France calls for legal review targeting Netflix

France calls for legal review targeting Netflix
France's president has called for a legal review that could hurt Netflix. Photo: AFP
Netflix's arrival in France has prompted the French president to call for a review on laws and taxing after local cable operators grumbled over the threat posed by the American video service.

French President Francois Hollande has called for a review of European laws on audiovisual services, as local operators bristle over the recent arrival of US online streaming giant Netflix.

"France will shortly send its proposals to the new Commission so that we can have the same rules" for everyone, Hollande told the audiovisual council late Thursday.

"Digital companies based outside of Europe must be subject to the same tax treatment as traditional operators because they are broadcasting on the same premises," he said.

Netflix arrived on French screens two weeks ago to great fanfare from excited viewers, and chagrin from local broadcasters who fear an unequal battle with the California-based company which already has 50 million subscribers worldwide.

Netflix does not give subscription figures for individual countries but Le Figaro daily estimates some 100,000 French have already signed up. However as the first month is free, they could cancel their contract at any time.

Hollande took aim at "tax inequality" and those who "base themselves at a distance but broadcast here without having the same obligations", without naming Netflix directly.

With its European headquarters based in Luxembourg, and set to move to The Netherlands in 201, Netflix escapes hefty French taxes.

"France will propose that the idea of virtual establishment be preferred to that of permanent establishment" to avoid tax evasion, said Hollande. "Operators in the same market must be able to evolve within a common and coherent framework."

For €7.99 ($10.34)a month French subscribers can now binge on Hollywood films, cartoons and television series.

Netflix is also commissioning a French-language political drama — a tale of power, corruption and revenge set in the port city of Marseille, France's second city.

Netflix's entry into the French market is the beginning of its second wave of expansion across Europe. It is to be quickly followed by launches in Austria, Belgium, Germany, Luxembourg and Switzerland.

The service has been available in Britain, Denmark, Ireland, the Netherlands, Norway, and Sweden since 2012.

Many European providers have improved their offers or dropped their prices ahead of Netflix's arrival, and France's main pay-TV group Canal+ has beefed up its online streaming offer, CanalPlay.

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