Film industry worries practicability of capping celebrity pay move

Nine Chinese TV and film production companies released a joint statement on Saturday to limit high celebrity pay, which raised industry insiders' concerns about its feasibility, reports the Beijing News.

According to the statement, payments for actors cannot exceed 40 percent of the overall budget of any of their future productions, while lead actors can only earn 70 percent of the cast's total pay. The companies also set salary caps demanding that an actor can get paid 50 million yuan ($7.3 million, including taxes) at most for an entire TV series and 1 million yuan tops for each TV series episode. The campaign was led by China's three largest online media streaming platforms: iQiyi, Youku, and Tencent.

Famous Chinese actress Fan Bingbing [File photo: IC]

Some people working in the film industry are applauding the move as a producer saying the statement promotes artists to return to the nature of creation and produce better works. Another producer said film star payment is a market conduct, but has to be in accordance with the basic revenue rules.

Nevertheless, some professionals are foreseeing challenges and difficulties in implementing the measures proposed in the statement. Director Jiang Haiyang said the fact that film stars get massive paychecks is not easy to change because it's the result of the profit model of media streaming platforms. "The platforms need investments from advertisers and sponsors, who are more willing to invest in TV shows featuring A-list actors who can draw a large amount of data flow from the audience."

Jiang Yong, an expert in film marketing who doesn't think highly of the specified salary limits, said the cap lacks reasonableness because it's not set based on the market. He called on disclosing paychecks of actors, making them more transparent.

According to director Lin Nan, the statement clarifies that actors must pay their own tax obligations rather than production companies bearing the burden, but there are no detailed specifications on that front. Lin said carrying the stipulations in the statement needs concerted efforts by all parts in the industry and more specific regulations to follow.

Some experts also point out that the statement only involves nine enterprises and is not compulsory. Huayi Brothers Media, with which famous Chinese actress Fan Bingbing is associated, has neither joined the campaign nor released any public comment on the issue.

The statement follows a joint announcement by several national-level government bodies in June, which urged the film and TV industry to deal with exorbitant celebrity pay and tax evasion. The measure also comes on the heels of a widely publicized legal issue in May involving Fan Bingbing.