Sir Ian McKellen is not "under contract" to appear in 'The Hobbit'.

The British actor - who has appeared as wizard Gandalf in the previous 'Lord Of The Rings' movies - says things could be "complicated" if he goes into detail but he is not currently set to work on the prequel, which begins shooting early next year.

He told Broadway World: "I am not under contract no. I'm not going to say any more than that because it might complicate things!

So I would say - at the moment - no, I am not under contract. I'm not saying any more than what I've said."

'The Hobbit' has experienced a large number of problems around its production.

Problems with financing at MGM Studios led to the film being halted, which consequently saw the end of Guillermo Del Toro's association as director of the movie.

Acting unions also called for a boycott on the film claiming the "makers" of the movie refused to "engage performers on union-negotiated agreements" regarding payments, cancellation fees and working conditions.

However in recent weeks 'The Hobbit' has seen some good news, with new director Peter Jackson coming on board and British star Martin Freeman signing on as lead character Bilbo Baggins.

The film begins shooting in New Zealand in February 2011.