The Academy of Motion Picture Arts & Sciences has defended its decision to reject Ang Lee's Lust, Caution as the Taiwanese submission for the Foreign Language Oscar race.

When the Academy's Foreign Language Film Award Executive Committee met on Oct 11 to discuss any problematic entries, Lust, Caution was disqualifed as the Taiwanese entry. Taiwan was invited to submit an alternate, and it quickly put forward Chen Huai-En's Island Etude.

'The film was disqualified because the rules require that creative talent from the submitting nation head up at least a few of the key areas beyond producer/director/writer,' Academy spokeswoman Leslie Unger clarified. 'The cinematographer, editor, composer, production designer, costume designer, sound mixer and the principal cast members [of Lust, Caution] were all non-Taiwanese.'

Earlier this week in an interview with ScreenDaily.com, the film's executive producer and Focus Features CEO James Schamus, called Academy's decision 'unjust and capricious.'

Academy Executive Director Bruce Davis said the situation was a clear-cut case of the film not meeting Oscar rules.

'We certainly agree with Mr. Schamus that Ang Lee is a 'world-class director making a film in a foreign language,' but we're not as clear about how a film set in mainland China and Hong Kong is 'expressing the quintessence and height of a culture,' if by that he means Taiwanese culture,' Davis said in a statement to ScreenDaily.com.

Davis continued: 'The Academy has demonstrated its enormous respect for Ang Lee's work on numerous occasions, and we wish Lust, Caution the best of luck in the 17 categories in which it qualifies.'

Rules for all Academy Awards categories are available by post, online or by contacting Academy staff.

A record 63 countries submitted films in the Foreign Language category for the 80th Oscars.

This year's Oscar nominees will be announced Jan 22, 2008 and the ceremony is held Feb 24, 2008.