France is just different

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Gerald Tarrant
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France is just different

Post by Gerald Tarrant »

From here
PARIS: The online retailer Amazon.com said Monday that it would pay €1,000 a day in fines, rather than comply with a court ruling upholding French limits on price discounts for books.

The company decided to pay the daily fine worth $1,500 rather than eliminate its offer of free shipping on book purchases, said Xavier Garambois, director of Amazon's French subsidiary.

"We are determined to follow every avenue available to us to overturn this law," Garambois said. The company appealed the ruling Friday.

Jeff Bezos, founder and chief executive of the company, based in Seattle, was equally defiant in a weekend e-mail message to French customers. "As unbelievable as it appears, the free delivery of Amazon.fr is threatened," he wrote in the French-language note.

"France would be the only country in the world where the free delivery practiced by Amazon would be declared illegal," the Bezos e-mail concluded, inviting consumers to sign an online petition. By Monday evening, more than 120,000 people had clicked in favor of maintaining free delivery.

Of Amazon's $3 billion in third-quarter revenue, about $1 billion came from outside North America. Amazon does not break down sales or active users, which total 72 million globally, among seven international operations.

Amazon's defiance has the potential to backfire. Amazon must pay the fine for 30 days if it continues to violate the court order, at which point the court will reconsider the fine and then extend it, lower it or raise it.

Cédric Manara, a law professor and e-commerce specialist at Edhec, a French business school in Nice, said he would not be surprised if the court raised the penalty, and that Amazon "had no chance" with its appeal.

The law is "really clear," Manara said. "There is no way you can read the text to find a different result. And the court would have evidence of the firm's deliberate will to violate the law." A similar law regulating the price of books in Germany does not affect free shipping for Amazon.de, Mantello said.

The 1981 Lang law was passed at a time when booksellers were losing sales to supermarkets and other new competitors. It was meant to assure that the French public had equal access to a wide variety of books, both high-brow and low-brow, not just heavily marked-down publications.

The law has twice come before the European Court of Justice and both times it has been affirmed. The law is not considered anticompetitive because all book retailers are held to the same standard, Manara said.

In the Amazon case, a union of French bookstores won its lawsuit against the company last month over the free-shipping offer, which applies only to deliveries within France on book orders of more than €20.

The Tribunal de Grande Instance in Versailles awarded the bookstore association €100,000 and ordered Amazon to start charging for delivery. The court said if the cost of Amazon's delivery reduced the price of a book more than the 5 percent allowed by law, then the sale violated the law.

Still, Amazon said it could triumph. "As a company, we are very passionate about this," said Stephanie Mantello, of Amazon's office in Paris.
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Post by Rogue 9 »

:wtf: indeed. What the hell is it with France and dumb shit like this? This, their labor policies (how hard do you need it to be to fire somebody?), their immigration laws (let's have slums full of disenfranchised third-generation immigrants who are somehow not citizens by now!), and probably more I can't think of just now are all utterly ridiculous.
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Post by Fingolfin_Noldor »

Rogue 9 wrote::wtf: indeed. What the hell is it with France and dumb shit like this? This, their labor policies (how hard do you need it to be to fire somebody?), their immigration laws (let's have slums full of disenfranchised third-generation immigrants who are somehow not citizens by now!), and probably more I can't think of just now are all utterly ridiculous.
They do have one of the most protected industries around. Rather retrograde it is.
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Post by Soontir C'boath »

The 1981 Lang law was passed at a time when booksellers were losing sales to supermarkets and other new competitors. It was meant to assure that the French public had equal access to a wide variety of books, both high-brow and low-brow, not just heavily marked-down publications.
Reading this quote, it seems this was to protect bookstores against supermarkets from selling best sellers at reduced prices (what's the range of books French supermarkets carried back then anyway?) which would threatened the regular bookstores out of business along with other books that do not sell as well. Except, Amazon offers a great range of books to sell which leaves this shit bullocks.

