THX, a company focused on cinema certification business that was founded by Star Wars director George Lucas, has chosen Hong Kong as its Asian headquarters as it eyes expansion on the mainland, which is on track to overtake the US as the world's largest film market. Rene-Louis Cacciuttolo, THX's executive vice-president of international business, said it chose Hong Kong as its Asian hub despite declines in the number of movies produced in the city and the number of cinemas here. There were only 51 films produced in Hong Kong last year, down from 300 a year in the mid-1990s, and the city had only 47 cinemas and 37,420 seats last year, down from with 119 cinemas offering 121,885 seats in 1993. "We believe Hong Kong is the best place to be our Asian headquarters for its geographical location, which is close to mainland China and makes for easy to travel to other Asian markets," he said. "It also has rule of law and a sound financial system." The mainland box office topped US$4.75 billion last year, up 40 times from US$120 million in 2003 with an average annual growth rate of 30 per cent. Transformers: Age of Extinction sold US$320 million in tickets on the mainland last year, more than the US$245 million it grossed in the United States, while this February's mainland box office surpassed that of the US. "China has become the second-largest movie market after the US," Cacciuttolo said. "With many new premium cinemas established every day, it is only a matter of time for us to see China become the biggest film market worldwide. This will provide tremendous growth opportunities for THX." Cacciuttolo, 49, was born in the southern French city of Perpignan, where his family ran a 200-seat live theatre, and has always had an interest in the entertainment business. His grandfather served in the military in Asia and urged him to learn Putonghua, which he now speaks fluently, while in high school. "My grandfather predicted in the 1960s that China would become a superpower, so I had to learn the language at young age," he said. After graduating from university, he got a job in marketing and advertising in Taiwan in 1988 and he has since worked in Taiwan, Hong Kong and mainland China. He served as head of several major advertising companies in Asia including Saatchi & Saatchi X and Ogilvy Action. In 2011, he quit advertising to become a writer and director, producing his first film, Cendre , which was shown in film festivals in London, Rome and Sydney and won two awards. But he needed a job to earn a living and joined THX last year. "I still have a dream in film making," he said. "Joining THX is sort of combining my work and my interest." Cacciuttolo insisted on being interviewed in the only THX-certified theatre in Hong Kong - the Run Run Shaw Creative Media Centre at City University. For a theatre or studio to be THX certified, its design, construction materials and equipment must pass numerous tests to make sure they can reproduce movie soundtrack and image the way the directors intended. THX was founded by Lucas in 1983 after he had a horrible experience watching Star Wars at the cinema. "George Lucas, the creator of Star Wars , was very disappointed by the poor acoustics, image and sound quality in the cinema which failed to truthfully translate the artist's original intention to the audience," Cacciuttolo said. Lucas then worked with his engineering team at Lucasfilm in San Francisco to establish THX - named after the title character of his first feature film THX1138 - and develop technology and a certification system for cinemas and production studios. It was later expanded to premium audio and video systems for home and automotive applications. "All equipment needs to pass through hundreds of tests," Cacciuttolo said. "If any piece of equipment fails only one test, it won't be able to get the THX certification." THX was spun-off from Lucasfilm in 2001 with the majority share now owned by private investors. It now makes money though issuing certificates to cinemas, films studios and equipment manufacturers that want to prove their high standards. It has 90 cinema chain partners and 82 studio partners in 26 countries. It also provides consultancy services for the design and technological development of cinemas and home entertainment systems for the home, aircraft and cars. Clients have included US President Barack Obama's Air Force One jet and Russia's Kremlin Palace Theatre. On the mainland, it has an office in Beijing and a partnership with state-owned China Film Group which, one of the largest cinema operators. "Besides China Film, we have also had many discussions with other cinema operators and studios on the mainland," Cacciuttolo said. "THX expects to certify most of China's premium cinema auditoriums by 2020." He said many production studios on the mainland also wanted THX certification so they could attract well-known international directors. The Hong Kong government recently proposed reserving some land for building new cinemas, a move welcomed by Cacciuttolo, who said THX could help to design high quality cinemas.