By Stephen Wright

WELLINGTON, New Zealand--Amazon Studios will move filming of its Lord of the Rings series to the U.K. despite New Zealand's offer of substantial extra subsidies to continue shooting the television show in the same place as the fantasy film trilogy.

The New Zealand government said Friday that Amazon's decision to end production in New Zealand after completion of the first season next year was part of a commercial move by the online-commerce giant to expand its U.K. production space.

Amazon would no longer qualify for an additional 5.0% subsidy of the first season's 664 million New Zealand dollars (US$465 million) production cost, it said.

New Zealand earlier this year said Amazon's subsidy would be increased to 25% from 20% if production remained in the country.

"The international film sector is incredibly competitive and highly mobile. We have no regrets about giving this production our best shot with government support," said New Zealand's Minister for Economic Development Stuart Nash.

Director Peter Jackson's films based on J.R.R. Tolkien's books on the mythical Middle Earth gave New Zealand a significant tourism boost before the pandemic and also helped to establish a local film production and special effects industry.

Write to Stephen Wright at stephen.wright@wsj.com

(END) Dow Jones Newswires

08-12-21 2047ET