Prominent film-makers have warned against a move that could make European public broadcasters’ streaming offerings accessible from anywhere within the EU, predicting that it would unravel the industry’s business model and lead to “dull films aiming for the lowest common denominator”.

In a drive to deepen the EU’s digital single market, the European parliament will on Tuesday vote on whether to ask the commission to look into banning film and TV platforms from using “unjustified” geoblocking, technology that is used to restrict access to internet content based on location.

While most online services such as shopping and car rentals have been banned from using geoblocking in the EU since 2018, the technology is still used in film, TV and sports broadcasting – meaning for example that the catalogues of big streamers such as Netflix differ from country to country, and that national equivalents of the BBC’s iPlayer are not accessible outside their borders.

If those protective barriers were removed, film-makers say they would come under commercial pressure to target the tastes of a median European viewer, and their art would suffer. “In a single market for cinema, you would end up with dull films aiming for the lowest common denominator of human experience,” said Ruben Östlund, the award-winner Swedish director of Triangle of Sadness, The Square and Force Majeure. “It’s a very simple formula that market capitalism has long worked out.”

“What I appreciate about European film is its originality,” Östlund told the Guardian. “We have many small markets with small producers that have developed their own cinematic style. The diversity is the strength.”

“If you unify European production, you will end up with generic products that will be of no interest to anyone,” said Polish director Agnieszka Holland.

The row comes amid the backdrop of a long-running debate over whether Europe’s critically admired but commercially underperforming film industry needs to be shielded from the dominance of Hollywood, or whether protectionist measures disincentivise film-makers from producing works that cut through to the mainstream.

Politicians pushing for the vote say the current setup discriminates against long-term migrants and linguistic minorities in border regions, who can’t access streaming content from countries they may even be eligible to vote in.

“The absurdity of the situation is that digital rights have made it harder not easier for audiences to access European content,” said Karen Melchior, an MEP for the Danish Social Liberal party.

“Before streaming, you could put an antenna on your roof and, say, access German TV in Denmark. Now it’s much harder to access films or TV in, say, French, than in English. It goes against the whole internal market idea.”

The entertainment industry has been surprisingly united in its pushback against the proposals, with a joint letter to the commission last week signed not just by European film festival leaders but Hollywood studios and the major football leagues. Far from boosting European content, they argue, an end to geoblocking would destroy a business model that relies heavily on “pre-sales” – distributors co-financing the production of a film in exchange for the exclusive right to release and market the film in their national territory.

“In a totally free market, only the big sharks will win,” said Holland, whose 2023 film Green Border was co-produced between Poland, France, Belgium and the Czech Republic. “Local distributors will become irrelevant, and films like mine won’t have a chance to exist.”

Cinema operators too have expressed concerns. An end to geoblocking would further boost streaming giants such as Netflix and reduce the attractiveness of their sector, which has only recently started to recover after the pandemic. “It may be an online tool, but geoblocking is crucial for the survival of European off-line film culture too,” said Laura Houlgatte, of the International Union of Cinema, an association that represents about 43,000 screens across Europe, and chair of Creativity Works!, a coalition of European cultural and creative sectors.

“For good commercial reasons, we don’t have harmonised cinema release dates in the EU,” Houlgatte said. “If a film was to become digitally accessible from every country at the same time, there would be no incentive for viewers to wait until it comes to their cinema.”

“There’s a difference between a common European culture and a shared European culture,” said Emanuele Grassia of FIAD, representing film distributors. Charlotte Lund Thomsen of the International Federation of Film Producers Associations, added: “If we strive for a common European culture, I fear there won’t be the diversity we see today or indeed many films in Danish, Latvian or Portuguese. Instead, we risk getting mostly mainstream euro pudding.”

Campaigners who pushed to bring the issue in front of the European parliament say the film industry is fighting back against proposals much more radical than anything they propose. MEPs will vote on Tuesday on a report which already notes that changing the carve-out for the film industry could have potentially negative effects on pricing, since it could force streamers to standardise subscription fees across the EU.

“We are not advocating a pan-European licence for audiovisual works,” said Justus Dreyling, policy director at Communia, a Belgian pro-public domain association. “All we are saying is that creatives should be able to better reach their audiences.”

Dreyling urged European policymakers to consider trial projects that could allow wider exposure to publicly funded film productions that can’t find distributors in smaller markets within the EU, for example by setting up a pan-European on-demand streaming platform that would host them after the passing of a grace period.

While such proposals are more sympathetically received by film-makers, scepticism remains in the absence of concrete plans to build up joint European streaming infrastructure to rival big players such as Netflix, Disney or Amazon.

“I agree that Europe’s film industry can be quite conservative, clinging on to existing structures,” Östlund said. “But if the risk is that the few big streaming services that dominate the market will become even more dominant without geoblocking, that’s bad.”