China's domestic film industry is the biggest victim of movie piracy in that country, a senior film industry representative said today in Beijing.

China is "the worst piracy problem we have in Asia. Unquestionably," said Michael Ellis, the Motion Picture Association's (MPA) senior vice president and regional director for the Asia Pacific region, at a briefing with reporters.

The country's homegrown film industry lost almost $2.5 billion to piracy in 2005, Ellis said. By comparison, the MPA's member companies, representing Hollywood's biggest film and television studios, lost an estimated $280 million.

The MPA estimates that its member companies lost $6.1 billion worldwide in 2005 to illegal reproduction or downloading of movies. In Asia-Pacific, it lost $1.2 billion. The figures are based on what the MPA projects consumers would spend on cinema tickets, DVDs, and other film-viewing opportunities if pirated film products were not available.

Although piracy losses in China are far lower than those in the US, which the MPA said were $1.3 billion in 2005, Ellis said that was because the Chinese film and video market is still not fully developed.

China's piracy rate for film and video products stands at 93 per cent, Ellis said. That is, of all such products being purchased by Chinese consumers, only 7 per cent are legitimate. The Chinese government disputes that figure, but Ellis said he has never received an official government estimate. "I still wait for any government official to tell me what the piracy rate is in China."

Chinese films have come into their own over the last decade, with films like 2002's Hero (Ying Xiong), 2003's Mountain Patrol (Kekexili), and 2004's House of Flying Daggers (Shi Mian Mai Fu) winning critical and commercial acclaim at home and internationally.

The biggest difficulty MPA members face in battling piracy in China is market access, Ellis said. Under the terms of its entrance to the World Trade Organisation, China agreed to allow 20 foreign films per year into theatrical release, with a maximum of 14 from the US. Chinese consumers often have no choice but to purchase pirated products in order to see certain titles, especially dubbed in Mandarin or subtitled in Chinese. For example, Pirates of the Caribbean — Dead Man's Chest was banned in China due to its supernatural themes, a no-no in the eyes of China's film censors.

US television shows such as Sex in the City and Friends have become huge hits in China, all via sale as pirated discs. The former was never released or broadcast in China, and the latter aired only years after the show had started its run.

Pirated DVDs in China sell for approximately $1 each. Legitimate "introductory price" DVDs, offered by some companies to create a low-priced, authentic alternative to pirated discs, come with basic packaging and no special features, and sell for $2.

Ellis lauded Chinese law enforcement efforts. "There is good rule of law here," he said, but hoped that Chinese officials would do more on market access to allow MPA members to compete against pirates.

The Motion Picture Association is the international arm of the Motion Picture Association of America, the American film industry's lobbying group. It is comprised of Hollywood's largest film studios: Buena Vista International, Paramount Pictures, Metro-Goldwyn-Mayer, Twentieth Century Fox International, Sony Pictures Releasing International, Warner Brothers International Theatrical Distribution, and Universal International Films.