Amazon.com is taking on Ze French by trying to offer consumers free shipping. On the surface, you wonder, why is the French government upset? But looking at the nuances in the matter, I agree with the French.
Booksellers have complained about Amazon.com’s decision to waive S&H, the matter has gone to court and Amazon has lost. It has been forced to pay a $1,000 fine every day for 30 days, after which point the Courts could lower or raise the fine. Amazon is trying to reverse the rule:
Cédric Manara, a law professor and e-commerce specialist at Edhec, a French business school in Nice, said he would not be surprised if the court raised the penalty, and that Amazon “had no chance” with its appeal.
The law is “really clear,” Manara said. “There is no way you can read the text to find a different result. And the court would have evidence of the firm’s deliberate will to violate the law.” A similar law regulating the price of books in Germany does not affect free shipping for Amazon.de, Mantello said.
The 1981 Lang law was passed at a time when booksellers were losing sales to supermarkets and other new competitors. It was meant to assure that the French public had equal access to a wide variety of books, both high-brow and low-brow, not just heavily marked-down publications.
The law has twice come before the European Court of Justice and both times it has been affirmed. The law is not considered anticompetitive because all book retailers are held to the same standard, Manara said.
Is it just me or should Amazon simply offer a bigger rebate to offset the S&H fee?
On the one hand, I like that Amazon.com is sticking to its guns and trying to lower price and what not, but at the heart of the ruling is a mechanism to protect competition, so I think Amazon.com is not helping itself with its arrogance in the matter.
They are helping in the short-term but in the long-term they will end up driving many of the small, mom and pop-style booksellers out of business and in turn, Amazon.com would control what books the French can and cannot read.
For this reason, Amazon.com will lose the case, again.
The risk it runs, frankly, is to come across as a “arrogant American company” telling France what to do… and that might create much more badwill than Amazon.com bargained for.
What ever happened to think global, act local Jeff?
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January 16th, 2008 at 7:31 pm
Just wanted to point out it is 1000 euros, not $1000. in dollars the fine is $1500.
January 24th, 2008 at 3:33 am
I’m not sure how this ruling protects competition. It’s one thing for a publisher to enforce a Manufacturer Minimum Advertised Price (MAP), but the cost of fulfillment to the end-customer is not cost of the product. In this way, it is actually anti-competitive in that it discriminates against online commerce or any other non-brick and mortar sales channel. A supermarket can eat the cost of distribution to its stores, but Amazon cannot eat the cost of fulfillment directly to a customer?
Maybe I’m confused, but do French books have a minimum shipping and handling that is included in the total cost that everyone pays regardless of where they purchase it from? If that’s the case, the word ‘ridiculous’ comes to mind.