The Ministry of Culture recently received a letter alleging, among other things, that some Estonian businesses are selling their films to Russia. Edith Sepp, a member of the management board of the Estonian Film Institute, said that while this does indeed happen in Europe, it does not happen in Estonia. The Ministry of Culture confirmed this. However, it emerged that there are other ways in which both Estonian films and money reach Russia.

Sepp said Estonian companies have purchased films for distribution in Estonia through Russian intermediaries. The intermediary companies are registered in countries such as Malta or the United Kingdom, outside the European Union. However, their parent companies are based in Russia. As a result, payments from Estonia for the distribution of certain films reach Russia through intermediary companies. "The situation has certainly improved considerably over the past couple of years and we no longer have to purchase very many films through intermediary companies," Sepp said.

An international agent can also sell on Estonian film in Russia

Another way money can reach Russia from Estonia is through international sales agents that acquire the rights to Estonian films and hold licenses to represent them. Karlo Funk, an adviser on audiovisual and digital culture at the Ministry of Culture, said an international sales agent can then sell a film anywhere in the world without the direct involvement of the Estonian film company. The Estonian producer only learns about the sale afterward, within three to six months.

Most European sales agents are companies registered in France. Funk gave the example of a French sales agent acquiring the rights to films from Latvia, Poland or Belgium and selling them internationally. The same applies to Estonian films that have received public funding. "The solution here would be for Estonian film producers that have received public funding to clearly stipulate in their contracts that the film cannot be sold for distribution in Russia," Funk said.

He acknowledged that an international sales agent could also acquire the rights to a film currently showing in Estonian movie theaters and sell it to Russia. "Films are not subject to sanctions," he said. After the outbreak of the war, French film exports to Russia increased rather than decreased. "French films took advantage of the opportunity created by Hollywood's withdrawal from the Russian market," Funk explained.

He said this was also because, in the film industry, advance purchases for major projects are sometimes made two to three years ahead of time, meaning existing contracts were not terminated. "As far as we know, the share of French films in the Russian market has declined by now, but they are still being shown there," Funk said.

Sepp said France has no intention of completely stopping the sale of its films to Russia. According to her, France argues that if European films were not shown in Russia, the country's residents would become increasingly disconnected from European values.

Another way Estonian films can reach Russia is through international co-productions, for example, when Estonia is a co-producer of a French film. If the French producer, as the lead producer, decides to sell the film to Russia, Estonia has no say in the matter. Funk said that if Estonia were to introduce a rule prohibiting films made with Estonian public funding from reaching Russia in any form, the French co-producer would likely withdraw from the project.

The European Commission's Creative Europe program aims to support Europe's cultural and creative sectors, including the film and audiovisual industries. Funk explained that the Creative Europe programs in Estonia, Latvia and Lithuania have been addressing the issue of film sales to Russia for the past two years.

Member States decide whether companies can work with Russia

This year, Creative Europe introduced a rule under which film projects cannot receive European Union funding if their distribution rights in the Baltic states are sold to Russia. This means that European film sales agents receiving EU funding for their operations will lose that funding if they enter into such a deal. However, Funk emphasized that ultimately, it is up to individual member states to decide whether to allow their companies to do business with Russia.

Pirated copies of Estonian films also circulate in Russia. Sepp acknowledged that this has always been a problem. She explained that these films are stolen and screened, but no one sells them or receives any money for them. "At least not to my knowledge," Sepp said. Such piracy cannot be stopped.

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