Amazon in talks to settle EU e-book dispute and shorten legal battle

5 Oct 20161 Share

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Amazon Kindle. Image: A Aleksandravicius/Shutterstock

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Rather than spending months and months fighting legal battles with the EU, Amazon is apparently in talks to settle the dispute over its contracts with publishers and its Kindle e-books.

Amazon – much like Google – has been under the scrutiny of the European Commission (EC) over claims that they are using their financial leverage to squeeze out competition unfairly.

Now, Amazon is looking to end one such dispute that has rumbled on for a year now relating to its contracts agreed with publishers. As per their agreement, publishers would be required to inform Amazon of the terms they agree with other e-book retailers.

The EC alleged that as part of the contracts, publishers would also be required to offer any better deal to Amazon.

According to Bloomberg, people close to the case have confirmed that Amazon is hoping to come out the other side of the case with a better deal, by beginning early talks with the EC.

Already facing another investigation into its tax practices in Luxembourg, Amazon will likely have to bring the details of the settlement to their publishers before any agreement can be made.

Similar to Apple in 2012

Both Amazon and the EC have refused to comment on the suggestions of any deal, however.

If a settlement is reached, it would follow a similar deal agreed between the EC and Apple back in 2012 over the latter’s own publishing platform, iBooks.

At that time, the settlement ensured that Apple avoided a substantial fine for what was considered unfair pricing of its books.

The Luxembourg case appears to be the biggest hurdle for Amazon, with the EU alleging that the company does not pay any corporate tax in the small, but wealthy state.

Rather, it is believed that it pays a much smaller tax deductible royalty as part of a limited liability partnership based in the country.

Amazon has however denied these claims, saying that they are subject to the same tax laws as every other company in Luxembourg.

Amazon Kindle. Image: A Aleksandravicius/Shutterstock

Colm Gorey is a journalist with Siliconrepublic.com

editorial@siliconrepublic.com