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Why Is China Blocking The Release Of Disney's 'The Eternals'?

Walt Disney Co. (NYSE: DIS) is facing problems with the Chinese government on the release of its upcoming film “Eternals” due to an eight-year-old interview by director Chloé Zhao’s that criticized the ruling Communist Party.

What Happened: China limits the number of international films that play in local cinemas, and box office success around the world is no guarantee of a local release. Disney’s “Black Widow” and “Space Jam: A New Legacy” from AT&T (NYSE: T) have yet to secure playdates in the country.

Two surefire guarantees for exclusion from the Chinese cinema are film talent who are critical of the Chinese leadership and films that are perceived by Chinese censors as being insulting to the national heritage.

The Beijing-born Zhao, who won the Academy Award earlier this year for directing “Nomadland” from Disney’s Searchlight subsidiary, accused the Communist-run government of creating a land “where there are lies everywhere." Since then, her presence has been mostly scrubbed from Chinese social media and the news of her Academy Award victory was censored by local media.

Disney also reportedly ran afoul of Chinese censors for its recent “Shang-Chi and the Legend of the Ten Rings” due to comments made in 2017 by its star, Simu Liu, on starvation deaths of Chinese nationals, while the 2020 live-action version of “Mulan” wasn't released in China due to perceived historical inaccuracies in the film’s story.

Related Link: 'No Time To Die' Tops Box Office With M: Why 007 Underperformed

What's Next: The Wall Street Journal, citing an unnamed “person familiar with the matter,” reported that Disney has yet to receive word from the Chinese authorities on whether its films can get playdates in the country. The company's investment in China, including the $5.5 billion Shanghai Disney Resort, hasn't helped ensure its films will reach Chinese audiences.

The Chinese box office is the largest film market in the world, overtaking the U.S. last year when Chinese theaters opened before their U.S. counterparts. The 2020 Chinese production “The Eight Hundred” became the highest-grossing film in the world last year with $460 million from the local box office.

Photo: Angelina Jolie in “The Eternals,” courtesy of Disney.

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