Originally scheduled for December or January, Taiwanese hit Cape No. 7 has had its mainland China release postponed indefinitely.

State-owned distributor China Film Group and Taipei-based Long Shong Entertainment, the company that handles mainland China sales, have confirmed.

Also Taiwan's submission to theAcademy Awardsbest foreign-language film category,it is understood thatCape No. 7wastaken for mainland Chinaas a sign of warmer cross-strait relations.

'We have not given up introducing the film into the mainland market. But right now because of technical reasons, the film will not be released during the year-end season,' said China Film Group spokesperson Weng Li, citing issues with dubbing and subtitling.

Cape No. 7 makes heavy use of Hokkien and Hakka dialects as well as Japanese.

The original subtitles are in traditional Chinese characters, which are different from the simplified characters used in mainland China.

The film follows a failed rocker who goes back to his hometown and ends up with a band of locals from different ethnic backgrounds as they struggle with one another, and a Japanese publicist,to make music as the opening act for a visiting Japanese pop star.

The subplots include a WWII-era romance between a Japanese teacher and a Taiwanese girl.

Starting out with everyone in discord, the film ends in pluralistic harmony.

Wang Ying-hsiang, president of Long Shong said the company was told to submit the film copies on a later date as Chinese customs and China Film Group needed to negotiate some problems.

Long Shong had signed a memorandum of understanding (MOU) with China Film Group in mid-November, on distributing the film in major Chinese cities.

Chen Chih-kuan, director of the Motion Pictures Department of Taiwan's Government Information Office (GIO), told Taiwan press today that it will communicate through cross-strait dialogue channels to help the film be released in China soon.

Still on release in Taiwan, Cape No. 7 has grossed $6.9m inTaipei and is the second highest-grossing film there after Titanic.

The film just opened in Singapore last Thursday, and after 12 days on release in Hong Kong, Cape No. 7 has now taken $600,000 (HK$4.71m) and isnumber twoin the charts behind Dante Lam's Beast Stalker starring Nic Tse.

Stephen Cremin contributed to this report.