Apparently, the French government's law website doesn't have an english version so I can't exactly read what the law is about. It's here.
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Post by Androsphinx »

Amazon France has free shipping? I'd go out of business if I didn't have that extra £2.75 on every order to actually give me a profit margin!
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Post by Terralthra »

Soontir C'boath wrote:Reading this quote, it seems this was to protect bookstores against supermarkets from selling best sellers at reduced prices (what's the range of books French supermarkets carried back then anyway?) which would threatened the regular bookstores out of business along with other books that do not sell as well. Except, Amazon offers a great range of books to sell which leaves this shit bullocks.

Apparently, the French government's law website doesn't have an english version so I can't exactly read what the law is about. It's here.
Roughly translated, the relevant portion is in Article 4:

For the books published in a member country of the european economic communicty. or which was put in free circulation in a member country, the selling price to the public in France cannot be lower than the price set by the editor, or than the exact price set in the publishing country or the country of circulation, expressed in French francs, or at the price resulting from the effect on these prices of an advantage obtained by the importer in the country of edition.

Basically, if Amazon's free shipping offers a significant advantage over booksellers in France (which must pay shipping), it's illegal.
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Post by Siege »

Many French supermarkets are, at least by European standards, gigantic. Many of their supermarches and hypermarches could very well compete with smaller bookstores, and considering people would be drawn to the supermarket for other stuff as well as books I can see how this would pose a problem for small bookstores.

Of course, it's still odd to "protect" the public by forcing them to shell out more money for the books they want. France has many odd ideas about what constitutes protection of the public.

Soontir C'Boath wrote:Apparently, the French government's law website doesn't have an english version so I can't exactly read what the law is about. It's here.
My French is a bit rusty but as I understand it, you aren't allowed to sell your book under the price set by the "editeur", which is presumably the publisher. Amazon does sell under that price: it takes the price set by the "editeur" and subtracts from it the price of delivery, resulting in a lower price than that set by the publisher, which would be illegal.
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Post by Tsyroc »

Androsphinx wrote:Amazon France has free shipping? I'd go out of business if I didn't have that extra £2.75 on every order to actually give me a profit margin!
Amazon in the US will give you free shipping if your order is large enough, or you can pay $75 or so a year to be a prime member and then all 2 day or slower shipping is free for items shipped from Amazon and most of their direct partners, like Target.

I've more than made up my $75 in shipping over the last year. Heck, I probably made up the shipping difference in a couple of months at most.

I used to make a point of buying stuff from the local Borders/Waldens until they boned me over. Now I essentially still buy from them but through Amazon. Currently it saves me the cost of the state and local sales tax.
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Post by Glocksman »

I used to make a point of buying stuff from the local Borders/Waldens until they boned me over. Now I essentially still buy from them but through Amazon. Currently it saves me the cost of the state and local sales tax
You mean to say that you don't pay the state and local taxes due* when you file at the end of the year?

Shame! :P

Seriously though, while this is probably (I'm certainly no French legal expert) legal under French law, it strikes me as straying from its original intent of protecting bookstores from being driven under by non bookstores (such as Wal*Mart, to use a US example) selling books at below cost as 'loss leaders' to draw people in.



*Most states have a line on their tax forms for sales tax due on mail order items.
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Post by Crown »

Rogue 9 wrote::wtf: indeed. What the hell is it with France and dumb shit like this? This, their labor policies (how hard do you need it to be to fire somebody?), their immigration laws (let's have slums full of disenfranchised third-generation immigrants who are somehow not citizens by now!), and probably more I can't think of just now are all utterly ridiculous.
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Post by Darth Wong »

Soontir C'boath wrote:Reading this quote, it seems this was to protect bookstores against supermarkets from selling best sellers at reduced prices (what's the range of books French supermarkets carried back then anyway?) which would threatened the regular bookstores out of business along with other books that do not sell as well. Except, Amazon offers a great range of books to sell which leaves this shit bullocks.
The line between consumer protection and market diversity protection can get pretty blurry sometimes. Sometimes it seems as if someone is just tossing a bone to industry, but there is often a real fear that if certain big retailers are allowed to dominate a market, they will start effectively dictating what people can buy, and that is not an unfounded fear. Is it necessarily true in the case of Amazon in particular? Maybe not, but one cannot base rules on the assumption that companies will necessarily behave in a certain way. Wal-Mart certainly hasn't suffered for its poor selection, shitty shopping environment, and failure to offer both highbrow and lowbrow products.
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Post by Sidewinder »

