Netflix and Disney+ Challenge France's Revised SMAD Streaming Investment Rules

What the revised rules require

Under the amended SMAD framework, streaming services operating in France must direct at least 20% of their audiovisual production contributions towards animation, creative documentaries, or recordings of live performance. For services with an annual turnover above 50 million euros, 75% of that genre-specific share must be devoted to original works rather than acquired titles. The obligations form part of France's long-standing approach to supporting domestic and European production, and they apply to platforms regardless of where they are headquartered, provided they target French audiences.

The basis of the challenge

Netflix and Disney+ have both taken issue with the genre-specific character of the spending requirements. Netflix has characterised the rules as a constraint on editorial freedom and on the way platforms shape their content offering, contending that the state should not dictate the categories into which mandated investment must flow. In setting out its wider contribution to the French market, Netflix said it had invested more than 1.7 billion euros in the country's creative economy since 2021, supporting roughly 25,000 jobs, and that around 250 million euros went to French productions during 2025 alone.

The regulatory and legal questions

The central legal question is one of proportionality: whether the obligations amount to a legitimate exercise of cultural policy or whether they improperly extend into editorial control. A related concern is whether the rules treat streaming platforms on an equal footing with traditional broadcasters, which have historically been subject to their own investment quotas. Several authorities have an interest in how the matter is resolved, including ARCOM, the French audiovisual regulator responsible for overseeing compliance, the National Centre for Cinema and the Moving Image, and the European Commission, whose directive provides the overarching legal foundation for national measures of this kind.

What is at stake for the platforms

For the platforms, the outcome will influence how much discretion they retain over the composition of their French production budgets. A requirement to earmark a fixed share for specified genres limits the flexibility to respond to audience demand, while the higher original-works threshold for larger services increases the commitment expected from the biggest operators. The companies' emphasis on their existing investment reflects an argument that voluntary commercial spending already delivers substantial benefits to the French sector without prescriptive allocation.

The wider implications extend well beyond the two companies involved. France has been among the most assertive EU member states in translating the Audiovisual Media Services Directive into binding national obligations, and the way this challenge is resolved may shape how other governments calibrate their own investment rules. A decision that upholds genre-specific mandates could encourage similar measures elsewhere, while one that curtails them may prompt regulators across Europe to reconsider how far cultural policy can direct the commercial choices of global streaming services.