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In January 2015 it was announced that Panahi's film Taxi was scheduled to premiere in competition at the 65th Berlin International Film Festival. Panahi was awarded the Golden Bear for the film at the festival.

In December 2014 Panahi won a 2014 Motion Picture Association Academy Film Fund grant for $25,000 for the screenplay Flower (Gol). He was awarded the grant at the 8th annual Asia Pacific Screen Awards in Brisbane, Australia. The script is about disabled people in Iran and will be directed by Panahi's son Panah Panahi. Panahi will be the executive producer of the film. It has been described as exploring "the turmoil created by a father’s conviction that he must kill his disabled son to bring peace to his family. This challenging drama is drawn from real life, and brings home the plight of people with disabilities in Iran. This film will be directed by Jafar’s son, Panah, who is an emerging director of distinction and shares his father’s humanist concerns."

Panahi says his style can be described as "humanitarian events interpreted in a poetic and artistic way". "In a world where films are made with millions of dollars, we made a film about a little girl who wants to buy a fish for less than a dollar [The White Balloon]—this is what we're trying to show", he said. Panahi has said that "in all of my films, you never see an evil character, male or female. I believe everyone is a good person."

Dabashi praises Panahi's restrained depiction of violence, saying that his "manner of showing violence without showing who has perpetrated it has now become a trademark of Panahi's cinema." Dabashi specifically cites Razieh's brother in The White Balloon as clearly having been beaten in one scene, but only being given hints of the violence of Razieh's father from off screen. In The Circle Nargress has been beaten but we are never told why or by whom. Dabashi writes, "violence in Panahi's cinema is like a phantom: you see through it, but it lacks a source or physical presence—who has perpetrated it is made intentionally amorphous. The result is a sense of fear and anxiety that lurks in every frame of his film, but it is a fear without an identifiable referent."

At age 20 Panahi was conscripted into the Iranian army and served in the Iran–Iraq War, working as an army cinematographer from 1980 to 1982. In 1981 he was captured by Kurdish rebels and held for 76 days. From his war experiences he made a documentary that was eventually shown on TV. After completing his military service, Panahi enrolled at the College of Cinema and TV in Tehran, where he studied filmmaking and especially appreciated the works of Alfred Hitchcock, Howard Hawks, Luis Buñuel, and Jean-Luc Godard. At school he first met and befriended filmmaker Parviz Shahbazi and cinematographer Farzad Jodat, who shot all of Panahi's early work. During college he interned at the Bandar Abbas Center on the Persian Gulf Coast, where he made his first short documentary films. He also began working as an assistant director on his Professor's films before graduating in 1988.

In March 2013 Columbia University professor Hamid Dabashi wrote an article highly critical of Panahi and his decision to continue making films and partially blaming him for the "tragic endings of Iranian cinema". Dabashi had previously written extensively about and praised Panahi's early career. Dabashi called Panahi's two post-arrest films "self-indulgent vagaries farthest removed from" his previous films and wrote that Panahi "should have heeded the vicious sentence and stayed away from his camera for a while and not indulge, for precisely the selfsame social punch that have made his best films knife-sharp precise has now dulled the wit of the filmmaker that was once able to put it to such magnificent use."

In June 2013 Panahi was invited to join The Academy of Motion Picture Arts and Sciences.

In August 2013, shortly after the election of Iranian President Hassan Rouhani, several well-known political prisoners were released. One such prisoner was Panahi's Sakharov Prize co-winner Nasrin Sotoudeh, whose release prompted European Parliament President Martin Schulz to say "We are eagerly waiting to welcome her in Strasbourg together with her Sakharov Prize co-winner, film director Jafar Panahi." A few days earlier the House of Cinema, Iran's largest professional guild for filmmakers, reopened after having been deemed illegal in January 2012.

On 26 October 2012 Panahi was announced as a co-winner of the European Parliament's Sakharov Prize. He shared the award with Iranian human rights lawyer Nasrin Sotoudeh. European Parliament President Martin Schulz called them "a woman and a man who have not been bowed by fear and intimidation and who have decided to put the fate of their country before their own". Catherine Ashton, the European Union High Representative of the Union for Foreign Affairs and Security Policy, said of the prize, "I am following the case of Nasrin Sotoudeh and other human rights defenders with great concern ... We will continue to campaign for the charges against them to be dropped. We look to Iran to respect the human rights obligations it has signed up to". Panahi's daughter Solmaz accepted the award.

