FILM distributor Mei Ah International plans to slash prices in China - even as it is trying to force up videotape rental costs in Hong Kong. But mainlanders - who will have counterfeiters to thank for driving prices down - will have to wait six months longer than Hong Kong film buffs to see the latest releases. Mei Ah plans to combat mainland video piracy by slashing its prices there to nearer the levels charged by counterfeiters. However, in Hong Kong, worried by cut-throat competition at video rental shops, it is spearheading a campaign to have prices increased. Mei Ah aims to protect itself from the possibility of cheap mainland-released films being flown back to the territory by delaying the launch of films in China by six months. The distributor, which claims a market share of about 40 per cent in Hong Kong, expanded into China earlier this year through Guangzhou Tung Ah, a joint venture with a company controlled by the Ministry of Culture's marketing bureau. Chairman Li Kuo-hsing said the venture, which was given exclusive rights to distribute foreign films in China, had notched up sales worth more than 10 million yuan (about HK$13.4 million at the official rate) since it was set up in March. But Mr Li said it could have done better without the video piracy rampant in Guangzhou and other Chinese cities. The company was reviewing its mainland policy and was likely to cut prices sharply from the beginning of next year. Mei Ah's videotapes sell for 80 to 100 yuan in China, while counterfeits sell for about 20 yuan. ''We will follow [the pirates'] pricing to drive them out of business,'' he said. He added: ''After the price cut, we are confident the profit will be much better, because we will have a larger market.'' Mr Li said videotape sales could double or triple next year. Mei Ah would adjust its prices again once piracy had disappeared. Mei Ah plans more outlets, in areas such as Shanghai, Fujian and Sichuan, to boost sales. Mr Li said established Hong Kong videotape and laser disc rental chains might open rental stores on the mainland. Meanwhile, Mei Ah plans a territory-wide campaign for a unified rental rate in Hong Kong. Managing director Patrick Tong said talks were under way with video rental shops in Hong Kong about a unified rate of $22, moving up to $25, to prevent damaging levels of competition. Videotapes and laser discs currently cost between $9 and $20 to rent. ''Some dealers try to boost business by cutting the rentals, and this has resulted in the drop in the overall income of the industry,'' said Mr Tong. ''In the long run, this will have an adverse effect on the development of the local home entertainment market.'' He said cut-throat pricing had already forced some dealers out of business. Mr Tong said Mei Ah would increase prices by about 15 per cent once dealers became more profitable. Mei Ah plans to persuade customers of its case by explaining that the higher prices will be accompanied by better service and a larger choice of films.