2014 Amendment of the Law on Fixed Book Prices
- protection of books as cultural assets in a changing – now increasingly digital – environment by adjusting the legal framework, specifically the federal law in which Austria’s fixed book price agreement is codified.
- ensuring diversity in book distribution and counteracting monopolistic market structures between authors, publishers and readers – thus contributing to a stronger value chain and enabling not only authors, but also publishers and booksellers, to make a living from their work.
In principle, the Federal Law on the Obligation to Sell Books at a Fixed Price stipulates that minimum retail prices for German-language books published, imported or sold in Austria must be fixed. This pricing system aims to create comparable conditions for competition among publishers, distributors and retailers. The rationale behind this is that without the fixed minimum pricing system for imported German-language books, there would be a drop in the prices of books targeted at the general public which would cause the loss of profit margins achieved as a result of the sale of that type of book. As a result of such a loss, it would not be possible to finance the production and marketing of more demanding but economically less attractive works, and small booksellers which normally offer a wide choice of books of that type would be driven out of the market by the large booksellers, which sell primarily commercial goods. Hence, the law strives to encourage the production of books and a diversity of titles at regulated prices as well as the diversity of bookshops.
When this law was passed in 2000, e-commerce in books was of very little relevance. The share of books sold online made up just 1 percent. By now, the situation has fundamentally changed. In order to guarantee that the law still serves its main purpose of protecting books as a matter of overriding public interest, the government made the following modifications – which have been recognised as compatible with Union law by the European Court of Justice:
- explicit inclusion of e-books in the law’s scope of application,
- a very broad definition of e-books, given the rapidly changing technological means of distributing texts in digital forms, that covers in particular every form typically offered by publishers, and
- the elimination of the exception for cross-border electronic trade.
With this, foreign and domestic online retailers are put on an equal footing and legal certainty has been created by rendering irrelevant the question as to whether an online activity can be classified as cross-border or not.
The law should have a positive structural effect on the book market, in particular by:
- encouraging a diversity of physical and online booksellers by creating more comparable conditions of competition between the different market players, irrespective of their size
- supporting a diversity of publishers and encouraging them to invest in a diversity of titles and new authors (original German-speaking literary creations as well as translations into German) by rendering them more independent through the fixed pricing system. Thus, authors should also benefit from this environment.
- creating incentives for publishers to use e-books to contribute to a broad range of new publications and available book content
- providing legal certainty regarding the law’s scope of application
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