Develop reports that the European Commission has created a fund worth a total of €1.5m (close to £1m) specifically to support games developers.

The funds are direct aid and not repayable loans - it's the first time the EU's games developers have received such widespread financial backing, and comes as the EC's Media 2007 program puts a special focus on games development projects.

In a statement backing the move, the European Games Developer Federation (EGDF) said the games industry has finally "been recognized as increasingly economic and culturally important factor, whose special needs must be considered".

EGDF members include UK's Tiga, France's APOM, Sweden's Spelplan-ASGD, and a number of other local trade associations for games development - all of which have lobbied for government support of the industry.

The general secretary of the EGDF, Malte Behrmann, commented: “This is the first visible sign of the success of our political work with the European Commission.

"We hope now, as the European Union has acknowledged the importance of our industry, that the developer community will harvest the fruits of our work and make their submissions for prototype funding.

We would like to be informed about any experiences and problems any members have with the funding system, so that we can propose amendments if necessary."

Under the scheme, developers can claim €100,000 to support the production of PC, handheld and console prototypes. Projects already under way can claim from a minimum of €10,000 (£6,840) to €60,000 (£41,000).

The grant can cover up to half of the budget, with 60 per cent of the fund reserved for games that focus on the cultural heritage and diversity of Europe. To qualify, studios must have developed at least one successful game since the start of 2005 and the submission process is now open, with the first application round ending in November.

Detailed information including how to apply can be found at the EC site here and the EGDF site here.