With China said to be on track to overtake the United States as the world’s largest movie market by 2017, it’s particularly significant that Beijing’s film bureau has punished the Chinese distributor of a major film–Ip Man 3–over box-office fraud. The movie, the third installment in a martial arts biopic about the life of Wing Chun grandmaster Ip Man, was released in its home market of Hong Kong and a handful of other Asian markets in December and the U.S. in January). But its March release in China has been flubbed by fraud.
Ip Man 3 stars Donnie Yen in the title role and Mike Tyson (because why not). The previous two films–Ip Man (2008) and Ip Man 2: Legend of the Grandmaster (2010)–were well received and all three have ratings on Rotten Tomatoes above 80 percent. There have been a handful of biopics about Ip Man, who died in 1972 and counted Bruce Lee among his pupils, in recent years; those starring Yen have been the most prominent and popular.
Chinese regulators were tipped off that something might be amiss due to the film’s larger-than-expected box office numbers: in three days it apparently raked in $72.3 million. Additional clues came from industry observers who, the Hollywood Reporter says, noted suspicious patterns in the film’s screening schedule:
Several of China’s top mobile ticketing apps — which is how over 70 percent of Chinese movie tickets are now bought — showed sold-out Ip Man 3 screenings running every 10 minutes until 3 a.m. at some cinemas, an impossibly frequent schedule.
The Chinese distributor, Beijing Max Screen, was ordered to suspend distribution for a month by the film bureau of the State Administration of Press, Publication, Radio, Film and Television. Three online ticket sellers and 73 theaters were also given formal warnings for their part in the fraud.
According Xinhua, Beijing Max Screen released a statement last Friday in which the company admitted to purchasing 56 million yuan’s worth of tickets ($8.6 million) for the film and making up 7,600 “ghost screenings.”
In the company’s statement, as reported by the LA Times, Beijing Max Screen said it had “studied and fully accepted” the government’s punishment, going to say “As a company entering the film market, we are eager to make a contribution to Chinese film, but we lacked a deep understanding and familiarity with the relevant regulations… The company solemnly pledges to learn from the experience and comply with the rules.”
China’s film regulations are a point of tension between Hollywood and Beijing. This isn’t just about movies, but about trade and cultural influence. A bilateral agreement finalized during Chinese President Xi Jinping’s September visit to the United States formalized a 2012 agreement that upped the quota of foreign films released in China from 20 to 34 annually. The agreement, per the Hollywood Reporter, also “boosted U.S. distributors’ share of box-office revenue in the country (from the previously dismal 11-15 percent to 25 percent).”
Hollywood wants ready access to the massive Chinese market, but Beijing seeks to protect and promote indigenously made films. Moreover, Hollywood filmmakers have been criticized for making film-decisions specifically to placate Chinese regulators, like adding extra scenes to the Chinese release of Iron Man 3.