| Commentary

348 Net distribution agreement

| Commentary

348 Net distribution agreement

Under a net distribution agreement the gross receipts derived by a distributor from a film are applied in the following order:

  1. 348.1

        The distribution fee1 is retained by the distributor.

  2. 348.2

        Distribution expenses2 are deducted and retained by the distributor.

  3. 348.3

        The balance remaining (if any) is paid back to the producer.

As the costs incurred by the distributor in respect of prints and advertising are likely to be significant. it may be some time before the distribution expenses have all been recovered. Until the point of recovery is reached, the producer will not

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