Netflix and several other streaming platforms have criticised a proposed German law that would require digital streaming companies to reinvest part of their locally generated revenue into domestic film and television production.
The draft legislation, approved on Wednesday by Chancellor Friedrich Merz’s cabinet, would force streaming providers operating in Germany to channel at least eight per cent of their earnings from the country into German and broader European film and TV projects. Companies that fail to comply could face financial sanctions.
The measure would affect major international platforms such as Disney+ and Amazon Prime Video, alongside local streaming services. Although the proposal still requires parliamentary approval, German authorities say the initiative is aimed at revitalising the country’s struggling film industry.
In addition to the proposed regulation, the government announced plans to almost double public funding for local productions, increasing support to 250 million euros ($290 million).
Netflix, however, warned that the policy could negatively impact investment and limit growth within Germany’s entertainment sector.
“If regulation ultimately makes it harder to invest in ambitious projects and, as a result, fewer titles are produced overall, that benefits neither audiences nor the production location,” Wolf Osthaus, Netflix’s senior global affairs director in Germany, said in comments sent to AFP.
The objections were first reported by The Financial Times.
Osthaus also expressed concern over provisions requiring streaming companies to gradually return or share rights with producers instead of retaining them permanently.
“The risk is that large, ambitious projects will no longer be economically viable, because such big budgets often cannot be put together through co-financing,” Osthaus said.
Vaunet, an organisation representing streaming companies including Disney+, Paramount+ and RTL+, also criticised the proposed law, describing it as “an unnecessary and disproportionate interference with media freedom”.
“The actual goal of strengthening Germany as a production hub with diverse content cannot be achieved through legal compulsion,” said Vaunet managing director Daniela Beaujean, who called for changes to the proposal.
Under the draft law, any streaming platform that fails to meet the reinvestment requirement could be fined up to 75 per cent of the amount not invested.
The legislation would additionally require platforms to maintain a minimum quota of German-language and European productions. However, companies investing at least 12 per cent of their German earnings into local content would be exempt from the quota requirement.
Germany would not be the first European country to adopt such measures. Nations including France, Denmark and Sweden already enforce rules requiring streaming services to reinvest part of their locally earned revenue into domestic productions, although the regulations differ from country to country.
