Animation in Spain

Spain’s animation and VFX industry is currently the audiovisual sector with the biggest growth opportunities in the country, as new companies focus on original IP and strike key international partnerships.

Recovery following financial crisis

The Spanish animation industry suffered particularly badly during the economic crisis between 2008 and 2014, with many animation companies going out of business. Their financial difficulties were primarily down to extensive overheads that, as broadcasters’ budgets were cut and the work dried up, they were unable to maintain.

The recovery process since the crisis has been slow but steady, with smaller yet more nimble companies being founded by both new entrants and talent that previously worked at the now-defunct firms. In 2018, almost one quarter of Spain’s animation companies had been founded since 2013 and almost half of the companies working in the Spanish animation were under 10 years old.

As a result, the sector is full of young companies that have learnt from the mistakes of companies that came before. They tend to be internationally focused, quick to adapt to new market trends and willing to share expertise and talent with each other. The total revenue of Spanish animation companies was €654m in 2017 and they expect to collectively reach the €1bn mark by 2020.

Successful series exports include Pumpkin Reports, Yoko, PINY: Institute of New York and Lucky Fred, which has reached over 165 territories, while Pocoyo is one of the most popular animation brands to come out of Spain.

Spain has also released some box offices successes in recent years such as Tad the Explorer (2012) and its sequel Tad the Explorer 2 (2017), as well as Capture the Flag (2015) and Deep (2017). Many more are in the pipeline, while Sergio Pablos’ SPA Studios in Madrid is producing the feature film Klaus (2019) for Netflix with Atresmedia Cine.

Tax breaks help fuel production

While the Spanish government had to cut support to the audiovisual sector due to financial restrictions during the economic crisis, the situation changed in 2016 with new regulations and the creation of nationwide tax deductions for investment in audiovisual production, service work and technological innovation.

As Spain is a highly decentralized unitary state, some regional governments have their own tax resources and so are able to decide on the level of tax incentives they choose to offer. This means some tax rebates, such as the 45-40% rebate for national and international animation productions offered in the Canary Islands, or 35% rebate in Navarre, are among some of the highest in Europe.

This is attracting both local and international companies to set up animation studios in destinations where the tax incentives are on offer. However, most Spanish companies remain headquartered in either Madrid or Barcelona. In 2018, almost three quarters of animation companies in Spain had developed their own IP for international exploitation, with the majority of companies also providing service work for international partners on a work-for-hire basis.

One key issue is that there are currently no dedicated funds for animation in Spain, although animated feature films can apply for generic cinema funds. Local producers are talking to the Spanish Centre for Cinema and Audiovisual (ICAA) to explore the possibility of introducing a new fund specifically for the development and production of animated series for TV and new digital platforms.

Dedicated coproducers

Broadcasters remain the main source of financing for animation companies in Spain, with Spanish broadcaster RTVE’s children’s channel Clan one of the main investors in animation series and films. Catalan public broadcaster TV3 is also actively coproducing animation projects, but the country’s private channels focus on acquiring finished content with the occasional pre-buy.

As a result, funding from local broadcasters is never enough to fully finance productions. Many Spanish companies are therefore well versed in striking coproduction partnerships in Europe and territories as far afield as Asia in order to complete financing jigsaws.

The Spanish animation sector looks set to continue to go from strength to strength. However, much depends on improved government support, studios’ capacity to retain talented technicians and artists, alongside producer’s ability to retain rights to and profit from the original IP they create.

Spain’s animation and VFX industry is currently the audiovisual sector with the biggest growth opportunities in the country, as new companies focus on original IP and strike key international partnerships.

Recovery following financial crisis

The Spanish animation industry suffered particularly badly during the economic crisis between 2008 and 2014, with many animation companies going out of business. Their financial difficulties were primarily down to extensive overheads that, as broadcasters’ budgets were cut and the work dried up, they were unable to maintain.

The recovery process since the crisis has been slow but steady, with smaller yet more nimble companies being founded by both new entrants and talent that previously worked at the now-defunct firms.

In 2018, almost one quarter of Spain’s animation companies had been founded since 2013 and almost half of the companies working in the Spanish animation were under 10 years old.

As a result, the sector is full of young companies that have learnt from the mistakes of companies that came before. They tend to be internationally focused, quick to adapt to new market trends and willing to share expertise and talent with each other. The total revenue of Spanish animation companies was €654m in 2017 and they expect to collectively reach the €1bn mark by 2020.

