Private and foreign firms will premiere on China's big screens next month, under new rules allowing them to invest more in the domestic film industry.

And censors' controls on films and film scripts will also be relaxed under new regulations issued by the State Administration of Radio, Film and Television.

Starting from December 1, the administration will allow foreign investors to buy minority shares in film production companies. The changes are outlined in a provisional regulation on qualifications for film production, distribution and projection issued last month.

Foreign capital is also permitted in joint venture film technology companies with Chinese firms. In certain provinces and cities, with approval from the administration, foreign investors can hold a majority share of such companies.

In addition, overseas investors will be allowed to become more involved in cinemas, insiders said.

Under the changes, foreign investment could eventually account for three-quarters of the capital invested in cinemas in China's seven major cities, according to Guan Zhibing, manager of Capital Cinema in Beijing.

Guan is now negotiating with several foreign investors to transform the cinema into a complex with the most advanced equipment.

The administration refused to confirm Guan's assertions. But it said a new regulation on the issue is being drafted and would be issued soon.

At present, foreign enterprises are only allowed to build cinemas as minority shareholders in joint ventures or cooperative businesses. They do not have the right to run and manage cinemas.

But as competition intensifies, state-owned cinemas have run short of the funds needed to upgrade their equipment and compete with the new joint-venture cinema complexes.

Nan Deshan, manager of Dahua Global Media Cultural Development Co, said that although Dahua Cinema in Beijing now has four screens, it is still using a building from the 1930s, which does not have enough parking.

"We welcome foreign capital into our cinemas, because this investment will not only solve our shortage of funds, but also bring advanced technology and management ideas,'' he said.

Dahua Cinema is yet to find potential foreign investors. But Nan said the company running it and three other cinemas was trying to find a way to reinvigorate state-owned cinemas.

"We are now trying to build up our own cinema networks and will invest in film-making and TV plays if there are good stories,'' he added.

The reforms in the movie industry are also good news for private investors.

According to the new regulations, private investors will be allowed to establish their own movie production companies and build up their own cinema networks.

Non-state capital is already playing a more and more important role in the country's movie and television industry.

Last year, non-state capital helped fund 29 of the 100 movies produced. The number this year has surged to at least 60.

Zhang Hongsen, a senior official with the administration in charge of the movie industry, was quoted by Guangzhou-based Nanfang Daily as saying the administration was determined to end some old restrictions on movie production and management, and provide a freer environment for movie-makers.

The release of the new regulations is part of the administration's move to encourage artists to make more excellent movies, Zhang said.

For example, censorship rules on movies and movie scripts have been eased and no longer force movie makers to wait for the administration to approve the entire script.

Instead, they usually need to submit only the main idea of the script in less than 1,000 words to the administration. The exceptions are movies funded by the Chinese government, movies on historical events or certain topics, and movies co-produced by foreign film-makers.

(China Daily November 22, 2003)