China's Media & Entertainment Law, Volume II, 2006

By James F. Paradise

This review was originally published by AsiaMedia on Feb. 20, 2007. Republished by permission.

China's Media & Entertainment Law (Volume II)
1400 pages, TransAsia Publishing Ltd: 2006. US$280.

A few years ago, it was possible to talk about a combination of liberalization and censorship in the Chinese media industry. Now the story is more about censorship and a variety of other restrictions as the Chinese government seeks to reassert control after a period of rapid change.

This is confirmed by an updated version of China's Media & Entertainment Law, a publication of TransAsia Lawyers that is a goldmine of information about the Chinese media industry. As the authors of this work write, "In mid-2005, the PRC government suddenly tightened the reins on China's media sectors, slowing and in some ways reversing its recent liberalization of the television industry." These changes "coincided with the turnover of top SARFT [State Administration of Radio, Film and Television] officials."

Among the contributing editors of this volume are a number of Chinese government officials. The book also contains an endorsement by the SARFT. At the same time, the book contains this disclaimer: "The commentaries contained herein represent the personal views of the authors and should not be taken as official statements of the Chinese government."  The book also received support from a number of companies, including BPA Worldwide, Deloitte, Motion Picture Association, Time Warner, NBC Universal and IMG. In short, the book itself seems to be symbolic of a media industry, which in some ways, still possesses a schizophrenic character.

One way the Chinese government has attempted to control the media and entertainment industries has been through media and entertainment law. The laws -- and all the other rules and regulations by which the media environment is shaped -- state what is possible and what is not, define what classifies as acceptable content, outline licensing and investment requirements and deal with a whole host of other issues such as penalties for law violations. Some of the laws deal with the Chinese media environment in general, while others are applicable to foreign reporters or corporations.

To know exactly what the laws and other regulatory instruments are, there is probably no better place to turn for their presentation in English than this second volume of China's Media & Entertainment Law. The book, which also includes the original Chinese texts, contains key legislation in six different areas -- television, film, audiovisual products, print media, advertising and event management. Each section features commentary dealing with the history of the industry, the industry's outlook and the current regulatory environment. The commentaries are written in a very authoritative way, and are useful both for their high level of detail and identification of broader trends. The book often seems geared towards foreign investors, but it will also be of interest to academics, journalists, government policymakers and others interested in the Chinese media and entertainment industries.

One of the strengths of the book is that it contains many pieces of new legislation created since its last edition was published in 2003. A list of repealed legislation contained as an annex could have been more useful if the authors had said how the current legislation differs from the repealed legislation, but some of this information is contained in the commentaries.

A close reading of the book, however, indicates that in some cases legislation has become more onerous or restrictive, and there is evidence of this from industry developments. In November, Time Warner said that it would withdraw from the Chinese cinema market because of rule changes that prohibited it from having a majority stake in joint ventures in China in this area. Under a 2003 regulation, foreign companies could own up to 75 percent of a cinema venture in a number of cities in China. But new rules issued at the end of 2005 said that Chinese mainland investors had to have a controlling share.

While the creation of a more restrictive media environment in some cases has been the result of new media legislation, in other cases it has been due to less formal policy changes. As the book points out, there have been cases where laws have remained on the books but the implementation of them has changed. One example is landing rights for foreign satellite channels. The law pertaining to these rights is still the same, but the Chinese government has a less benign attitude towards new approvals. Another example is foreign investment in television production joint ventures. Rules promulgated in 2004 made this activity possible, but there is now a policy freeze on permitting new joint ventures. A tightening may have begun in 2005 when SARFT issued a notice saying that foreign investors could invest in only one joint venture for television production unless they received special permission.

The consequences of these changes are great. One is that foreign investors in the Chinese media and entertainment markets will have restricted opportunities, a prospect that may be worrying to some given the good growth potential in these areas. According to a forecast by PricewaterhouseCoopers in June 2006, China is set to become the biggest entertainment and media industry in the Asia-Pacific region in 2009 as compound annual growth of 18 percent, fueled by strong spending in areas such as advertising and broadband Internet access, will enable it to surpass Japan. Foreigners will participate in this growth, but perhaps not as much as they might like.

Another consequence, perhaps a more profound one, is that evolution towards democracy, or at least away from authoritarianism, will be set back. Along with the less receptive attitude of the Chinese government toward involvement of foreigners in many areas of the media and entertainment industries, though not all, there are other activities occurring that are making the Chinese media landscape generally more hostile. Hardly a month goes by when ones does not hear about the firing of an editor, the harassment of a reporter, the closure of a publication, the censorship of the Internet or some other chilling event.

The Chinese government has a lot on its plate with the approach of the 17th Party Congress later this year. Faced with the consequences of economic reform, which have allowed more private money to creep into the media industry and forced media companies to respond to commercial incentives, the government will be trying to keep a tight grip on media activities. Its second thoughts on media liberalization, or more accurately a different group of politicians and government officials' new thoughts on media liberalization, may reflect concerns about the speed of change and the possible impact on political stability.

As bleak as things may seem, there are reasons for optimism. As the authors of China's Media & Entertainment Law put it, "With China now a member of the World Trade Organization and its economy becoming more integrated with the rest of the world, in addition to the numbers of global representatives flocking to the capital for the 2008 Olympic Games, it would be surprising if the existing strict censorship rules are not relaxed at or about the time of the Beijing games." Regulations have already been eased a bit for foreign reporters and the Chinese government, should it take an enlightened view, may be inclined to seriously ponder how further media repression will damage the country's reputation in the eyes of the international community.

Probably the only thing that can be said with certainty is that the battle will go on between the forces of media change (and it is hard to say how strong these forces are with people preoccupied with making money) and the forces of resistance to media change. Sustainable media liberalization will only occur when the Chinese government realizes that media change is in its own best interests or when its current policies become unsupportable. It is true that control of the media is a feature of all governments -- the questions are: What are the content of the laws? Who shapes them? How easily can they be changed? And what are the non-legislative methods of control? The volume under review does not answer the political science questions, but it does provide a wealth of nuts-and-bolts information for intelligently considering them.

*****************************

James F. Paradise is an AsiaMedia writer and advisor. He has more than a decade of experience reporting from Asia and is currently researching China’s participation in the World Trade Organization. AsiaMedia provides daily coverage of media trends and policies.