Reed Hastings, chief executive officer for Netflix Photo: IC

US firms like Netflix, Amazon and Apple face quotas for European movies and television shows under EU proposals unveiled Wednesday that also aim to lift cross-border barriers for Internet shoppers.

The proposals are the latest step towards what Brussels calls a digital single market, in which the European Union's 500 million people will no longer be blocked from buying goods and services more cheaply abroad online.

"We have a European film culture and we think European content should be in those programs," Guenther Oettinger, the German EU commissioner for digital economy, told a press conference in Brussels.

The European Commission, the executive of the 28-nation European Union, called for US Web streaming giants like Netflix and Amazon Prime to devote 20 percent of their content in Europe to European movies and television shows.

The proposal also targets Apple's iTunes, which offers movies for download, although EU officials said both Netflix and iTunes already devote 21 percent of their catalogues to European content.

The Commission believes that "there should be a guaranteed share of those programs," and that "20 percent is a reasonable figure," Oettinger said.

"We are giving businesses some room for maneuver to show non-European products," added Oettinger, speaking in German through a translator.

Quotas already set by some member states vary between 10 percent and 60 percent.

Fighting the dominance of Hollywood is a major priority for EU heavyweight France in particular, which has for years subsidized its own national film industry through a special tax on privately-owned broadcasters that rely heavily on US-made content.

The Commission also proposed that member states should be able to ask on-demand services available in their country to "contribute financially to European works," stopping short of calling for a tax.

"We appreciate the Commission's objective to have European production flourish, however the proposed measures won't actually achieve that," Netflix said in a statement.

Netflix said it has so far committed hundreds of millions of euros to European productions, including its first major French-language series Marseille, starring Gerard Depardieu, that premiered this month.

It added many more Europe-produced series were in the pipeline.

The proposals call for member states to allow for independent regulators who will ensure that video-sharing platforms, such as YouTube, protect young people from harmful content, like violence and pornography.

And they call for protecting all citizens from incitement to hatred.

'Geoblocking' overhaul

Meanwhile the Commission also proposed that online firms lift barriers starting next year to Internet shoppers who seek cheaper prices for goods and services on sites in different European countries.

The practice known as "geoblocking" often limits customers to websites in their home countries for services such as car hire or travel, blocking them from seeking better prices on foreign sites.

Under the proposals, for example, automatically rerouting customers to a local version of the online service will be forbidden.

"Discrimination between EU consumers based on the objective to segment markets along national borders has no place in the single market," EU Industry Commissioner Elzbieta Bienkowska said.

But trade group DigitalEurope said geoblocking is a symptom rather than the cause of a fragmented EU market resulting from differing national living standards, consumer habits, language requirements, consumer laws, copyright and value added tax rates.

"This is like putting a sticking plaster on a broken leg," DigitalEurope Director General John Higgins said in a statement.

In a related proposal, the Commission called for making cross-border parcel delivery more affordable by introducing greater price transparency to foster competition.

"For 50 percent of our European companies, the main obstacle to flourishing in e-commerce is high parcel prices," Andrus Ansip, the European Commission's vice president on media issues, told reporters.

The proposed geoblocking ruling currently excludes audiovisual online providers but leaves it open to a review that worries firms that sell music or electronic books.

The European Consumer Organization welcomed the "great news" on the proposed geoblocking overhaul but regretted that ebooks, music, television series, films and sports were still off-limits.

"It is time the EU puts the final nail in the coffin of geoblocking," organization head Monique Goyens said in a statement.

The plans must now be approved by member states and the European parliament.

AFP
Newspaper headline: One market to rule them all