Hollywood looks east

China is now the second-largest film market in the world, but restrictions on foreign films have provoked US production companies to take special approaches to enter the Chinese film industry. Liu Wei reports.

In 2012, China became the second-largest film market in the world, behind only the United States. The booming market has sparked the interest of Hollywood, which is trying various ways, many innovative, to enter the Chinese market through collaborations and co-productions with Chinese companies. But critics say full and genuine co-productions between Hollywood and the Chinese film industry still have a long way to go.

Chinese actor Wang Xueqi joins the cast of Iron Man 3, which is screening throughout the country. Photo by Jiang Dong / China Daily

A report from the Motion Picture Association of America found box office revenues in China reached 16 billion yuan ($2.59 million) in 2012.

China contributes the most overseas box office revenue for many Hollywood productions, such as Avatar and Transformers 3.

The booming profits are prompting Hollywood to take a greater interest in China, but access to the market is not easy.

China imports only 34 foreign films a year for theatrical release, and Hollywood studios get no more than 25 percent of the revenue. There are also protective policies for domestic films, such as releasing two Hollywood blockbusters on the same day to dampen their impact.

Co-produced films, however, are exempt from the quota and treated as domestic productions, for which investors can discuss how the profits are distributed.