Hailed as a historic decision, the French parliament has greenlit 20% tax rebates for U.S. and other foreign shoots in France.

Applied to overseas shoots’ expenditures in Gaul, the rebates will be capped at e4 million ($5.7 million) per film. They will cover labor costs, accommodation, transport and the use of local animation and VFX houses.

Movies, miniseries, series and TV movies will be eligible for the rebates.

Documentaries will also be eligible but as the rulings require spending a minimum of $1.4 million in France, not many will qualify.

However, movie shoots receiving CNC French state subsidies will not be eligible for the rebate. That rules out co-productions, but opens the door for U.S. and Japanese films as neither country has co-production treaties with France.

Films wishing to apply for rebates will face cultural tests, as in the U.K. and Germany, demanding above-the-line French talent or cultural elements. These criteria still have to be clarified.

Included in France’s budget for 2009, the regs were introduced to the lower-house national assembly by the senate Wednesday and are expected to pass unchallenged — reversing Gaul’s long-held policy of guarding its domestic biz by refusing to offer coin to foreign pics.

Rebates will be channeled through local companies handling foreign shoots, which can pass on the tax breaks to their client, said Patrick Lamassoure, managing director of Film France, the national film commission.

The major benefit of the rebates, he added, will be that movies set in France will now be shot in France.

“They won’t have to fake. We will be aiming for any foreign production that has France in the script. It doesn’t mean we’ll be far cheaper than our closer neighbors but France is back in the market,” Lamassoure added.

Estimates suggest France loses some $70 million-$100 million a year in coin that foreign pics would’ve spent in the country.

Olivier-Rene Veillon, executive director of the Ile de France Film Commission, agreed.

“If we had tax breaks available last year, like Germany, we could have had Quentin Tarantino shooting ‘Inglourious Basterds’ in France for three more weeks,” said Veillon. “And instead of spending $300,000 in France, he would have spent $3 million.”

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