Case C-308/26, Netflix International – must a streaming levy fund new films?
Since 2018 a Member State may tax a streaming service that targets its viewers from abroad to pay for its own film industry. The Belgian Cour constitutionnelle asks how far it may dictate what the money buys.
Facts
Netflix International BV, established in the Netherlands, is challenging before the Cour constitutionnelle a decree of the French Community of Belgium on audiovisual media services, as amended in December 2023. The decree requires on-demand providers targeting the French-speaking Belgian audience to contribute financially to the production of audiovisual works. Where the contribution takes the form of direct investment in production, it must go to new works and must be split — 65% to European works, 35% to French-language Belgian works; the acquisition of broadcasting rights in works already produced does not count. Where the contribution is instead paid as a lump sum to a public fund, no such allocation applies. Netflix, which is subject to a contribution obligation in the Netherlands as well, says the Belgian rules go beyond what Article 13 of Directive 2010/13/EU permits and discriminate against a provider established in another Member State.
Questions Referred
1. Must Article 13(2) of Directive 2010/13/EU of the European Parliament and of the Council of 10 March 2010 on the coordination of certain provisions laid down by law, regulation or administrative action in Member States concerning the provision of audiovisual media services (Audiovisual Media Services Directive) (codified version) be interpreted as allowing a Member State to offer media service providers the possibility of fulfilling the obligation to make a financial contribution to the production of audiovisual works in the form of direct investments in content, not only by investing in new works to be produced, but also by acquiring broadcasting rights for European works already produced?
2. If the first question referred for a preliminary ruling is answered in the affirmative, must the requirement of proportionality laid down in Article 13(2) of Directive 2010/13/EU be interpreted as precluding a Member State from prohibiting a media service provider which targets audiences in the territory of that Member State whilst being established in another Member State from paying the mandatory financial contribution for the production of audiovisual works by acquiring broadcasting rights for audiovisual works already produced?
3. Must the requirements of proportionality and non-discrimination contained in Article 13(2) of Directive 2010/13/EU, in Article 56 of the Treaty on the Functioning of the European Union and in Articles 16, 20 and 21 of the Charter of Fundamental Rights of the European Union be interpreted as precluding the legislation of a Member State, such as Article 6.1.1-1 of the Decree of the French Community of 4 February 2021 on audiovisual media services and video sharing services, as replaced by Article 60 of the Decree of the French Community of 7 December 2023 amending the Decree of 4 February 2021 on audiovisual media services and video sharing services, under which, for the financial contribution to the production of audiovisual works by direct investment in production, there is an allocation for investments in European works (65 %) and investments in French-language Belgian audiovisual works (35 %), but under which that allocation does not apply where that contribution is made in the form of a payment of a sum of money to a specific public institution?
4. Must the second sentence of Article 13(3) of Directive 2010/13/EU, Article 56 of the Treaty on the Functioning of the European Union and Articles 16, 20 and 21 of the Charter of Fundamental Rights of the European Union be interpreted as precluding a Member State, in order to comply with the obligation to contribute financially to the production of European works by a provider of on-demand media services which targets audiences in its territory but is established in the territory of another Member State of the European Union, from not taking into account the financial contribution of that provider, in performance of an obligation to contribute to the production of European works, in the Member State in which it is established?
Sources
OJ notice C/2026/3290 (EUR‑Lex) · Case file on CURIA · Directive 2010/13/EU as amended by Directive (EU) 2018/1808
Comment
Article 13(2), as inserted by the 2018 revision of the Directive, is short and permissive: where a Member State requires providers under its jurisdiction to contribute financially to European works, “including via direct investment in content and contribution to national funds, they may also require media service providers targeting audiences in their territories, but established in other Member States to make such financial contributions, which shall be proportionate and non-discriminatory”. That sentence is the whole legal basis for the streaming levies that have spread across the Union since 2020, and the reference is the first to ask the Court what “proportionate and non-discriminatory” limits. Netflix’s four questions work outward from the narrowest: whether the levy may be spent only on new production (Question 1); whether a non-established provider may be denied an option — buying existing rights — that would satisfy the obligation more cheaply (Question 2); whether earmarking 35% for Belgian French-language works is a national preference dressed as cultural policy (Question 3); and whether Belgium must credit what Netflix already pays in the Netherlands (Question 4).
The fourth question has the clearest text behind it. Article 13(3) provides that the contribution of a non-established provider “shall be based only on the revenues earned in the targeted Member States”, and that “if the Member State where the provider is established imposes such a financial contribution, it shall take into account any financial contributions imposed by targeted Member States”. The duty to take account runs from the home State to the targeted State — the Netherlands must credit Belgium, not Belgium the Netherlands. Netflix’s reading turns that sentence around, and the referring court is right to ask whether Article 56 and the Charter require more symmetry than the Directive provides; but the drafting is deliberate, and the Court tends to hold Member States to what the legislature wrote rather than to what a provider would prefer it had written.
The third question is the most sensitive, because it concerns the cultural purpose of the whole scheme. The Directive’s aim is the promotion of “European works”; the French Community has reserved a third of direct investment for works from one linguistic community in one Member State. Whether that is a legitimate specification of the European objective or a discrimination in favour of domestic production is the kind of question on which the Court’s answer in free movement cases has depended on how the national measure is drafted — and here the referring court notes the asymmetry that the allocation binds direct investment but not a cash payment to the public fund, which suggests a policy of steering money towards particular producers rather than towards production as such.
A separate Italian reference by the same provider, Case C‑51/26, asks whether a video-on-demand service may be made to contribute to the funding of the regulator itself without regard to how much regulating it receives. Together the two cases will tell streaming services what the Directive’s licence to tax them actually permits.