Why would something like Amazon's offer of free shipping be worth bringing up to court? I haven't read anything about Barnes & Nobles, Borders, or Waldenbooks suing Amazon for causing them to lose revenue-- that's what competition in a capitalist economy is about! Or are the French judges trying to transform their national economy into a communist one?
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Post by Tsyroc »

Glocksman wrote: You mean to say that you don't pay the state and local taxes due* when you file at the end of the year?

Shame! :P

*Most states have a line on their tax forms for sales tax due on mail order items.
I haven't seen one on Arizona's yet. :)

I have ocassionally had to pay taxes on stuff I bought online but so far Arizona hasn't locked on to Amazon yet. It's kind of odd since I would think that some of the stuff has to be coming from local suppliers (Borders/Waldens, Target).

For the most part our sales taxes are to nail the snow birds and tourists anyway. :twisted: So that might be part of the reason they haven't made a push to collect sales taxes on mail order and internet sales.
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Post by Tsyroc »

Sidewinder wrote:Why would something like Amazon's offer of free shipping be worth bringing up to court? I haven't read anything about Barnes & Nobles, Borders, or Waldenbooks suing Amazon for causing them to lose revenue-- that's what competition in a capitalist economy is about! Or are the French judges trying to transform their national economy into a communist one?
Borders/Waldenbooks is partnered with Amazon. Their websites are even crosslinked, and the last time I looked even look the same. So they've already come to some sort of agreement.

Barnes & Noble has it's own website going but I don't know how it's doing in competition with the Borders/Amazon stuff.
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Post by Master of Ossus »

To me what's worst about this law is that amazon is arguably the single company that caters the MOST to small, niche literary circles. It epitomizes the "long-tail" marketing philosophy. If the goal of the policy is actually to ensure "equal access to a wide variety of books, both high-brow and low-brow, not just heavily marked-down publications" then amazon is the single company they should be promoting.
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Post by Mobius »

then amazon is the single company they should be promoting.
Evil american company: we have senators going on hunger strike when a factory moves of 50 km (going in another département)

the funny thing is that the union that brought the court on amazon is launching his own e-shop with free shipping.
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Post by Sidewinder »

Mobius wrote:the funny thing is that the union that brought the court on amazon is launching his own e-shop with free shipping.
French hypocrisy. Why am I not surprised?
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Post by The Grim Squeaker »

But Globalization and Inter-national corporations are evil :roll: .

Oh, and for the record, I wish the concept of free shipping existed here, let alone tax free amazon :evil: .
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Post by Siege »

Sidewinder wrote:French hypocrisy. Why am I not surprised?
Have you checked out what the law actuallt says? It's not illegal to offer free shipping, it's illegal to sell books under the price established by the publisher. As long as Amazon, this new shop, the King of France or whomever do that they are in compliance with the law and no-one will give a shit about their free shipping.
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Post by The Nomad »

I am at a loss for words :cry: . I'd better start ordering as much stuff as I can before they are finally bullied into compliance. I'm thoroughly disgusted :evil: . My esteem of Pierre Mauroy, Jacques Delors and Robert Badinter has been grievously lowered. Jack Lang, well it has hit a new low, but then he appears as a sycophantic asshole; still now I really hate him.
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Please ignore the above rambling. This was just the pain-induced thrashing of my bank account :oops:
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Post by Gerald Tarrant »

Hope you'll forgive the Necro. But this is another example of French peculiarity (although the article notes that other parts of the Euro zone do this too).

Apparently Sales are only allowed at certain times, in accordance with government principles. I'll grant that some of their reasons are sound, but the first time I heard about this it stunned me.
French pay a price for rules on sales
Bloomberg News

By Geraldine Baum, Los Angeles Times Staff Writer
January 31, 2008

PARIS -- On the first day that nearly everything in France went on sale, employees of the upscale Bon Marche were stationed at the entrances offering cookies to customers as they stormed the glass doors.

