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France sets delivery fee for online book sales to help stores compete with Amazon

Stock Markets Sep 23, 2022 10:32AM ET
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© Reuters. FILE PHOTO: Books are displayed on a table at "La Librairie du Canal" bookstore in Paris as French lawmakers voted a draft bill aiming at stopping Amazon from offering free delivery for books and at protecting traditional bookshops from competition, Franc
 
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By Elizabeth Pineau and Geert De Clercq

PARIS (Reuters) -France plans to impose a minimum delivery fee of 3 euros ($2.93) for online book orders of less than 35 euros to level the playing field for independent bookstores struggling to compete against e-commerce giants, the government said on Friday.

A 2014 French law already prohibits free book deliveries, but Amazon (NASDAQ:AMZN) and other vendors such as Fnac have circumvented this by charging a token 1 cent per delivery. Local book stores typically charge up to 7 euros for shipping a book.

Legislation was passed in December 2021 to close the one-cent loophole through a minimum shipping fee, but the law could not take effect until the government had decided on the size of that fee.

"This will adapt the book industry to the digital era by restoring an equilibrium between large e-commerce platforms, which offer virtually free delivery for books whatever the order size, and bookstores that cannot match these delivery prices," the culture and finance ministries said in a joint statement.

They added that France will notify the European Commission of its plan and the minimum delivery fee will take effect six months after the EU grants approval.

The culture ministry said the three euro fee - which includes taxes - could not be circumvented through customer loyalty programmes or joint purchases of books with other items.

It added that for orders worth more than 35 euros, online vendors could still propose a one-cent delivery fee.

"The three euro delivery fee... is not dissuasive for book buyers and the 35 euro threshold will favour grouped orders, which is virtuous in environmental terms," the ministries said.

Amazon on Friday had no comment but a spokesman referred to a statement made during the lobbying phase of the legislation when the company said a delivery fee would be a "major" inflation driver and especially hit readers in rural areas.

Bookshops in France have survived the rise of Amazon thanks to a 1981 law that prohibits price discounting on new books, but they say the U.S. online behemoth's ability to undercut them on shipping still skews the market.

French bookstores association SLF said in a statement on Friday that the three euro fee was insufficient, as it means bookstores will still sell at a loss when expediting books to customers. It called on the government to lower French post office fees for shipping books by bookstores.

More than 20% of the 435 million books sold in France in 2019 were bought online and the market share of France's 3,300 independent bookstores has been slowly declining because of competition from online retailers like Amazon, Fnac and Leclerc.

($1 = 1.0227 euros)

France sets delivery fee for online book sales to help stores compete with Amazon
 

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Comments (2)
Ma Lu
Ma Lu Sep 23, 2022 10:38AM ET
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Stupid decision. Tax breathing!
Tom Saltzman
Tom Saltzman Sep 23, 2022 7:14AM ET
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Regressive policies to keep high taxes.
 
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