How emerging location contract clauses threaten production workflows – and what productions can do about it.

As artificial intelligence (AI) and digital scanning tools become embedded in modern production workflows, a growing number of filming locations are introducing restrictive clauses in their contracts. These provisions target AI use and digital replication technologies and are often vaguely worded, presenting real hurdles not just during filming, but throughout post-production and even distribution.

For producers, location managers, legal teams, and VFX supervisors, understanding these emerging risks is now essential.

The most challenging clauses fall into two areas:

AI platform restrictions

Many location agreements now ban uploading any location footage or images to AI-driven platforms – especially those that use or share data externally. These restrictions can cover:

• Generative content tools (e.g., text-to-video or image synthesis)
• Virtual set/environment generation
• Cloud-based editing systems with AI-enhanced tools

Some contracts allow “AI-powered enhancement tools” but the line between what’s permitted and what’s not remains blurry. Is using AI to clean plates acceptable? What about a cloud-based colour grading platform with automated scene matching? Often, it’s unclear and that’s a problem.

Digital replica prohibitions

Even more disruptive are blanket bans on creating “Digital Replicas.” This broad term can include:

• 3D scans of environments (LiDAR, photogrammetry)
• 360° captures and volumetric video
• Virtual backdrops for VFX and LED volume stages

These are no longer niche techniques – they’re standard tools for efficient, flexible filmmaking. By prohibiting them without express permission, contracts can derail production plans or force last-minute budget revisions.

The implications can be significant:

• Post-production uncertainty: Will standard editing pipelines be interpreted as violating AI restrictions?
• VFX delays and cost spikes: What was once a routine environment capture now requires approvals or new fees.
• Distribution risks: Vaguely written clauses referencing “AI-driven platforms” or “content sharing” could technically implicate streaming services that use recommendation algorithms, potentially limiting the ability to distribute content freely.
• Legal exposure: Many contracts now give location owners the right to seek injunctions for breach of these provisions, not just monetary damages. That’s a serious escalation of risk.

At the heart of these restrictions is a legitimate concern: location owners don’t want their properties turned into reusable digital assets that can be repurposed for future productions without compensation.

That’s fair, but in most cases, the clauses go too far. By casting a wide net, they inadvertently capture routine, non-threatening production practices that don’t jeopardise the owner’s commercial interests.

The result is legal language that:

• Fails to distinguish between creating virtual stock assets and creating temporary assets for one-time use in connection with the production
• Increases red tape and fees for standard workflows
• Discourages innovation and digital efficiency

To avoid unexpected friction – or worse, delays – productions need to get proactive:

Address digital use upfront

Don’t wait until post. Discuss planned digital workflows, scanning tools, and VFX needs during location scouting and negotiations. Transparency builds trust and allows custom permissions to be crafted early.

Narrow the definitions

Push back on vague or expansive definitions like “AI platform,” “digital replica,” or “content distribution.” Seek language that specifically exempts:

• Digital assets used solely in connection with the production
• AI-powered editing tools with no third-party data sharing outside of the named production
• Standard post-production workflows already in common use
• Sharing of content in connection with the production, including any ancillary and derivative rights as are customarily exploited per industry norms e.g. merchandise for the film/TV show

Lock in permissions and fees

Don’t rely on “we’ll ask later.” Get written approvals for the use of any planned digital replication or AI-enhanced workflows. If fees are required, negotiate them into the deal upfront to avoid surprises.

Provide a “statement of intent”

A document outlining how the location will be filmed, what technology will be used, and what permissions are sought can help bridge the gap. These can be fed into the contract with explicit language confirming that these uses will not be considered a breach of any contractual restrictions.

As the film and TV industry becomes increasingly digital, production contracts must evolve to reflect the practical realities of modern operations. The challenge lies in protecting the rights of location owners without stifling creativity or innovation.

Achieving this balance requires genuine collaboration: contracts must be clear, fair, and grounded in day-to-day production demands. While producers are immersed in these realities, location owners may be less familiar with the complexities involved. That’s why it’s essential for location owners and their representatives to actively engage with industry norms and embrace reasonable flexibility. This mindset will enable smoother productions and enhance the value and competitiveness of their properties in an ever-changing market.

If you need support navigating AI and digital restrictions in your location agreements, our team would be delighted to help – please get in touch.