Making Films in China. Part 2 : You Talkin’ To Me? by Mathew Alderson

25 July 2011 13 h 04 min 10 comments

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By Mathew Alderson,  July 25, 2011

Mathew Alderson is a Beijing-based Australian lawyer with US firm Harris Moure pllc with a vast experience representing foreign companies involved in China’s film industry.

He explains the basic rules for foreign companies doing film co-productions in China.

Sino-Foreign Film Co-Productions in China Part 1 by Mathew Alderson

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A few weeks ago, I did a post, “Sino-Foreign Film Co-Productions in China,” outlining the requirements for doing film co-productions in China. We received the following comment in response to that post:
Thank god I ignored all this when I shot “Shangdown: The Way of the Spur” in Shanghai last year ;)
The person who left this comment even linked over to his website.

Dan and Steve tell me they are used to people leaving comments here and elsewhere bragging about how they violated Chinese law and got away with it and implying that anyone who actually follows Chinese law is a sucker.

Me, I was stunned. I have been handling Chinese legal matters for going on ten years now and I live in Beijing it was not the law-breaking that stunned me. No, not at all. Rather, I was stunned by how people tout it online and act as though simply because they have (at least so far) gotten away with it, everyone else should be doing it. Self-justification perhaps?

As lawyers who constantly see what happens to people who violate the law in China, we would be fools not to take the law seriously. We have dealt with enough businesses that have been shut down and people deported, and even jailed, to know that there are very real risks to not following China’s laws. Our job as lawyers is to tell you how to follow the laws. If you choose to violate them, that is obviously up to you.

Though we pride ourselves on providing practical advice and practical commentary, our approach is always based on what the law says and how the law is applied in China. What the law says, and what people may sometimes be able to get away with in China, are two completely different things. So, when someone tells us that they got away with something in China, they generally imply that there is no need to follow the rules. A particular instance, they say, is to be mistaken for a universal principle. Someone who smoked like a chimney their whole life yet lived to 77 is proof that cigarettes do not cause lung cancer.

Though I am not familiar with the “Way of the Spur”, it sounds as though it is one of many films produced in China without complying with the rules. Usually, this occurs when the producer is indifferent as to whether the film will ever be screened in China or when the producer determines that the film will, because of its subject matter, never be approved for screening in China anyway.

Mao’s Last Dancer”, a well-known Sino-Australian co-production directed by Bruce Beresford, is generally regarded as falling into the latter category. This film took in more than $15 million at the box office and was the highest grossing Australian film of 2009. But did it get a theatrical release in China?

Did the producers and investors get a slice of that famously burgeoning Chinese box office? No, because it cannot legally be shown in Chinese theaters.

If “The Way of the Spur” was not made according to the rules then it too cannot lawfully be exhibited in China. Its producers and investors will not see any China box office. But there is more in the way of disincentives for not following China’s co-production rules.

Those rules and regulations also provide for the following punishments:
1. Confiscation of equipment
2. Independently producing – minimum fine RMB 300,000
3. Movie contains prohibited content – minimum fine RMB 300,000
4. Movie exhibited in China or overseas without authorization – 5 year ban on making a film in China

My initial post on Sino-foreign co-production was aimed at those who wish to operate legally in China and by so doing, be able to exploit China’s massive and burgeoning film market. For that, you have to follow the rules.

For those who do not wish to abide by Chinese law, we maintain a list of top tier Chinese criminal lawyers. And we use it more than we would have liked.

This article was orginally written for China Law Blog, by Mathew Alderson (bio link). Mathew Alderson is an Australian-admitted lawyer with US firm Harris Moure pllc in Beijing. He specialises in media, entertainment and IP work.

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