“Mediapro will produce the new Woody Allen film,” a company spokesperson said, before adding: “The project is in an initial phase, we cannot therefore provide details.”
A well-informed source told AFP that Allen, 83, would work in San Sebastien, capital of the Spain's northwest Basque region.
The Basque daily El Diaro Vasco reported meanwhile that an advance team had been spotted in the city.
The new Spanish project continued the US film director's cinematic love affair with major European cities.
In 2008, Allen released “Vicky Cristina Barcelona”, which was set in the Catalan capital as well as Oviedo, in Asturias, and was also financed by Mediapro.
The company also produced Allen's 2011 film “Midnight in Paris”.
Other Allen films have been set in Rome and London.
Earlier this month Allen filed a $68 million suit against Amazon for breach of contract, accusing the streaming giant of cancelling a film deal because of a “baseless” decades-old allegation that he sexually abused his adopted daughter.
The film in question “A Rainy Day in New York”. has been completed but not released.
The allegations that Allen had sexually abused the then seven-year-old first emerged in the 1990s during the custody battle between Farrow and Allen but were shrugged off after Allen denied the claims.
But in 2014, Dylan repeated the allegations in an open letter published in the New York Times calling for actors to stop working with him. Again, she was largely ignored.
Now aged 32, Dylan reiterated the allegations in the #MeToo movement and Time's Up campaign – which grew out of the Harvey Weinstein sexual abuse scandal, giving an emotional interview describing specific details of an alleged assault in the summer of 1992 in an attic in Connecticut.
Full transcript of our report is available here: https://t.co/khZMx2RVyi
— CBS This Morning ❄️ (@CBSThisMorning) January 18, 2018
Actors famous for roles in Allen’s films have now come out publicly to say they believe Dylan and would not work with Allen again, including Rebecca Hall, Colin Firth, Mira Sorvino, Natalie Portman and Reese Witherspoon.
Spanish Oscar-winning actor Javier Bardem. who starred in Allen's Vicky Cristina Barcelona has jumped to the director's defence.
“I don’t agree with the public lynching that he’s been receiving,” Bardem said in 2018. “And if Woody Allen called me to work with him again I’d be there tomorrow morning. He’s a genius.”