In October 2012 Kiarostami told a journalist that Panahi had completed a new film that he predicted would be screened in film festivals. In January 2013 the Berlin Film Festival announced that it would premiere Closed Curtain (Pardeh) at its 2013 festival. This film was co-directed by Panahi and Kambozia Partovi, who both appear in it along with cast members Maryam Moqadam and Hadi Saeedi. Berlin Film Festival director Dieter Kosslick is a longtime supporter of Panahi and said that he "asked the Iranian government, the president and the culture minister, to allow Jafar Panahi to attend the world premiere of his film at the Berlinale." In the film Partovi and Moqadam star as two people wanted by the police who hide out in a house on the Caspian Sea and always keep the curtains closed to avoid detection. The film was shown in competition at the 63rd Berlinale in February 2013. Panahi won the Silver Bear for Best Script.

On 15 October 2011, a court in Tehran upheld Panahi's sentence and ban. Following the decision, Panahi was placed under house arrest. He has since been allowed to move more freely but he cannot travel outside Iran.

Cine Foundation International, a "nonprofit film company and human rights NGO aiming to 'empower open consciousness through cinema'" announced on 3 January 2011 that it was launching a campaign of protest films and public actions calling for Panahi's release. "The campaign will include protest films that speak to human rights issues in Iran and throughout the world, six of which are commissioned feature-length, plus twenty shorts. Participating filmmakers may act anonymously or through pseudonyms since voicing their stories can be dangerous. The films, which will address themes of nation, identity, self, spiritual culture, censorship and imprisonment, will be aimed for public, web and various exhibition media". Later in January, CFI deployed a video protest mechanism called White Meadows (named for the Mohammad Rasoulof film The White Meadows, which Panahi edited) and developed by Ericson deJesus (of Yahoo! and frog design) at the foundation's request. The video mechanism "allow(s) anyone in the world to record a short video statement about Panahi and Rasoulof. There will be an ESCAPE button at top, allowing quick exit for those in countries where recording a statement would be dangerous. There will an option to have the screen black, and soon, voice distortion. The video statements will be recorded as mp4s, giving them maximum transmedia capacity, which essentially makes them broadcastable from any device that can show video". Users can also use the mechanism to comment on how they would "like to see as an international response by the film industry", comment on the state of human rights in general, or "report a human rights abuse to the world".

In his March 2011 greetings to the Iranian people on the occasion of the Iranian New Year, U.S. President Barack Obama cited Panahi's case as an example of Iran's oppressive regime. In April 2011 Time Magazine placed Panahi third on its list of the Top 10 Persecuted Artists who have challenged authority.

In Spring 2011 Boston's American Repertory Theater and System of a Down's Serj Tankian dedicated their production of Prometheus Bound to Panahi and seven other activists, stating in program notes that "by singing the story of Prometheus, the God who defied the tyrant Zeus by giving the human race both fire and art, this production hopes to give a voice to those currently being silenced or endangered by modern-day oppressors".

In the middle of the controversy and court appeal, Panahi broke the ban imposed on him from making films and made the documentary feature This Is Not a Film (2011) in collaboration with Iranian filmmaker Mojtaba Mirtahmasb. The film was made for €3,200 and shot on a digital camcorder and an iPhone. It was shot in four days over a ten-day period in March 2011 and its title was inspired by René Magritte's painting The Treachery of Images. In the film Panahi sits in his apartment making phone calls about his court case, watching TV news stories, interacting with his neighbors, talking about his past films and describing scenes from the film that he had begun shooting when he was arrested (much as he had described scenes from films to his sisters as a child). Ten days before the opening of the 2011 Cannes Film Festival, This Is Not a Film was announced as a surprise entry into the festival. It was smuggled out of Iran on a USB thumb drive that had been hidden inside a cake. Panahi's wife and daughter attended the festival. In December 2012 it was shortlisted as one of 15 films eligible for Best Documentary Feature at the 85th Academy Awards.