Successful series exports include Pumpkin Reports, Yoko, PINY: Institute of New York and Lucky Fred, which has reached over 165 territories, while Pocoyo is one of the most popular animation brands to come out of Spain.

Spain has also released some box offices successes in recent years such as Tad the Explorer (2012) and its sequel Tad the Explorer 2 (2017), as well as Capture the Flag (2015) and Deep (2017). Many more are in the pipeline, while Sergio Pablos’ SPA Studios in Madrid is producing the feature film Klaus (2019) for Netflix with Atresmedia Cine.

Tax breaks help fuel production

While the Spanish government had to cut support to the audiovisual sector due to financial restrictions during the economic crisis, the situation changed in 2016 with new regulations and the creation of nationwide tax deductions for investment in audiovisual production, service work and technological innovation.

As Spain is a highly decentralized unitary state, some regional governments have their own tax resources and so are able to decide on the level of tax incentives they choose to offer. This means some tax rebates, such as the 45-40% rebate for national and international animation productions offered in the Canary Islands, or 35% rebate in Navarre, are among some of the highest in Europe.

This is attracting both local and international companies to set up animation studios in destinations where the tax incentives are on offer. However, most Spanish companies remain headquartered in either Madrid or Barcelona. In 2018, almost three quarters of animation companies in Spain had developed their own IP for international exploitation, with the majority of companies also providing service work for international partners on a work-for-hire basis.

One key issue is that there are currently no dedicated funds for animation in Spain, although animated feature films can apply for generic cinema funds. Local producers are talking to the Spanish Centre for Cinema and Audiovisual (ICAA) to explore the possibility of introducing a new fund specifically for the development and production of animated series for TV and new digital platforms.

Dedicated coproducers

Broadcasters remain the main source of financing for animation companies in Spain, with Spanish broadcaster RTVE’s children’s channel Clan one of the main investors in animation series and films. Catalan public broadcaster TV3 is also actively coproducing animation projects, but the country’s private channels focus on acquiring finished content with the occasional pre-buy.

As a result, funding from local broadcasters is never enough to fully finance productions. Many Spanish companies are therefore well versed in striking coproduction partnerships in Europe and territories as far afield as Asia in order to complete financing jigsaws.

The Spanish animation sector looks set to continue to go from strength to strength. However, much depends on improved government support, studios’ capacity to retain talented technicians and artists, alongside producer’s ability to retain rights to and profit from the original IP they create.

DIBOOS

The Spanish Federation of Animation Producers’ Association is the umbrella body of the sector’s main associations, integrating AEPA (Spanish Association of Animation Producers) and PROAnimats (Association of Animation Producers), representing more than 80% of the production of Spanish animation.

DIBOOS is devoted to promoting the Spanish animation and visual effects sector in two different arenas: as a pole of cultural creation and as an industry. Regarding the first one, animation generates a common imaginary that must be preserved; as for the second one, the sector claims its important role as generator of stable employment and exports (70% of firms’ turnover comes from abroad), as well as a growing investment in R&D.

PROAnimats

PROAnimats is the Barcelona-based professional association of animation producers. Created in 2007, it is federated to PROA ( Nationwide Federation of the Audiovisual Producers made up of seven associations, PROA currently includes over 200 production companies and is still expanding and growing) and to DIBOOS.

Providing advising and promoting dialogue and cohesion among its partners, ProAnimats has achieved a relevant and valued position among the different agents in the field.

DIBOOS

The Spanish Federation of Animation Producers’ Association is the umbrella body of the sector’s main associations, integrating AEPA (Spanish Association of Animation Producers) and PROAnimats (Association of Animation Producers), representing more than 80% of the production of Spanish animation.

DIBOOS is devoted to promoting the Spanish animation and visual effects sector in two different arenas: as a pole of cultural creation and as an industry. Regarding the first one, animation generates a common imaginary that must be preserved; as for the second one, the sector claims its important role as generator of stable employment and exports (70% of firms’ turnover comes from abroad), as well as a growing investment in R&D.

PROAnimats

PROAnimats is the Barcelona-based professional association of animation producers. Created in 2007, it is federated to PROA ( Nationwide Federation of the Audiovisual Producers made up of seven associations, PROA currently includes over 200 production companies and is still expanding and growing) and to DIBOOS.

Providing advising and promoting dialogue and cohesion among its partners, ProAnimats has achieved a relevant and valued position among the different agents in the field.