted on before a film can be shown " second run " in the competitive area.

68. As in the case of the renter, the exhibitor who is in default may make a submission to the Board under Section 23 (2) of the Act that non-compliance was duo to reasons beyond his control. Every case where the Board contemplate the refusal of such a certificate is referred to the Advisory Committee. A number of certificates are, in fact, granted every year.

69. It may be added that under Section 32 (2i of the .Vet, " where compliance on the part of a renter or exhibitor with the provisions of the Act as to quota was not commercially practicable by reason of the character of the British films available or the excessive cost of those films, non-compliance with those provisions on that ground shall for the pur- poses of the Act be treated as due to reasons beyond his control."

VIII. — The Demand fob Bbitish Films.

70. It is common knowledge that the entertain- ment value of British films has consistently improved since the Act came into operation anil that they are #n general demand by the public, especially since the introduction of sound. The tables in paragraph 59 show the extent to which the exhibitors as a whole have exceeded their statutory obligations in the exhibition of British films. The object of the ex- hibitor is, of course, to give the public the type of films which it wants: and the fact that the statutory quota has been exceeded over each of the last four years is in itself a proof of public demand.

71. Further light on the demand for British films is shown by the following Table " K ". This Table shows the particulars, taken from the renters' statu- tory returns, of the range of bookings of long films acquired by renters in the years 1932-33 and 1933-34. Comparable figures for 1934-35 will not be available until the supplementary returns from renters due on 1st .May. I936j have been received and collated.

Table K.

Range in Days.	British Films.		For. ign	Films.
	1932-3.	1933-4.	L932-3.	1933-1.
1 to 2,000 3.000 to 5,000 5.001 and upwards ...	No. 50 75 34	Per cent. 31-6 47-4 21-0	No. 60 82 45	Per cent. 32- 1 43-8 24-1	No. lot 340 32	Per i ent. 21 -S 71- t 6-8	No. 101 341 43	Per cent. 20-8 7o-3 8-9
Total	159		187		47ii		485

MINUTES OF EVIDENCE

11

5 May, 1936.]

Mr. R. D. Fennelly.

[Contmi in J.

72. The Table shows that the number of British films which are booked tor 5,001 days and upwards was in excess of the number of foreign films so booked in each of the years 1932-33 and 1933-34. This comparison is even more striking when it is remem- bered that the number of foreign long films regis- tered is between two and three times as great as the number of British long films registered. It must, of course, be remembered that a large number of films in the higher range of bookings are those made by the British producers who have affiliated renting and exhibiting organisations and also that there is a certain demand for the good British films for quota purposes.

73. It will be observed that in the category of the lowest range of bookings (1 to 2,000 days) there is a larger percentage of British films than of foreign films. The British films falling within this class include a large number of films acquired by the foreign-controlled renters in order to meet their obligations under the Act. It is a constant com- plaint of exhibitors that a large proportion of the films acquired by these renters are of poor quality and that they do not offer a satisfactory booking proposition in the case of most cinemas. It is around this question of the quality of " quota " films that

the chief controversy regarding the operation of the Act has arisen.

74. The quality of British films may be examined from another aspect. Reference has already been made in paragraph 51 to the markings assigned to films by the Cinematograph Exhibitors' Association Review. The Board of Trade have no means of judging whether the standard of marking is con- stant throughout a year or as between one year and another, and in the case of particular films the markings may perhaps be open to criticism. It may perhaps be assumed, however, that throughout the range they represent fairly accurate marking from the exhibitors' point of view. The scale of markings has already been described in the footnote to para- graph 51.

75. The following Table " L " shows in summary form the markings assigned by the Review to British films in the quota year 1932-33 and also in the calendar years 1934 and 1935. In the Table a com- parison is made between the British films registered by British renters and those registered by foreign- controlled renters. Full details of the markings of the films acquired by the different companies are given in Appendix VI.

Table L.

	Quota year 1st April, 1932	Calendar Year 1st January	Calendar Year 1st January
Scale of Markings.	to 31st March, 1933.	to 31st December, 1934.	to 31st December, 1935.
British Renters.	No. of films.	Per cent.	No. of films.	Per cent.	No. of films.	Per cent.
Under 7	7	9	7	9	2	2
7to7J:	5	7	3	4	6	7
7|to7f	5	7	16	21	22	26
8 to 8£	38	51	41	54	52	60
8| and over	19	26	9	12	4	5
Total	74	100	76	100	86	100
U.S. Controlled
Renters.
Under 7	9	11	33	31	33	34
7 to 74.	16	20	32	29	29	30
7£to7f	18	23	29	27	19	20
8 to 81	33	42	12	11	14	14
8| and over	3	4	2	2	2	2
Total	79	100	108	100	97	100

76. Taking a marking of eight and above as the criterion of a good film, it will be seen that in the calendar year 1935, 56 out of 86 films regis- tered by British renters, as compared with only 16 out of 97 registered by foreign-controlled renters, fell within this category. Whether or not in con- sequence of some variation in the standard of mark- ing, the proportion of British films falling within this class has tended to fall on a comparison of the three periods ; but the fall has been consider- ably greater in the case of the foreign-controlled renters than in the case of the British renters.

77. Since the exhibitors' quota has increased to 15 and 20 per cent, the Board of Trade have re- ceived complaints from the exhibitors that they are unable to obtain sufficient British pictures of good quality and that in order to meet their obliga- tions under the Act they are forced to book British films of inferior quality and consequently with low earning capacity. The films registered in the year 1935 represent more or less those available to ex- hibitors during the quota year 1st October, 1935, to 30th September, 1936. Again on the assumption

that a marking of eight and above represents a good film, it will be seen that the number of such lilms available to exhibitors was 72. Where an exhibitor shows two feature films in his programme and changes his programme once a week he re- quires, with a quota of 20 per cent., some 25 British long films after making some allowance to cover his deficiency in quota on foreign short films. Where the independent exhibitor is in competition with one or both of the producer-renter-exhibitor cir- cuits he has no opportunity of booking their films " first run " and his choice is therefore somewhal restricted, especially when allowance is made for the competition of smaller circuits or with other independents and for films which, although of good quality, do not suit particular localities. Too much stress should perhaps not be laid on these calcula- tions, especially as some of the films marked 71, ami ~i may be specially suitable for particular parts of the count i\ .

78. It is clear, however, that the tendency oi foreign-controlled renters has been to acquire cheaply produced British films in order to meet

3G152

B 2

12

COMMITTEE ON CINEMATOGRAPH FILMS

5 May, 1936.]

Mr. R. D. Fexxelly.

[Cont rwed.

their obligations under the Act. Cost is, of course. not the only or even the best criterion of quality, but it is probably true that a good film cannot be produced for the amount of money these renters are prepared to pay.

79. The necessity for some quality test for British films was mentioned during the course of the Debates in the House on the Bill and many representations have been received by the Board of Trade on the subject since. In general, all these representations have the same basis, namely, that a film should have cost a certain amount of money in order to qualify for registration as British. It is generally admitted, as mentioned above, that cost is not the best criterion of quality, but it is argued that it is the only method administratively possible. Pro- posals on these lines were made in 1929 to the Board of Trade by a joint deputation from the Federation of British Industries and the Cinemato- graph Exhibitors' Association and were repeated in 1931 by a joint deputation from the Federation of British Industries and the Trade Union Congress. These proposals are discussed in the report of the Cinematograph Films Advisory Committee made in October, 1935, which is before the Committee.

IX. — The Export Market.

80. Since the Cinematograph Films Act, 1927, was passed in this country legislation on somewhat similar lines has been introduced in various parts of the Empire. A summary of this legislation is given in Appendix VII. It will be seen that in New Zealand, Southern Rhodesia and certain Colonies the object of the legislation has been to increase the exhibition of British films.

81. In New South Wales and Victoria, however, the recent legislation has taken a different trend and its main object is to assist the promotion of film production in Australia. It is anticipated that this legislation may have repercussions on film pro- duction in the United Kingdom. Under the legisla- tion renters in business in Australia are under an obligation to acquire a certain proportion of Australian films against their foreign films though not against their British (other than Australian) films. Films made for this purpose in Australia, provided that they comply with the requirements of the Cinematograph Films Act, 1927, can also count for quota purposes in this country, and it is therefore to be expected that a certain number of films which would otherwise be made in this country for quota purposes will henceforth be made in Australia so as to satisfy both quotas at once. Objection has been taken to this legislation by the film producers in the United Kingdom on the ground that it does not provide reciprocal treatment, but presumably it was felt that if British (other than Australian) films were entitled to count for quota purposes in Australia in the same way as Australian films can count in the United Kingdom the object behind the Act was not likely to be achieved.

So far as exhibitors are concerned, the situation varies in the two States. In New South Wales exhibitors have to provide a certain proportion of Australian iilius against all the films including British (other than Australian) which they exhibit, whereas in Victoria the obligation only applies in respect of foreign films exhibited.

82. Australia has hitherto provided the best market for British films outside the United Kingdom and so far us inn be judged Mich films are increasing in popularity.

83. In Canada, where, as in the case of Australia, films arc a matter for the separate Provinces, legis- lation imposing quotas has been passed in two provinces, but has noi been put into operation. The

I ;ress of British films has been slower in Canada

than in Australia, presumably owing to the hold which United States interests have over flu1 Canadian cinemas

84. There is no quota legislation in South Africa,

the Irish Free State or India.

85. Colonies and Mandated Territories. — The posi- tion here requires more lengthy explanation. In March, 1929, the Secretary of State lor the Colonies appointed the Colonial Films Committee " to examine the arrangements existing for the supply .... of cinematograph films for public exhibition in the Colonies, Protectorates and .Mandated Terri- tories, and to consider in what way these arrange- ments could be improved, with special reference to . . . . the desirability, on political as well as economic grounds, of encouraging the exhibition of British films."

86. One of the recommendations made in the report of the Committee (Cmd. 3630) in July. 1930. was that an organisation should be set up in this country, independent of but working in close co-operation with the Government Departments concerned, to under- take the distribution of British films throughout the Colonial Empire. The Committee also recommended that this organisation, when established, should have the assistance of an advisory Committee nominated by the Government to assist in the selection of suit- able films for exhibition in the Colonies and to advise generally on questions relating to the distribu- tion of such films. It was not intended that this Committee should in any way replace the local censorship authorities who would still retain the responsibility for deciding what films could properly be shown in each of the territories concerned.

87. With a view to assisting in the establishment of this organisation, a number of Colonial Govern- ments, at the request of the Secretary of State for the Colonies, and in accordance with a recommenda- tion made by the Colonial Films Committee, under- took to guarantee the Company formed for the pur- pose against loss in its total transactions in the first year up to £1,000.

88. In order to give effect to the recommendations made by the Colonial Films Committee, the Film Producers' Group of the Federation of British Indus- tries formed in October. 1931, the British United Film Producers Company Limited, to undertake the distribution of British films throughout the Colonial Empire. This Company had on its Board of Direc- tors representatives of some of the principal film producing companies in Great Britain. At the same time the Secretary of State nominated as members of the Advisory Committee to assist the Company m the selection of suitable films, two ex-Colonial Governors, the technical adviser to His Majesty's Government on Cinematography, and a representa- tive of the Department of Overseas Trade.

89. The Company undertook the distribution of British films through local agents in the Colonies. and Colonial Governments were requested by the Secretary of State to afford to the Company and its agents such assistance as could properly be given. The Company shipped large consignments of British films to the West Indies and to West Africa.

90. Generally speaking, the Company were only able to cover those Colonial territories which were not already adequately served by existing arrange- ments for distribution; and as such arrangements increased in scope in the Colonial Empire, so the facilities for distribution of the new company diminished. There was no clause in its articles of association making it obligatory on the part of member firms to utilise its services. In consequence the character of the Board and shareholders changed in 1933 an.! 1931. so that by the end of the latter year the company had come under both the financial and directing control of the Gaumont-British Picture Corporation, Ltd.

91. Quota legislation exists in certain West Indian Colonies ami in British Guiana and has been con- sidered in connection with other parts of the Colonial EJoipire. but before any steps can be taken

MINUTES OF EVIDENCE

13

5 May, 1936.]

Mr. R. D. Fennelly.

( 'mi I iwued.

the Colonial Office and the Colonial Governments concerned require to be assured that an adequate and regular supply of British films can be made available for exhibition in the territories concerned. It may be mentioned that the enactment of such legislation is not possible in the majority of the African Colonies owing to international treaties.