The shoppers were ravenous -- but not so much for sweets.


After months of planning, saving and strategizing, they couldn't wait to be set free in the most luxurious department store in France with prices slashed on every rack and in every bin. The same was true later across town in more pedestrian shops on Boulevard St. Denis, where Silvia Atisso and her sister were pawing through racks of winter coats priced at $29.35 each.

"We wait for the sales so that we can buy everything that we've seen during the year for a much lower price," said Atisso, 37, who had come that morning on the Eurostar train from London to find bargains.

In America, merchants hold sales whenever they like. In parts of Europe, it's the government that makes the rules.Twice a year, in January and June or July, French law allows retailers to post the word "sale" in their windows and significantly cut prices.

The government sets the dates, and for four to six weeks, there is mayhem. The usual French decorum is dropped as shoppers, who on an ordinary day wouldn't dream of eating lunch or drinking a cup of coffee on the streets the way Americans do, gobble baguette sandwiches as they race from shop to shop.

Which sort of explains why Bon Marche was giving out treats at 8:30 the first morning.

"People get so worked up anticipating the low prices," confided a worker as she gingerly handed cookies to the incoming herd. "The last thing we want is for them also to be hungry."

Not only are out-of-season sales banned in countries including Belgium, Italy, Spain, Greece and France, but a jungle of regulations also keeps European retailers in lock step: In most countries, they can't sell below cost; in others they can't advertise reduced prices in advance of sales or discount items until they have been on shelves more than a month.

A recent study in France explained that these bans were conceived to preserve "le jeu loyal de la concurrence," or "the loyal game of competition." Almost like a duel at dawn, fair competition isn't considered possible without regulation to set a time and place for it.

This may seem ludicrous in the competitive 21st century, but these laws are aimed at preventing big stores from driving smaller ones out of business. Some are said to have originated in the mid-1930s in Germany, when the Nazi Party wanted to protect the public from what it regarded as overly competitive "Jewish" practices by some shopkeepers.[ed: WTF, trying to discredit a practice by linking it to the NAZI's, less bias more facts plz]


In France, they have long been intended as an orderly orchestration by the state to allow merchants to clear out old stock and bring in new collections.

But such restrictions help explain why in France and in the euro zone, consumer spending is expected to account for about 56% of the gross national product in 2007, compared to 70.3% in the U.S., according to the Organization for Economic Cooperation and Development.

Yet change is afoot. Germany scrapped the last of its sales restrictions in 2004, freeing retailers to offer discounts any time. Now, France looks poised to make some changes.

New President Nicolas Sarkozy appears to be as ravenous for structural reform as shoppers at Bon Marche were for bargains, and he has promised to lift sales restrictions and other regulations. Although they were intended in part to preserve France's quality of life and inhibit cutthroat competition, they have contributed to economic stagnation. France's gross domestic product growth fell from 2.2% in 2006 to 1.9% in 2007.

On the first day of the January sales, Economy Minister Christine Lagarde went shopping for ties in a Printemps department store and told a reporter about her plans to liberate French retailers by making sales "general" and "permanent" through the year.

But many small merchants and some shoppers are not happy at the prospect. Paolo de Cesare, head of that Printemps, said: "Sales should stay a special event. Two sales periods are largely sufficient."

Vivian Lautte, a 42-year-old teacher, couldn't conceive of random sales at random times.

"How will I know the real prices of things?" she wondered.

Since last summer, she's been skimming 10- and 20-euro bills from her household budget and stashing them in a drawer. (This is in addition to the 10% her husband saves of their salaries each month.)

Within the first few hours of the January sale, she'd run through the entire stash, buying, among other things, black patent leather boots for herself, a desk set for her 9-year-old son and a made-in-China tablecloth with 12 napkins, all discounted 30% to 70%.

"I'm always embarrassed to be seen on the Metro with so many bags, so I stuff everything in one bag together," she said. "I don't want people to think I'm a materialist."

