China regulators touchy on co-productions

Message to Hollywood: legitimate co-productions only, please

If Hollywood really wants to pursue Chinese co-productions, it’ll have to dot its i’s and cross its t’s — not to mention mind its p’s and q’s.

The country’s head biz regulator told local media Tuesday that for U.S. filmmakers’ productions to be granted joint-effort status, all the China Film Co-production Corporation’s requirements would have to be strictly met. That means at least one-third of the coin must come from China, the main cast must be Chinese, and part of the movie must be shot in the country.

“Some so-called co-production movies just do superficial changes, with little investment from China and use very few Chinese elements, and call it a co-production. These co-productions get around the quota system and take domestic investment away and threaten Chinese movies,” said Zhang Peiming, deputy bureau chief of the State Administration of Radio, Film and Television, singling out aspiring co-productions “Looper” and “Cloud Atlas.”

Official co-production status guarantees a mainland release, immunity from blackout periods and a greater revenue share.

Multiple U.S.-based consultants who help steer Chinese co-production deals told Variety that Zhang’s comments do not necessarily portend a policy shift but rather a new resolve to follow the letter of the law. They also suggested that filmmakers should avoid publicly talking about cursory efforts to gain co-prod status; such comments do get back to Chinese regulators, who are hypersensitive to the notion that Hollywood is cynically taking advantage of its booming film market.

“I think he was trying to give the market a message,” said Peter Shiao, founder and CEO of Orb Media Group and chair of the U.S.-China Film Summit, which takes place in Los Angeles in October. “This is one of those situations of where they’re being very careful of not getting a black eye.”

The Endgame and DMG production “Looper” is set for release in China in late September and features the Chinese thesp Xu Qing in a supporting role, as well as a number of scenes shot in Shanghai. “Cloud Atlas,” which is being distributed by Warner Bros. domestically but by Dreams of the Dragon Pictures in China, has a mostly Western cast and features Chinese actress Zhou Xun.

Both pics are seeking Chinese co-production status, which is still pending. H owever “Looper” seems on a fast track, as it’s already been granted a blackout-period release date and has been allowed to start its marketing campaign more than two weeks before release — another perk of co-production status — so it’s puzzling that it was held up as an example.

“The real issue is that there’s been an influx of films seeking co-production status without meeting official requirements,” Shiao said, adding that Zhang’s comments could “impact a lot of projects that were announced with the best of intentions but without the appropriate triggers to make it an official co-production.”

Competition to get a theatrical release in China is high, as the government restricts the number of foreign movies allowed each year to around 34. Several smaller indies regularly make it through, but only one or two large-scale features with known talent get the designation per year, like Sony’s “The Karate Kid.”

Other consultants suggest that even the smallest offhand comment can irritate regulators, like when “Iron Man 3” director Shane Black addressed the China co-production at Comic-Con, saying that neither he nor the cast expected to actually travel there but that a second-unit crew would “while I’m by my swimming pool” — and that talent would attend the premiere.

Disney, Marvel and DMG announced in April the intention to co-produce “Iron Man 3” in China. Like “Looper” and “Cloud Atlas,” “Iron Man 3” is subject to Chinese government approval.

If it gets the greenlight, production would film scenes in China this fall and hold a premiere there.