Hobbit producers to New Zealand: if you tell people how we got our sweet tax/labor deal, no one will want to make movies in your country

The production company that made the Hobbit convinced the government of New Zealand to suspend its labor laws and tax laws. Now the NZ Labour Party is asking for the details of the deal that the company struck with the government to be disclosed, and the production company is fighting it, saying that if the government tells the voters of NZ what sort of sweetheart deal they were handed, no one will want to make movies in New Zealand any more.

Radio New Zealand applied for the documents in November 2010 under the Official Information Act but ministers refused on the grounds they were commercially sensitive.

The broadcaster appealed the decision and on January 31, Ombudsman David McGee ruled 18 documents, including emails between Hobbit director Sir Peter Jackson and government officials, must be released.

In his 29-page ruling McGee said the information in the documents didn't pose serious commercial risks.

But New Line warned this would affect future relations, objecting in a statement included in the ruling.

"If the government is not willing to adequately protect this sensitive information from disclosure, this will operate as a major disincentive to motion picture studios as well as local and foreign talent - to utilise New Zealand as a location for future productions."

Threats fly over Hobbit document release [NZ Herald/Cassandra Mason]


  1. Oooooh, that really makes me mad. What bull, that the rights of its citizens should be shelved because they won’t cooperate otherwise. Reminds me of the damned Republicans.

  2. Do ya wonder if the reason no one will want to film there anymore is because the public outcry about how badly they got screwed would be to loud?

  3. It’s just like in The Godfather:

    They come to you and ask for a favor. Before you know it, they’ve made a trilogy with a crappy ending.

  4. Much worse than ‘suspending’ the labor laws, I’m afraid; the conservative NZ government rushed anti-labor changes through to make New Line happy, and now those changes are the law of the land.  I can only hope that the forthcoming revelations birth a storm of controversy, because there was the outcry was much too muted at the time.

  5. “Now remember New Zealand, if you tell anone what we did in the basement, you’ll get in a lot of trouble.”

          1. But there is a constitution, they talk about it.
            so confusing for me, I’m just a simple coward I don’t understand.

            edited bit – as I can not reply to all of you, thank you for explaining it to me.

          2. @That_Anonymous_Coward:disqus 
            There is no constitution in the sense that there is no document called “The Constitution of New Zealand” that outlines the basics of government, etc. 

            Instead there is precedence and a variety of other legal documents that understood together form basically the same thing as a written constitution.

            @NathanHornby:disqus It doesn’t exist as a written document that anyone can read in one place. It does exist as a generally understood set of principals, laws, etc.

          3. The NZ constitution is “uncodified” because it derives its practices from the (also uncodified) UK one. This is mostly because, where the British monarch remained the official Head of State, countries didn’t experience revolutions or any real break in the continuity of power since the times of absolute monarchies. By instituting  Parliament and adopting some “ancillary” documents like the Magna Charta, English monarchs basically sidestepped the issue with a practical hack that somehow stood the test of time. In fact, the absence of a codified constitution allowed for a lot of flexibility in the role of any institutional British power, whereas most constitutional documents are very rigid and prone to catastrophic results when they fail to deal with new circumstances.

            Where many political theories tend to absolutes that may or may not stand the test of time, the British approach is inherently pragmatic: “we’ll fix what breaks, as it happens, and leave the rest untouched”. This can result in the survival of archaic concepts and practices (aristocracy being the main example), and also misguided “reforms” (see the current UK jumbling around the role of Lords and Judiciary, which currently seem to change every few years with shocking carelessness) but it also meant that England didn’t suffer through Illuminism-inspired upheavals like most of Europe, and it was able to survive the rise of mass-politics in the first half of the XX century — whereas all main European countries experienced years of one-party rule at some point.

          4. Personally I would prefer to have my rights to unrestricted speech, privacy, bodily integrity etc. written down clearly somewhere, rather than being subject to the interpretive whim of a judge or parliament. Although, maybe there’s no difference in practice, since if a powerful enough group can get enough force and lawyers behind an infringement of my rights, there’s probably not a lot I can do about it.

            I need ice-cream. They can’t take away my right to ice-cream can they?

      1. We, the people of New Zealand, in order to provide a location for Hobbit films to be made, do hereby bend over and take it up the posterior from New Line.

  6. This could end up revealing how small and vulnerable to a movie studio New Zealand really is — more than any sweet deals. If the studio and officials are so concerned, the signs of a national bend-over are starting to show.

