With Taiwanese film production at a record low, there was some speculation whether this year's Golden Horse Film Festival and Awards would even take place.

The success of Hong Kong and Chinese movies at recent Awards has embarrassed the Taiwan government, with tensions further strained over the festival's position on speeches by politicians. After months of uncertainty, funding arrived at the eleventh hour. The 16-day film festival, in its 25th edition, unspooled on 27 November with 98 features and 73 short films.

The festival has moved to the more expensive eastern side of the city, at the popular Warner Village multiplex in the shadow of Taipei 101, the world's tallest building. Festival highlights include a focus on director Godfrey Reggio, a strong line-up of Asian features and an expanded digital shorts competition.

The competition, previously restricted to local work, has opened up to international entries, giving the top prize of US$5,875 to French filmmaker Juan Solanas' The Man Without A Head.

This year's most controversial entries - Bernardo Bertolucci's The Dreamers and midnight screenings of Miike Takashi's gory Gozu and Ichi The Killer - required the signing of a disclaimer by audiences, pronouncing themselves mentally fit to watch the films uncut. But the real controversy was in the stalls with a catfight breaking out after Ken Loach's Sweet Sixteen, and the case of the filmlover who got on his knees to beg another audience member to eat quietly during an otherwise silent screening of F.W. Murnau's Nosferatu.

While the festival is largely an audience event, it's beginning to have a business function as well. Head programmer Liu Wei-jan noted that this year's event has proved instrumental in finding buyers for several films, including Thomas McCarthy's The Station Agent, Denys Arcand's The Barbarian Invasions, Khyentse Norbu's Travellers And Magicians and Sanjay Leela Bhansau's Devdas. Festival guests included Norbu, Junji Sakamoto and Bernd Lichtenberg, the award-winning screenwriter of Goodbye, Lenin.

Just one local film received its world premiere at the festival, Alex Yang's relationship drama Taipei 21. It explores the end of a young couple's life together in Taiwan's recession-hit capital. The title refers to the two choices facing the protagonist: to marry her underachieving boyfriend of seven years, or move to North America to further her studies. More focused than his debut, The Trigger, it marks the director's attempt to make a more commercial film in a difficult local market.

Actor Lee Kang-sheng's directorial debut The Missing also received its local premiere. It opens nationwide together with Tsai Ming-liang's Goodbye, Dragon Inn on December 12. Tsai's film previewed for one week in August to impressive box office and opened this year's festival.