CHINA TOPIX

Hollywood's in need of a superhero - to recover its money from China

golden point   |

Jul 31, 2013 08:43 AM EDT

In 2012, China’s vice-president Xi Jinping, and US vice-president Joe Biden agreed to ease down the policies regarding foreign film showings in China. As per the agreement, Hollywood movies can now be screened in Beijing which will allow 25 percent of earnings in favor of the US Studios. This is a promising move that can increases the chances of Hollywood studios become a worldwide source of films. However, it was found out that China stopped paying dues a few months ago. Despite of the issue, US movies still are being screened all over Chinese cinemas at the end of 2012. The China Film Group has reported that they deliberated a levy of 2 percent tax on every US film releases. Hollywood did not agreed to this terms and refused to pay the said amount, as there were claims of breach of contract involved in the WTO agreement. This issue boiled down from the Hollywood’s findings of not having received any of the 25 percent payment from the movie releases. Warner Brothers has more than $31 million of shares owed by China. This is from the blockbuster movies, Man of Steel and The Hobbit. Disney also made about $30 million from Iron Man 3, and Sony has earnings from the movie, James Bond, which was not also paid. In the past, the move agreements in China did not come easy. Hollywood film makers and producers tolerated the rants of Chinese censors. There were films banned with no explanation, and others are suddenly withdrew without notice. However, the Chinese audiences had increased interest so Hollywood studios provided more ways to meet their expectations. US Senator, Chris Dodd, who now is the chairman of the Motion Picture Association of America (MPAA), stated that they are now working to resolve this matter. The US Trade Representative as reported to be working with the MPAA and the “counterparts within the Chinese government to resolve the issue”.