A scene from the Chinese independent movie Don’t Expect Praises. Credit: Yang Jin

BEIJING — Yang Jin shot his first film, “The Black and White Milk Cow,” in his hometown in 2004 for $1,600. He asked villagers to be his actors, paying them only in cigarettes, and his main expense was $320 spent renting the titular cow.

The tale of poor, rural China won him a $5,000 prize at Switzerland’s Fribourg International Film Festival, but it had no chance of being seen or making money in his homeland. Because it touched on the subjects of AIDS and Chinese Christians, Yang knew it wouldn’t get past the censors, and thus could never play in Chinese theaters, on TV, or even be sold legally on DVD.

Yang’s second film was a similarly shoestring, underground affair. When it came time for his third, he wanted to do something more sophisticated — and reach a wider audience.

In the past, Yang’s choices would have been to try to move into much more commercial fare with a Chinese studio, or look for financial backing abroad — following in the footsteps of directors such as Wang Xiaoshuai, whose “Beijing Bicycle” (2001) was funded with the help of French and Taiwanese studios, or Lou Ye, whose “Suzhou River” (2000) had producers in Paris and Berlin.

But in the last few years, more and more filmmakers like Yang have been trying to carve out a new middle ground: They are developing scripts for art house-style movies that can win a “dragon seal” (Chinese censors’ official stamp of endorsement). As the number of these government-approved indie films grows, a nascent Chinese industry — production houses and exhibitors — is emerging to support them.

For “Don’t Expect Praises,” a charming, Tom Sawyer-esque story of two naughty little boys who spend their days fishing and plotting to run away, Yang raised 30% of his 1 million renminbi ($160,000) budget from Heaven Pictures, one of a growing number of companies supporting art house cinema within China. He recently cleared the censorship process and is excited to see one of his movies released in a Chinese cinema for the first time.

“For my first two films, I had to buy props myself. Now, I am working with 36 professionals,” said Yang, 30. “I have an art team, photography team, and costume team, so I can concentrate on directing and go on set with only a script in my hand.”

The trend is not without its detractors, who fret that a new generation of filmmakers may be sacrificing its artistic integrity. But Yang and others say independent filmmaking in China can be broader than just underground cinema.

“With the dragon seal, I can sell in China. I haven’t had to compromise, because to begin with the film’s subject matter is not dark. It’s a simple story about a child’s adventure.”

Heaven Pictures was established in 2010 and supports both films sanctioned by the censors and productions that have not applied for government approval.

“Our fund was set up because there are lots of young people with the talent and the passion, but who weren’t getting the chance to make films,” said general manager Yang Cheng.

While non-dragon seal films can be sold only overseas or online, Yang said applying for a dragon seal, so that a film can be screened domestically, does not necessarily mean making a deal with the devil.

“It’s the director’s choice,” he argued. “A film with a dragon seal doesn’t have to be mainstream, praise the government or be middle-of-the-road. It also can be pointed, experimental and exploring.”

Even if a film does receive a dragon seal, a wide theatrical opening is hardly guaranteed. Without a big-name star or a blockbuster story line, the chances of a film’s being shown in China’s megaplexes are bleak.

Until recently, a low-budget art house film’s best bet for making a return domestically was to be sold to a television station dedicated to movies, such as state-run CCTV6. But three years ago, the first art house cinema in mainland China opened in Beijing: Broadway Cinematheque Moma.

“When I was a student, if you wanted to see independent films, you had to find illegal DVDs or travel an hour on a bus to some screening in an obscure cafe,” recalled Wu Jing, the program director of BC Moma.

BC Moma must work with China’s state film bureau and can show only dragon-seal pictures; it screens domestic indie fare alongside more artistic international films such as “Anna Karenina.”

Business is good: With sales up 30% this year, the company is looking into opening another theater in Shanghai. “The problem is not the audience,” said Wu, but the difficulty is “finding enough good films to show.”

Industry professionals such as Wu Jing and Yang Cheng are optimistic that independent film in China can continue to grow and work in conjunction with the government.

However, Karin Chien, the founder of dGenerate Films, which distributes Chinese independent films (with and without dragon seals) around the world, noted that the definition of “independent film” is under strain in China.

As an example, she cited Lixin Fan’s “Last Train Home,” a documentary about migrant workers that screened at BC Moma and played at the Sundance Film Festival in 2010.

“Last Train Home,” she said, was “a very controversial film in the independent community in China.… It was very squarely identified as an independent film in the U.S. for all the American signifiers of what an independent film is: It was filmed outside the studio system, it’s a film that played at Sundance, and it’s a signifier that it’s independent filmmaking. But Chinese filmmakers see that it’s a film that’s been government approved, it showed in theaters, so it’s controversial to call it independent.”

Still, she noted that “if you want to make a bigger film in China, you normally have to cooperate with the government in some way. I don’t think in the U.S., an independent filmmaker is really confronted with losing his artistic credibility or not being true to his principles in order to make bigger films. But in China, you are caught between these two choices.”

For older, more established filmmakers such as Lou Ye, this choice seems stark. After Lou submitted his “Summer Palace” to Cannes in 2006 without Chinese government approval, he was banned from making films in China for five years. When he sought to get his most recent French co-production, “Mystery,” through China’s censors, he was asked to make many changes and took the unusually confrontational step of blogging about his battle with the film bureau.

Among members of the younger generation, though, there seems to be an expectation — perhaps naive, perhaps practical — that they will simply hop back and forth between the two worlds of dragon seal and underground independent film with little conflict.

Though “Don’t Expect Praises” received a dragon seal, Yang Jin says his next film will “touch on sensitive matters” and he thinks he will have to “shoot it secretly.”

“Independence,” he said, “means shooting whatever I like in whatever way I want.”

First appeared in Los Angeles Times on December 9, 2012.