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Co‐production of films entails a variety of transborder mobility and trans‐local production networks, which are further complicated by state intervention through co‐production treaties or arrangements. This paper unravels the process of Mainland China–Hong Kong film co‐production that has been explosive after the promulgation of 'Closer Economic Partnership Arrangement' (CEPA). Drawing on the information of all Mainland–Hong Kong co‐produced films between 1998 and 2017, we chart the collaborative networks of studios and creative staffs and examine the commercial and artistic performances of co‐produced films to illustrate the impact of regulatory reform on the evolution of cross‐border film co‐production. We argue that CEPA is among the series of national regulatory reforms to enable marketisation of the film industry and, further, to construct an imagined new identity of Chinese culture at the supranational scale. However, the cultural goals have been given way to the commercial interests of co‐production with the implementation of CEPA policies. [ABSTRACT FROM AUTHOR]