Guidance and Compliance:The Way to China’s Entertainment Market
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III. Requirements for Films Produced under China-Foreign Cooperation

1.Basic Requirements for Films Production under China-Foreign Co-operation

China implements a licensing system for Film Production under China-Foreign Cooperation. Any entity or individual that does not obtain the License for Chinese-Foreign Cooperative Production of Films or the approval document may not produce a film cooperatively with any foreign entity or individual. Without approval, no foreign entity or individual may produce a film independently in China (for details, see item 3 of this section). Legal persons and other organizations may, with the approval of the film department of the State Council, cooperate with overseas organizations in shooting films; but they shall not cooperate with overseas organizations that engage in activities detrimental to China's dignity, honor, and interests, jeopardizing China's social stability, or hurting national sentiments in China, among others, nor hire individuals committing the aforesaid acts to participate in film shooting. C hinese-Foreign Cooperative Production of Films shall comply with the following principles:(1)It shall abide by Chinese Constitution,laws and regulations and relevant provisions; (2) It shall respect the custom, religions, beliefs and life habits of all Chinese nationalities; (3) It shall be benefi cial to the promotion of the excellent traditional cultures of the Chinese Nation; (4) It shall be beneficial to China's economic, cultural or ideological and ethical construction and social security; (5) It shall be benefi cial to the exchange of Chinese and foreign films; and (6) It may not impair any interests of the third country.

An application for the Chinese-Foreign Cooperative Production of Films shall also meet the following conditions: (1) The Chinese producing entity shall, in principle, have participated in the production of two or more domestically-produced films with Permits for Public Projection of the Film. (2) Both the Chinese and the foreign sides are not under any penalty of being prohibited from producing films for any violation of the Film Industry Promotion Law of the People's Republic of China or the Regulation on the Administration of Films.

A ny joint-produced films may be shown publicly inside or outside China after it is examined and held to be up to standards, and the Permit for Public Projection of the Film issued by the administrative department of film of the State Council has been obtained. With respect to a ny assisted film or entrusted film, after it is examined and held to be up to standards, the procedures for the exit thereof may be followed on the strength of the approval document issued by the administrative department of film of the State Council. (For details, see Section 4 of this chapter)

2.Types of Films Produced under China-Foreign Cooperation

There are three types of Chinese-Foreign Cooperative Production of Film: (1) joint production, i.e. the way of production by which the Chinese and foreign parties jointly contribute capitals (including funds, labor or kinds), produce films and share interests and risks; (2) assisted production, i.e. the way of production by which the foreign party contributes capitals, the Chinese party p rovides with considerations such assistance as equipment, apparatuses, sites and labor, and t he film is done in China; and (3) production by entrustment, i.e. the way of production by which the foreign party entrusts the Chinese party with the work of shooting films on behalf of it.

If any foreign creator needs to be engaged in any joint production, the matter shall be approved by the administrative department of film of the State Council, and the ratio of foreign main actors and actresses may not exceed 2/3 of the total main actors and actresses. With respect to any jointly produced film, its Chinese Mandarin(putonghua)edition shall be produced, and its Chinese captions shall use standard Chinese characters. Under the need of distributing the film, the production of other editions in the languages of the corresponding countries, regions or minor nationalities according to its Chinese Mandarin(putonghua)edition shall be permitted. However, it shall be noted that, in practice, there are more detailed requirements of the joint production. For example, the number of the creators of Chinese party shall meet a certain proportion. There is no requirement for the place to shoot the film but the film shall contain some Chinese elements. For more details, it is necessary to consult with professionals and relevant agencies.

3.Procedures of Films Produced under China-Foreign Cooperation

The procedures for reporting on and approving and examining the initiation of the project of Chinese-foreign cooperative production of any film shall be as follows: (1) the Chinese producer files an application with the administrative department of film of the State Council; (2) the administrative department of film of the State Council accepts the written application submitted by the applying entity within the time limit specified in the Administrative License Law;(3)if the administrative department of film of the State Council decides to accept the application, it shall decide on whether to approve the initiation of the project within twenty working days. If the film's screenplay must be subject to the review of experts, the applying entity shall be informed in writing, and such review shall be completed within twenty working days; then (4) if the conditions for the joint production are met, the non-reused License for Chinese-Foreign Cooperative Production of Films shall be issued with a validity of two years; if the conditions for assisted or entrusted production are met,the approval document shall be issued. If an approval is not granted, the reasons shall be explained in writing. After obtaining the License for Chinese-Foreign Cooperative Production of Films or the approval document, the Chinese and foreign parties shall sign a contract based on the contents in respect of which the initiation of the project has been approved.

To apply for Chinese-foreign cooperative production of any film, the applicant shall submit to the administrative department of film of the State Council the following materials: (1) the Chinese producer's application for initiating the project of producing the film; (2) photocopies of the Permits for Public Projection of the Films (two or more) for the domestically-produced films the production of which is participated in by the Chinese producing entity; (3) the film's screenplay (in Standard Chinese characters) in triplicate; (4) the certifi cate of credit worthiness of the foreign party and the conditions of the film to be produced cooperatively thereof; (5) the letter of intent of cooperation or agreement between and by Chinese and foreign parties whose contents shall clarify the investment ratio of both cooperative parties, Chinese and foreign main creative persons ratio, and whether the film is to participate in a Chinese or foreign films festival (exhibition) etc.; and (6) the brief introductions of the creative persons.