But recent polls show most French consumers are eager for more opportunities for bargains and shopping hours. Despite the high value of the euro, prices of staples like bread, gas and milk have been rising, and the French have been complaining that their euros don't go as far as their francs used to.

Fears of declining purchasing power have the French so worried that recently the left-leaning Liberation newspaper featured a giant baguette on its cover as well as a story about a family from Lyon struggling to stay within a budget that allowed for using only two tanks of gas a month.

Many aspects of shopping that Americans take for granted are rare here. Credit card use is much lower than in the U.S. Instead, the French rely on debit cards, which give them the convenience of plastic with less risk. American consumers have been more willing to spend rather than save: French workers on average were expected to save 13.1% of their income in 2007, while the European average is 9.8%. Americans saved 0.7% on average.

And while many Americans check their Sunday newspapers for sales, then head to the mall, the French can't shop much that day -- because few stores are open, thanks to a century-old labor code that decrees a day of rest for all workers. (Moreover, newspapers aren't allowed to run department store ads, out of concern about unfair competition.)

Lagarde was recently able to circumvent the ban on Sunday trading at certain furniture stores by labeling them "tourist destinations."

Now, Sarkozy is pushing a bill in parliament to loosen the ban everywhere, but it faces resistance from unions and Socialist politicians. When hundreds of workers who favor working Sundays held a rally near Paris this winter, a union leader labeled them "collabos," a term for Nazi collaborators during World War II.

Nicole Bricq, a socialist member of the Senate, is fighting Sunday openings. She worries about the effect on low-paid clerks, particularly single parents who might leave children at home unsupervised.

"Nobody asks what becomes of these children," she said. Moreover, she noted that Sunday shopping isn't a panacea. "In Japan, stores are open night and day and it hasn't stopped them from having economic troubles. And you, the Americans, you have a recession right now!"

A few retailers have found ways around the Sunday ban, but their arguments border on the comical: After unions tried to shut down the flagship Louis Vuitton store on the Champs-Elysees when it opened on a Sunday, the company persuaded a judge that a fashion museum on the second floor was a "place of cultural significance."

Sarkozy appointed a committee of economists and businessmen to come up with ideas to revolutionize the country into more of a free-market society. It presented its controversial plan, titled "300 Decisions for Changing France," last week.

But France has been down this road before. Two years ago the government, of which Sarkozy and Lagarde were members, set out to reform the twice-yearly sales regulation and ended up changing little. Last month another "working group" was brought together to study the same set of laws.

They are, indeed, complicated. Grasping the difference between an official "sale," an occasional "promotion" and a sanctioned "liquidation" may take a law degree -- and the laws are constantly litigated.

"It's subtle, no?" said Pierre Chambu, the director of the government bureau that regulates fair trade. "I know this is all hard for people from America to comprehend. But really, all you need to know is . . . The sale season is more like Christmas than Christmas."
I understand that there are some decent reasons for this policy, that doesn't make any less strange though.

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This quote makes it seem like the effort to liberalize the sales policy faces serious opposition.
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Post by KlavoHunter »

Now, Sarkozy is pushing a bill in parliament to loosen the ban everywhere, but it faces resistance from unions and Socialist politicians. When hundreds of workers who favor working Sundays held a rally near Paris this winter, a union leader labeled them "collabos," a term for Nazi collaborators during World War II.
Is it just me, or does the Left in France seem like a bunch of complete lunatics, to label people who want to work on Sundays as Nazi collaborators? :shock:
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Post by K. A. Pital »

The government sets the dates, and for four to six weeks, there is mayhem.
German government also sets the dates for sales, IIRC. I don't think European governments are "lunatic" for doing it, price dumping is an abusive and brutal practice that can ruin whole lots of small producers, isn't it?
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Post by Bounty »

The Belgian government does it too. It stops stores from dumping stock willy-nilly, but still allows them to get rid of the end-of-season stuff quickly.

And I don't see the problem with measures like this; they ensure that big chains don't rape their staff to get prices down, and they help keep smaller businesses in business. Like the article says, it's a security measure to prevent the market degenerating into American practices.
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