CHINA: China lifts ban on foreign investment in film industry

China said yesterday it has lifted its long-time ban on foreign investment in television and film production companies, as the country moves to reform its monolithic and largely loss-making media industry

The Straits Times
Thursday, March 11, 2004

SHANGHAI - China said yesterday it has lifted its long-time ban on foreign investment in television and film production companies, as the country moves to reform its monolithic and largely loss-making media industry.

The State Administration of Radio, Film and Television (SARFT) issued regulations that took effect in December permitting foreign media groups to hold stakes in joint-venture production firms.

'Foreign companies are allowed to start joint ventures with Chinese film and TV programme-producing companies, although the Chinese side should hold more than 51 per cent of the shares in the joint venture,' Mr Tong Gang, director of the film bureau at SARFT, said.

'Generally speaking, the Chinese side should be a state-owned company, and the foreign side should be famous and strongly influential on the global stage.'

Domestic private firms will be allowed to jointly develop pay TV channels to help attract the investment needed to fund China's plans for expansion of pay TV and digital TV services, he added.

'In the past, foreign companies and Chinese companies were only allowed to work together on some film and TV programme-producing projects; starting a joint venture was impossible,' Mr Tong said.

Allowing television-programming joint ventures is part of an ongoing spate of industry reforms to bring foreign know-how to China's often tedious TV output.

'After joining the WTO (World Trade Organisation), we've been seeking cooperation overseas and we want to inject fresh funds and experience into the industry,' Mr Tong said. 'It's becoming more open now.'

As part of the new reforms, more foreign films and television programmes will be allowed on Chinese screens as current quotas are eased, although restrictions on foreign broadcasting will remain in place.

'Broadcasting time of domestic films should account for two-thirds of the total while imported foreign films account for one-third,' Mr Tong said.

'This percentage is restricted, but the volume of introduced foreign films can be increased.'

Date Posted: 3/11/2004