China exceeds quota on Hollywood films amid box-office slowdown
China appears to have abandoned its strict foreign-film import quota in the final months of 2016 in order to bolster sagging annual box-office growth figures.
A number of last-minute releases for Hollywood films have been announced in recent days, exceeding the number normally allowed by China’s protected film industry.
On Saturday, 20th Century Fox’s Keeping Up with the Joneses and Miss Peregrine’s Home for Peculiar Children were given release dates for China for November 8 and December 2, respectively.
They joined releases announced for Paramount’s Allied (November 23), Disney’s Moana (November 25), and Warner Bros.’ Sully (November 29).
The last-minute additions take November’s tally of Hollywood films screening in China to eight following, the earlier announcements of releases for Disney’s Doctor Strange, Harry Potter spinoff Fantastic Beasts and Where to Find Them, and Ang Lee’s Billy Lynn’s Long Halftime Walk.
The total number of foreign films imported on a revenue-sharing basis now appears to be sitting at 38—four more than is normally allowed. That figure could change, as it’s still unclear whether Billy Lynn is being imported on a revenue-sharing or flat-fee basis.
China’s film-importation system restricts foreign movie imports to either 34 titles per year on a revenue-sharing basis, allowing Hollywood studios to take home up to 25 percent of the box-office receipts.
Flat-fee releases are also available but are usually reserved for independent and smaller titles, normally between 20 and 30 each year. In a flat-fee arrangement, Chinese distributors pay a lump sum upfront and all the box-office proceeds stay in China.
Despite the clear surfeit, a spokesperson for the film bureau denied the quota had been exceeded, telling local news portal Sina Entertainment that a portion of the films imported was considered “cultural exchange projects” and aren’t counted in the 34.
Total box-office receipts for the year up to October 23 have reached RMB 38.26 billion (US$5.6 billion), far short of the year’s goal of RMB 60 billion ($8.9 billion) and behind last year’s total amount of RMB 44 billion ($6.5 billion), according to online movie ticket seller Maoyan.
Last week, film bureau boss Zhang Hongsen warned the country’s film industry that the number of foreign films allowed into the country on a revenue-sharing basis is set to increase as early as next year.
The current quota system was put in place in when China signed an agreement with the World Trade Organization in 2012, valid for five years. The second round of negotiations is likely to be held in February 2017.
Of the Hollywood studios, the biggest winner in China this year is Disney, having secured releases for eight films including Star Wars: The Force Awakens, Captain America: Civil War, Zootopia, The Jungle Book, Finding Dory, Alice Through the Looking Glass and now Doctor Strange and Moana.
Local entertainment media is rife with speculation about what other foreign titles might be able to enter the country. Among the titles in contention are Lionsgate’s Deepwater Horizon and their Mel Gibson-directed war epic Hacksaw Ridge.
Chinese movie fans took to social media to welcome the new releases, with many also complaining about a dearth of quality films at the cinemas lately.
“This means you shouldn’t bother to go and see crappy local films,” wrote one Weibo user “as long as the annual box-office numbers look like they’re too low, you can always count on the Film Bureau to import better foreign movies.”
Upcoming Hollywood Films in China
11.04 Doctor Strange
11.08 Keeping Up with the Joneses
11.11 Billy Lynn’s Long Halftime Walk
11.18 Fantastic Beasts and Where to Find Them
12.02 Miss Peregrine’s Home for Peculiar Children