International relationships are key to these companies and Luxembourg is part of the European Co-production Convention, with individual co-production treaties with countries such as Canada, France, Austria, Portugal, Switzerland and Ireland. Meanwhile, as part of the politico-economic union Benelux, it enjoys close ties with Belgium and the Netherlands and frequently coproduces both films and series with these countries, as well as France and Germany.

Aside from their own private finance, Luxembourg companies have only one support mechanism for audiovisual productions. However, the Luxembourg Film Fund, a public institution governed by the Ministry of Communications & Media, has an annual budget of around €40m, which makes Luxembourg producers hugely attractive as coproduction partners.

The National Audiovisual Production Support (AFS) is a selective scheme which provides discretionary loans to Luxembourg registered production companies, repayable from the finished work’s receipts.

However, this fund does not purely focus on animation, meaning animation producers in Luxembourg must share the film fund’s balance with those making live action fiction, documentaries, short films, transmedia and XR projects.

Nevertheless, Luxembourg-based animation companies can bring in up to €1.5m as a minority coproduction partner on projects, with around five animated projects per year tapping into the film fund.

As a result, Luxembourg producers can cherry pick which European projects they would like to work on, meaning the animated productions made with the participation of Luxembourg producers tend to be of the highest quality with strong artistic merit. Overall, Luxembourg has a track record made up mostly of coproduced animated feature films, however some local producers have chosen to focus specifically on series.

Examples include the feature film Wolfwalkers, released on Apple TV+ in 2020 and coproduced with Ireland and France; the Oscar-winning short Mr Hublot (2014), coproduced with France; the Netflix feature film Pachamama, a 2018 French-Luxembourgian-Canadian copro; and the animated series Fox & Hare, which is coproduced with Belgium and the Netherlands and will have a feature film spin-off.

Non-existent broadcaster support

Luxembourg is among the least-populous nations in Europe, which means its broadcast industry is eclipsed by those in its fellow European markets, with just the one broadcaster of note. RTL Télé Lëtzebuerg, part of European media giant RTL Group, is the main television channel in Luxembourg, broadcasting in Luxembourgish.

However, it does not provide financing for animated projects from Luxembourg companies. This is a source of frustration among the local producers as not being able to include a local broadcaster in their financing plans makes it difficult for them to hold onto rights when doing deals with copro partners.

This means international relationships are paramount of Luxembourg producers as they are unlikely to get projects off the ground without the participation of a coproduction partner in a larger market, particularly series. Original intellectual property is being developed in many of the Luxembourg studios, however without local broadcaster support it is difficult to succeed in this area and so coproduction work takes up most of the studios’ time.

Of Luxembourg’s four studios, some are partnerships with other European studios, such as
Doghouse Films, which was set up with Belgian producer Walking The Dog in 2012. Fabrique d’Images is the largest of the four studios, employing around 100 people, and has partnered with French distributor KMBO and Belgian producer Frakas Productions on separate joint ventures.

Meanwhile, the financing opportunities presented by the AFS means that numerous international production and distribution companies have set up a presence in Luxembourg to tap into the film fund, some of which include animation among their activities.

Working remotely

Since 2020 and the Covid-19 pandemic, the working-from-home revolution has meant many of those working for a Luxembourg animation studio do so while living in another country. Meanwhile, many of those who do come into the studio to work do so by commuting from nearby France or Belgium.

Working for a Luxembourg studio has its benefits as they tend to pay higher wages comparative to other European studios, as the country has one of the world’s highest GDP per capita. However, this also means that living in Luxembourg is prohibitively expensive, with the cost of living also being higher compared to France or Belgium.

With animation producers in high demand around Europe, Luxembourg studios are facing stiff competition from other countries in the fight to recruit talent, something that is expected to only grow in the coming years.

Given its small size compared to its neighbours and its reliance on working with them, Luxembourg is highly vulnerable to external forces, and this leaves it at a disadvantage when it comes to growing its own animation sector. However, there is no doubting the quality of the output of Luxembourg animation studios, which, together with its generous film fund, will stand it in good stead for the future.