Netflix & Amazon face 30% Euro content quota

The European Council has agreed there should be a minimum 30% quota on European works in the catalogue of video-on-demand service providers, including international providers, such as Netflix and Amazon, offering services in EU member states.

The move represents a significant raising of the stakes the EU’s drive to make on-demand service providers raise the level of support they offer to European content creation. The European Commission’s initial proposal for quotas last year suggested a level of 20%.

The European Council recommendation of 30% will now form the basis of negotiations with the European Parliament ahead of the adoption of the proposed directive.

In addition to the 30% quota, the Council agreement calls for member states to be able to require a financial contribution from media service providers, including those established in another member state, with exemptions for start-ups and small enterprises.

Analysts last year claimed the directive will have “limited” effect on addressing perceived imbalances between SVOD services and broadcasters, as the pan-contintental Netflix and Amazon already acquire and produce locally.

The scope of the directive has been extended to include “social media” services, where the provision of audiovisual content forms an essential part of such services.

The agreement has also set a two month deadline for national regulators to respond to requests from other member states in cases of problems relating to cross-border services, for instance those arising from providers established in one country but targeting an audience in another.

The Council proposal also calls for member states to comply with rules on the protection of minors and the protection of all citizens against hate speech and violence.

The raised quota agreement followed an amendment tabled by Greece, Spain, France, Italy, Lithuania and Romania proposing that the level be raised. Greece had earlier called for a 40% quota.

“We are very proud to have reached an agreement on audio-visual media services,” said Maltese culture minister Owen Bonnici, whose country holds the EU rotating presidency. “This is a complex directive which touches on very sensitive issues such as the internal market, fundamental rights and freedoms, cultural diversity and the protection of minors.”

“But the marketplace and technology are developing rapidly. We have to ensure that the relevant rules keep pace with these changes. Today’s agreement in the Council  constitutes a further step forward in the completion of the Digital Single Market, which is vital for Europe’s future prosperity.”

EC vice-president for the Digital Single Market Andrus Ansip said: “I am pleased that the Council adopted today a general approach on the update of the Audiovisual Media Services Directive. It is essential to have one common set of audiovisual rules across the EU and avoid the complication of different national laws.

“We need to take into account new ways of watching videos, and find the right balance to encourage innovative services, promote European films, protect children and tackle hate speech in a better way.

“Today’s agreement among Member States paves the way towards a final compromise with the European parliament. I would like to congratulate and thank the Maltese presidency for their hard work to find a consensus on this complex file, just one year after we presented the proposal.”