Parallel imports and books

The Productivity Commission has published its issues paper on its reference relating to the parallel importation of books.  You can download the pdf here.  At present:

(1) anyone may “parallel” import a book for their own use (i.e., not to resell or distribute it);

(2) books first published after 22 December 1991 and not published first simultaneously in Australia may be parallel imported;

(3) for any other books, however, there is a very convoluted regime,

see Copyright Act 1968 s 44A and 112A.

Things have apparently changed since all the earlier studies by the then Prices Surveillance Authority, the ACCC and the Ergas Committee as now they would have us believe:

While requiring the Commission to examine options for reform, the terms of reference should not be taken as meaning that the current restrictions are necessarily inappropriate. That is a matter to be examined in this study.

Nonetheless, the Productivity Commission appears to have started from the former Prices Surveillance Authority’s proposition that the right to control imports is some how additional or extraneous to copyright:

It has been argued that restrictions on the parallel importation of books provide an incentive, additional to that provided by copyright alone, for people to create literary works.

At an impressionistic level, one clear benefit under the current regime has been the faster availability of paper-back editions. My recollection is that the Prices Surveillance Authority found paperbacks were usually not published until at least one year after the publication of the hardback edition in Australia – and often longer.  Walk into any Dymocks, Borders or whatever these days and you will often see 2 or even 3 different versions of the same book – the UK paperback, the US paperback and often the trade or mass market versions as well (the ones that smudge when you press your thumb too hard on the page).

It will be very interesting to see how the Productivity Commission explains its competition theory to support repeal when anyone with an internet connection can jump online and order the book from overseas (for their own use).

The sector most affected by the current regime might be thought to be the booksellers who can’t use this form of arbitrage (at least for books first published simultaneously in Australia – unless they already have a written or verifiable telephone order).  Would we all be better off if the booksellers could use the threat of parallel importing in volume to negotiate a better price from the the local publisher/distributor?

It will also be interesting to see how the Productivity Commission deals with possible cultural considerations, which have proved so powerful in Canada in trying to block parallel imports.  The Productivity Commission raises the possibility, however, that such issues can be better addressed by direct subsidies – so in the interests of market forces operating, the Government would have a more active role in trying to pick ‘winners’ and taxpayers generally would subsidise readers.

Your comments should be submitted to the Productivity Commission by 20 January 2009.

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