92. The revenue derived by United Kingdom pro- ducers from Dominion and Colonial sources is not substantial except in the case of Australia, but it is obviously necessary for the purposes of British prestige that good British films should be exhibited not only in the Empire but elsewhere in the world as widely as possible.

93* The budget of production costs of a film must obviously depend upon the market which is to be anticipated. In the case of a film produced in this country the main market at present is the United Kingdom, and producers can estimate with some degree of certainty the revenue to be expected from a particular type of film, provided it is well made, and can plan its production accordingly. There are, however, limits to the revenue which can be expected from the United Kingdom and this consequently sets an upper limit beyond which pro- ducers cannot afford to go unless they have some assurance of a market outside the United Kingdom. The exhibition of British films in the Dominions and Colonies assists in this respect, but it is often stated that the production industry in this country cannot take the next big step forward unless it can be certain of finding a market in foreign countries. particularly the United States. A certain amount of progress in this respect has been made in the last few years. The Gaumont-British Picture Cor- poration have started their own renting organisa- tion in the United States and arrangements are understood to exist which ensure the release to exhibitors in the United States of films of other British producers.

94. There is no restrictive legislation in the United States. Various Continental Governments have, however, taken steps to encourage the production of films in their own territories and a summary of the measures at present in force is given in Appen- dix VII. In general there is a tendency to regulate the exhibition of foreign films by quotas on imports; in some cases the local industry is assisted by loans and subsidies, while some countries require the " dubbing " of imported films, i.e., the re-making of the sound track in the language of the country concerned, to he carried out locally.

X. — The Question of Sub-Standard Films.

95. The standard film used in the ordinary cinema is of a width of 35 mm. There are, however, other sub-standard films of widths of 16 mm. and 9 mm., which are largely used for educational, scientific anil similar purposes and in home cinemas. Cases have arisen recently, however, where sub-standard films (usually reproductions of 3-5 mm. films which have been registered under the Act) have been exhibited to the general public. The application of the Act to exhibitions of sub-standard films raises some awkward problems. For instance, the line between long and short films is drawn in the Act at 3,000 feet and this was clearly based on the 35 mm. film. The distinction on this basis has, however, little meaning in the case of 16 mm. and 9 mm. films. So far as the Board of Trade are aware, however, the exhibitions of sub-standard films of a registrable character to the public have only taken place in a few cases, but as such exhibitions may increase in number their place in any legislation appears to require consideration.

1. (Chairman): Mr. Fennelly has given us a very excellent summary of the position. It was mentioned last week that we should be glad of an outline of the objects of national film policy. That is not

covered by this evidence and perhaps Mr. Fennelly

would in that respect supplement wluu he has given us. He will remember that Sir Arnold Wilson as\e<l whether there was any change in the attitude of the Government on this matter. Mr. Fennellj said that the conditions were the same and that he would b • able to give us an outline of what objects we should set before us to advise the Government how to achieve a satisfactory film policy. Could he tell us what was laid down when the Act was passed? The beginning of the memorandum shortly summarises the position, I think, but possibly the best way of dealing with that question is to read to you some extracts from the speech of the President of the Board of Trade on Second Heading, when the Bill came up in 1927. The extracts are not very long. He started off by saying : —

" 1 think the importance of securing greater production and wider distribution of British films is generally recognised throughout the country. The necessity was enforced in the strongest language by the Imperial Conference last Autumn " . . . .

He then went on to recite the Resolution which

you have in the document before you, stressing the

importance from an Empire point of view of British

films being as widely shown as possible. He said: —

" I believe that that Resolution expresses a

sentiment which is prevalent in the House and

the country and throughout the Empire. It is

based on a realisation that the cinema is to-day

the most universal means through which national

ideas and national atmosphere can be spread,

and, even if those be intangible things, surely

they are among the most important influences in

civilisation. Everybody will admit that the

strongest bonds of Empire — outside, of course.

the strongest of all, the Crown — are just those

intangible bonds — a common outlook, the same

ideas, and the same ideals which we all share

and which are expressed in a common language

and a common literature ". . . .

" To-day films are shown to millions of people throughout the Empire and must unconsciously influence the ideas and outlook of British peoples of all races. But only a fraction, something like 5 per cent., of the films which are at pre- sent shown in the British Empire are of British origin. That, as I submit and as the Imperial Conference held, is a position which is intoler- able if we can do anvthing effective to remedy it".

That deals with the national aspect. He then went on to deal with the trade aspect of the cinema and to stress the importance of the cinema from the advertising point of view on our trade abroad.

2. I do not think you need read it in detail if you mention the points that we have to bear in mind as being cultural? — With regard to the trade aspect, he drew attention to the importance which the United States of America attached to the film as a means of attracting trade, and made a referenc to some evidence given before an American Com- mittee by the man in charge of the cinema section of the Department of Commerce, in which he said he had been shipwrecked on the coast of Peru and went ashore to lie re-outfitted, and found that in the shops there were no longer British articles; but that American articles had taken their place. On making inquiries he found that a great deal of that change was due to the fact that the people were con- stantly seeing American films. It was a direct, con- sequence of American films being exhibited. The President then quoted statements made bj the Trade Commissioners in Canada and Nen Zealand. Canada says, for instance : —

"The cinema film has also operated against British trade. The production, distribution and exhibition of films in Canada is almost, entirely emit rolled by foreign interests. The effect of the

14

COMMITTEE ON CINEMATOGRAPH FILMS

5 May, 1936.]

Mr. R. D. Fexxelly.

[Coni

constant exhibition of foreign films on the senti- ment, habits and thought of the people is obvious. The pictures show the foreign flag, styles, standards, habits, advertisements, etc."

The President went on to say: —

" If that be at all true of the importance oi this matter from a trade point of view, I submit that the need for the development of the British film, from a national point of view and from a trade point of view, is firmly established ; and if it cannot be developed without Government intervention then, I submit, the case for Govern- ment intervention is made out."

He then dealt with the various parts of the Bill before the House, and concluded by saying : —

" You cannot treat the film industry as if it were an isolated industry or trade, the activi- ties and the success or failure of which affect only those who are engaged in it. On the success or failure of the British film industry much more depends than its own future. It inevitably in- volves great interests, national and Imperial, and the anxiety which was expressed at the Imperial Conference, and the determination which wras registered there to remedy an in- tolerable position, are shared, I believe, by the majority of British people throughout the whole Empire. That determination must be translated into action, and I commend this Bill to the House as the only constructive proposal which has yet been put forward to achieve that end." I think that that remains true to this day; the Government attach enormous importance to the film industry both from a cultural and trade point of view.

3. Have you seen any great increase of export of films to foreign countries concurrently with the im- provement of our films? — There has been an increase, but the extent is difficult to judge. Trade statistics are not of much use; they show only lengths (and value) of film exported, and it may be fifty copies of one film, or one copy of fifty films, we cannot tell at all. In Europe at all events, the market is ex- panding, probably slowly, but it is expanding. Most European countries in recent years have adopted some sort of restrictive legislation, quotas and what not, not exactly like ours, but usually quotas on imports, in order to build up their own national industry. That must to some extent act as a deter- rent to any increase in trade especially as the Americans are there first.

4. Is there generally an import duty in addition to a quota requirement? — That I could not say.

5. In our case is there an import duty as well? — Oh, yes.

6. On the made film?— Yes, a duty that varies according to whether the film is a positive or nega- tive. There are certain exceptions, like educational films and scientific films.

7. The inducement is to bring in the negative and make the positive here?— That is the tendency, yes. One other point about the European and any foreign market is that nowadays when you have sound the producer is put to a certain expense in what he ■ ■.ill- dubbing his picture. He has to put titles across it in the language of the country where it is being shown, or in some cases obtain local speakers speaking the local language and impose their voices on the original film. There are two ways of doing it.

8. You can suggest no evidence to us to show there are useful experiments which we can copy fi;om abroad? — I will put in a memorandum of all the information we have of what is happening in foreign countries.*

9. There is only one other ma iter of importance I want I" ask you. Probably the members of the Committee know more aboul films than I do ami maj

Appendix VII.

think the question rather elementary. Reading your paper it does not seem evident that the rent, i quota has very much effect. I do not know whether when they passed the Act they imagined that the renters' quota would be the controlling factor, or the exhibitors' quota, but it seems that the renter by having this quota, which is really only an obliga- tion to offer films, not a compulsion to sell them, has rather been encouraged to market bad films, and to force them on a reluctant public, and it would seem to me that the method which has proved effec- tive is the exhibitors' quota. Is the renters' quota working in the way you anticipated when you brought it in? Did you think it was going to be effective and that the renter would be able to market all his films? — To go back, I believe when the Bill was being discussed they did think of im- posing a quota on the renter by himself and also of imposing one on the exhibitor by himself. I think the conclusion was that if a quota were imposed on the renter only he would have a lot of films on his hands, and not necessarily a market for them unless there were a corresponding obligation imposed on the exhibitor ; whereas if an obligation were imposed on the exhibitor only, to show a certain proportion of British films, unless there were some assured supply of films, in the long run he would have been forced to make films himself. That is carrying it to extremes.

10. The position is very different now. There is a surplus, and the supply and demand would appear to have obviated that difficulty? — When the renters' quota was arranged it was laid down in the Act that a renter had to acquire a certain proportion of British films for the purposes of booking. I have the exact words of the Act : —

" shall acquire for the purpose of renting to exhibitors a certain proportion of British films." At that time it was felt that that provision would operate sufficiently to make the renter produce good films that he could book. Later that rather broke down because the foreign-controlled renters were in general not prepared to spend money to any extent to make good films.

11. There is no restriction as to the age of the film. The exhibitor can take an old film and show it again? — Yes.

12. As the renters' quota is now working do you see that it achieves any purpose? Does it get any- thing which you would not get by having an effective exhibitors' quota? — I think the exhibitors would be very unhappy if there were not a corresponding pro- vision imposed on the renters to offer them British films for booking.

13. Can you tell me how you are able to apply your seventy-five per cent, qualification to Empire films? How are you able to ascertain the expenditure on films outside your own administration? — All these details of expenditure have to be certified by an incorporated accountant, and when we get a form in from Australia or Canada, if we do not know the man we make inquiries at the office of the High Commissioner where they usually have all the refer- ence books necessary. In the long run you have to trust the accountant.

14. You mentioned there is difficulty in certain cases in finding out how much is paid for tic services of assistants:- Yes.

15. Does not that apply far more intensely out- side your administration? — That particular trouble does not apply in Australia. It has only arisen over here where firms borrow stars from one another.

16. If the Committee found a case for putting on a cost qualification of films to rank for quota, could that be administered outside our own area? — Personally I have always though! that was one of the difficulties of a cos! qualification, apart from the objection which the Dominions and Colonies might take to it, which is another point altogether.

17. Generally speaking, are the quickies short film- or long films?— Do you mean over three thousand feet?

MINUTES OF EVIDENCE

15

5 May, 1936.]

Mr. R. D. Fennelly.

[< 'mi H a mil.

18. Yes? — They are practically all over three thousand feet; it is very seldom they buy any films below three thousand.

19. The drop in the exhibition of short films is therefore nothing to do with the bad qualities of the quickies, it is simply due to a change in the arrange- ment of programmes. The statutory requirements which you give us in Appendix I have been found ineffective in several respects according to your evidence. Do you think that there is a case for getting some change about the restriction. The kind of case which occurs to one is when there is a scene" in Tahiti; it must be of enormous cost to British film producers to take people specially out there. All the wages they have to pay to the Tahitian natives would have to be excluded from the seventy- five per cent.? — There have been proposals that the seventy-five per cent, requirement should be dis- pensed with altogether. We have not heard much about that lately, but in the early days of the Act it was the subject of representations to the Board of Trade on more than one occasion, the producers holding if they had to employ such a large pro- portion of British artists and technicians they could not make films for the world market. In other words they were prevented from employing the best talent the world could produce. There is a tendency for films to be partly re-made here and foreign material to be incorporated, and the Act says they are not British films for quota purposes. We ourselves re- cognise that cannot be pushed too far, and in practice we apply the de minimis principle, and if a man introduces a small amount of foreign material for the purpose of getting foreign atmosphere we dis- regard it.

20. You do not apply this? — Rigidly, no. In a case which went to the High Court the Judge himself said " substantially in its entirety," which I think implies de minimis.

21. The provision that the author of the scenario must be a British subject has broken down too. How do you administer that? — Nowadays there are so many people engaged. There are the continuity writers and the treatment writers, and it is difficult to know who is the scenario writer under the Act.

