Germany’s incoming government has placed a major bet on the country’s screen sector, pledging to overhaul its film and TV production landscape with a new incentive strategy and mandatory local investment from streamers.

In a significant shift for Europe’s largest economy, the presumptive Chancellor Friedrich Merz and his conservative CDU party — alongside coalition partners CSU and SPD — have outlined a sweeping plan to revitalize German film and television. The agreement includes core demands from industry stakeholders: a robust 30% tax rebate for local productions and an “investment obligation” requiring streamers to reinvest up to 25% of their German revenue into domestic content.

The move mirrors France’s policy playbook and positions Germany to reclaim competitiveness amid a rapidly consolidating European production landscape.

Industry-Led Reform

The proposals, developed in close collaboration with the German Film Academy, the country’s production alliance, directors’ and screenwriters’ guilds, and the Guild of German Art Cinemas, aim to boost both international and local production. These measures could unlock hundreds of millions in new spending annually and help arrest the steep decline in German box office and TV revenues.

“The coalition agreement is good news for the industry — the messages are encouraging,” said Björn Böhning, managing director of the production alliance. “France has shown how combining investment requirements with incentives is a recipe for attracting capital, retaining revenue, and building long-term infrastructure.”

While global streamers have previously pushed back against mandated reinvestments, Germany now joins a growing list of EU countries pushing for local contributions — a sign that content nationalism is increasingly a production reality in Europe.

A Sector in Distress

Germany’s screen industry needs the support. According to the production alliance, 80% of producers are facing financial difficulty. Domestic box office revenue declined 5.8% in 2024 to 90.1 million admissions — a sharper drop than most Western European peers. Local titles now account for just 20.6% of the market, down nearly four points year-over-year.

In late 2024, the outgoing administration extended Germany’s federal film funding law, preserving vital subsidies for now. However, diversity and inclusion benchmarks tied to funding were removed to accommodate Merz’s conservative coalition.

What It Means for Global Studios

For international soundstage operators, vendors, and service providers, the introduction of a 30% German incentive would mark a substantial opportunity — particularly for co-productions and European hub strategies. With the rise of regional investment mandates, streamers operating in Germany may increasingly look for turnkey solutions that offer local compliance with maximum production efficiency.

If implemented as outlined, Germany’s new plan could unlock one of Europe’s most dormant but high-potential production markets — and bring new volume to German stages in cities like Berlin, Munich, and Cologne.