China Owes Hollywood Millions After Halting Payment for Films; lack of profit has not deterred US studios from sending their films to China,

August 1, 2013 Leave a comment

China Owes Hollywood Millions After Halting Payment for Films

By Agence France-Presse on 1:48 pm July 31, 2013.
Los Angeles. China has stopped paying Hollywood studios for its films in a dispute over a Chinese tax on movie profits, Hollywood trade papers reported Tuesday. Tens of millions of dollars in box office revenues are owed in arrears to the likes of Disney, Warner, Universal, Paramount, Fox and Sony, according to The Hollywood Reporter. The magazine said China’s state-owned movie distributor, China Film Group, owes more than $31 million to Warner for “Man of Steel,” $23 million to Sony for “Skyfall” and $23 million to Fox for “Life of Pi.” China stopped payment at the beginning of the year, when American studios took issue with a two percent value-added tax that the world’s most populous nation was levying on US films. Chinese authorities want the studios to pax them the tax, but the studios argue it violates a World Trade Organization agreement governing the film trade between the two countries. In the accord last year, heralded as historic by the United States, the two countries agreed that China could import 34 US blockbusters a year (up from 20) and studios’ revenue share from China was fixed at 25 percent (up from 13 to 17 percent). The Motion Picture Association of America (MPAA), which acts on behalf of studios’ interests, is negotiating with Chinese authorities, to resolve the tax dispute. In the meantime, lack of profit has not deterred US studios from sending their films to China, which currently has the world’s most dynamic movie market, in the aim of cementing a long-term foothold.

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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