22. (Mr. J. S. Holmes): I would like to follow ii]) what the Chairman has said with regard to renters' quota. The necessity for putting the quota on the renters as well as exhibitors was that the exhibitors would not have been able to get British films and would have had to have made them them- selves ? — Yes.

23. That does not occur at the present time, and I am wondering whether if we abolished the renters' quota it will not have this effect, that the renters who were attached to the foreign makers of films would probably give up troubling about the rental of any film but their own and new firms would arise in this country who would devote themselves to the supplying to exhibitors of British films only. They would therefore take far more interest in British films, and would probably exercise a good influence on the makers of British films in seeing their quality was improved and only those that were good were likely to obtain contracts from the exhibitors? — I think it is perfectly certain if there was no quota obligation on the foreign-controlled renter he would make no films in this country. That is not his business. Whether you would get a sufficient supply, on the assumption the exhibitors' quota remained at its present level, to satisfy them I doubt. Most of the production of the foreign-controlled renters are not good films, in the sense that the exhibitor does not want to show them if he can possibly avoid it. Therefore there is a very large market for good British films, but the exhibitors say there are not sufficient good British films produced to satisfy their requirements disregarding the renters' quota altogether.

24. (Sir Arnold Wilson): Will Mr. Fennelly be good enough to add. as an appendix to bis evidence, the full text of the President of the Board of Trade's

speech on the Second Reading? It would certainly be of assistance to us.* Secondly, will be add, as an appendix, (a) details of import duties so that we may have that on record? Thirdly, much has happened technically since 1927. The President of the Board of Trade referred to a " common lan- guage.'' He was anticipating events, for sound films had not been invented in 1927. Can Mr. Fennelly say to what extent the administration of the Act has been made more or less difficult by the advent of the sound film? — It has made extra- ordinarily little difference in practice.

25. Did it on the whole encourage British films':" — That, I think, is undoubtedly true. It is really to my mind a moot point whether after 1920, when the sound film came in, the Act itself, or the English voice had the greater effect on the growth of British film production, and it is a point on which trade opinion might be asked. I have always thought it was a point that wanted investigation. The British public do like the sound of British voices, there is no doubt about that.

26. One of the main difficulties of the Board of Trade in administering the Act is to interpret Sec- tion 27 of the Act, i.e., to decide to what films the Act applies and whether certain films have special exhibition value? Can Mr. Fennelly tell us whether " Felix the Cat " and " Mickey Mouse " had been invented in 1927?— I think " Felix the Cat " was in existence, but not " Mickey Mouse." There cer- tainly were the beginnings of cartoon films even in those early days.

27. I should have thought myself, Mr. Chairman, that such films ought to be excluded from the Act. They do not deal with news or current events; they are mechanically made and have a universal appeal. They are not " cultural." No sentence of the Presi- dent of the Board of Trade's speech can conceivably refer to " Felix the Cat." Does Mr. Fennelly think that they should be excluded from the Act in future? — Speaking offhand I should have thought not. The Act was intended to apply to what are commonly called entertainment films, the films nor- mally shown in the cinema, and these are probably the most widely shown apart from news reels. They are produced by mechanical means, but I should think they have helped very largely in the technical development of the industry, especially more re- cently on the colour side, and no doubt in photo- graphy. I am not a technician, but I should have imagined so.

28. If they were to be excluded from the Quota Act would it not facilitate their export? — From this country ?

29. From this country. Are we not hampered in our dealings with foreign countries by the applica- tion of the quota? Has it not led to retaliation? — Do you mean foreign retaliation?

30. Yes? — We have not seen any signs of it. Of course, it has been very difficult not only for the British cartoon film, but also for the long ordinary feature film, to break into the American market, but I do not know that has been due to the United States taking objection to our quota law. T think ii is a question of getting into the market, as with most other trades, and selling your product on its merits, and the position seems to be improving rapidly there now. Some of the more recent British films are said to have obtained extraordinarily good bookings in the United States of America.

31. Paragraph 44 of Mr. Fennelly 's memorandum says : —

"The Board of Trade are not in a position to estimate either the capital invested in the

production side of the industry or the cost of British films."

* Not re-printed. (Official Report 16th March, 1927, Columns 2037-2048.) (a) Appendix VIII.

16

COMMITTEE ON CINEMATOGRAPH FILMS

5 May, 1936.]

Mr. R. D. Fennki.iv.

[ ( 'on l in tied.

That should be covered to some extent by the census of production? — Yes, the cinema industry has not been covered by any census of production so far taken, and the question of doing so has not at present been considered. J have put it to our Statistical Department and they see no objection at all to it being done. The earliest it could now be done is in 1937 in connection with the census taken under the Import Duties Act.

32. It is a recommendation that might properly come from this Committee? — I think the Board of Trade might be prepared to accept that. The cine- matograph printing trade is included, but that is rather a different side.

33. The Orders in Council were issued in 1936? — There are two forms of census at present, the quin- quennial census and also an annual census taken under the Import Duties Act, and a section of the Finance Act, 1933, which extended that enquiry to goods covered by duties other than those under the Import Duties Act. It is not so wide in its scope as the quinquennnial census.

34. We can consider that at leisure? — The forms are going out to all the industries now.

.35. (Chairman) : There is no urgency about the quinquennial? — The next one will not be until 1940, I presume.

36. The forms have gone out? — For the 1935 one.

37. (Sir Arnold Wilson): It is too late for the Board of Trade to do it now? — I gather it is.

38. (Chairman): The same forms do not go out to everybody, I mean the same details are not applic- able to all industries. Would it be possible? — I will inquire, there may just be time, I do not know.

39. (Sir Arnold Wilson): I would be satisfied with a census under the Import Duties Act. Has the Board of Trade any data as to the production and export of cinema films in the United Kingdom? — By production do you mean production of all films?

40. Of all films not under quota? — We have no figures at all of total production. The only figures Ave have are of the ones that are registered and it is safe to assume they represent a very high pro- portion of the total. On the export side, the export figures of films are very difficult. You do not export your original production, but a copy of it and the trade figures themselves are useless for the purpose of deciding how much trade is going on in them. Mr. Rowson made some remarks on the subject in the paper read to the Royal Statistical Society and suggested that the form of the trade statistics relat- ing to films might be altered altogether and put on an entirely new basis. That will be taken into con- sideration when the time comes for revising the trade stal istics.

41. I noted particularly that suggestion of Mr. Rowson's; would you regard it as a proper recommendation that might come from this Com- mittee?— I think so.

42. 1 think unquestionably it would have greater weight coming from this C0111m^tfee> anc^ if would make it possible for the Board of Trade to keep a closer eve upon the operation of the Act than they can at present? — Tt would enable us to see what is happening abroad, I think.

13. Can you add to your evidence a statement showing the number of persons engaged in the various capacities as film producers, and in connec- tion with film production? — I will put in a state- ment, (b) but I can give some figures now.

44. Can we have the rough figures? — The latesl official information is in the 1931 Census. The occu- pation tables show 454 persons employed as film producers in film studios in England and Wales, and one in Scotland, making 455. The occupation tables du not show separately electricians, Ac employed in film studios. tlie\ are all classed under their occu- pation and not their actual employment. The in- dustry tables show that nearly 6,000 persons are employed in film producing ami film studios, of

(b) Appendix IX.

which 4,000 are males and 2,000 are females. The operative employees were 5,500.

15. (Chairman) : What is the date of these figures? — This is the 11)31 Census of Population.

46. (Sii A i i<i,ld Wilson): That is after four years of the Ac! that is a net gain to industry ? — Nof net, I think, because there was a certain amount of employment before.

47. Has there been a further increase since then? — I have no doubt that the number employed in the industry has increased since, because of the growth of new studios and larger output of films. The National Association of Theatrical Employees, if they give evidence, and possibly the Association of Cine- Technicians, could perhaps give information.

48. (Mr. Stanley Holmes):"! should not think the 1931 figures are of any value.

49. (Sir Arnold Wilson): Has the Ministry of Labour any information as to wages and hours and conditions of labour in the film-producing industry? — The Board of Trade has no information. I under- stand the Ministry of Labour have none either.

50. Is there a special Board dealing with employ- ment in the cinematograph industry as. for example, there is in the insurance industry ? — I have never heard of such.

51. I have only one more point. I can find no statement in your admirable report of the number of British films registered annually, firstly, as having special exhibition value? — I must apologise for omitting those figures. I have them here. Shall I put them in as an appendix ?(c)

52. If we can hear them roughly, you can put them in later? — This is proviso (i). Since the Act came into force we have registered 14 long films and 53 short films on the ground of their special exhibition value.

53. Special exhibition value was described by the President of the Board of Trade as " box office value " ? — Yes.

54. Do you consider that in view of their ten years' experience the Board of Trade considers that to be the last word? — I would not like to say it was the last word, but I think that the trade woidd continue to take that view nevertheless. I think some regard ought to be paid to the cultural aspect, but I think too much regard can be paid to that aspect. It is rather astonishing to find how few short films are actually exhibited. The table in paragraph 59 of my memorandum shows that the proportion of short films exhibited is tending downwards now. It did go up, and now it is going down. Tt dropped from 6-28 per cent, to 4-21 per cent, in the last year and that at a time when there was an increased amount of short subjects available, because we have been registering far more films for exhibitors' quota only in the last year or two than we ever did before. namely 56 short subjects in 1934-35. and 46 in 1935-36. That is in addition to four long films in the two years.

55. Have you reason to think registrations have in fact been excessive? Has the experience of the trade s 1 1 ggested you have registered too main ? For exhibitors' quota?'

56. Yes? — The films are entitled to exhibitors' quota as of right .

57. Have too mam been registered: Not judging bj the showing of films. One would assume offhand then' have not been enough registered. It i- difficult to know why the exhibitions have fallen so rapidly, unless the ordinary cinema public or the proprietors do not care about them, or unless under the two- teat ure programme there is no room left lor the short feature.

58. Is not that fact tin' more probable explanation? — Yes. 1 think it is. The average exhibitor does not care about short exhibits, lie concentrates on the long film.

.V.). If I may go back to exhibition value, the President of the Hoard of Trade weakens the Hied

(c) Appendix X.

MINUTES OF EVIDENCE

17

5 May, 1936.]

Mr. R. D. Fbnnelly.

{('mi fin ui',1.

of the Act in his reference to linguistic and cultural value by going on to box office value in the second reading. Are the Board of Trade satisfied with the operation of the Advisory Committee to whom this question of "special exhibition value" is referred? would they be prepared to consider an independent tribunal of qualified persons to decide this issue? Would such a tribunal not be preferable to the present rather unwieldy Advisory Committee who in point of fact have often not seen the film? — It is rather a large question. In the first place it is asking the Board of Trade, so to speak, to throw over the present Advisory Committee and say they are not satisfied with the way they have assisted them so far.

60. Only in respect of special exhibition value? — It is a thing I should rather like to think about, and I would not like to commit myself at the moment.

61. You are not required by Statute to refer the question of exhibition value to the Advisory Com- mittee at all? — I agree, but as inexpert civil servants we go to an expert Committee for advice.

62. There is nothing in the Act which would pre- vent you setting up another body to advise, you in regard to special exhibition value? — Nothing at all.

63. Thank you, Sir. That concludes my observa- tions?— If I might make a remark on what you were saying, Sir Arnold Wilson ; all the films you are talking about, put up for special exhibition value, are in most cases entitled as of right to registration for exhibitors' quota, that is any exhibitor who shows them can count them against his foreign films. The application for registration on the ground of special exhibition value is made in many cases because the film obtains full quota and the maker can sell it to a renter for more money than if it has exhibitors' quota only. That is the whole secret. The renter can count it against his foreign films, and it is much easier for him, when he has not sufficient short British films to meet his quota, to acquire extra long British films to cover the deficiency. If I may add a further word on this documentary type of film. You will no doubt see when the Associated Realist Film Producers give evidence, that the difficulty about the short documentary film is that when it is produced and a fair amount of money spent on it the principal market seems to be the foreign-controlled renter.

64. (Mr. Cameron) : Is that why it has been sug- gested that the renters' quota as distinct from the exhibitors' quota should be substantially increased? It is the opposite point to the one that the renters' quota should be abandoned. I have seen it suggested there should be a considerable increase in the renters' quota ? — The idea behind that theory is that there are far too many bad British films about and the area from which the exhibitor can choose in the ordinary way is restricted. It is argued that competition will raise the standard of output and if you make it much higher the renters will fall over one another to make good films, because their market becomes re- stricted. The proposal comes from the exhibitors' side of the trade.

