China quietly opens door to more foreign films

China is quietly allowing more foreign films to be imported even though talks between Beijing and Hollywood about an official deal to allow greater access to the world’s fastest growing film market have stalled.

Under a quota system designed to limit the number of foreign films screened in the country, only 34 foreign releases are allowed to be distributed on a revenue-sharing basis.

But in recent years that quota has been exceeded “albeit unofficially and for tactical reasons,” according to a report from the London-based global information provider IHS Markit, paving the way for more international blockbusters, such as the November debut of Crazy Rich Asians.

Crazy Rich Asians is being allowed to open in China next month.

Crazy Rich Asians is being allowed to open in China next month.

The report said 38 revenue-sharing films had been imported in 2016 and 40 in 2017, including works from the US, India, South Korea, and France.

“It is possible that China intends to open the market more, or test the market, but the government doesn’t want to make it official yet due to the tension between USA and China,” Xin Zhang, senior analyst for film and cinema, wrote in the report.

A five-year agreement between Hollywood and China that covered the number of international films allowed to be shown in the country expired last year, but talks about a new deal have been put back amid the current trade war and changes to the Chinese media regulator.

As the months drag on, there is greater uncertainty over whether the US negotiators – Motion Picture Association of America, the trade body for Hollywood’s six major film studios, and the US Trade Representative – will succeed in pushing for a higher film quota and a higher share of the revenues for the studios.

China’s film market is set to be the world’s largest, giving Hollywood studios an extra incentive to appeal to Chinese audiences.