Baverstock: Canadian tax breaks have "decimated French industry"

But French start ups have increased following introduction of cultural tax in country, claims Edmondson

Kuju Entertainment's Ian Baverstock has spoken out about Canadian tax incentives saying the country has "decimated" the French games industry.

The CEO was responding to a question about how the industry in France has benefited from the cultural tax breaks it has been afforded, in a panel discussion at Wednesday's Game Horizon Best of British event in London.

"Unfortunately the Canadians have already totally decimated the French industry," he said.

However, Ubisoft Reflection's Gareth Edmondson disagreed that tax incentives had come too late for France, saying it has "certainly helped" Ubisoft's business although it was still too early to judge fully what the impact will be.

"After the introduction of the tax breaks Ubisoft grew its headcount by 20 per cent, following the 20 per cent tax break," he said.

"I'm not saying that it's because of that, but it certainly helped. The other thing that they have seen happen is that there are a lot more start ups that are taking the chance. It certainly helps stimulate things."

Edmondson added that Ubisoft Reflection's upcoming new Driver game has been eligible for the French tax break, a fact that should allay developers' fears they will need to adhere to certain cultural criteria in order to qualify. "It's a car chase game set in the US and we actually qualify," he said.

The Give us a Break panel discussion debated the impact a cultural tax break could have on the UK industry; an industry which panel member Rick Gibson, director of Games Investor Consulting said is in danger of shrinking and losing its major talent to countries such as Canada.

Gibson revealed figures that indicated the number of development jobs could have fallen by as much as eight per cent over the last three years – from 10,000 in 2006 to 9200 in 2009. And predicted the decline could become far worse.

Canada is able to offer tax breaks to individuals, he said, an incentive that is currently luring talent out of the UK and to the country.

It was added that 75 per cent less film production would take place in the UK if the film industry had no tax breaks. It's an system "proven to work," said Gibson.

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Latest comments (4)

robert troughton Managing Director, Coconut Lizard12 years ago
If tax breaks don't work, let's see the government stop giving others in the entertainment industry tax breaks... but, of course, they won't do that - they wouldn't want to upset Sir Kenneth Branagh, Sir Andrew Lloyd Webber or Sir George Lucas, would they..?
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Brian Ward SVP, Worldwide Studios, Activision Blizzard12 years ago
Ian is deluded. One of the principal jobs of any politician anywhere is to create local jobs. That's what the Canadians have done in Quebec, and more recently in Ontario. It is not the job of the Quebec or Ontario politicians to create jobs in France, the US, UK, or anywhere else. If the French politicians didn't realise this until recently and are now at a competitive disadvantage, that's for the French politicians to reconcile with their constituents. Furthermore Ian, French labour law has a significant amount to do with their competitive disadvantage -- it's pretty hard to have a robust development community in France when the French are prohibited by law from working a full work week.
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Ian Baverstock Co-founder, Tenshi Ventures12 years ago
Brian, I am not saying that the Canadian government shouldn't be trying to gain an advantage for their citizens over those of France or that it wasn't the French government's responsibility ... precisely the opposite in fact The point was that we in the UK could go the same way if the government here don't act! We are lucky that the French speaking bits of Canada had the most aggressive policy of attracting development companies and developers so it was France that bore the brunt of this competitive pressure for investment and talent.

I have to agree that French labour laws (and IP laws) help their cause though!
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Brian Ward SVP, Worldwide Studios, Activision Blizzard12 years ago
Ian, I now see your point behind the headline above. Completely agree with you on the UK issue. Arguably the effect has already begun -- the change in developer landscape in the UK over the past 10 years is shocking. A lot of jobs lost. Contrasted against more than 8000 game and digital media jobs created in Montreal alone, you'd think the argument would be more obvious and supportable in the UK. But I am obviously in favor of incentives.
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