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Thursday, 3 March 2011

WORLD BOOK DAY - E-BOOK PRICE FIXING

 Thursday, 03 March 2011 10:35
Patrick Stafford

European eBook publishers have been raided by the European Commission regulator as part of an investigation into price fixing that could potentially result in significant fines.


The inspections come merely weeks after the British Office of Fair Trading sparked its own investigation into the publishing sector, with suspicions that booksellers are forcing retailers to adopt certain prices.

The EU confirmed that it is working closely with the OFT, but would not name any of the companies that were raided.
The commission confirmed on its website that the raids took place earlier this week, unannounced, at the premises of companies selling eBooks in several member states.
"The Commission has reason to believe that the companies concerned may have violated EU antitrust rules that prohibit cartels and other restrictive business practices."

The EU points out that unannounced inspections are only a preliminary step in an investigation, and do not mean the companies targeted are guilty of anti-competitive behaviour – but did say it has reason to suspect price fixing is occurring.

While major publishers have not confirmed whether their offices were raided, French publisher Albin Michel told 01net that its offices were targeted as part of the investigation. Its president, Francis Esmenard, also claimed that "this operation is masterminded by Amazon".

"They are based in Luxembourg so they don't pay the VAT in France and they would like to be able to sell books at whatever price, like they do in the United States, selling bestsellers for $9.90 US dollars," he said.

The officials are reportedly concerned about whether publishers are setting restrictive pricing rules – Europe has quite strong competition laws regarding these matters.

The Commission introduced laws three decades ago that said governments could fix book prices on the condition that exchanges between states could not be affected. However, eBooks did not exist at that time.

While the EU hasn't revealed too many details about its investigation, it has admitted working with the OFT, indicating the two investigations are at least based on similar grounds.
These raids are usually the beginning of more formal investigations.

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