65. There is only one other point that has not been covered, the question of European films coming into this country which are of cultural value and of a kind one wishes to see coming freely. The position was that bodies like the London Film Society, were unable to get any renter to take on its quota a foreign film that would only be shown two or three times and so used to import them without a renters' quota. The Board of Trade allowed them to do it, and the film came to England and went straight back again after being shown, say, at the London Film Society. It was thus not available for dis- tribution among a good many repertory cinemas and film societies where it would not have been in com- petition with British pictures and might have done a good deal of good. I do not know to what extent that is tile position now? — We have always recognised that the Film Society deals in the rather specialised films from abroad, and is in a special position. They

pass on a number of films to other renters in this country who let them out to repertory theatres and places like Studio One. Whether the trumbers ar< growing I am not sure.

66. (Chairman) : Is the Film Society a public bodyp It is a question of renting, is it not? — The Film Society are renters.

67. They short-circuit and it does not go through a renter ?

68. (Mr. Cameron): That is what I understand is the position, the London Film Society show, for example, " A day of great adventure," and the Board of Trade trusting the Society and knowing it is a benevolent body takes no action. That is the position? — When they show at their own meeting there is no exhibition to the public; but occasionally they rent a film of this specialised type : they register the film and act as renters themselves. They may at times have been in default, but in view of the special circumstances we have not felt it necessary to take action under the Act.

69. But actually for that film to come in it ought to hare appeared on a renters' quota before being shown to the Film Society? — Not before being shown by the Film Society, because that is not an exhibition to the public.

70. So it need not appear in a renters' quota ? — No. it need not appear in a renters' quota. In 1935-6 there were forty-three foreign films regis- tered other than U.S.A. films, including fifteen from Germany, five from Austria, thirteen from France, and five from Russia.

71. I have raised this point because I think that for the circulation of foreign films of genuine but limited entertainment value it should not depend on the Board of Trade exercising discretion not contemplated under the Act? — I agree that the Act does tend to impede the exhibition of these foreign films for the reason that a renter knowing he is going to get very few bookings for them, because they appeal to a very small clientele, does not want to go to the cost of acquiring a British quota against them.

72. (Sir Arnold Wilson): The Committee is doubt- less aware there has been a great increase in the last two years of (German films shown in France, which is an astonishing fact due to the skill of the Germans in getting French actors to go to Berlin in order to take star parts in films made in Berlin which are thereupon shown in Germany and equally freely in France? — Yes.

73. (Sir Arnold Wilson) : There is that aspect as well.

74. (Mr. Cameron): I quite realise you have got to be careful. It is not a means of introducing any films that are undesirable in any way, but I think it is a point that the Committee should consider, whether it cannot safeguard the distribution of foreign cultural films somehow by amending the Act. Has Mr. Fennelly in mind any suggestion as to how that position might be improved without open- ing the door to abuse? — I should like to be con- vinced it does not work satisfactorily now. I think if the Film Society were asked they would say that they had not suffered any harm. The real sii.il; is that some renter has got to have this film sooner or later if it has got to be shown to the general public, and the average renter will not take this film because he has got to produce British quota against it. That is perhaps one reason why foreign films are not shown in this country except in special circumstances.

75. That is a thing I am suggesting should be made more possible, not so much lor the Film Society but for the repertory theatre thai is aiming at catering for an adult audience in a particular locality. I want to see it made more easy for them, but I know it is working better new than it did at one time? — What sometimes happens is thai these renters who take this class of film combine together under Section 14 of the Act, and where one renter

36452

18

COMMITTEE ON CINEMATOGRAPH FILMS

5 May, 1936.]

Mr. R. D. Fennelly.

[Cont'ui vh d.

has got one or two British films and more quota than he wants he takes under his wing a number of other small renters (I presume for a considera- tion, but we do not know that), and they all satisfy the quota together.

76. What about a film like " Emil und der Detective " which might have had a big circulation in this country, but which went straight back to the country of origin? — I think if it is a good film, and it is the kind of film that will have a big cir- culation, it gets it. Take, for instance, that German film, " Madchen in Uniform," that was brought in by the Film Society. They handed it over to another renter and I believe he did very well out of it, at least it had a large number of bookings.

77. It happened to get written up by the Press; but I do not want to keep the Committee on this point. I have called attention to it. There is one other question I wanted to ask. In paragraph 56 in the last sentence you say :

" The renters have now set their face against any extension of this practice." I want to be quite clear what that means. It means, does it, that the renters will now not rent films to a group of companies or theatres unless there is a properly organised circuit which is really one com- pany, is that it? — Unless there is financial control throughout, excepting in the case of some existing booking circuits. I believe they will not do business with any more new booking circuits where there is no financial inter-relation between the companies.

78. There must be a definite financial control of a circuit, that it is a genuine circuit and not a kind of customs union? — Yes. I think you will find that the exhibitors will give some evidence on that subject.

79. Are we to take it as a statistical fact that the two-feature programme is on the increase? — I only judge by what I read in the trade Press, and the general impression I have is that it is on the in- crease. Of course it starts in the big towns first and I think it is spreading outward.

80. In spite of this new growth of so many docu- mentary films in this country, you still think the use of the two-feature programme, as a fact, is growing? — Yes, I think the public want more for their money, and competition between theatres brings that result. There was a tendency to give a four- hours programme, but the renters put their foot down and they will not rent to anyone who shows a programme of more than three and a quarter hours.

81. (The Hon. Eleanor Flumer): Most of the questions I wanted to raise have been put, but there is one point about the exclusion of documentary films. That comes under paragraph 29. Of course, when the Act was passed the documentary film was hardly in existence. It was very much in its infancy, was it not? — Yes.

82. Now, surely is it not a fact, that because they do now cost a good deal to make and there are a very much larger number of them being made, would they not, in their present foim, come within the scope of what the Act was designed to promote ? — Oh, much more now than they did.

83. There is a good deal more studio work in them, is that not a fact? — I agree, but the trouble is to draw the line between that class of film and the film where a man goes out with a camera and turns a handle.

84. There is a very great diHereiiee between that and the documentary film as envisaged by Paul Rotha? — Yes, the introduction of sound makes an enormous difference.

85. There is one other point on paragraph 45, Table (', "here you give particulars of British films and particulars of films made outside Britain regis- tered for lull quota. Practically all those films were acquired by foreign-controlled renters. I suppose that is because the British companies do not waul the imported films — these are Dominion films, are they not? — The real fact is that they are, in general poor films.

86. That is what I was getting at? — And the foreign renters acquire the United Kingdom ri^'m - of those films remarkably cheaply.

87. There has been a very slight increase, though the number was eleven in 1934 and eleven at the present time. It is a fact, is it not, that there is a batch of films made in Canada which has just quali- fied for quota? — One only, I think.

88. No, I have seen three? — Do you mean feature films ?

89. Feature films, yes, and that seems to me to be new? — Yes, there were two in 1935-36. There may be others being made. I think they have started making them in British Columbia.

90. Yes, they have? — But they are not very good films.

91. They are terribly bad, but that seems to be a point which we shall have to look into? — As regards that we might expect an increase from Australia in the near future because of the operation of their quota legislation which makes the exhibitors and the renters in Australia acquire and show a certain pro- portion of Australian films. It is rather a compli- cated arrangement, but as those films, as matters stand, can count for quota both here and in Australia, obviously if an American renter is renting films in Australia and has to acquire Australian films he will bring those films over here and register them for quota purposes. To that extent, of course, there will be less films made in this country than one would otherwise have expected. That is the general effect of the Australian Acts.

92. (Dr. Mallon) : About these American com- panies, they are not interested in the production of good English films ; that we can understand. "Would you put it higher than that and say they are in- terested in the production of bad English films? — No, I would not put that against them.

93. Then there is no reason to suppose that they do desire to go about and secure that the reputation of the English film is lowered? — That has been alleged, but it is difficult, of course, to get any proof of a thing like that. It must be recognised, of course, that United Artists, for instance, do distribute some of the best British films of London Film Productions, Ltd., and one or two other American renters show signs of wanting to make films here, not for quota purposes but for world markets. Fox-Twentieth Century, I believe, are going to make films here. There are other ideas in the air, but, of course, there have always been other ideas in the air ever since the Ait started. We are always hearing that American renters are to make good films here. At times some of them have made an effort. They spent a lot of money on them, but they do not seem to be able to produce films to make money.

94. So far as bad British films go about the world the Americans have no responsibility for them? — I have no doubt that thej export their poor British films to the Dominions. We have seen that stated, but whether they get many exhibitions out there I do not know. I should imagine not.

95. And so far as they do that, so far as they ex- port British films it is not necessarily with a base intention? — I would not like to say that. no.

96. You think it happens in the ordinary routine of business- Yes. they ^are in business to run foreign films and they regard this quota as some- thing to be done as cheaply as possible. It is a matter of business in the long run.

97. Where a British firm secures the booking oJ :i film of the inferior type, does it get fair treatment? It has been alleged, has it not. that in certain i ases a film ot the kind I have in mind is run off in the morning to almost emptj houses?— Oh. yes. that is the tendency in one or two of the West End theatres tb.it are real); controlled by a renter. They have to show a certain proportion ot British films

MINUTES OF EVIDENCE

19

5 May, 1936.]

Mr. R. D. Fennelly.

j ( 'on i ii in d.

and they start showing them early in the morning when the only people on the premises are the char- women.

98. Whose morals and whose cultural sense will not, one may expect, be very much offended? — Well, I do not expect they have very much time to look at the screen.

99. Supposing there were a practice of that kind, would you regard it as desirable that something should be done to check it? — I think if it could be checked it would be desirable. As I say, as the Act stands, these films are shown in the morning, but they are shown in the normal hours when the theatre is open and anybody who likes to pay can go in and see them.

100. (Chairman,) : It would be easy to show it once in each programme? — Yes, that could be done. The tendency at present is to show these bad films very early in the morning and very late at night.

101. (Chairman) : Then you could get over it if you said it should be Shown four or five times, once in each programme.

102. (Dr. Million) : Where this occurs, does it occur in houses that are controlled by American companies or does it occur in other fiouses also ? — It occurs in some of the West End theatres which are con- trolled by American companies, and it occurs to a certain extent with other exhibitors who have no objection to British films as such, but through cir- cumstances ouisfde their control cannot get all the good British films they want and they occasionally get a bad British film that they have to show in order to meet their quota. There is undoubtedly a tendency to showr it early in the programme before the house fills up. According to the returns made to us, they often show a bad British film four times in a day as compared with three times for the average feature, so I presume they get in the first showing when the theatre opens and before the crowds arrive.

103. Then on the question of documentary films, does that bear, in your view, upon this difficulty of the shortage in the supply of good films ? Supposing that documentary films did count for quota, might they be used to an increased extent by the exhibitors for quota purposes ? — Well, in a large number of cases, of course, an exhibitor can use them now. They have got exhibitor's quota. On the assumption that they were given a renter's quota, a renter would of course be more inclined to push the sale so as to get some of his money back, but it is always a moot point whether the average cinema-goer is very keen on looking at a large number of documentary films.

104. The documentary film people say they have difficulty in getting a satisfactory verdict on then- productions. Is it not a fact that before they can get a Press show they have to have the documentary film booked up by a renter?- — No, that is not so. The documentary film can always be shown, and it is shown to the Press and to the trade very often before any question of registration arises. In fact all films are trade shown before they are registered, they have to be trade shown by law before they are registered.

105. I thought the difficulty was on the one hand a Press show might be difficult to arrange if the film had not been taken up by a renter, and on the other that the renter insisted on a quota before taking the film? — Undoubtedly the renter would, if it was a foreign-controlled renter, or even a British renter who wanted the film for quota purposes.

106. You are familiar with this objection, are you not? It has been made, I think, by Mr. Grierson and others. They have alleged the existence of a vicious circle which works in that way, that they cannot get their show unless they get a renter, and they cannot get a renter unless they get the quota ? — Yes, it does work that way, but it is possible to break it nevertheless.

107. Well, we shall have them before us to tell us about it? — Yes.

(The Witn

108. I think that is all, thank you? — Might I just add one more word. There is one aspect of the film trade which may assume a certain amount of importance in the future, and that is the question of substandard films. The average film is a 35 mm. film, but there is a growing practice now which members of the Committee will know of, of showing the 1G mm. film for educational purposes. There is also a tendency, which has not grown very far yet, to show the 16 mm. films to the general public in halls and similar places. As far as I know these halls are not subject to the 1909 Act, in that they have to have a licence from the local authority, or anything of that sort. Hitherto in the few cases that have come before us we have rather taken the view that these exhibitions are outside the Act. Undoubtedly when the Act was drafted it was designed to meet the 35 mm. film — length and every- thing else are based on that assumption — and to apply the Act to the 16 mm. film would be in many respects difficult. We have rather taken the line that we would not apply the Act to the 16 mm. films. That is as matters stand at present, but I think the Board of Trade would be very grateful if the Committee could look at that aspect of the matter and obtain some evidence from the trade as to the extent to which it is prevalent now or likely to grow.

