France passes anti-Amazon bookshop law

THE FRENCH government yesterday banned websites from offering free postage in conjunction with discounts on books, in a direct attack on Amazon’s dominance of the market.

The move is designed to boost France’s independent bookshops, who claim they cannot compete with the cheap prices and swift delivery offered by their much larger US rival.

“The [book pricing] law is part of our cultural heritage,” said conservative MP Christian Kert who sponsored the bill.

Existing French laws require books to have a unique selling price, in order to protect small sellers, but until now stores have been allowed to apply a discount of up to five per cent. Amazon has angered small booksellers by combining this with free postage to build market share.

The company responded angrily, saying the move would hit consumers who have flocked to its service.

“All measures that aim to raise the price of books sold online will curb the ability of French people to buy cultural works and discriminates against those who buy online,” Amazon said.

France has a history of imposing taxes to try and protect the country’s domestic arts scene. Earlier this year the government considered imposing a tax on the sale of smartphones and music devices to subsidise domestic cultural projects.

Between 1900 and 1995 Britain had a voluntary arrangement between publishers and booksellers, known as the Net Book Agreement, which banned shops from offering books at a discount to their cover price. This collapsed when shops such as Waterstones began offering hefty discounts and the Office of Fair Trading issued a formal challenge on behalf of consumers.

Unlike traditional retailers, Amazon has repeatedly chosen to build market share rather than profit. Net sales grew by a quarter to $61bn (£37.8bn) in 2012 but the company still made a loss of around $39m.