A newly proposed amendment introduced by the Czech Ministry of Culture, which could have a significant impact on providers of audiovisual media services as well as to Czech film incentives, has been published by the Czech Ministry of Culture and distributed to public bodies for comments.

If approved, the amendment would significantly change Act No. 496/2012 on Audiovisual Works and Film Support (Czech Audiovision Act) - which implements the EU’s Audiovisual Media Services Directive (AVMS Directive) into Czech law (including the 2018 amendments to the AVMS Directive) - and would impact the national film incentives scheme administered by the Czech Film Fund.

The amendment also introduces a new set of financial obligations on video-on-demand (VOD) providers, in accordance with Article 13(2) AVMS Directive. This is an optional provision requiring VOD providers to contribute financially to locally filmed productions which has not been implemented into Czech law yet. The new fees would apply to both foreign VOD providers targeting Czech audiences as well as to VOD providers established in the Czech Republic. The proposed amendment also introduces a new set of fees, introduced in accordance with Article 13(2) AVMS Directive, applicable to VOD providers targeting Czech audiences: (i) a fee amounting to 2 percent of revenues generated in the Czech Republic and (ii) direct investments amounting to 1.5 percent of revenues generated in the Czech Republic. Several EU countries have already implemented these fees in accordance with Article 13 (2) AVMS Directive; thus, the Czech Republic appears to be following this trend.

At present, the proposed amendment has only been distributed by the Czech Ministry of Culture to other ministries and other public bodies for consultation and has not been officially introduced in the Czech Parliament. We presume this should follow in the upcoming months after the Ministry of Culture has a chance to reflect upon - and possibly modify - the amendment following the comments received from the more than 15 public bodies. Therefore, the amendment is in a very early stage of the legislative process.