109. (Sir Arnold Wilson): Are those the non-flam films? — They are the non-flam films; they are mostly reproductions on the entertainment side of ordinary feature films brought down to 16 mm. and there are a number of travelling cinemas showing these in one place or another. I do not think they have grown to any extent yet, but one is never sure of what may happen in the future.

110. (Chairman): They are right outside the Act? — Well, we have not applied the Act to them. I would rather put it that way.

111. (Sir Arnold Wilson): Is the interest of the Treasury affected? — They pay entertainment tax, but I am not sure whether the local authorities have any jurisdiction over them under the 1909 Act. There was a test case up in the North of England, but it failed.

112. (Mr. Cameron) : Is not the point this, that in the Act of 1909 there is no definition of what an inflammable film is, and these are non-flam films? The Home Office endeavoured to prove a non-flam

•film was inflammable, because it would burn slowly, and the test case was taken and reported. They did not really get a decision, but I understand there is no secret of it, that the Home Office have for a long time been contemplating issuing regulations. I do not know whether Mr. Fennelly knows how far they have got ? — I do not know that side of the business, but we are a little concerned about the growth of this 16 mm. entertainment film, and it is extraordinarily difficult to bring it under the Act as it stands at present.

113. Does not consideration of that depend on the action of the Home Office in the first instance? — I should not have thought so, with all respect.

114. I am only asking the question. I thought if they took steps to bring these halls under the jurisdiction of their Act it would imply a greater degree of official relation with shows of that kind and so might involve consideration for quota purposes? — Yes. The two Acts are, of course, quite distinct, and I think our problem is an entirely different one from the problem of the Home Office, which is the safety problem. Ours is the problem whether the Act can be applied to the 16 mm. film. There are all kinds of awkward snags arising once you si art to consider these 16 mm. films.

115. (Chairman): Is that in addition to your evidence? — I will include it in the memorandum. We are not clear to what extent these films are a pre' yet. but we feel it may be one. Thai is the most we can say.

ess withdrt w, I

36452

I '

20

COMMITTEE ON CINEMATOGRAPH FILMS

5 May, 1936.]

[( 'on I

APPENDIX I.

BitiTisH Films — Statutory Requibem] m-

The requirements to be complied with in order that a film may be deemed to be a British film for tin purposes of the Act are contained in Sub-Sections (3) and (5) of Section 27. By regulations under Section 29 (1) (c) evidence of compliance with these requirements must be furnished on Registration Form C, a copy of which is attached (Appendix II). This form was drawn up in consultation with re- presentatives of the British film industry. They are as follows : —

(1) The film must have been made by a person who teas, at the time the film was made, a British .subject or by two or more persons each of whom teas a British subject or by a British company. — A British company is defined as one constituted under the laws of any part of the British Empire, the majority of the directors of which are British subjects.

The Board have found it necessary on a few occasions to refuse to register, as British, films made by companies without a majority of British directors, although in other respects the Act had been fully complied with. The omission to obtain a majority of British directors seems to have been quite in- advertent.

From time to time films made in Great Britain have incorporated lengths of negative taken from films made abroad by foreign makers. Usually the films concerned have been British versions of foreign films and it appears to have been considered ad- vantageous and economical to incorporate scenes, such as exteriors and crowd scenes in big settings, which would be difficult or expensive to reproduce in Great Britain. The Board were advised that in view of the terms of Section 27 (3) (i) of the Act, such films could not be registered as British films. This view was confirmed by a decision by Mr. Justice Luxmoore in an appeal under Section 9 of the Act by Warner Brothers — First National Productions Limited against the Board's refusal to register as British a film of 7,877 feet in which was incorporated 2,949 feet of film of Italian origin. In the course of his judgment Mr. Justice Luxmoore stated " In my judgment the first requirement of that sub- Section [Section 27 (3)] is that the film which is to be considered for registration as a British film must substantially in its entirety be made by British subjects ".

(2) The studio scenes 7tiust hare been photographed in a studio in the British Empire.

It appears to have been generally accepted that a condition of this kind is essential for the encourage- ment and development of a British film industry. Studio scenes are regarded by the Board of Trade as scenes photographed in a place (whether within a building or not) where sets were erected for the purpose. This definition was adopted after consulta- tion with representatives of the British film industry and no exception to it has been taken by film makers.

(3) The author of the scenario must have been a British subject at the time the film was made.

The repeal of this requirement has been recom- mended by the Cinematograph Films Advisory Com- mittee, and by a joint deputation of the Federation of British Industries and the Cinematograph Ex- hibitors' Association and again by a joint deputation of the Federation of British Industries and the Trade Union Congress. The case for the recom- mendation may be stated as follows: —

Tn imposing this requirement the intention was to secure that the story or theme and the scenes presented should be essentially British in character and atmosphere. The author of the scenario, how- ever, is, to-day at least, not the person who controls these matters. His function is to take the story

as adapted or prepared by the treatment writer and to arrange the various scenes and equip them with the necessary direct ions for shootin,g purposes. The scenario writer is a technician rather than an artist. There are not sufficient British scenario writers of the front rank to meet the needs of the British industry and this requirement deprives the makers of British films of the opportunity of obtaining the services of the world's best technicians in this de- partment. The persons who actually determine the national character of a film are those responsible for making it. It is they who select the story, theme or plot and who hazard capital for its pro- duction.

The Board understand that in the preparation of a scenario particularly since the introduction of sound, more than one person may be engaged and that in some of the large studios there are scenario depart- ments employing staffs of treatment, dialogue and continuity writers. It is, therefore, not always easy to determine precisely who is the scenario writer within the meaning of the Act. In the course of administration the Board have seldom found it necessary to refuse to register a film as British on the ground that this requirement had not been complied with.

(4) Not less than 75 per cent, of the salaries, wages, and payments specifically paid for labowr and services in the making of the film (exclusive of payments in respect of copyright and of tht salary oi payments to one foreign actor or actress or prodm • i but inclusive of the payments to the author of the scenario), must be paid to British subjects or persons domiciled in the British Empire. — The Board of Trade are empowered to relax this requirement in any case where the British percentage is not less than 70 pier cent, provided that they are satisfied that the maker has taken all reasonable steps to secure com- pliance with the requirement and that his failure to comply was due to exceptional circumstances beyond his control.

The repeal of this requirement was recommended in 1929 by the Cinematograph Films Advisory Com- mittee, and in June, 1930. by a joint deputation from the Federation of British Industries and the Cinematograph Exhibitors' Association mainly on the ground that it prevented the engagement of the foreign " stars " and technicians which were necessary in the production of films for the world market. A joint deputation from the Federation of British Industries and the Trade Union Congress in April. 1932, did not repeat this recommendation and the proposal has not since been revived.

The particulars furnished to the Board of Trade in Form C indicate that in the great majority of cases payments made to persons of British nation- ality or domicile considerably exceed 75 per cent, of the total labour costs. Only on very rare occasions have the Board been requested to exercise their discretion to register films as British in which the British percentage of labour costs was between 70 and 75.

The Board of Trade have on their administration of the Act regarded " salaries, wages and payments specifically paid for labour and services in the making of the film" as covering only payments directly attributable to the making of the film, including a proper and reasonable proportion of any annual salaries or fees to tie attributed to the making of the film. They have not considered these words to include any payments to the employees of the maker who render clerical or other services of a general nature in connection with the administration and maintenance of a film producing business.

APPENDICES 21

5 May, 1936.] [Continued.

APPENDIX II.

BOARD OF TRADE.

CINEMATOGRAPH FILMS ACT, 1927.

REGISTRATION FORM C.

Evidence of British Nature of Film entitled

application for the registration of which was made by

on the 19.

w declare that the following particulars set out in paragraphs 1 to 0 below relating to the film entitled

are true to the best of ^ knowledge and belief, our

Signature of the Maker(s) of the film. Address

Date.

1. The photographing was begun on 19

and finished on , 19

2. (a) The scenes photographed in a place (whether within a building or not) where sets were erected for the purpose

occupy feet of the film, and were photographed in the following places (give

names and addresses of studios), and nowhere else : —

(b) The only scenes photographed outside the British Empire were as follows (state the scenes and tin number of feet of the film occupied by them) : —

3. The particulars given in paragraph 4 exclude payments made to one foreign — ±—

actor or actress.

* Strike out the words which do not apply.

22

COMMITTEE ON CINEMATOGRAPH FILMS

5 May, 1936.]

[Continued.

4. Salaries, wages and payments specifically paid for labour and services rendered by the persons referred to below in the making of the film : —

Amounts paid or due to

British subjects

or persons

domiciled in the

British Empire.

Other Persons.

(1). Production Staff (including author of scenario, production manager, producer, assistant producers, editors, art directors, photographers) as follows : —

Name.

Function.

Nationality.

Permanent place of residence.

(2). Principal Actors and Actresses, as follows : —

Name. Nationality. Permanent place of residence.

(3). Other Actors and Actresses

(4). Other persons photographed for the picture : —

(a) in scenes taken in the British Empire ... ...

(b) in scenes taken outside the British Empire ...

(5). Other Staff (including scenery craftsmen and labourers, seam- stresses, electricians, etc.) : — («) Wages for services rendered in the British Empire ...

(b) Wages for services rendered outside the British Empire

Total

Number of Persons.

APPENDICES

23

5 May, 1936.]

[Continued.

ACCOUNTANTS' CERTIFICATE.

* certify that have inspected the books of the makers of the film herein referred to in so far as they relate to the We - we r

making of the said film, and have called for such explanations and documents as are necessary to enable to ascertain

the amounts of salaries, wages and payments specifically paid for labour and services in the making of the said film (including a proper and reasonable proportion of any annual salaries or fees to be attributed to the making of the said

film) and * certify that the amounts entered in the table above are correct.

Dated this.

.day of 19.

Address.

Signature

Qualification

5. la) Names and nationality of the maker(s) of the film (in the case of a firm state the firm's name as well as the name of each partner, in the case of a company state the name of the company) : —

Name.

Nationality during the time stated in paragraph 1.

(b) Address of maker (in the case of a company its registered office)

(c) If the maker is a company, state below the part of the British Empire under the laws of which the company was constituted and the names and nationalities of the persons who were its directors during any part of the time stated in paragraph 1 : —

Part of British Empire.

Names of Directors.

Nationality during the time stated in paragraph 1 .

6. — Name and nationality of the author or authors of the scenario : —

Name.

Nationality during the time stated in paragraph 1 .

APPENDIX III.

Makers of Films in Gkeat Britain.

Makers of the 215 long films which were registered as British during the renters' quota year 1935-36, totalled 76.

The chief makers of British films who have their own studios in Great Britain are : —

Archibald Nettlefold Productions, Walton-on- Thames. (Studios mainly rented to other makers.)

Associated British Picture Corporation, Ltd. (British International Pictures, Ltd., Boreham Wood, Elstree, and Welwyn Studios, Ltd., Wehvyn Garden City.)

Associated Talking Pictures, Ltd. (Studios Ealing).

British and Dominions Film Corporation, Ltd. British Lion Film Corporation, Ltd., Lion Studios, Beaconsfield, Bucks.

British National Films, Ltd.

Criterion Films, Ltd. (Worton Hall Studios, lsleworth.)

Fox British Pictures, Ltd., Wembley (makers for Fox Film Co., Ltd.)

Gaumont-British Picture Corporation. Ltd.. Shepherd's Bush: and Gainsborough Pictures (1928) Ltd., Islington.

Joe Rock Studios, Elstree (associated with Leslie Fuller Pictures, Ltd.)

London Film Productions, Ltd. (whose asso- ciated making companies are Denham Films, Ltd., Denham Film Corporation, Ltd., London and Denham Films, Ltd., Denham Studios. Ltd., and Technicolor., Ltd.)

24

COMMITTEE OX CINEMATOGRAPH FILMS

5 May, 1936.]

[( font << hi •/.

Sound City (Films), Ltd., Sound City Studios. Shepperton (mainly used by other making companies.)

Stoll Picture Productions, Ltd., Cricklewood — (generally used by other making companies).

