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Agency ebook pricing now under investigation in the UK

The UK Office of Fair Trading announced yesterday that they were going to look into whether publishers broke the law in adopting agency pricing for ebooks. From the announcement:

Following a significant number of complaints, the OFT has opened an investigation into whether arrangements that certain publishers have put in place with some retailers for the sale of e-books may breach competition rules.

The investigation is at an early stage and it should not be assumed that the parties involved have breached competition law.

The Competition Act 1998 prohibits agreements, practices and conduct that may have a damaging effect on competition in the UK. The Chapter I prohibition covers anti-competitive agreements and concerted practices that have the object or effect of preventing, restricting or distorting competition in the UK or a part of it and which may affect trade in the UK or a part of it. Its European counterpart, Article 101 of the TFEU, covers equivalent agreements or practices which may affect trade between EU Member States.

This isn’t the first investigation into agency pricing; here in the USA at least one state’s Attorney General has begun an investigation (Connecticut). But that just makes this so much more fun.

Publishers have pushed for Agency pricing in 2 countries, and it’s now under investigation in 2 countries. A plain text reading on the relevant laws suggest that agency pricing is illegal, so I really have to wonder why publishers  thought they’d get away with it.

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