Court rules out Austrian fixed price imports

<p>A price fixing system for German-language books imported into Austria has been declared illegal by the European Court of Justice (ECJ). The ruling means Austrian booksellers will be able to match the price the books are sold at in neighbouring Germany, or even sell them cheaper, raising fears that Austria could become a back-door for cheap books into Germany.</p><p>The case was brought to the European Court by Austrian bookseller LIBRO, which operates 219 branches in the country, and dates back to 2006 when it began advertising German-language titles at a discount to the fixed price, as set by the Austrian trade association, the Fachverband der Buch und Medienwirtschaft. Ironically, it meant that the imported German language books were most expensive in Austria than in Germany, since Austria levies VAT at 10% on books, compared with Germany&#39;s 7%.</p><p>The European judges concluded that this breaks European Union (EU) treaty commitments on the freedom of movement of goods.</p><p>In its ruling, the court noted: &quot;Austrian publishers are free to fix themselves, for their goods, such minimum retail prices for the national market.&quot; As a result, it added: &quot;The provisions . . . provide for a less favourable treatment for German-language books from other member states than for domestic books, given that they prevent Austrian importers and foreign publishers from fixing minimum retail prices according to the conditions of the import market.&quot; It concluded: &quot;Such provisions constitute therefore a restriction on the free movement of goods.&quot;</p><p>The court also rejected an earlier decision by an Austrian court that the price scheme was &quot;justified for cultural reasons and by the need to maintain media diversity&quot;. Although such an argument could in some cases justify this kind of price fixing, the court said there were less restrictive alternatives available to Austria, which should be used instead. It recommended that the Austrian government allow importers or foreign publishers &quot;to fix a retail price for the Austrian market which takes the conditions of that market into account&quot;.</p><p>It is expected that the Austrian government will now have to amend its fixed price regulations to allow for the price of imported books to be sold at a lower price.</p>