After several years of conflict with the Iranian government over the content of his films (including several short-term arrests), Panahi was arrested in March 2010 along with his wife, daughter, and 15 friends, and later charged with propaganda against the Iranian government. Despite support from filmmakers, film organizations, and human rights organizations around the world, in December 2010 Panahi was sentenced to six years in prison and a 20-year ban on directing any movies, writing screenplays, giving interviews with Iranian or foreign media, or leaving the country except for medical treatment or making the Hajj pilgrimage. While awaiting the result of an appeal he made This Is Not a Film (2011), a documentary feature in the form of a video diary. It was smuggled out of Iran on a flash drive hidden inside a cake and shown at the 2011 Cannes Film Festival. In February 2013 the 63rd Berlin International Film Festival showed Closed Curtain (Pardé) by Panahi and Kambuzia Partovi in competition; Panahi won the Silver Bear for Best Script. Panahi's subsequent film Taxi also premiered in competition at the 65th Berlin International Film Festival in February 2015 and won the Golden Bear, the prize awarded for the best film in the festival. In 2018 he won the Cannes film festival Award for Best Screenplay (tied) for 3 Faces; he was unable to leave Iran to attend the festival, so his daughter, Solmaz Panahi, read his statement and received the award on his behalf.

In February 2010 Panahi's request to travel to the 60th Berlin Film Festival to participate in the panel discussion on "Iranian Cinema: Present and Future. Expectations inside and outside of Iran" was denied.

On 1 March 2010 Panahi was arrested again. Plainclothes officers took him, his wife Tahereh Saidi, daughter Solmaz Panahi, and 15 of his friends to Evin Prison. Most were released 48 hours later, and Mohammad Rasoulof and Mehdi Pourmoussa on 17 March 2010, but Panahi remained in section 209 inside Evin Prison. The government confirmed his arrest but did not specify the charges.

On 14 April 2010, Iran's Ministry of Culture and Islamic Guidance said that Panahi had been arrested because he "tried to make a documentary about the unrest that followed the disputed 2009 reelection of President Mahmoud Ahmadinejad."

On 20 December 2010, after convicting Panahi of "assembly and colluding with the intention to commit crimes against the country’s national security and propaganda against the Islamic Republic," the Islamic Revolutionary Court sentenced him to six years' imprisonment and a 20-year ban on making or directing any movies, writing screenplays, giving interviews to media, or leaving Iran except for Hajj holy pilgrimage to Mecca or medical treatment. Panahi's colleague Mohammad Rasoulof also received six years' imprisonment but that was reduced to one year on appeal.

On 8 March 2010 a group of well-known Iranian producers, directors and actors visited Panahi's family to show their support and call for his immediate release. After more than a week in captivity, Panahi was finally allowed to call his family. On 18 March 2010 he was allowed to have visitors, including his family and lawyer. Iran's culture minister said on 14 April 2010 that Panahi had been arrested because he "was making a film against the regime and it was about the events that followed election." In an interview with AFP in mid-March, Panahi's wife, Tahereh Saeedi, denied that he was making a film about post-election events, saying: "The film was being shot inside the house and had nothing to do with the regime."

In mid-March 50 Iranian directors, actors and artists signed a petition seeking Panahi's release. American film directors Paul Thomas Anderson, Joel & Ethan Coen, Francis Ford Coppola, Jonathan Demme, Robert De Niro, Curtis Hanson, Jim Jarmusch, Ang Lee, Richard Linklater, Terrence Malick, Michael Moore, Robert Redford, Martin Scorsese, James Schamus, Paul Schrader, Steven Soderbergh, Steven Spielberg, Oliver Stone, and Frederick Wiseman signed a letter on 30 April 2010 urging Panahi's release. The petition ends, "Like artists everywhere, Iran’s filmmakers should be celebrated, not censored, repressed, and imprisoned." He was named a member of the jury at the 2010 Cannes Film Festival but because of his imprisonment he could not attend, and his chair was symbolically kept empty.

On 23 December 2010 Amnesty International announced that it was mobilizing an online petition spearheaded by Paul Haggis and Nazanin Boniadi and signed by Sean Penn, Martin Scorsese, Harvey Weinstein and others to protest Panahi's sentence.

