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Suha Arraf identified her film Villa Touma” as Palestinian at the Venice Film Festival. Israel, which helped fund the movie, objected. Credit Villa Touma
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Like most film festivals around the world, the Toronto International Film Festival provides audiences with standard information about the movies on its menu: screening dates and times, duration, director. Also, nationality: The 366 films at last month’s festival came from 70 countries; each of the films had a geographic designation. All, that is, except one.

Villa Touma,” a darkly comic fable directed by a Palestinian-Israeli screenwriter, Suha Arraf, had been experiencing an identity crisis well before it got to Canada. At the Venice Film Festival a week or so earlier, Ms. Arraf (“Lemon Tree”) listed the film as “Palestinian,” and in doing so kicked up a media and bureaucratic storm. Since most of her financing came from Israeli state sources, the political establishment argued that “Villa Touma” should have been considered Israeli. The Israeli Film Council demanded the return of more than $500,000 Ms. Arraf raised from the Israeli Film Fund, the Economic Ministry and the national lottery.

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Suha Arraf, who wrote and directed “Villa Touma.” Credit Kathleen McInnis

The response online and in the Israeli press to Ms. Arraf, was not, generally speaking, kind. “It was crazy,” Ms. Arraf said in Toronto. “They said I stole Israeli money, they said I’m a whore, of course, and a suicide bomber.” She continued: “When I talk about it here, and people hear about the story, they start laughing and ask me to write a comedy about it. A comedy. Nobody would believe me if I wrote the script.”

Set in 2001, the film tells of three Christian sisters who have cloistered themselves since the 1967 Six-Day War inside their once-elegant Ramallah home in the West Bank (though, aside from some exteriors there, the film was largely shot in Haifa, Israel). When a niece comes to live with them, their insular existence starts to dissolve. Featured are the Palestinian actresses Nisreen Faour, Ula Tabari and Maria Zreik, along with Cherien Dabis, the Palestinian-American director (“Amreeka”), making what she called a long-delayed acting debut.

“It was so refreshing,” she said of Ms. Arraf’s script. “It’s about a world we’ve never seen, a segment of Palestinian society that’s just lost. It’s about women’s lives, their intimacy. The humor was there, the pacing was there.”

Reviews in the trade publications Variety and The Hollywood Reporter were decidedly negative, although few critics not at the September festivals have been able to see the movie. Even writers and critics in Israel had to wait for an Oct. 17 screening at the Haifa International Film Festival. New York audiences will get a chance Nov. 7 and 9 at the Other Israel Film Festival, which also helped finance the film.

“We saw a rough cut at Haifa last year and decided to support it,” said Isaac Zablocki, the Other Israel Festival programmer and director of the Israel Film Center at the JCC Manhattan, the Upper West Side community center. Among other reasons, he said, “Villa Touma” articulated his festival’s mission of giving a forum to disparate voices in Israel, in this case Palestinians and Christians.

Ms. Arraf argued that “films all over the world belong to the artists, not to the funds and not to the countries.” In the end, the Film Council decided not to sue, but Raphael Gamzou, the deputy director general of Israel’s Foreign Affairs Ministry in charge of cultural and scientific relations, said her actions were plainly political. He said that he understood the complexities of being an Arab citizen of Israel, but that Ms. Arraf acted with a “lack of integrity.”

“The fact that she gets the money from the Israeli establishment and then, when the moment of registration comes, she registers the film as Palestinian, this is definitely a kind of collaboration with the trend of delegitimizing Israel and its existence,” Mr. Gamzou said. He contended that the “Villa Touma” issue could affect future funding for Israeli-Palestinian filmmakers.

One such artist, the director Tawfik Abu Wael (“Last Days in Jerusalem”), agrees. “What will happen next to an Arab citizen in Israel who identifies himself as Palestinian?” he wrote via email. “Or to a Jewish artist who sympathizes with Palestinian suffering? I am concerned of a day to come when the right-wing government in Israel will silence directors and artists, Arabs and Jews as well, in the name of patriotism.”

The Israeli director Samuel Maoz (“Lebanon”), writing in the Israeli daily Haaretz, said that, in a sense, Ms. Arraf had already given the funds back: “The money supported the families of the photographer, the editor, the carpenter who built the scenery, the owner of the mini-market who provided sandwiches for the production, the electrician who is paying a mortgage, the seamstress who is supporting her student son, the driver, the cook, the gofer, the security guard and dozens of other Israeli citizens.”

Film identity has become a muddier issue as co-productions have become more common. At the Sundance Film Festival, the rules state that if more than 50 percent of its financing comes from a specific country, a film is categorized accordingly. At the Toronto festival, a spokeswoman, Genevieve Parent, said: “Our protocol is to cite the country of origin of the film based on where the majority of funding comes from: Israel, in the case of this film. We felt that citing no country of origin was a practical solution. All parties agreed.”

At the Oscars, distinctions are more nuanced. “The Foreign Language Film Award Committee of the Academy never considers where a film’s financing comes from, never,” said Mark Johnson, the committee’s longtime chairman. He said in his 12 years, members have never discussed financing. Instead, “we examine the nationality of the director, the writer, the producer, the cast, the director of photography, with added weight given the director and writer.”

Which would suit Ms. Arraf just fine.

“To me, it’s very silly,” she said. “The story is Palestinian, the actresses are Palestinian, it takes place in Palestine. It’s my basic right as a human being to present my film according to the artistic identity of the film. I believe in freedom of art and this is my issue. The film contains not a single word of Hebrew. Yes, half my crew was Israeli. But so what?”