The movie, also starring Donnie Yen, is the third instalment in a series of Hong Kong films about the life of famed Wing Chun master Yip Man, teacher of Bruce Lee and other martial arts legends.
Chinese film distributors and cinemas often try to inflate box office figures in order to create blockbuster buzz for new releases and attract moviegoers. There may also be financial incentives for such activities.
But the film's distributor Beijing Max Screen bought 56 million yuan-worth of the tickets itself, and fabricated more than 7,600 screenings that it claimed generated another 32 million yuan, the media regulator's official newspaper said.
The State Administration of Press, Publication, Radio, Film and Television (SAPPRFT) ordered the firm to suspend its distribution activities for a month while it "rectified all malpractices", the China Film Newspaper reported Friday.
More From This Section
One common tactic is for distributors to collude with cinemas by buying up empty seats in exchange for guarantees that theatres will screen their product.
"You used to invite the cinema managers out for dinner and drinks, but now it's become much more direct. Buying the tickets yourself is a way of ingratiating yourself with the cinemas," Xu explained.
The distributor of "Monster Hunt", touted as the highest grossing Chinese film of all time, admitted in August to falsifying its box office figures by handing out large numbers of free tickets in 17 cities and scheduling extra screenings in the middle of the night, among other tricks.
But he expected the punishment would do little to change the long-established practice.
Ip Man 3's falsified figures "caused a serious disturbance in the film market, generated a definite level of harm to the environment of fair competition, and adversely impacted the credibility of the film industry as a whole," the China Film Newspaper said.