On 30 July 2009 Mojtaba Saminejad, an Iranian blogger and human rights activist writing from Iran, reported that Panahi had been arrested at the cemetery in Tehran where mourners had gathered near the grave of Neda Agha-Soltan. He was able to contact friends in the film industry, both in Iran and internationally, and filmmakers and the news media pressured the Iranian government to release him. He was detained for eight hours. The Iranian government claimed he had been arrested by mistake.

In September 2009 Panahi travelled to Montreal to act as the Head of the Jury at the 2009 Montreal World Film Festival. At the festival he convinced the entire jury to wear green scarves during the opening and closing ceremonies in solidarity with the Green Movement in Iran. He also openly supported and appeared in photographs with Iranian Green Movement protesters at the festival.

In 2006 Panahi made Offside. In the film, a group of young Iranian girls disguise themselves as boys to sneak into Azadi Stadium to watch the World Cup qualifying football playoff game between Iran and Bahrain. The film was partially shot during the actual game it depicts. Since the 1979 Islamic Revolution women have been banned from attending football matches in Iran on grounds of rowdy and aggressive language, lewd behavior, and seeing men in shorts and short sleeve shirts. At one point Mahmoud Ahmadinejad had wanted to repeal the law but was overruled by the ulema. Panahi has stated "I use the football game as a metaphor to show the discrimination against women on a larger scale. All my movies have that topic at their center. This is what I am trying to change in Iranian society." The film was inspired by an incident several years earlier when Panahi's daughter was refused entry to a football stadium but ended up sneaking into the stadium anyway.

The film premiered in competition at the 2006 Berlin Film Festival, where Panahi was awarded with the Silver Bear Jury Grand Prix. Like The Circle and Crimson Gold before it, Offside was banned from being shown in Iran. Panahi had already set up distribution for the film all over Iran and the film was predicted to break all box office records. Two days after being banned and twenty days before the World Cup championship game, unlicensed DVD copies of the film became available all over Iran. Panahi has stated that of his films Offside is "probably the one that people have seen the most" in Iran. After the film's release a feminist protest group in Iran called the White Scarf Girls began showing up at football matches carrying banners that read: "We don't want to be Offside" Sony Pictures Classics, the film's U.S. distributor, wrote a letter to the Ministry of Guidance in Iran requesting that the film be shown for at least one week in its home country so that they could launch a campaign to nominate the film for Best Foreign Language Film, but the Ministry refused.

Panahi directed Crimson Gold in 2003, produced by Jafar Panahi Productions. The film depicts an impoverished pizza delivery man's failed attempt to rob a jewelry store and the events that drove him to his crime. The story is based on real events that Panahi first heard about when Kiarostami told him the story while they were stuck in a traffic jam on their way to one of Kiarostami's photographic exhibits. Panahi was extremely moved by the story and Kiarostami agreed to write the script for him to direct. Panahi submitted the film to the Cannes Film Festival without being granted a permit from the Ministry of Culture and Islamic Guidance. Panahi had applied for the permit but the Ministry demanded several cuts be made to the film. Panahi refused and submitted the film anyway. At the festival it won the Un Certain Regard Jury Award. It later won the Golden Hugo Award for Best Film at the Chicago International Film Festival. Like The Circle, Crimson Gold was banned in Iran.

In 2003 Panahi was arrested and interrogated for four hours by the Information Ministry in Iran, then released after being encouraged to leave Iran.

On 15 April 2001 Panahi stopped over at JFK International Airport in New York City en route from Hong Kong to Buenos Aires, where he was to participate in a film festival. He was immediately detained by police officers who wanted to fingerprint and photograph him; Panahi refused both requests on the grounds that he was not a criminal. He was threatened with jail and refused an interpreter or a phone call. After being handcuffed and detained at the airport until the next morning, he was finally allowed to make a phone call to his friend Professor Jamsheed Akrami. He was finally photographed and sent back to Hong Kong.

In 2000 Panahi made The Circle, produced by Jafar Panahi Film Productions and Mikado-Lumiere&Co. Although Panahi claimed that he was not a political filmmaker, his third feature was a major departure from his first two works about children and is critical of the treatment of women under Iran's Islamist regime. Panahi has stated that "I started my career making children’s films, and while doing that I had no problems with censors. As soon as I started making feature films, it all started and I had problems," but that "in my first films, I worked with children and young people, but I began to think of the limitations facing these girls once they grow up. In order to visualize these limitations and to have this constraint better projected visually, I went to a social class, which has more limitations to areas that are more underprivileged, so that this idea could come out ever stronger." He had to wait an entire year to get an official shooting permit.

