The proposed provisions apply to providers of subscription on-demand services. The proposal also applies to European audiovisual content. The purpose of the proposal is to implement Article 13(2) of the AVMS Directive (EU 2018/1808).

Government proposal to Parliament for an act on an investment obligation for audiovisual on-demand servic

Under the proposal, subscription on-demand service providers established in Finland would be obliged to contribute financially to the production of European audiovisual content in Finland. The obligation would also apply to providers of on-demand services established in another EU Member State who make a subscription on-demand service available to the public within Finland. The act would not apply to providers of subscription on-demand services whose annual turnover in Finland does not exceed EUR 2 million, or whose subscriber base accounts for less than one per cent of the total number of subscribers to subscription on-demand services in Finland, or whose service is thematic in nature and focuses on a single subject area such as sports. The financing obligation would not apply to linear services provided by television companies or to video-sharing platform services. The obligation would not apply to the Finnish Broadcasting Company (Yle), whose on-demand service Yle Areena is financed by tax.

Under the obligation, providers of subscription on-demand services must invest five (5) per cent of the turnover they generated in Finland during the previous financial year in European works in Finland. The obligation could be fulfilled by investing in the production of new audiovisual content, paying a parafiscal tax or combining the investment and the tax.
The investment should be allocated to the acquisition of performance rights or the production or co-production of new audiovisual content. Audiovisual content would refer to films, series or documentary programmes. More than half of the total investment in new audiovisual content should be allocated to the acquisition of performance rights for or the production or co-production of scripted films, documentaries or drama series. This would support the Directive’s objective of promoting European cultural and linguistic diversity and strengthening European content production.
More than half of the content of a work considered to be new audiovisual content, or of a work for which performance rights are being acquired, should be in Finnish, Swedish or Sámi. The content should also be closely linked to Finnish history, culture or society. The requirements apply to audiovisual content that is the subject of an approved investment, not to the provider of the on-demand service, and they should not be used to restrict market access or the provision of services. At the same time, the conditions would be consistent for all providers of subscription on-demand services and pay attention to the smooth functioning of the internal market and the promotion of fair competition. The conditions could therefore be considered to be proportionate and non-discriminatory.
If providers of subscription on-demand services fulfil the financing obligation by making a financial contribution, this contribution is a parafiscal tax. Compliance with the obligation would be monitored by the Transport and Communications Agency. The funds collected through the financing obligation would be awarded as government grants by the Finnish Film Foundation for the production of scripted films, documentaries or drama series. The Finnish Film Foundation could award government grants if the production of a scripted film, documentary or drama series and the resulting work would meet at least three of the following conditions: 1. the manuscript or another written basis of the work was originally written in Finnish, Swedish or Sámi; 2. more than half of the work is in Finnish, Swedish or Sámi; 3. the work is closely linked to Finnish history, culture or society; 4. more than half of the work is filmed within the territory of Finland; 5. the work and its production involve a significant contribution from Finnish creators and performing artists or those permanently resident in Finland, and the share of the production’s remuneration costs accounted for by the wages and fees paid to them is significant. The government grants awarded would be notified annually to the Commission as aid for cultural products within the meaning of Article 54(2) of the General Block Exemption Regulation.