China set for World Trade Org entry

Nation opening up movie, TV market

WASHINGTON — The last hurdle has been cleared for China to become a member of the World Trade Organization and a new outlet for American movies, TV and other entertainment fare.

Late Friday, U.S. trade officials and the European Union announced they had resolved a dispute over how an American insurance firm would do business in China, clearing trade ministers to formally vote on China when the WTO gathers in November in Doha, Qatar.

Hollywood has been working for years to open up China’s vast population to American films. In recent months, there has been a flurry of activity as congloms have prepared for China’s entry into the WTO. With the world’s largest population, China is considered a ripe market for entertainment.

In recent days, Chinese authorities approved an unprecedented number of foreign films — including at least seven U.S. pics — for release on the mainland over the next five months.

Increase is in line with the government’s agreement to double from 10 to 20 the unofficial quota of foreign films released per year on a revenue-sharing basis — a concession designed to help woo U.S. support for China’s WTO membership.

But some U.S. reps believe the underlying reason is a not-so-subtle attempt by China Film Group to entrench its position before the agency loses its monopoly on distributing foreign films. China has signaled that up to six distrib licenses will be issued, covering all major regions, as part of the WTO reforms.

U.S. reps believe the China Film Import/Export division will soon be stripped out of China Film and transferred to the all-powerful State Administration of Radio, Film and Television (Sarft). China Film’s distribution division would thus become a free-standing entity, forced to compete with up to six new distribs covering all the major regions.

China Film sources contend there are pressing financial reasons for the upsurge of product that have nothing to do with the WTO issue or looming distrib reforms, with one exec saying that films released in the first half of the year fared poorly.

While that may be true, two WWII epics have sparked a considerable turnaround for the Chinese B.O. in the past month or so. “Enemy at the Gates” has grossed an impressive $2.4 million in five weeks. And blockbuster “Pearl Harbor” has racked up $10.1 million in four weeks, already ranking as the third-highest grosser ever on the mainland behind “Titanic” and “True Lies.”

(Don Groves contributed to this report.)

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