On May 25, 2016, the Commission proposed to amend two dozen articles of the Audiovisual Media Services Directive (hereafter the “Directive”). One amendment requests “providers of on-demand audiovisual media services under their jurisdiction to secure at least a 20 percent share of European works in their catalogue and ensure prominence of these works.”
The Commission claims that it is an ardent believer in undertaking an impact assessment before tabling its proposals. This amendment should thus have passed three tests. First, is there a need to regulate? The Commission provides no information on this point. Second, if there is such a need, is a local content quota a good instrument—does it work? This paper provide ample robust evidence—based on France and Korea—that such a quota has massive negative consequences, most notably on the firms that are not the largest ones. Finally, would such a quota contribute to the ultimate objective of a Digital Single Market? The paper argues that, on the contrary, the amendment will fragment further the European audiovisual markets and generate a gigantic European House of Cards.
* This work was supported by the Laboratory Program for Korean Studies through the Ministry of Education of Republic of Korea and Korean Studies Promotion Service of the Academy of Korean Studies (AKS-2015-LAB-2250003).