Lawmaker Wants DOJ to Probe Dalian Wanda’s Hollywood Acquisitions

Congressman wants re-examination of the Foreign Agents Registration Act in Wanda’s recent deals

Last Updated: October 6, 2016 @ 4:05 PM

The Dalian Wanda Group’s Hollywood acquisitions are under more scrutiny from U.S. politicians.

In a letter Thursday, Rep. John Culberson, a Texas Republican, asked the Assistant Attorney General for National Security John Carlin to re-examine a registration act that would address “foreign lobbying and propaganda efforts in the United States, especially by countries like China and Russia.”

The Foreign Agents Registration Act (FARA) has not been reviewed since 1990, according to Culberson, and should be deployed so the U.S. does not “allow Chinese state-controlled companies a significant degree of control over the financing and content of American media.”

FARA was adopted in 1938, according to the letter, in response to rising propaganda from the Soviets and the Nazis in the U.S.

Culberson, the Chairman of the House Subcommittee on Commerce, Justice, Science, and Related Agencies, claims FARA’s power has been eroded over the last 26 years and has not adapted to technology and foreign mergers and acquisitions.

Wanda recently purchased Thomas Tull‘s Legendary Pictures for $3.5 billion, is pursuing Dick Clark Productions to the tune of $1 billion and has several strategic partnerships with major Hollywood studios such as Sony Pictures. (Thursday’s letter erroneously stated that Wanda had purchased a 49 percent minority stake in Paramount Pictures. The Chinese company was in talks to do so, but the purchase stalled after the removal of Viacom’s CEO Philippe Dauman.)

The congressman specifically calls out Wanda CEO Wang Jianlin, stating that he “does not try to hide his close relationship with the Chinese government,” referencing an article in which Wang said his goal is to “change the world where rules are set by foreigners.”

“This has profound implications for American media controlled by this type of Chinese company leadership,” added Culberson.

Culberson also recalled a report by the U.S.-China Economic and Security Review Commission titled “Directed by Hollywood, Edited by China: How China’s Censorship and Influence Affect Films Worldwide.”

“The report documents a growing number of troubling examples of how agents of the Chinese Communist Party are exerting control of American movie content, both through direct ownership of studios and distribution as well as through coerced cooperations with the Chinese censorship agency, the State Administration of Press, Publication, Radio, Film and Television,” he wrote.

At the end of the letter, Culberson calls FARA an “important and significantly underutilized tool the department has as its disposal,” and urges the DOJ to provide options “Congress may consider to ensure transparency, full disclosure and to mitigate this type of foreign propaganda influence over American media.”

Earlier this week, the Government Accountability Office accepted a request from members of Congress to review the Committee on Foreign Investment in the United States and determine whether its legal powers have kept pace with the influx of international buyers targeting American companies — particularly the fire hose of Chinese investment in Hollywood.

Rep. Robert Pittenger, a North Carolina Republican, headed a group of 16 members of Congress who wrote an initial letter to the GAO on Sept. 15 asking the body — Congress’ investigative arm — “to determine whether its statutory and administrative authorities have effectively kept pace with the growing scope of foreign acquisitions in strategically important sectors in the U.S.”

The letter expressed concern about Wanda’s acquisition of Legendary, as well as its ownership of AMC Theaters and pending acquisition of Carmike Cinemas. It referenced “China’s efforts to censor topics and exert propaganda controls on American media.”

Read Culberson’s full letter here.