    1. sounds to me like New Line’s point is “if you start blabbling about the specifics of what was assumed to be a private contract – if you demonstrate that you can’t be trusted to behave with discretion – nobody else is going to want to enter into contracts with you.” and that’s a fair point, IMO.

      1. Translation:  If you put your duty to your citizens ahead of your allegiance to us (and our bribes), other sleazy bastards just like us may not trust you in the future.

      2. A contract with a government is not a private contract. A gerbil should be able to figure that out before signing.

        1. apparently, some of the gerbils in the NZ government and all of the gerbils who run New Line cinema disagree. they seem to think there’s something in there that shouldn’t be made public just because someone else thinks it should.

          1. The issue is that the government is compelled by law to release these things when asked for them unless they meet very specific criteria for refusing.

            They don’t disagree that it’s a public contract, because that’s in the law. They disagree that people should see it because it’ll lose them polling points in the next election.

  7. Cory, as a New Zealander this is clearly very important stuff. Please point me to the Labour and Tax laws that were “suspended”, as you state.

        1. Because you thought it was the polite thing to do, darn you Canadians and your manners! 

  8. Question for those from NZ, do you all get screwed as badly as Oz does when it comes to movies and tv etc arriving like 8 months after its available everywhere else?

      1. <– might be US based…
        I know that Oz has a long history of being screwed over by content providers, but am unsure if the same applies to NZ.

        I often like to explain the delay in getting things to Oz because the galleons have to sail past the sea monsters… or the inverter that turns all the content upside down is on the fritz again.

        Galleons make more sense, and this would explain the preoccupation they have with pirates being a large concern…

        1.  Yes…..we sometimes have to wait 6 months for a “new release”, if things get picked up at all…. we only have 2 broadcast tv companies, and one cable/sat company. We are some of the biggest pirates in the world, in terms of illegal downloads per capita.

          1. The cartels whine about how they are losing money… how much money are
            you losing when the content isn’t available at any price in the market.
            While the downloading might be ‘illegal’, I think it screams more of a market being ignored.
            Someday when the dinosaurs who are running the content cartels die off, I would like to think someone who wants to make money would build a system that sells the content globally at the same time at the “right” price.

    1. It depends on the show. Traditionally shows are often heinously delayed. Nearing the end of Smallville’s run, we were something like two years behind. I believe our screenings of popular UK soap Coronation Street are currently 18 months behind.

      With the rise in internet downloading, TV stations are slowly learning that if they play shows ASAP after they screen elsewhere, they get better ratings. We got episodes of Revolution a mere two weeks after they played in the US, and the last Doctor Who Christmas special played here on boxing day, something like 13 hours after its UK screening.

      1. Which gives me a tiny sliver of hope that some content people are starting to understand that “piracy” isn’t about stealing from them that it is consumers who are fed up with being ignored.  Content makers are obsessed with keeping control and trying to maximize profits at the expense of the consumer… but they now aren’t the only way for consumers to access it.  Its nice to see some of them understanding declaring war on your customers isn’t a good way to do business.

  9. Call me crazy, but I’m guessing that New Line has a better grasp on the gravitas of the situation than a radio station looking for an Awesome Scoop.

  10. Didn’t the movie studios threaten New York City a while back when they raised permitting fees, and haven’t they threatened California over unionized labor costs? And yet, most movies and TV in the US are still made in California and New York.

    Some productions might shift to other places, but people will still want to produce movies in New Zealand—for the landscape, the actors, the (local) studios, etc. I’m guessing that making exceptions for a few big movies will do more harm to the local people and companies than keeping the rules even for everyone. And I bet New Line is more concerned about the people upset with them than the citizens upset with NZ government.

          1.  Of course they are.  When the state throws tons of free money to Hollywood, they will send their projects there.  But should NC taxpayers really be footing the $20 million bill for Iron Man 3? 

          2. True…but it’s also wishful thinking.  The only way NC can keep the big projects coming is to keep giving them the free money.  The second the handouts stop, Hollywood is gone.  At their present rates, film incentive programs like NC or Georgia or Louisiana are simply unsustainable.  That’s why the NC film incentive is set to expire in 2015.  I hope they keep going to NC after that, but without free money its not very likely. 

    1. You missed mentioning the sweetheart deal that is giving them cash for each episode they shoot from the feds (US variety)… they reupped that in the stuff to avoid the fiscal cliff.  They are worth destroying our civil rights to protect their business model, but we have to give them handouts to make their content…

    2. Tax breaks to multinationals are the equivalent of women “putting out” on their first date just because they’re insecure.

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