Selecting which film to submit for the foreign-language Oscar category has become part of the political quagmire engulfing China and Taiwan.

If indeed "The Knot" (for China) and "Lust, Caution" (Taiwan) emerge as the respective candidates, it won’t have been without plenty of twists.

At one stage it seemed as if China might have named Ang Lee’s "Lust, Caution" in a move to frustrate Taiwan — a territory that China regards as a rebel province, not a sovereign nation.

But, according to sources at the Academy of Motion Picture Arts & Sciences, Taiwan's Government Information Office submitted "Lust" in time to meet the Oct. 1 deadline.

The same sources were unclear whether China had submitted a picture in time, but told Variety that they like to be "as flexible as possible."

Given the total shutdown of China for the Golden Week holiday, repeated phone calls to the Film Bureau seeking clarification have gone unanswered. Strong rumors now have it that "The Knot" (Yun shui yao), a period melodrama by Yi Lin, is China's choice.

The situation once again underlines the thorny problems of assigning nationality to movies — especially co-productions and especially in Asia.

Taiwan’s claim to “Lust” already has proved controversial. During the recent Venice Film Festival, where “Lust” premiered, Taiwan’s Mainland Affairs Council made an official complaint about the festival’s website, which listed the film as originating from “Taiwan, China.” The council said that looked too much like “Denver, Colorado,” and gave the impression that Taiwan is part of China. Venice caved in and amended the site.

Apart from being the place of Lee’s birth, Taiwan had little to do with the film. Its story is set in Shanghai and Hong Kong and filmed in China and Malaysia. It was made with coin from China, Hong Kong and Focus Features of the U.S. Lead actor Tony Leung Chiu-wai is from Hong Kong, while Tang Wei and Joan Chen are both from China. Highest ranking cast member with a Taiwan connection is Wang Lee Hom, a New Yorker who now has a decent Mandarin pop music career.

While China’s claim to “Lust” may be considerably stronger, pic did not play commercially there before the submission deadline. Its sex scenes were partially trimmed and were nevertheless deemed too provocative to screen before this month’s upcoming Communist Party Congress. The film opened in Taiwan on Sept. 24, giving it exactly the minimum required seven days of commercial release necessary to qualify for the Oscars.

China’s film industry honchos may have felt the red carpet being pulled from under their feet. Not only did “Lust” not screen in China, Jiang Wen’s “The Sun Also Rises” was both too arty and too public a box office flop to enjoy a decent Oscar run. Peter Chan Ho-sun’s “The Warlords,” which the local press talked about as the strongest candidate, will not emerge from post-production until mid-November ahead of its Dec. 13 commercial release.

Industry gossip says that there might have been another political dimension, too. Some say that China backed down over “Lust” and appeased Taiwan in the hope that Taiwan may reverse its objection to next year’s Olympic torch relay traveling through the territory.

That leaves China with “The Knot,” an undistinguished period melodrama. The irony is that the pic was very carefully constructed to have a multi-territory Chinese-Hong Kong-Taiwanese production pedigree and a heartwarming pan-Chinese, cross-strait theme.

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