Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2018

Sales and Use Tax Annotations

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375.0000 MOTION PICTURES—Regulation 1529

Annotation 375.1097


(1) Generally

375.1097 Transfer of Exploitation Rights. Section 6010.6 (a)(2)(B) of the Sales and Use Tax Law excludes from the definition of sale, the transfer, under certain circumstances, of any interest in a motion picture which has been exhibited or broadcast.

The required circumstances are that the transfer be to a person holding either directly, indirectly, or by affiliation, any exploitation rights obtained prior to the date the motion picture is exhibited to its general audience. Indirectly refers to the holding of a controlling interest in an entity which holds exploitation rights; by affiliation refers to a transfer to an entity which is controlled by the person holding exploitation rights.

Transfers of rights between a parent company and multiple subsidiaries in which the parent has the majority interest are not sales if the parent holds exploitation rights. The transfer of rights from a partnership to the majority partner whose subsidiary held the exhibition license is also excluded from the definition of sale. 7/18/89.