Panahi was quickly recognized as one of Iran's most influential filmmakers. His films were often banned in Iran, but he continued to receive international acclaim from film theorists and critics and won numerous awards, including the Golden Leopard at the Locarno International Film Festival for The Mirror (1997), the Golden Lion at the Venice Film Festival for The Circle (2000), and the Silver Bear at the Berlin Film Festival for Offside (2006). His films are known for their humanistic perspective on life in Iran, often focusing on the hardships of children, the impoverished, and women. Hamid Dabashi has written, "Panahi does not do as he is told—in fact he has made a successful career in not doing as he is told."

In 1997 Panahi made the documentary short film Ardekoul. In 2007 he contributed the short film Untying the Knot to the omnibus film Persian Carpet. The film contains one single long take and is inspired by his childhood. In 2010 he made the short film The Accordion, which was commissioned for the THEN AND NOW Beyond Borders and Differences series of short film by Art for The World. It premiered at the 2010 Venice Film Festival. Panahi has referred to the situation in Iran as "the dark ages for filmmaking in Iran" and that he was "presenting the future with something to see, a document of what life was like at that time."

Panahi's second feature film was The Mirror, produced by Rooz Films. Initially Panahi was going to direct Kiarostami's script for Willow and Wind, but he decided to pursue his own work instead. Panahi was inspired to make the film when while attending the 1996 Pusan International Film Festival in South Korea he noticed a young girl sitting alone on a park bench staring blankly into space, and realized that he had seen this same thing countless times in Iran and never paid attention to it. He has stated that he "choose a precocious child and placed her in a situation where she is left to her own devices. Everyone she meets on her journey is wearing a mask or playing a role. I wanted to throw these masks away." The film stars Mina Mohammadkhani, the sister of Aida Mohammadkhani. In the film Mohammadkhani could be said to play two characters: the role of a little girl named Baharan and then herself as the film shifts into a documentary mode. Panahi reported casting her after having detected " a feeling of emptiness within her, and a determination to prove herself to the world." It received the Golden Leopard Award at the Locarno Film Festival, the Special Jury Award and Best Director Award at the 1998 Singapore International Film Festival, the Golden Tulip Award at the 1998 Istanbul Film Festival, the FIPRESCI Prize and the Eisenstein Magical Crystal and Cash Award at the 1998 Riga International Film Festival, and Buñuel's Golden Era Award at the Royal Archive Film Festival in Belgium.

In 1995 Panahi made his feature film debut, The White Balloon (Badkonak-e sefid), produced by IRIB- Channel 2, Ferdos Films and the Farabi Cinema Foundation. Initially titled Happy New Year, Panahi developed the original story with Parviz Shahbazi and attempted to get funding from IRIB's Channel 1 with the expectation that it would be a short film, but his proposal was rejected. He then showed his original treatment for the film to Kiarostami during the shooting of Through the Olive Trees. Kiarostami encouraged Panahi to make the idea into a feature and agreed to write the script. During their car rides to set while shooting, Kiarostami would dictate the film's script while Panahi taped the conversation and typed the script. Kiarostami also helped Panahi secure funding from IRIB's Channel 2. While casting the film, Panahi traveled throughout Iran in order to include all of the diverse ethnicities of his country as characters in the film. He found lead actress Aida Mohammadkhani at the first school that he visited and immediately cast her as Razieh, but auditioned 2,600 young boys for the role of Razieh's brother Ali before settling on Mohsen Kalifi. He cast non-professionals in most of the supporting roles, including a real fish seller he found in the Rasht market and a college student to portray the young soldier. He also cast professional actress Anna Borkowska as an Armenian woman.

