Production Contract

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Production Contract

A Brief Introduction About Production Contract

Do you know anything about the production contract in the film industry? Every producer, distributor, and financier should know about this contract as it plays a major role in film productions. This contract is made between financiers and producers who hire a trusted production company for the film production project. The production company has all the resources to deliver the movie production as per the specifications of the financier.

Production agreement is quite important for every TV show and film due to which it plays an important role in the entertainment industry. The film projects aren’t small tasks but have to be done with the help of numerous people, and managing all of this can’t be done by one single person, and that’s why they need for production companies to increase. This leads the financier and producers to sign a contract with the production companies.

Who Takes the Production Contract?

The production contract is taken by the distributor or financier of the movie and producer with the production company. This agreement shows that the production company would work on the movie project to make it successful, and the finances would be specified by the financier here.

Purpose of the Production Contract – Why Do You Need It?

The major purpose of this agreement comes in play when you have got the control of source material or screenplay along with full financing for a film project. The production company has to work as per written in the agreement. This agreement protects the money of producers and directors who have invested in the film project and made the payment to the production company to receive finalized projects. Even after having money and screenplay, one can’t handle the work of casting, production, accounting, and payroll. So, this work is given to the known production company.

Contents of the Production Contract – Inclusions

The details about money and expenses are also written in this agreement. There are several clauses included after the discussion between both parties. The obligations for the production company would be like:

  • Provide suitable crew as per the size of the project
  • Arranging the shoot as per the details provided
  • Directing, production, shooting, and editing are included in the finalized product.
  • Have to show the final draft to the client to get approval
  • Supply DVD and master encoded copy for a film project
  • Providing film project footages
  • Nothing should be undertaken publicly while the project is going on.

The client (producer or financier) has to agree on several obligations like:

  • Agree to allow the production company to get creative control for film project till the project is finished
  • Agree to make payment for remuneration
  • Agree to provide creative input for the project
  • Agree on the locations for the project if it hasn’t specified
  • Agree that changes requests after signing contracts would not be guaranteed

There are many more clauses added in the final production agreement, but these were the basics of it.

[ Also Read: Film Contracts ]

How to Draft the Production Contract?

The obligations of the production company and the client (producer of the film) are added in the agreement. There are various things on which the producer of the film has to agree before signing this contract, and the same applies to the production company. One can use a production contract template to work on this agreement in a proper manner. It can give you the basic idea of the production contract.

Negotiation Strategy

The production company can’t be forced to agree on requests and negotiations asked by the financier if it hasn’t been written in the contract. In case the production company finds it worth the benefit, then it can agree on the strategy or rules.

Benefits and Drawbacks of the Production Contract

The benefit of the production agreement is that the financier has the proof of payment made to the production company for the whole film project with all necessary details. The rules which are to be followed by the production company are also mentioned in the agreement, and that’s why it is necessary for every financier. The drawback of this agreement comes when the financier wants to change the location of the project and hasn’t mentioned it in the contract. In such situations, the financier might have to pay more to the production company or have to negotiate for it. The production company can’t be forced to change location until it has been mentioned in the contract.

What Happens in Case of Violation?

If a person violates the production agreement, then he/she would be liable to get punishment(1) as written in the agreement. It mostly includes payment of money for violation of certain laws and rules. If both parties have signed on an agreement, that implies that they have agreed on the contract. After this, if any of the party does wrong to the contract, then that party is eligible to pay for it.

The important details of rules and regulations to be followed by the production company should always be written in the contract. One can check the contract template to get an idea of the necessary things to be written in the contract. It would be best for the financier and production company to take the assistance of the lawyer. This would remove all the confusion in the beginning. Both parties have to agree on the terms and conditions after they have signed the contract. This brings out the fact that producers and production company both should focus on reading every clause properly to avoid any issues later.