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CBA demands changes to parallel importation laws

In a bid to force publishers to lower Canadian book prices, the Canadian Booksellers Association is asking the federal government to consider amending the laws that restrict the import of foreign books into the country.

In a press release sent out on Friday, the association said the current regulations that limit “parallel importation” are “no longer commercially reasonable and should be repealed.” The CBA expressed its views in a meeting with Canadian Heritage Minister James Moore on Thursday.

Under the current guidelines, which are governed by the Copyright Act, Canadian booksellers must buy directly from Canadian-owned distributors and the Canadian arms of multinational publishing houses (such as HarperCollins Canada or Random House of Canada). Booksellers can circumvent the Canadian supply chain and buy directly from the U.S. only if certain titles aren’t available from Canadian sources or are priced at more than 10% of the U.S. price, given that the Canadian dollar is at par. (When the Canadian dollar is valued at less than the U.S. dollar, the price discrepancy allowed under the act is greater.)

If the current regulations are repealed, and if the Canadian dollar (which closed at $0.98 U.S. on Thursday) remains at parity, publishers would be obliged to price their books in line with U.S. titles, or else booksellers could buy directly from U.S. suppliers such as Ingram or Amazon.com.

In an e-mail to Q&Q, CBA vice-president Mark Lefebvre describes the current guidelines as “anti-competitive” and amounting to “a tariff on the Canadian book-buying public.”

The CBA’s stance on parallel importation is sure to outrage Canadian publishers, particularly the Canadian arms of multinational houses, which underwrite their domestic publishing programs by selling higher-priced Canadian editions of foreign titles to the Canadian market. Arguably, if Canadian booksellers were to buy from U.S. sources en masse, there would be little justification for companies such as Random House, HarperCollins, Penguin, and Simon & Schuster to have any Canadian presence. Such a move could also force Canadian-owned publishers to lower their prices to compete with a flood of cheap foreign imports and cut into author royalties, which are calculated based on a book’s retail price.

But Lefebvre argues that overpriced Canadian books are actually hurting publishers by encouraging consumers to buy directly from the U.S. “When a customer buys a title directly from a U.S. online retailer, these Canadian divisions [of multinational houses] don’t get credit for it,” Lefebvre says.

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