On 27 May 2026, the German Federal Cabinet adopted the government draft of the new Media Services Investment Obligation Act (MedienInvestVG). The Act forms part of the Federal Government’s broader film funding reform and complements film funding guidelines published earlier in May. The legislation introduces a statutorily mandated level of investment in the audiovisual production sector, combined with defined reversion mechanisms for exploitation rights, and establishes new regulatory obligations for media service providers, including streaming platforms and public broadcasters operating media libraries.
Key Aspects of the Current Draft
- Providers of on-demand audiovisual media services (VoD) must invest at least 8% of their net annual revenue in the production and exploitation of European audiovisual works. Sub-quotas govern the allocation of these investments among new works, German-language content, and independent producers.
- For a production to qualify as an eligible investment, exclusive exploitation rights may only be granted for a limited initial exploitation window. The duration (typically between three and seven years) depends on the producer’s financial contribution, including most contributions derived from public funding (federal, EU, and Council of Europe sources).
- Providers may deviate from certain statutory requirements, including the sub-quotas, if they voluntarily increase their investment commitment to at least 12% and enter into an industry agreement with representative producer associations.
Scope of Application
The MedienInvestVG applies to all providers of on-demand audiovisual media services targeting users in Germany, regardless of their place of establishment. Relevant factors include whether advertising is directed at German consumers, the service’s primary language is German, or content and commercial communication specifically target German users.
Investment Obligation (8% Quota)
- Commercial providers — subscription-based and/or advertising-based services like subscription video on demand (SVOD) and advertising-based video on demand (AVOD), but not pay-per-view models like transactional video on demand (TVOD) — must invest at least 8% of net revenues generated in Germany, calculated based on the second-last financial year.
- Public service providers must invest at least 8% of their programme expenditure incurred in the second-last year.
- Exclusions from the calculation base: Revenues and costs relating to news and current affairs programming, sports, in-house productions, video games, and pornographic content are excluded. Revenues unrelated to subscription and advertising models — such as TVOD — are not considered.
- Start-up grace period: The obligation applies only from the beginning of the 25th calendar month following market entry of a VoD service in Germany.
- Small providers with annual net revenues below EUR 10 million are exempt.
Sub-Quotas
The draft imposes three investment sub-quotas:
- At least 60% of investments must be allocated to the production of new (i.e., not yet completed) European works.
- At least 80% must be invested in works originally produced in the German language.
- At least 70% must be spent on commissions to independent producers, i.e., producers not affiliated with the media service provider.
Investments in European works released theatrically or in content specifically targeting children (based on theme, narrative, and design) are eligible for enhanced weighting (factor 1.5).
Reversion of Rights
To qualify as an eligible investment, exclusive exploitation rights may only be granted for a limited initial period. The maximum term depends on the producer’s financial contribution to the production budget. For example, where the producer’s contribution is between 9% and 30%, rights must revert to the producer no later than three years after initial release.
Opt-Out / Industry Agreements
Media service providers may deviate from statutory requirements on sub-quotas, eligible investments, reversion of rights, and reporting obligations, provided that:
- the investment obligation is increased to at least 12%,
- a balanced rights allocation regime is agreed,
- the agreement is concluded with one or more representative producer associations, and
- the arrangement is reviewed by the German Federal Film Board (FFA) and formally approved by the competent federal authority.
Such agreements are limited to a maximum term of five years.
What Comes Next
The detailed framework of the legislation may still change during the parliamentary process. The draft is currently under review by the Federal Council (Bundesrat) and will subsequently be considered by the Federal Parliament (Bundestag). Entry into force is expected no earlier than 1 January 2027.
Stakeholders may wish to monitor developments and assess potential implications at an early stage. This includes reviewing whether their services fall within scope, analysing the relevant revenue base and sub-quota requirements, and evaluating existing contractual arrangements – particularly regarding licence terms and rights reversion provisions.
