×
You will be redirected back to your article in seconds

China Launches Incentive Scheme to Boost Box Office of Local Films

China’s Film Bureau has announced an incentive scheme to reward movie theaters that increase box office scores for local films. The move will take effect from Jan. 1, 2018.

The scheme rewards theaters that derive more than 55% of their box office revenues from Chinese films, allowing them to keep half of a 5% tax they pay on ticket sales. There are bigger bonuses for those that score 60% and 66%.

This is not the first time that China has announced such a scheme. In March last year it said that theaters earning 66% could keep half the tax.

“I don’t think the Chinese government reduced the target because they were feeling generous. They wanted results, and they weren’t getting them at 66%,” said lawyer Matthew Dresden at law firm Harris Bricken. Boosted by the $860 million gross for “Wolf Warriors II,” market share for Chinese films stood at 52% as of mid-November.

The scheme has numerous potential problems. These include the creation of an additional incentive for theaters to engage in fraud. Chinese cinemas have a long-established history of distorting results and diverting revenues from one film to another. The requirement to use a government-controlled box office reporting system is supposed to eliminate this.

It also contradicts other systems and structures. The major exhibitors are privately owned, profit-maximizing companies. And the country’s dominant distributor of imported, revenue-sharing movies is state-controlled China Film Corp.

The scheme adds another wrinkle to the ongoing negotiations between China and the U.S. over quotas, revenues and distribution conditions. China currently operates a range of tight controls over foreign films. These include regulators who decide release dates and two or three blackout periods per year when only Chinese films can be released.

More Film

  • Carol Burnett

    Carol Burnett's Mother-Daughter Story 'Carrie and Me' in Development as a Movie

    Carol Burnett’s bestseller “Carrie and Me: A Mother-Daughter Love Story” is in the works as a movie at Focus Features with Burnett, Tina Fey, Eric Gurian, and Steven Rogers producing. Burnett will produce through her Mabel Cat Productions with Fey and Gurian under their production banner Little Stranger along with Rogers (“I, Tonya”). The sibling [...]

  • Contract Placeholder Business WGA ATA Agent

    Writers Guild Plans for Agency Pact Expiration: 'There Will Be Difficult Moments'

    Leaders of the Writers Guild of America have sent members contingency plans for the possible expiration of its agency franchise agreement on April 7 — and admitted that it may be a rocky road. Members received the letter Tuesday from the guild’s negotiating committee as the WGA and agents were about the hold their seventh [...]

  • Editorial use only. No book cover

    Entertainment One, Universal to Partner on Home Entertainment

    Entertainment One and Universal Pictures Home Entertainment have signed a multi-year, multi-territory distribution agreement. UPHE will serve as the home entertainment distributor of eOne’s offerings across both physical and digital formats. The pact covers film, television, and select family content and includes all sales, marketing, and distribution, spanning the U.S., Canada, U.K., Germany, Spain, Australia, [...]

  • Will Smith Jada Pinkett Smith

    AFI, Will and Jada Smith Family Foundation Launch Second Young Women in Film Intensive

    The AFI Conservatory and the Will & Jada Smith Family Foundation have partnered to launch the second annual Young Women in Film Intensive. The AFI Campus in Los Angeles will host 45 high school girls for an eight-week filmmaking workshop, where students will receive mentorship from current fellows and working professional alumni of the AFI [...]

  • Paul Davidson

    The Orchard Head Content Executive Paul Davidson Steps Down

    At the finish line of its sale to 1091 Media, distributor the Orchard’s film and TV head Paul Davidson is parting ways with the company. In an amicable split, the creative executive addressed staff in person and in a company-wide memo on Tuesday in New York City to inform them of his decision. “While I [...]

  • Ava DuVernay Toby Emmerich Michael Douglas

    Ava DuVernay, Toby Emmerich, Michael Douglas to Speak at Produced By Conference

    Ava DuVernay, Toby Emmerich, and Michael Douglas will speak at the Producers Guild of America’s 11th Produced By Conference. The event will be held on June 8-9 at Warner Bros. Studios in Burbank, Calif. Other notable speakers include Netflix executive Cindy Holland; Blumhouse producer Marci Wiseman; “Homecoming” showrunners Micah Bloomberg and Eli Horowitz; Entertainment One [...]

More From Our Brands

Access exclusive content