US firms Netflix and Amazon face quotas for European movies and television shows under new Brussels proposals unveiled Wednesday that also aim to lift bloc-wide barriers for Internet shoppers.

The plan is the latest step towards what Brussels calls a digital single market, in which the European Union's 500 million people will no longer be blocked from buying goods and services more cheaply abroad online.

"E-commerce in the EU is not functioning as smoothly as it could," EU industry commissioner Elzbieta Bienkowska said at a press conference in Brussels to unveil the proposals.

The European Commission, the executive of the 28-nation European Union, called for US web streaming giants like Netflix and Amazon to devote one fifth of their content in Europe to European movies and television shows.

"With these new rules, we will uphold media pluralism, the independence of audiovisual regulators and will make sure incitement to hatred will have no room on video-sharing platforms," said Guenther Oettinger, the EU commissioner for digital economy. 

"We also want to ensure a level playing field, responsible behaviour, trust and fairness in the online platforms environment," Oettinger said.

The commission also proposed that online firms lift barriers starting next year to Internet shoppers who seek cheaper prices for goods and services on sites in different European countries.

The system is known as "geoblocking", whereby customers are limited to websites in their home countries for services like car hire or travel, and are blocked from seeking better prices on foreign sites.

Under the proposals, for example, automatically rerouting customers to a local version of the online service will be forbidden.

"Discrimination between EU consumers based on the objective to segment markets along national borders has no place in the Single Market," Bienkowska said.

"With clearer rules, better enforcement and more affordable cross-border parcel delivery, it will be easier for consumers and companies ... to make the most of the EU Single Market and the cross-border e-commerce," she said.

In a related proposal, the commission called for making cross-border parcel delivery more affordable by introducing greater price transparency to foster competition. 

The plans must now be approved by member states and the European parliament.