Twickenham Film Studios, Ltd., with studios at Twickenham and Hammersmith. An asso- ciated company J. II. Productions, Ltd., have acquired studios at Elstree.

Warner Bros., First National Productions, Ltd., Teddington Studios.

Production Units without their own studios include : —

Butcher's Film Service, Ltd. *Capitol Film Corporation, Ltd. *Cecil Films, Ltd. Concordia Films, Ltd. Embassy Pictures (Associated), Ltd.

Garrett Klement Pictures, Ltd.

George Smith Productions, Ltd.

Grosvenor Sound Films, Ltd.

Hammer Productions, Ltd. *Herbert Wilcox Productions, Ltd.

l.F.P. Ltd. (Phoenix Films).

John Stafford Productions. Ltd.

New World Pictures, Ltd.

Radius Films. Ltd.

St. George's Pictures, Ltd.

Soskin Productions, Ltd.

Toeplitz Productions, Ltd. tU.K. Films. Ltd.

J. G. & R. B. Wainwright, Ltd.

Wyndham Films, Ltd.

* Now associated with General Film Distributors as producing companies.

t Associated with Sound City (Films) Ltd.

APPENDIX IV.

Renters of Films in Great Britain.

In the renters' quota year 1935-6, licences were issued to 65 renters.

The principal renters, all of whom have their headquarters in London, number 19 (11 British ,8 foreign-controlled) and are : —

		Associated
Name of Renter.	Associated Producing Co.	Exhibitors
		(Circuits).
British Renters.
Associated British Film Distributors,	Associated Talking Pictures, Ltd.. Ealing Studios, W.5.	None.
Ltd.
Associated Producing & Distribution Co. British Lion Film Corporation, Ltd.	U.K. Films, Ltd., Sound City Studios, Shepperton	None.
■ Own Studios at Beaconsfield	None.
Butcher's Film Service, Ltd....	None — make some British films themselves at hired studios.	None.
Equity British Films, Ltd. ...	None	None.
Gaumont- British Distributors, Ltd....	Gaumont-British Pictures Corp., Ltd., Shepherd's Bush Studios. Gainsborough Pictures (1928), Ltd., Poole Street, Islington.	G.B. Circuit.
General Film Distributors, Ltd.* ...	British and Dominions Film Corp., Ltd., Boreham Wood, Herts, and other associated companies.	None.
Pathe Pictures, Ltd. ...	British International Pictures, Ltd., and obtain some	Associated British
	British films from other production units.	Picture Corp. Circuit.
Reunion Films, Ltd. ...	None ...	None.
Twickenham Film Distributors, Ltd.f	Twickenham Film Studios, Ltd., Twickenham, J. H. Productions, Ltd., Boreham Wood, Herts.	None.
Wardour Films, Ltd	British International Pictures, Ltd.	Associated British Picture Corp. Circuit.
Foreign. Controlled Renters.
( iolumbia Pictures Corp., Ltd.	None ...	None.
First National Film Distributors, Ltd.	Warner Bros. — First National Productions, Ltd., Ted- dington.	None.
Fox Film Co., Ltd	Fox British Pictures, Ltd., Wembley Studios New World Pictures, Ltd., Denham ...	None.
Metro-Goldwyn-Mayer Pictures, Ltd.	None ... ...	None.
Paramount Film Service, Ltd.	None ... ... ... ... ... ...	Several companies exhibiting at Astoria Theatres ( Key cinemas in London and some large tow no.
Radio Pictures, Ltd. ...	None ... ...	None.
United Artists Corp., Ltd.	London Film Productions. Ltd.. Dcnbam British and Dominions Film Corp., Ltd.. Boreham Wood. Criterion Film Productions, Ltd., Worton Hall Studios.	None.
Warner Bros. Pictures, Ltd. ...	Warner Bros., First National Productions. Ltd.. Ted- dington.	None.

* Have recently taken over the distribution interests in the U.K. of Universal Pictures. Ltd.. formerly one oi' the major foreign-controlled renters.

■\ Have recently taken over the distribution and production interests of Producers Distributing Co. (U.K.), Ltd., and its associated Co. New Ideal Pictures, Ltd., Hammersmith Studios.

APPENDICES

25

5 May, 1936.]

[Contiiuii d.

Q

z w

a.

Q. <

	I a P3
Ll cS c3 O 3 C? © 45 a o «	"3 0 H	o .a	w	1 tN | O | | | I [ iH	CO
Li pq	CO co 1 1 1 1	OS
bb a o	w	^M r~*	<M
Ll pq	Q \ t- \ 1 O t>l — i 1 1	o
CD CO IQ m OS	o .a	H	1 CO 1 1 I I I I [ !-H	t-
pq		1
bb a o ►J	H	1 1 1 1 1 1 1 1 rt 1	-
	CO 1 <N 1 1 CO 1 1 1 1	s
id CO 4. CO 03	13 o	w	1 I 1 CO 1 1 1 1 1 1	co
pq		1
SB a o	H		1
	co | co 1 1 1 1 1 1	i— t
>* CO ! CO CO OS 1— 1	4^ Li o to	H		1
Li	1 "* 1 1 1 1 1 1 1 1	i*
bb 0 0 h3	w		1
Ll pq	|> l-H ~H	OS
CO CO J. CO OS	o 43	H	° 1 1 1 I 1 1 1 1	lO
Li pq	1*11111111	CO
ti a o	W		1
Li pq	00 I 1 I I i-l	OS
CO 1 co OS	o J3 02	H		1
pq	~H	~
bio a o t-5	H		1
Li pq	N I I 1 I •* | I 1 |	co
CO ci CO OS	13' o M 02	H	I r-l 1 eo 1 1 1 1 1 |	<*
pq	1 1 I 1Q | 1 1 I I I	o
bb a o	H	III"*	"•
t-i pq	CO | CO |	os
cS 2 os cn CS	-e o 02	H		1
Li pq		1
be a o l-q	w		1
pq	CO *+	t-
OS 3	«2	H	i-H	-H
pq	PH	-
bb a o h5	H		1
Li pq	CO i 0-1 I 1 — i -h — I	oc
	1 c s	i )		Australia Australia Canada Canada Federated Malay States. India Irish Free State Jersey South Africa ... Southern Rhodesia.

36452

26

COMMITTEE ON CINEMATOGRAPH FILMS

5 May, 1936.]

\ r ,,,,;. : , |

APPENDIX VI.

United Artists Corporation, Ltd. (1 no marking)

Other Foreign-controlled Renters —

First National Film Distributors, Ltd. (1 no marking) Fox Film Co., Ltd. (1 no marking) Metro-Goldwyn-Mayer Pictures, Ltd.

Paramount Film Service, Ltd

Radio Pictures, Ltd.

Universal Pictures, Ltd. (2 no markings)

Warner Bros., Ltd....

Grand total Percentage . .

Analysis of British Long Films registered during the Quota Year, 1st April, 1932, to 31st March, 1933, on the basis of markings assigned by the cinematograph exhibitors' association.

C.E.A. markings.

Major British Renters —

British Lion Film Corporation, Ltd Butcher's Film Service, Ltd. Gaumont Films, Ltd. . . . ~)

Ideal Films, Ltd > Gaumont group.

W. & F. Films Service, Ltd. J Pathe Pictures, Ltd.

P.D.C., Ltd

Sterling Film Co., Ltd

Wardour Films, Ltd.

Other British Renters — ■

Ace Films, Ltd

Associated Producing and Distribution Co.

Equity British Films, Ltd.

International Productions, Ltd. ... W.P. Films Co., Ltd

Under 7.	7 to 7L	1\ to 7f.	8 to 8i,	8| & over.
1	]	—	1 1 1
		3
— .	—	1	2	3
—	—	—	12	7
3	1	2	1 1	—
—	1	1	3 15	5
4	3	4	37	19
6%	4%	6%	54%	30%
	1
—	—	—	1	—
3	1	—	—	—
—		1	—	—
3	2	1	1	—
43%	29%	14%	14%	—
—	—	2	6	—
—	—	25%	75%	—
	2	3	2
2	—	1	7
1	3	3	1	1
—	—	5	6	1
—	1	2	6	1
5	3	—	3
1	7	2	2	—
9	16	16	27	3
12%	23%	23%	.->s	4%
16	21	23	71	22
11%	14%	15%	46%	14%

APPENDICES

27

5 May, 1936.]

[ I 'nil I

APPENDIX TL— continued.

Analysis of British Long Films registered during the period 1st January to 31st December, 1934, on the basis of markings assigned by the cinematograph exhibitors' association.

Major British Renters —

Associated British Film Distributors, Ltd.

British Lion Film Corporation, Ltd.

Butcher's Film Service, Ltd.

Gaumont- British Distributors, Ltd. (1 no marking)

Pathe Pictures, Ltd.

P.D.C., Ltd

Wardour Films, Ltd

Other British Renters — Associated Producing and Distribution Co.

Beacon Film Distributing Co

Equity British Films, Ltd. (1 no marking)

International Productions, Ltd

Zenifilms, Ltd

United Artists Corporation, Ltd.

Other Foreign-controlled Renters — ■ Columbia Picture Corporation, Ltd. First National Film Distributors, Ltd. (1 no marking)

Fox Film Co., Ltd

Metro-Goldwyn-Mayer Pictures, Ltd. ...

Paramount Film Services, Ltd

Radio Pictures, Ltd.

Universal Pictures, Ltd. (2 no marking) Warner Bros., Ltd

Grand total Percentage

	O.E.A	. Marl mg.	t.
Under 7.	7 to 1\.	7i to 7|.	8 to U.	8| over.
1 4	1 2	2 2 3 1 1 1 3	3 2 16 6 1 11	1 5 3
5	3	13	39	9
7%	4.0/ */o	19%	57%	13%
I 1	—	1 2	1 1	—
2	—	3	2	—
28%	—	44%	28%	—
—	—	2	4	2
—	—	25%	50%	25%
7 5 3 7 4 1 1 5	3 1 3 7 7 6 2 3	1 1 4 4 5 G 5 2	1 1 1 1 3 1	—
33	32	27	8	—
33%	32%	27%	8%	—
40	35	45	53	11
22°/ "" /o	19%	24%	29%	6%

3(5452

D 2

28

COMMITTEE OX CINEMATOGRAPH FILMS

5 May. 1936.]

[Continued.

United Artists Corporation, Ltd.

Other Foreign-controlled Renters —

Columbia Picture Corporation, Ltd. (1 no marking) First National Film Distributors, Ltd. ...

Fox Film Co., Ltd

Metro-Goldwyn-Mayer Pictures, Ltd. (2 no marking)

Paramount Film Service, Ltd.

Radio Pictures, Ltd.

Universal Pictures, Ltd. (1 no marking)...

Warner Bros., Ltd

Grand Total Percentage

APPENDIX VI. {continued).

Analysis of British Long Films registered during the period 1st January to 31st December, 1935, on the basis of markings assigned by the cinematograph exhibitors' association.

C.E.A. Markings.

Major British Renters — Associated British Film Distributors, Ltd. British Lion Film Corporation, Ltd. Butcher's Film Service, Ltd. Gaumont-British Distributors, Ltd. General Film Distributors, Ltd. ... Pathe Pictures, Ltd. (1 no marking)

P.D.C., Ltd

Twickenham Film Distributors, Ltd. Wardour Films, Ltd.

Other British Renters —

Ace Films, Ltd

Associated Producing and Distribution Co. Equity British Films, Ltd. (1 no marking) Reunion Films, Ltd.

Under 7.	7 to 1\.	1\ to 7|.	8 to 8£.	8| & over
— .	2 1 1	2	7 5 1	—
	5
—	—	5 2	21 1 2	3
—	1	1 1 4	1 4 9	1
—	5	20	51	4
—	fi0/ %	25%	64%	5%
			1
1 1	—	2	—	—
	1	—	—	—
2	1	2	1	—
33%	17° 11 /o	33%	H%	—
—	—	—	6	2
—	—	—	•°/o	25%
4	2
—	1	2	3	—
2	4	5	1	—
8	4	—	—	—
4	6	3	—	—
6	7	2	1	—
8	4	5	1	—
1	1	2	2	—
33	29	19	8	—
37%	33%	21%	qo/ v /o	—
35	35	41	66	6
19%	19°' li* /o	23%	36%	3%

APPENDIX VII.

Legislation relative to the production, renting and exhibiting of cinematograph films in parts of the British Empire outside the United Kingdom and in foreign countries.

British Empire.