It went on to win four prizes in Iran at the Isfahan Film Festival for Children and Young Adults and at the Fajr International Film Festival. For several years after its release, Kanoon's Channel 2 would broadcast the film every year on New Year's Day. Outside of Iran The White Balloon received excellent reviews and was shown at the 1995 Cannes Film Festival, where it won the Camera d'Or. It also won the Golden Award of the Governor of Tokyo for Best Film and the Bronze Dragon for Best Film of Young Cinema at the 1995 Tokyo International Film Festival, the International Jury Award at the 1995 São Paulo International Film Festival and the Best Film Award at the 1996 Cinéfest Sudbury International Film Festival. It was Iran's official submission for Best Foreign Language Film at the 68th Academy Awards; however, the Iranian government asked the Academy to withdraw the film after Iran's relations with the US began to deteriorate. The Academy refused to withdraw the film, which was not nominated, and Panahi was forbidden by the Iranian government to travel to the Sundance Film Festival or to participate in phone interviews with US reporters to promote the film.

In the film Razieh, a strong-willed little girl in Tehran, wants to buy a lucky goldfish for the upcoming Iranian New Year celebration, but struggles to get and hold on to the 500-toman banknote needed to purchase the fish. Panahi worked closely with Mohammadkhani, gaining her trust and acting out each scene for her to mimic while still adding her own personality to the performance. Panahi was most concerned about Mohammadkhani being able to cry on cue, so he would have her stare at him off camera while he started to cry, causing her to cry. Filming began in early April 1994 in Kashan, Iran and continued until early June. Panahi has stated that during the making of his feature debut he "wanted to prove to myself that I can do the job, that I can finish a feature film successfully and get good acting out of my players." He also stated that "In a world where films are made with millions of dollars, we made a film about a little girl who wants to buy a fish for less than a dollar – this is what we’re trying to show." In Iran, films depicting children are the most likely to avoid censorship or political controversy, and The White Balloon was screened exclusively in theatres that specialized in children's films. Because of this the film had low attendance on its initial run in Iranian theatres, with only 130,000 tickets sold.

In 1992 Panahi made his first narrative short film, The Friend (Doust), an homage to Kiarostami's first short film, The Bread and Alley. That same year Panahi made his second narrative short, The Final Exam (Akharin Emtehan). Both films starred non-professional actors Ali Azizollahi and Mehdi Shahabi and won awards for Best Film, Best Screenplay, Best Cinematography, and Best Editing at Iran's National TV Festival that year. Inspired by a story of a young Luis Buñuel once contacting successful film director Jean Epstein to ask for a job in filmmaking, Panahi left a message on Kiarostami's answering machine saying that he loved his films and asking for a job on his next film. Kiarostami hired Panahi as his assistant director for the film Through the Olive Trees. He had seen several of Panahi's short films and in 1995 said he was "extremely gifted and can be a promising figure in our cinema's future."

Panahi made several short documentary films for Iranian television through the Islamic Republic of Iran Broadcasting's Channel 2. His first short film, The Wounded Heads (Yarali Bashlar), was a documentary about the illegal mourning tradition of head slashing in the Azerbaijan region of northern Iran. The film documents a mourning ceremony for the third Shi'ite Imam, Imam Hossein, in which people hit their heads with knives until they bled. Panahi had to shoot in secret and the film was banned for several years. In 1988 Panahi filmed The Second Look (Negah-e Dovvom), a behind-the-scenes documentary short on the making of Kambuzia Partovi's film Golnar. It focuses on the puppet maker for Partovi's film and his relationship with his puppets. It was not released until 1993. In 1990 he worked as an assistant director on Partovi's film The Fish (1991).

Panahi is married to Tahereh Saidi, whom he first met in college when she was working as a nurse. They have a son, Panah Panahi, born in 1984, and a daughter, Solmaz Panahi. Panah Panahi attended the University of Tehran and in 2009 made his first short film, The First Film, which was screened at the 2009 Montreal World Film Festival. Solmaz studied theater in Tehran.

Jafar Panâhi (Persian: جعفر پناهی ‎, [d͡ʒæˈfæɾ pæˈnɒːhiː] ; born 11 July 1960) is an Iranian film director, screenwriter, and film editor, commonly associated with the Iranian New Wave film movement. After several years of making short films and working as an assistant director for fellow Iranian filmmaker Abbas Kiarostami, Panahi achieved international recognition with his feature film debut, The White Balloon (1995). The film won the Caméra d'Or at the 1995 Cannes Film Festival, the first major award an Iranian film won at Cannes.