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In Sweden, Netflix agrees to pay royalties to audiovisual professionals

Netflix offices in Los Angeles, California in July 2018. Lucy Nicholson / REUTERS

Between the coronavirus epidemic and the oil war, information went almost unnoticed. However, it could have an impact on the remuneration of thousands of actors, screenwriters and directors in Europe, if the agreement, adopted in Sweden between Netflix and the Syndicate of performing arts and cinema (Teaterförbundet), Monday March 9, was widespread beyond the borders of the Scandinavian kingdom.

For the moment, this is a test: “We want to see if the terms of the collective agreement that Netflix has agreed to sign work, in which case we will perpetuate itsays Ulf Martens, union copyright manager. It will only apply to original series produced by the American streaming platform in Sweden.

If all the details have not been released, Netflix and the Swedish union presented the main lines, Monday, March 9. Instead of a single salary, paid at the time of filming, the agreement provides for three levels of remuneration, along the lines of what is said collective agreements applying to the audiovisual professions in Sweden.

The shortfall was considerable

In addition to an initial salary, Netflix agrees to pay a supplement to production members, based on the number of streams made by the series on the platform, without time limit. They will also have the right to repay part of the secondary operating income, in case, for example, the American giant resells the production rights.

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Until now, Netflix, like its American competitor HBO, required the application of a system of buy-out, which provides, in addition to the payment of a fee, an advance on the rights, the amount of which can reach between 15% and 25% of the initial salary. In exchange, the artist waives the royalties that the production could generate for years.

In October 2018, Danish actors, directors and screenwriters rebelled and threatened not to sign any more contracts until US companies followed the Scandinavian compensation model. According to the unions, the shortfall was considerable: for a successful series, the sum of royalties received over ten years could double the amount of the initial salary.

A “historic partnership”

Admittedly, the fees were, in general, lower than those offered by online video platforms. But, argued Benjamin Boe Rasmussen, president of the actors' union, “Producers do not have to advance huge sums of money up front, which gives small projects a chance, which otherwise would not have happened”. The system also allows part of the profits to be returned to the country, which can then be reinvested there.

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