Amazon will change its ebook contracts with publishers as EU ends antitrust probe

Photo by Amelia Holowaty Krales / The Verge

The EU has reached an agreement with Amazon following an antitrust investigation into the company’s ebook business. In 2015, the European Commission began a probe into the licensing deals Amazon was making with publishers, suggesting that the US giant was forcing them into unfair contracts that stifled competition in Europe’s €1 billion ebook market. In January, Amazon suggested a number of changes it would make to its contracts, and the EU now says it’s happy to accept them, bringing a close to the investigation.

The parts of the contract the EU objected to were a number of “most-favored-nation” clauses. These required any publishers doing a deal with Amazon to reveal the terms of the contracts they made with rival distributers. Amazon could then demand that it got the same deal (or better) on things like ebook prices, agency commissions, promotion campaigns, and release dates. The EU suggested that Amazon was using its dominant position in the market to strong-arm publishers into signing these contracts, while ensuring that rival distributers could never offer better deals to consumers.

Under the terms of the agreement announced today, Amazon will no longer include such clauses in its contracts for the next five years. This will apply to ebooks distributed in any language in the European Economic Area or EEA (a region that includes all 28 EU member states, plus affiliated nations like Iceland, Liechtenstein, and Norway). The US giant will not be fined unless it breaches this deal, in which case it could be hit with penalties of up to 10 percent its total annual turnover.

In a press statement, the head of the EU’s antitrust team, Commissioner Margrethe Vestager, said that the decision will “open the way for publishers and competitors to develop innovative services for e-books, increasing choice and competition to the benefit of European consumers.” In a press statement, Amazon said it was “pleased to have reached an agreement with the European Commission” and will “continue working to help authors and publishers reach more readers.”

Comments

Whoa! Not a ton of detailed information here, but WTF Amazon?

Sounds like exactly what the DOJ in the US hammered Apple for when Jobs decided the iPad was going to take over the e-Book industry.

It just seems bizarre that Amazon would go to the same "most favored" tactics after that.

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