(a) Australia — New South Wales and Victoria. — In New South Wales the Cinematograph Films (Australian Quota) Act, 1935, received the Governor's assent on the 11th April, 193.5. In Victoria an Act having the same title received assent on the 2nd December, 1935. In the main the two Acts are in identical terms. They impose quotas on distributors (renters) and exhibitors for periods of five years with the object of fostering film production in Australia.

The following notes apply to both Acts except as otherwise stated.

Films to which the Acts apply. — For quota pur- poses films to which the Acts apply are divided into Australian, British and foreign films. An Australian film is defined as a film: —

(a) which has been wholly or mainly produced in Australia ;

(b) all the studio scenes depicted in which have been photographed in Australia: and

(c) (where the film is produced by a company) which has been produced by a company in- corporated in Australia.

British films are films which are deemed to be British films under the Imperial Cinematograph Films Act, 1927, and foreign films are all films which are neither British nor Australian.

Nine classes of films are excepted from the Acts. The first six classes are identical in terms with those enumerated in Section 27 (1) of the Cinematograph Films Act, 1927. In addition the Acts do not apply to: —

(1) films not exceeding 5.000 ft. in length;

(2) Australian films rejected by the Minister on the advice of the appropriate advisory autho- rity on the ground that their artistic or photo- graphic merit, or their appeal to the interest of

APPENDICES

29

5 May, 1936.]

[Continued.

the public generally, or their general quality is not sufficient to warrant their being taken into account for quota purposes ;

(3) Australian films, the production of which

was commenced before the 1st January, 1934.

In New South Wales the Act may be applied to

any specified Australian film of any of the excepted

classes provided that the film is not less than

3,000 ft. in length.

In Victoria the Act may be applied to any speci- fied Australian film of any of the excepted classes except films depicting news and current events or being commercial advertisements, subject to the pro- viso that quotas may not be satisfied by single reel films to a greater extent than 25 per cent.

Advisory Authority. — The New South Wales Act provides for the appointment by the Governor of a Films Advisory Committee of three persons having no pecuniary interest in any branch of the firm industry. Members, unless employed by the State of New South Wales, are entitled to receive fees for their services.

The Victoria Act provides for the appointment by the Governor of a Films Adviser remunerated by fees. Distributors' Quota. — The prescribed quotas in both Acts are : —

Per cent. In the first year ... ... 5

In the second year ... ... 1\

In the third year ... ... 10

In the fourth year ... ... 12^

In the fifth year ... .., 15

The quota is calculated upon the numbers, not footages, of the Australian and foreign films acquired, i.e., distributors are not required to provide quota against British films. Where the prescribed per- centage is not a whole number any fraction exceed- ing a half counts as a whole number.

The statutory quotas may be modified or waived by the Minister if he is satisfied that compliance by an individual distributor or by distributors generally is not commercially practicable by reasons of the quantity, character or exhibition value of Australian films available, or the excessive cost of such films in relation to British or foreign films.

Small renters, each of whom acquires not more than six quota films in a year, may, with the consent of the Minister, combine for quota purposes.

Distributors are required to furnish to the Minister statements in writing showing the number of quota films which they propose to acquire and distribute " during the next succeeding year."

The maximum penalty for non-compliance, unless due to reasons beyond the distributor's control, is £100, and if the Court is of opinion that the offence was committed with the intent to defeat the purposes of the Act it may suspend or cancel the distributor's registration.

Exhibitors' Quota. — The prescribed quotas under both Acts are : —

Per cent. In the first year ... ... 4

In the second year ... ... 5

In the third year 7$

In the fourth year ... ... 10

In the fifth year 12^

Tn New South Wales the quota is calculated upon the total number of films (Australian, British and foreign) exhibited multiplied by the number of times of exhibition. In Victoria, however, the quota is calculated upon the total number of Australian and foreign films exhibited similarly multiplied. Accord- ingly the New South Wales exhibitor is required to exhibit Australian films as quota against British as well as foreign films, while in Victoria he is required to find quota against foreign films only.

There are provisions, similar to those relating to the distributors' quota, in respect of the counting of fractions, the modifications either individually or generally of the quota, returns and penalties for non- compliance.

Under both Acts an exhibitor, in order to comply with the quota, may, without incurring any liability for breach of contract, reject any foreign films which he has contracted to exhibit up to the number of the Australian films which he is required to exhibit in any year.

In addition the Victoria Act provides : —

(1) that a dispute as to the price to be paid for an Australian film shall be referred by the Minister to the arbitration of a committee of three, consisting of the Under-Secretary (Chair- man) and two other persons nominated respec- tively by the parties to the dispute. The Com- mittee's decision is final;

(2) the exhibitor may, without incurring any liability for breach of contract, reject up to 25 per cent, of the number of foreign films which he has contracted to take. Notice of objection must be given to the distributor concerned within specified time limits.

Under both Acts any agreement which requires an exhibitor to hire British or foreign films as a con- dition of hiring an Australian quota film is declared void. Also, any Australian film .which has been approved as a quota film in any other State is, unless otherwise directed, deemed to be an Australian film for the purposes of each Act.

(b) New Zealand. — In New Zealand a Cinemato- graph Films Act was passed in 1928 to assist the distribution of British films in that Dominion. It did not purport to assist the establishment of a local film producing industry. Accordingly it differs in some respects from the Imperial Act of 1927 and also deals with matters which are outside the scope of that Act. It does not prohibit blind booking or so strictly limit advance booking, but it gives exhibitors certain rights to reject films without penalties for breach of contract. Provision is made for renters' and exhibitors' quotas. The quotas are based on numbers, not footage, of long films only. Renters may be exempted from the obligation to acquire British films if exhibitors are not prejudiced thereby and the exhibitors' quota is not mandatory. The Act also deals with censorship and safety regu- lations in connection with the storage, transport and production of films.

The New Zealand Cinematograph Films Amend- ment Act, 1934 provides, among other things, that a standard form of contract between renters and exhibitors shall be prescribed or approved by the Minister and increases exhibitors' rights to reject films up to 25 per cent, in respect of all contracts for more than four pictures. The Act also imposes restrictions on the hire of films by exhibitors. It is made an offence for an exhibitor to hire more films than are necessary for his theatres. Rejection rights must be exercised within specified time limits. Renters are required on request to rent to any exhibitor on the usual terms and conditions any films rejected by or not already booked to another exhibitor in the same area.

(c) Southern Rhodesia. — In Southern Rhodesia the Entertainments Control and Censorship Act of 1932 deals with safety in theatres and cinemas and the censorship of films and film advertising, and amongst other things, also imposes a quota of British films on exhibitors. The definition of British films corresponds with that in Section 27 (3) of the Cinematograph Films Act, 1927, the quota applies bo long and all films and is calculated in precisely the same way as the exhibitors' quota in Great Britain and exhibitors are required to keep records and furnish returns. The quota was fixed at 15 per cent, for the year ended 30th May, 1933, and for the five succeeding years at such proportion not being less than 15 per cent, as the Governor might pro- scribe. For each of the succeeding three years the quota has been continued at 15 per cent.

In 1935 an amending Act provided that the quota provisions <>l the principal Act should not apply to silent films.

30

COMMITTEE ON CINEMATOGRAPH FILMS

5 May, 1936.]

I on t; i, in d.

(d) /}/■/'/ ;.s/i West Indies.— At the British Wesl

Indies Conference in 1929 the question of the exhibi- tion of British films in the British West Indies was discussed and a resolution was passed recommending the Governments of the Conference Colonies to pa legislation, if and when practicable. to provide for the exhibition of a proportion of British films. It was further agreed that Trinidad should undertake the drafting of a measure to establish a quota system.

(i) Trinidad. — As a result, the Trinidad Cinemato- graph (British Films) Ordinance, 1932, was passed. The Ordinance applies to all films except commercial advertising films, educational films, films consisting only of announcements, etc., not accompanied by pictorial illustrations, and films exhibited at per- formances where the total length of film does not exceed 2,000 feet. Quotas are imposed upon exhibi- tors only and must be satisfied as respects long films and all films and also as respects news films. Long films are films of 5,000 feet and upwards (as compared with 3,000 feet and upwards in Great Britain) and news films are films depicting wholly or mainly news and current events. Quotas are calculated upon the total number of feet of the films exhibited but no film is counted more than once, i.e., upon the footage of films booked without regard to the num- ber of exhibitions after the first that may be given. Quotas w7ere fixed at 20 per cent, for long and all films in 1933 and 23 per cent, in each succeeding year, and at 50 per cent, for news films from 1933 onwards. The Governor may also prescribe that not exceeding one-fifth of the percentage of British news films shall be British West Indian films and may regulate the price to be charged for such films.

Exhibitors are required to keep records and to make returns and provision is made for penalties for contravention of the Ordinance.

In 1935 an amending Ordinance gave the Governor power by proclamation to apply the principal Ordinance only to such towns or other areas as might be specified in the proclamation. It also pro- vided that the proportion of British films should be ascertained in such manner as might be prescribed.

In consequence of representations by the film in- terests concerned that the quotas were excessive the Ordinance is not being enforced pending considera- tion of this question.

(ii) Bahamas. — In 1933 the Bahamas House of Assembly rejected a Bill which was similar to the Trinidad Ordinance of 1932.

(iii) British Ghiiana. -- Barbados. — Legislation similar to the Trinidad Ordinance of 1932 was passed in British Guiana in 1933 and in Barbados in 1935. As in Trinidad, these are not being enforced pend- ing reconsideration of the prescribed quota per- centages.

(iv) Jamaica. — The question of quota legislation was considered in Jamaica in 1933, but no action was taken as voluntary arrangements which had been made for the exhibition of British films were regarded as satisfactory.

Foreign Countries. (a) Austria. — Regulations in connection with two Austrian laws. Nos. 2114 and 206 of the 9th and 28th March. 1931. respectively, were issued to the trade by the Ministry lor Commerce and Traffic in Decem- ber, 1935. According to these regulations. Austrian makers of sound films receive as premium for each film produced, vouchers entitling them to a number of permits lor showing sound films. These vouchers are handed by tile producers to the " Film Bureau " of the Vienna Chamber of Commerce, where they are sold lor t lie account of the producing firm to the film dealers at 500 to 1,000 Schillinge each. Xo permits for exhibiting sound films are given, unless such vouchers are produced, [n certain eases no permits are required, e.g., lor cultural films, and Austrian weekly reports, which must be shown in any event.

Xo vouchers are required when applying for

permits to exhibit Austrian films, or foreign " Actualities." For foreign advertising films, pro- paganda films, etc., vouchers are required.

One voucher gives a right to ten permits to exhibit a foreign short film, not exceeding 350 metres, or five permits for foreign films from 350 to 700 metres. In the case of foreign films above 1,500 metres, three vouchers must be produced; for each film of from 1,000 to 1,500 metres, two vouchers, and for films from 700 to 1,000 metres, one voucher. A reduction in the number of vouchers required can be granted when it has been necessary to make a (o rman rendering of a foreign language. For every normal film produced in the country, vouchers up

to a maximum of twenty-five can be iss 1. and for

short films or for films for obligatory exhibition, up to three vouchers. If normal films are produced on apparatus of Austrian make, four more vouchers may be granted. The maker of a version in a foreign language of a film originally made in Austria, is entitled to the free exhibition in Austria of one film made in the country to which the film in a foreign language is first sold. If such Austrian films with tourist foreign text serve as tourist propa- ganda for Austria, this benefit is increased. Rent- ing establishments who can prove expenditure in Austria for subsequent synchronisation of a film, may be granted up to two vouchers. Moreover, such films can be freely exhibited in Austria.

If the maker of an Austrian film sells that film to foreign countries at an adequate price, or other- wise disposes of the film in a foreign country, the " Film Bureau " is authorised to issue a number of special export premium vouchers to be fixed by the Ministry of Commerce and Traffic. These vouchers remain with the " Film Bureau " and can only be used for exhibiting films which come from the same foreign countries. This applies only one for every original film.

The Austrian film industry is not assisted in any other way by the Government, and no bounties on production are paid by the Government direct.

(b) Czechoslovakia. — The Chechoslovakian film in- dustry is assisted by subsidies from a fund obtained from registration fees on imported full length feature films.

The Czechoslovak Association of Film Industry and Trade is required to keep three registers (A. B and C). in which are entered particulars of all films imported or produced in Czechoslovakia. In these registers are entered respectively particulars of (A) all films produced in Czechoslovakia whose makers apply for a subsidy, (B) all imported full length feature films, (C) all other imported films (short films, etc., not exceeding 700 metres in length). To cover the expenses of registration the following "manipulation fees" are charged: —

For each entry in Registers A and B, Kc. 200. For each entry in Register C, Kc. 20. In addition, for each entry in Register B, a registration fee of Kc. 20,000 is payable.

