As many would be aware, the Australian Productivity Commission
("Productivity Commission") has been undertaking a review
of "parallel import" protection afforded to Australian
authors and publishers. The current provisions allow copyright
holders to prevent the importation into Australia of books that
have been published in other countries even if those books had been
legitimately purchased and even if those books cost less than the
price of the equivalent published book in Australia.
In recent years, Australia has relieved parallel import
prohibitions on a number of other products including software and
As part of the review, there was a lively debate between those
supporting the current provisions (mainly authors and local
publishing houses) and those seeking for the prohibitions to be
relaxed (basically the large book retailers in Australia).
The Productivity Commission released its Report on 14 July 2009
and some of the main findings and recommendations are set out
Parallel Import Restrictions ("PIRs") provide
territorial protection for the publication of many books in
Australia, preventing booksellers from sourcing cheaper or better
value-for-money editions of those titles from world markets.
From the available quantitative and qualitative evidence, the
Productivity Commission has concluded that the PIRs place upward
pressure on book prices and that, at times, the price effect is
likely to be substantial. The magnitude of the effect will vary
over time and across book genres.
Most of the benefits of PIR protection accrue to publishers and
authors, with demand for local printing also increased.
Most of the costs are met by consumers, who fund these benefits
in a non-transparent manner through higher book prices.
Some of the effects represent transfers from book purchasers to
local copyright holders, but the restrictions also cause economic
inefficiencies and a significant transfer of income from Australian
consumers to overseas authors and publishers.
Reform of the current arrangements is necessary, to place
downward pressure on book prices, remove constraints on the
commercial activities of booksellers and overcome the poor
targeting of assistance to the cultural externalities.
Having considered industry feedback and undertaken further
analysis, the Productivity Commission is recommending that the PIR
provisions be repealed, and that:
Three years notice should be given to facilitate industry
Current financial assistance for encouraging Australian writing
and publishing should be reviewed immediately, and any changes
implemented prior to the repeal of the PIRs. The new arrangements
should be reviewed after five years.
The crucial issue now is whether the Australian Federal
Government will accept all or any of the recommendations of the
Productivity Commission. Certainly the recommendation regarding a
three year period to facilitate industry adjustment and the other
recommendation to increase assistance to local publishing and
writing may afford the Federal Government an opportunity to
"gently" accept the recommendations. However, the arts
lobby is extremely strong and persuasive in Australia and there is
already significant action being undertaken on this front.
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The rumour is interesting after Australia's long held position of rejecting such a clause in bilateral trade agreements.
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