California Attorney General Rob Bonta announced a settlement with Paramount Global that mandates increased domestic film production and greater investment in the U.S. workforce as part of conditions attached to the company’s proposed merger. The agreement follows legal challenges from Bonta and a coalition of attorneys general, who had raised concerns over the potential impact of the $110 billion merger on competition and content quality.
Under the terms of the settlement, Paramount has committed to producing 30 feature films per year in the first two years following the merger, increasing to 32 annually in each of the subsequent three years. At least four of these films annually must be independent productions. The company also agreed to maintain a minimum theatrical release window of 45 days per film, a policy previously outlined by CEO David Ellison.
Paramount is required to boost domestic production spending by at least $300 million annually, emphasizing job creation and economic activity in the United States, with a particular focus on California. Should Congress pass a federal film tax credit, the company agreed to ensure that 20% of its film production occurs domestically in the first two years, rising to 30% in the following three years. In the event that states such as California or New York enact uncapped state film tax incentives, Paramount has pledged to raise its U.S.-based production share to at least 40%.
Bonta signaled his intention to pursue legislation establishing an uncapped California film tax credit to remain competitive with other regions offering robust incentives. Support for these tax measures aligns with broader industry efforts, as several members of Congress are reportedly drafting a 20% federal film and television incentive.
The settlement also imposes provisions to enhance labor relations and support independent content creation. Paramount must honor existing collective bargaining agreements and negotiate in good faith with unions. Additionally, the company will create independent editorial boards for CNN and CBS and is mandated to form an independent film fund, to which it will contribute annually to finance acquisitions of independent films. Workforce development will receive sustained attention through a $9.5 million yearly commitment toward training and career development in film and television production.
The legal pushback against the Paramount merger has included opposition from the Writers Guild of America, which filed suit asserting the merger breaches antitrust laws and threatens writers’ interests. Bonta criticized the proposed consolidation for potentially resulting in “higher prices, lower quality and less content” for consumers, affecting theaters, cable providers, and viewers nationwide.
Paramount, meanwhile, maintains that the merger will enhance its ability to compete by enabling greater investment in premium content, theatrical releases, and creative talent, promising benefits for the industry at large.