Import licences are issued only on production of proof that the films concerned have been registered and the appropriate fees paid.

The registration fees on " B " films provide a fund for the purpose of subsidizing the national production of feature films, and educational and propaganda films, and generally of promoting the national film industry.

A Czechoslovak film must be in the Czechoslovak language and have been made in studios and labora- tories within the country. Before production is commenced the scenario of the film must have been submitted to and approved by the Film Advisorj

Board.

The importation of seven films entitles the im- porter to a subsidj of Kc.l lO.(HK) for the purpose of producing, or purchasing, at his option, a Czecho- slovak film. The subsidj is increased by a Further Kc. 10.0(H) il the native film acquired is made also in

APPENDICES

31

5 May, 1936.]

[Contin ut 'I .

a foreign language for export. Post-synchronised and dubbed pictures are not regarded as foreign language versions.

The importation of eight films entitles the im- porter to import, free of the prescribed registration fee, one film dubbed in a foreign language, the in- ternal distribution of which is, however, strictly controlled.

On the importation of five films the importer is required to undertake to produce or purchase one native cultural film, 250 to 300 metres in length, in the Czech language, of which four copies must be supplied at cost price to the Ministry of Foreign Affairs (presumably for distribution abroad).

(c) France. — The exhibition of foreign films in the language of the country of origin is allowed only in five cinemas in the Department of the Seine and in ten cinemas in other Departments of the country.

During the period 1st July. 1935, to 30th Juno. 1936. post-synchronised films exceeding 900 metres in length, to the number of 94 in each half-year, may be exhibited in France subject to the following conditions : —

(1) The post-synchronisation must have been entirely effected in studios situated in French territory and within four months from the date of entry of the application as detei mined by the payment of the appropriate tax.

(2*) The film^ as exhibited to the public must be described as dubbed films and there must be shown the title in the original language, an exact translation of that title, the title of the dubbed version, names of the artistes concerned in the original production and in the post- synchronisation, the country of origin and the place in which the dubbing was carried out.

The exhibition of foreign films from countries where the exhibition of French films is subject to restrictions is subject to any agreements made with the governments of those countries. This condition does not appear yet to have been strictly applied.

Apart from these restrictions, the exhibition of foreign films is subject to the same conditions as to censorship, etc., as French films.

The quota of post-synchronised films is not allotted to specified countries in fixed proportions.

(d) Germany. — The importation of long sound feature films into Germany is limited to 105 in a calendar year. Import permits for these films are allotted as follows : —

60 (i.e., 4/7) to distributors of German films. These permits are issued free of charge but are not transferable and therefore can be used only by the distributors concerned.

30 (i.e., 2/7) to film exporters. These permits are transferable, as the majority of the film makers who would be entitled to them would have no use for them. The Ministry of Propaganda has fixed a price of 20,000 P.M. per permit as from 1st January, 1935.

The remaining 15 permits are at the disposal of the Ministry of Propaganda.

Long silent feature films are similarly restricted, the annual quota being 70.

The Ministry of Propaganda has power to issue further permits " in the event of an important change in the position of the film market or for other im- portant reasons," or in respect of films to be imported from countries witb whom or with whose industries

reciprocal agreements exist concerning film imports, " for political or cultural reasons."

(e) Hungary. — Under a decree dated loth May, 1932, a Hungarian Film Industry Fund was estab- lished to further the development of the Hungarian Film Industry.

The income of the Fund is obtained from the issue of " Importation Vouchers " and from additional censorship fees on certain films. An importation voucher must be obtained from the Fund in respect of each imported sound film at the following charges : —

gold pengo. Each film not exceeding 200 metres ... 100

Each film exceeding 200 metres, but

not exceeding 400 200

Each film exceeding 40O metres, but

not exceeding 800 ... 400

Each film exceeding 800 metres, but

not exceeding 1.200 1.000

In addition to the regular censorship lies addi- tional fees are payable on imported silent and sound films : —

per censored metre.

If the Hungarian captions have

been made in Hungary ... 20 filler.

If the captions have been made

abroad ... ... ... ... 1 gold pengo.

Importation vouchers are not required in respect of imported silent films, and news, educational, scientific and propaganda films are exempt from all the above-mentioned special charges.

The National Board of Film Censorship issues its licence in respect of an approved film only on pay- ment of the special additional fee and production of an importation voucher.

The film industry may, with the approval of the Ministers of Commerce and Home Affairs, grant premiums on films made in Hungary in proportion in each case to the capital invested in the film.

Fnder decrees issued in July, 1935, an Act for safe- guarding the maintenance of the Hungarian language in sound film exhibitions was brought into force on l>t August, 19:3-5.

These decrees provide for the issue in respect of each approved sound film exceeding 1.20O metres in length produced or synchronised in Hungary in the Hungarian language of " Censor's Tickets " (seven during the 1935-6 season). Each Censor's Ticket per- mits the examination by the Censorship Committee of one foreign film exceeding 1.200 metres in length.

Quotas for half-yearly periods are fixed for exhibi- tors whose cinemas are equipped for sound projection. During the half-year 1st August, 1935 — 31st January. 1936, each licensed cinema proprietor was required to include in his programmes 101 per cent, of Hun- garian sound films exceeding 1,200 metres in length of which one-half might consist of films synchronised in Hungary in the Hungarian language. For the half-year 1st February, 1936, to 31st July. 1936, the corresponding proportions are 15 per cent, and two-thirds.

Police authorities are required to see that these requirements are complied with and to submit half- yearly reports on the subject. Provision is made Eoi the withdrawal of licences from defaulting exhibitors.

(f) Italy. — Under a Decree Law of the 8th October. 1933, as amended by several later Laws. non-Italian fiction sound films of not less than 1,000 met res dubbed into Italian, may be exhibited only if the dubbing has been carried out in thai country in establishments situated in Italy, by artistic and

32

COMMITTEE ON CINEMATOGRAPH FILMS

5 May, 1936.]

[Continued.

executive staffs consisting wholly of Italian subjects. A dubbed film must show at what place the dubbing was carried out and that the work was done in Italy.

Persons carrying out in Italy dubbing of a foreign sound film must pay a tax of 26,000 lire on each such foreign film for which a permit to exhibit has been issued. Makers of native films dubbing foreign sound films into Italian are exempt from this tax if for three adaptations of foreign films they pro- duce and show one national film. The conditions to be complied .with by an Italian film are : —

(a) the subject must be by an Italian author or must at least have been adapted for the Italian production by Italian authors ;

(b) the majority of the artistic and executive staffs must be of Italian nationality;

(c) both outdoor and indoor scenes must be taken in Italy. Certain exceptions may be made in respect of outdoor scenes according to the special requirements of the story.

From and including the financial year 1933-4, 2,000,000 lire has been provided in the Budget of the Ministry of Corporations for the payment of prizes to national films considered as having artistic- merit and good technical execution. In first and second run cinemas in towns having a population of more than 50,000 inhabitants one Italian fiction sound film of not less than 1,500' metres must be shown for every three non-Italian sound films. At least three Italian films must be shown in each quarter of the year. The Under-Secretary for Press and Propaganda is authorised to vary the percentage of foreign to Italian films in accordance with the development of the national industry. The charges for and conditions of renting [talian films must not be less favourable than those of foreign films >if equal importance and Italian and foreign films must not be rented in the same contract.

Under a law dated 13th June, 1935, the Under- Secretary of State for Press and Propaganda is authorised to grant loans to Italian film makers.

An application for an advance must be accom- panied by financial, artistic and technical details of the proposed film.

Applications are considered, and the amounts of the advances to be granted are fixed, by a Com- mission of five members, subject to the approval of the Under-Secretary of State.

Provision for loans to film makers is to be made in the estimates of the Ministry of Finance up to a maximum of 10 million lire a year for five years from and including 1935-36.

Provision is also made for the establishment of a cinema credit department at the Banca Nazionale del Lavore for the purpose of granting loans at particularly favourable interest rates to makers of films. The capital to be provided for this purpose is to be not less than that provided by the Ministry of Finance for similar purposes.

(g) Poland. — The principal measures at present in operation in Poland for the protection and pro- motion of the film industry are: —

(a) a high customs duty on imported films ;

(b) strict censorship in respect of foreign films;

(c) very high municipal tax discrimination between foreign films and Polish films making up the programmes of cinemas.

A Film Law of 13th March, 1934, empowers the Council of Ministers to regulate the importation of films, but this power has not been used. The law also provides for the grant of subsidies to local filiu production from the fees payable for exhibition permits. This power also has not yet been exercised.

A decree of the 18th August, 1934, made under the law requires the registration of undertakings for the sale and lease of films.

A further decree of the 12th September, 1935, under the law established within the Ministry of the Interior (a) a Film Commission and (b) a High Film Commission. The function of these Commis- sions is to examine any films and advertising matter relating to them which may be submitted to them by the Ministry of the Interior. The Commissions do not take the place of the ordinary Film Censor- ship Committee.

Proposals are reported to be under consideration (a) for a municipal tax on films, the maximum rate of tax not to exceed 60 per cent, and on films with a Polish theme, 5 per cent, of the price of the ticket, with a special rebate to cinemas undertaking to show annually at least 10 per cent, of Polish films exceeding 1,500 metres in length, in which case the tax on foreign films would be 45 per cent. In otber towns than WarsaAV lower rates would be applied to foreign films, dependent on the number of inhabi- tants; and (6) for a special tax on imported films to provide a fund for the encouragement of local pro- duction.

APPENDIX VIII.

1. The following table shows the import duties at present in force on cinematograph films:-

Class or Description of Goods.	Rates of Duty.
	Full.	Preferential
Cinematograph Films imported for the purpose of the exhibition of pictures or other optical effects by means of a cinematograph or other similar apparatus: Blank film, on which no picture has been impressed, known as raw film or stock, including photo- graphic sensitised sheets or strips of celluloid or other similar material of a length of not less than twelve feet, whatever the width. Positives, i.e., films containing a picture for ex- hibition, whether developed or not Negatives, i.e., films containing a photograph, whether developed or not, from which positives can be printed	1 1 | per linear foot of }- the standard | width of If inches 1 J >>		£ s d. 0 0 01 0 0 1 0 0 5	£ s. d. 0 0 0| 0 0 0$ 0 0 3i

APPENDICES

33

5 Ma y, 1936.]

!

2. In certain circumstances imported negative cinematograph films are chargeable with duty as blank film. Details are as follows: —

(1) If it is proved to the satisfaction of the Commissioners of Customs and Excise as respects any imported negative cinematograph film, whether developed or undeveloped,

(i) that the production of the film was

organised by persons whose chief, or

only, place of business was in the United Kingdom, and

(ii) that the producer of the film and all the principal actors and artists employed for the production thereof, except five, or if the total number of the principal actors and artists is less than twenty, not less than three-quarters of the principal actors and artists were British subjects and domiciled in the United Kingdom.

that film is, subject to compliance with such conditions as the Commissioners may by Regu- lation prescribe, treated for the purpose of the above duties as being blank film. The expres- sion " artists " includes the person working the photographic camera by means of which the pictures composing the film are taken.

(2) Negative cinematograph films which are certified by the Board of Trade to satisfy the requirements of Section 27 (3) of the Cinemato- graph Films Act, 1927, and parts of any films so certified may, subject to compliance with such conditions as the Commissioners of Customs and

Excise may by Regulation prescribe, be treated as if they were blank film. Briefly stated, the requirements of the section are that the film must have been made by a British subject or company; the studio scenes must have photographed within the British Empire; the author of the scenario must have been a British subject; and a prescribed percentage of the salaries and wages spent in the production must have been paid to British subjects.

3. Certain scientific and educational films. whether positive or negative, are exempt from duty. Details are as follows : —

(1) Any cinematograph film which is certified by the Royal Society of London for promoting Natural Knowledge to be solely an illustration of scientific investigation for exhibition before members of a recognised scientific body and which is imported only for the purpose of such exhibition free of charge is exempt from this duty.

(2) Customs duties arc not chargeable on imported educational cinematograph films which are certified by the Board of Education under Section 7 of the Finance Act, 1935. The expres- sion " cinematograph film " for the purposes of the section mentioned means a developed negative or positive cinematograph film and includes both a gramophone record or other form of sound reproduction complementary to such a film and a developed negative or positive sound track.

APPENDIX IX.

Employment in the Film Producing Industry.

The only official information available concerning the number employed in the film producing industry is that contained in the Census of