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Amazon defies France with 1 centime deliveries

Retail giant Amazon has decided to hit back at a new law banning it from offering free deliveries in France by charging customers just one centime (1.4 cents) for books dispatched to their homes. A French minister had accused the online store of "destroying bookshops".

Amazon defies France with 1 centime deliveries
Amazon is offering deliveries for one centime to counter a French law that cracks down on free deliveries. Photo: Aurelijus Velaisa/Flickr

Online retail giant Amazon has defied a French law banning free deliveries by charging customers just one centime to send out orders.

France's parliament last month voted a law aimed at supporting small bookshops that bans online giants such as Amazon from delivering books without charge, but allows them to set discounts of up to five percent, the maximum allowed under existing French legislation.

The new law came into force several days ago, and users now ordering books online are being charged one centime for delivery.

In its "Frequently asked questions" section, Amazon's French site says that since the July 8 law, "we are unfortunately no longer allowed to offer free deliveries for book orders.

"We have therefore fixed delivery costs at one centime per order containing books and dispatched by Amazon to systematically guarantee the lowest price for your book orders."

While the law is not specifically aimed at Amazon, Culture Minister Aurelie Filippetti has singled out the US giant's practices in the past, attacking it for its "dumping strategy" and for selling books at a loss.

"Once they are in a dominant position and will have crushed our network of bookshops, they will bring prices back up," she forecast last year.

Filippetti has made her feelings towards Amazon quite clear when she said the online retailer "destroys" bookshops.

"Today, everyone has had enough of Amazon, which, by dumping, slashes prices to get a foothold in markets only to raise them once they have established a virtual monopoly," she said.

France is proud of a network of bookstores it says is "unique in the world" and crucial for culture to reach small towns.

The country has about 3,500 such stores – including 600 to 800 so-called independent retailers that do not belong to a publishing house, a chain or a supermarket – compared to just 1,000 in Britain.

In 1981, the French government ruled that editors must set a unique selling price for their books in a bid to protect small retailers, and set a limit of five percent on any discount.

The bill has been welcomed by independent bookstores like Shakespeare and Company, in Paris.

"We greatly appreciate the efforts France makes in trying to protect bookstores," Shakespeare and Company's Terry Craven told The Local. "The fixed price law has helped keep us alive, which has not been the case for independent bookstores in other countries, like Britain.

"The interesting thing is that the growth of huge companies like Amazon actually creates new niches for people who look for the exact opposite, like a bookshop that is like a community where people can come in and talk to a human."

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AMAZON

Germany opens ‘anti-competition’ probe into Amazon with tougher law

Germany's competition authority said Tuesday it had opened an inquiry into online retail giant Amazon over potential "anti-competitive practices", using a new law giving regulators more power to rein in big tech companies.

Germany opens 'anti-competition' probe into Amazon with tougher law
An Amazon warehouse in Brandenburg. Photo: picture alliance/dpa/dpa-Zentralbild | Patrick Pleul

Federal Cartel Office head Andreas Mundt said his office is examining whether Amazon has “an almost unchallengeable position of economic power” and whether it “operates across various markets”.

If so, it would be deemed of “paramount significance”, said Mundt, adding that the regulator could “take early action against and prohibit possible anti-competitive practices by Amazon”.

“This could apply to Amazon with its online marketplaces and many other, above all digital offers,” he added.

Under the amendment to Germany’s competition law passed in January, the watchdog said it now has more power to “intervene earlier and more effectively” against big tech companies, rather than simply punishing them for abuses of their dominant market position.

READ ALSO: ‘I want to know origin of my grapes’: Amazon loses fruit and veg ruling in German court

The German reform coincided with new EU draft legislation unveiled in December aimed at curbing the power of the internet behemoths that could shake up the way Silicon Valley can operate in the 27-nation bloc.

The push to tighten legislation comes as big tech companies are facing increasing scrutiny around the globe, including in the United States, where Google and Facebook are facing antitrust suits.

The Amazon probe is only the second time that Germany’s Federal Cartel Office has made use of its new powers, after first employing them to widen the scope of an investigation into Facebook over its integration of virtual reality headsets.

The watchdog already has two traditional abuse control proceedings open against Amazon.

One involves the company’s use of algorithms to influence the pricing of third-party sellers on Amazon Marketplace, while another is probing the extent to which Amazon and major producers such as Apple exclude third parties from
selling brand products.

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