Paramount opens Shanghai office

Zhe Chen will run studio's two-person satellite

BEIJING -- Paramount, Hollywood's oldest studio, opened its first China office in Shanghai on Wednesday to oversee the distribution of theatrical releases and explore local production opportunities in one of the world's fastest growing movie markets.

To import films such as "Transformers: Revenge of the Fallen," the Paramount Pictures International China Representative Office will liaise with the state-run and Beijing-based China Film Group, China Film Distribution and Huaxia Distribution, PPI's President Andrew Cripps said on the telephone from London.

China limits imported films to 20 a year. The Hollywood studios are hopeful that a U.S. case against China at the World Trade Organization soon could break down barriers to market access.

Cripps said Paramount had been mulling an office in Shanghai for over a year, "because it is China's commercial hub." The decision to open a China office now had nothing to do with the WTO case, he said.

A decision in the WTO case, though reportedly already reached, is not expected to be released until later this year.

Zhe Chen will head the new Paramount office as general manager of PPI China, Cripps said. Chen previously worked as chief China representative for Paramount sister company distributor UIP from Shanghai. Chen will run the office of two with his former UIP colleague Jennifer Fang.

"Their purview will be reasonably limited, considering the limitations in China," Cripps said.

In an earlier statement from London, Cripps called the opening of the Shanghai office a "step change for Paramount into the fastest growing and one of the most exciting cinema markets in the world."

China's boxoffice has grown more than 25% annually for five straight years, swelling 30% in 2008 to reach 4.3 billion yuan ($635 million).

Previously, Paramount films were handled in China by UIP, whose Greater China Chief Representative, Eugene Yang, is based in Taiwan.

"We will still rely on Eugene to help the [import] process, but we felt it was important to establish our own presence," said Cripps, who last visited China in a trip to Beijing in February to show "Transformers" to the China Film Group.

PPI's first China release managed from the Shanghai office will be "GI Joe: The Rise of the Cobra." Cripps said he had no sense yet if the film would be censored in China as "Transformers" was. "We hope to get it released as close to the U.S. release in early August," he said.

The closer a film is released in China to its release date in the West, the less time China's vast network of movie pirates has to take a bite of the potential opening week boxoffice take.

"Transformers: Revenge of the Fallen" grossed 166 million yuan ($24.3 million) in its first five days of release in China, a record for an English-language film. An opening battle sequence set in Shanghai had the city's name bleeped from the soundtrack, among other cuts but China's notoriously thin-skinned censors.

Hopeful, Cripps said, "We have a collaborative relationship with China Film and with the ministry that oversees film censorship. It's definitely getting better."

In 2008, "Kung Fu Panda" was the highest grossing foreign picture of the year, grossing roughly $25 million, Cripps said.

In April this year, the DWA title "Monsters vs. Aliens" saw a 3-D only release in China via Paramount, which saw a gross of $4.6 million, a figure Cripps said was "a very good result" given the limited number of theaters. "China is being aggressive with its deployment of 3-D. This could prove yet another part of its growth market going forward," he said.

In May, Paramount's "Star Trek" set the stage for a new Chinese audience "who will enjoy this franchise for years to come," the company said in the earlier statement.