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China Punishes More Than 300 Cinemas for Box Office Cheating

Variety logo Variety 3/23/2017 Patrick Frater
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Chinese film regulators have punished 326 cinemas for their part in box-office fraud. They are the first to be punished under the Film Promotion Law which came into effect at the beginning of the month.

Punishments range from the forced closure of theaters for three months and fines of $145,000 (RMB 1 million) for the 63 biggest cases, to fines of $24,000 (RMB200,000.) The 90 theaters caught out in frauds of less than $12,000 (RMB100,000) were given written warnings.

News of the regulatory action was announced via state media on Wednesday. It did not specify the nature of the fraud.

Box-office cheating was widespread in China, with cases making the headlines in 2014 and 2015. In some instances, theaters have colluded with distributors in massive ticket-buying operations that are intended to give the impression that a film is enjoying greater success than in reality. In other cases, theaters have stolen receipts.

And in still other instances, they have switched receipts from one film to pad the receipts of another. In the past, that was done to boost the purported take of state-backed propaganda films.

Greater transparency may have been partly responsible for the 49% surge in box office receipts reported in 2015. Further measures to increase accuracy and transparency were introduced at the beginning of this year, such as the inclusion and reporting of the fees charged by online ticketing agencies. Online and mobile ticketing accounts for some 70% of sales in China.

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