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Taxing news: Will the EU really trample over our game developers?

Opinion: As France's greatest studios consider a move to Canada, Steve Boxer counts the cost...

Fantastic news has just come in from the EU for developers... the ones in Canada, Singapore and the US, that is.

Because it turns out that Brussels has effectively imposed a ban on tax breaks for developers across the whole of the European Union. Ironically, given that along with Germany, it is the country that goes in to bat most enthusiastically for the EU, France is the country whose games industry could be decimated by the latest high-handed - and utterly senseless - outbreak of supranationalism among the legendary lunchers of the Belgian capital.

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Apparently, tax breaks of any kind are ideologically forbidden by EU law, but in 2007, the French Government managed to negotiate a deal allowing it to provide tax relief to games developers.

The results were palpable: what was a previously small and distinctly ropey national development scene - as anyone who had the misfortune of playing pretty much anything published by the unlamented Infogrames will tell you - was transformed into a major player on the world stage.

Ubisoft, in particular, took advantage to grow into a major heavy-hitter: these days, it really snaps at the heels of EA and Activision.

But the agreement between the French Government and the EU expired at the start of 2012, and now it seems that the EU is being characteristically stroppy and obstructive about reintroducing it. A gentleman named Wouter Pieke, who luxuriates in the Orwellian job title of Head of Unit, EC Directorate General for Competition, would have to approve such a move, and French officials negotiating with him and his team are reportedly becoming worried that the new status quo will be here to stay.

It won't have an immediate effect, as any games already under development in France are still eligible for tax relief, but already Quantic dream co-CEO Guillaume de Fondaumiere has said that: "The abandonment of this flagship measure... would be an historic mistake."

He also pointed out that it would lead to a similar brain-drain among developers to that which is currently afflicting the UK. Where, of course, we have a Government that was enthusiastically in favour of games tax relief in opposition but changed its tune once it was voted in -- and which replaced a Government that was about to implement the measure when it was voted out.

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