Tap play to listen to this article
PARIS – Who remembers that Amazon used to be an online bookstore? France does.
In a new twist on the e-commerce giant, French lawmakers this week will examine a draft law that would effectively prevent Amazon from offering virtually free delivery for book purchases — a major selling point for the online platform versus traditional bookstores.
The bill, which comes from the Senate and has the backing of President Emmanuel Macron himself, aims to protect brick stores from competition with Amazon, which has left them standing and smoking. It is the latest in a series of initiatives designed to bolster local culture against foreign technology companies, which have included backing press publishers against Google and Facebook and supporting TV companies against Netflix.
“The goal is to reduce the distortion of competition between online players who can offer book deliveries for one cent and the others,” Géraldine Bannier said in an interview. Bannier, a Member of Parliament from Emmanuel Macron’s allied party MoDem, is in charge of the lower house.
The text, which will be reviewed by the National Assembly’s Culture Committee on Wednesday, is expected to require a minimum rate for book deliveries. In other words, Amazon’s promise of virtually free shipping of books would no longer be legal in France.
The US e-commerce giant is against the new rules, according to several French officials who said the company was lobbying against them.
Amazon declined to comment for this article.
French politicians have long defended independent bookstores against the American tech company – once described of Paris Mayor Anne Hidalgo as “the death of booksellers” – and some have even called for it Boycotts from Amazon.
Between 2006 and 2019, the market share of France has 3,300 independent bookstores reportedly dropped by almost 3 percentage points due to the competition between online retailers like Amazon and Fnac. During the first lockon for coronavirus, bookstores also had to close – but was tagged “important companies” in early 2021 and was allowed to remain open. By 2020, one in five bookstores lost more 10 percent of revenue compared to 2019.
France is no stranger to regulating the book sector.
In the early 1980s, the country passed a law on a “single book price”, whereby publishers must decide on prices. Distributors then put their own in a very limited window between 95 and 100 percent of the price dictated by publishers.
On top of this rule, free deliveries are technically not allowed. Politicians now have the impression that the wide range of delivery rates – from € 0.01 to up to € 7 depending on the distributor – is defeating the law’s purpose of having only one price for books.
The new bill would require retailers to charge fees for shipping books at a minimum price set by the Ministries of Economy and Culture, based on a proposal from telecom and postal regulator Arcep. It would also require online platforms to more clearly distinguish between new books from used books.
High level support
The text was originally drafted by Laure Darcos, a senator from the conservative party Les Républicains, who previously worked for the book publishing industry. “It was not an easy choice because we are getting consumers to pay again,” she said in an interview.
Darco’s bill has received very important support: Emmanuel Macron, who before the summer holidays said there was a competition problem between multinational companies and independent booksellers.
It’s no secret that the bill is mainly – if not only – directed at Amazon, which built its global empire on cheap and fast delivery.
“It is a well-known fact that this operator’s strategy is to sacrifice its profitability in order to conquer the market through aggressive pricing policies. It compensates for its losses by offering other services, which is equivalent to making the book a loss leader,” said Culture Minister Roselyne Bachelot said in June, during debates in the Senate, adding that the bill was intended to “directly contradict this strategy.”
And Amazon has surprisingly pushed back against the new rules.
“Amazon is afraid it will set a precedent. They will be monopolistic on online book sales – I press where it hurts,” Darcos said.
The e-commerce giant has argued that higher delivery rates would hurt rural areas with poor access to physical bookstores, according to several people who were briefed on the company’s arguments. The US technology giant also argued that they would be the only ones who would get bigger fees because it would mean more margins, one of the people said. (It is not uncommon for technology multinationals to try to convince decision-makers that regulation would be counterproductive because it would actually benefit them.)
The new rules are bakkes op of the Syndicate of French booksellers, but also of Amazon rivals such as Fnac and Leclerc, as retailers are forced to lower delivery fees and gnaw at their own margins to compete with the deep-seated American tech giant.
The bill will go to the National Assembly plenary session in early October.
Do you want more analysis from POLITICO? POLITICO Pro is our first-class intelligence service for professionals. From financial services to commerce, technology, cybersecurity and more, Pro delivers real-time intelligence, deep insight and breaking scoops you need to stay one step ahead. E-mail [email protected] to request a free trial period.