British-US film: The special relationship

Robin of Locksley, an Englishman through and through, has been brought to life on screen by more than 30 different men. Some Robins have been brooding, some dashing, and some dressed in unnervingly snug tights. But fewer than half have been British.

Today, Russell Crowe reprises the role in Ridley Scott's Robin Hood. The film, marketed as grittier than its predecessors, boasts a British director, a British producer and was filmed in the UK. But it also has two Australian stars, an American backer (Universal) and a script penned by an American, although this is understood to have been given an extensive polish by Tom Stoppard.

So is it really a British film? And what do we mean by that? Historically, the British film industry, which has neither the flush studios of Hollywood nor the state protectionism of countries like France, has struggled to support itself without seeking funding from abroad. Even now, the main British film backers, UK Film Council (UKFC), Film4 and the BBC, have limited resources – the UKFC has £15 million ringfenced for emerging film-makers, but this is tiny compared with what foreign investment brings.

Which is part of the reason why the UK has developed tax credits for "British films" that require studios to spend just 25 per cent of their budget in the UK to qualify – on the set, Colin Firth's bagels, it doesn't matter so long as it was spent here. The film must also pass the UKFC's cultural test, based on things like whether or not the story reflects British culture, or be part of an official co-production. By this token, Robin Hood is British indeed.

The UKFC says the British film industry is thriving like never before. Films like Slumdog Millionaire, An Education, Kick-Ass and, of course, Harry Potter, have attracted critical and international acclaim. Last year, out of 125 films made in the UK, 110 were classified as British. Danny Boyle, Richard Attenborough and Emma Thompson recently all publicly thanked Labour for its support of British film, hailing it a "global success story".

But are the cracks beginning to show? Last month, a debt-laden MGM suspended development on the latest Bond film; HandMade Films, the quintessentially British film-maker set up by George Harrison to bankroll Life of Brian in 1978 (after American finance fell through), also announced a takeover approach from a previously little-known company called Almorah Services.

J Blakeson, director of The Disappearance of Alice Creed, the just-released, critically acclaimed British thriller, says a truly British film industry doesn't really exist. "We just have lots of little companies: producers rarely actually make any money. British film technicians often work on blockbusters to pay the mortgage, then British films for fun."

The upshot of this is two-fold. Firstly, it can make film-makers more risk averse if they know they will have to court American money or distributors (the body, often a US studio, that actually gets the film into cinemas), and can encourage them to tweak films to appeal to an American audience. Perhaps even more importantly, it means that a vast proportion of film profits go to Hollywood rather than feeding back into British production companies, thereby exacerbating the problem.

Take Slumdog Millionaire, for example, which made $377.4 million on a budget of $15 million. Celador, the co-producer with Film4, said it expected to take home $14.9 million (£10 million) in profits overall, while a commissioning editor at Film4 said he expected "practically no money" to flow back into the country from profit made in America. Meanwhile, Fox and Warner, the American co-distributors, were expected to take $40 million (£26.7 million) on box-office receipts alone. If Warner had not got cold feet and sold half its rights (rather embarrassingly, it expected Slumdog to go straight to DVD) it could have been taking home at least twice that of Celador, despite taking none of the risk.

In fact, Slumdog probably got a great deal because it was only distributed by a US studio. If it had been financed by it too, as Robin Hood and Harry Potter have been, the deference to Hollywood could have been far greater. Dr James Russell, a film lecturer at De Montfort University in Leicester, says profits tend to be distributed as follows: 40 to 50 per cent of gross box office receipts go to the cinemas, then 50 to 60 per cent go to the distributor, who divvies them up according to the contract, sometimes with less than 10 per cent making its way to the producers.

It is difficult to know precisely how much British producers are losing out on, since they themselves are cagey about the deals they make with the US to avoid being blacklisted. However, insiders agree they very often get a raw deal, particularly if the film is pre-sold – in other words before it has any success and the producer has any leverage. In a 2007 report, the House of Lords concluded that our lack of distributors was a "serious issue for the British film industry, in that much of the profit earned on films goes to American companies which have part-financed and distributed them".

But do these Byzantine financial structures necessarily mean that films like Robin Hood are less British? In some cases, yes. Russell says that apparent examples of "tweaking" the content to appeal to US distributors are everywhere in British film. "The most obvious example is casting American stars like Andie McDowell, in Four Weddings and a Funeral, or Renée Zellweger in Bridget Jones's Diary. Working Title may be our most celebrated producer but ultimately it is owned by Universal.

"But more generally, savvy British film-makers tend to make films that present a kind of internationally appealing Anglophile version of Britain to the world. That's particularly true of Harry Potter, where the wizarding world is basically a tourist-friendly version of Ye Olde Britain to Robin Hood, which espouses the modern ideals of political democracy, à la Braveheart."

The UKFC argues that its cultural test maintains the British film industry's sense of identity – pointing to the line-up at this year's Cannes film festival, with six films backed by the UKFC selected for screening and 190 British films for sale in the market. It also notes the increasing success of independently financed British films in cinemas, with those made with no foreign finance making up 8.5 per cent of all film takings at the UK box office last year – the best showing for a decade.

Nonetheless it admits that more could be done to create a more sustainable production industry, and has set up a think tank, chaired by Working Title founder, Tim Bevan, to explore how it could be improved.

Many, including the UKFC and the House of Lords report, conclude the likelihood of the UK developing its own version of Warner Bros or Universal is very slim indeed and that some dependence on foreign investment will probably remain no matter what we do. As one man puts it: "American studios aren't doing anything wrong – film is a business, and they are just bigger and better than anywhere else."

Still, making money off cash-strapped producers and giving it back to the Hollywood "fat cats"? There's just something a little too Sheriff of Nottingham about it. Just where is Robin Hood when you really need him?

'Robin Hood' opens nationwide today. 'The Disappearance of Alice Creed' is on general release