Amazon reportedly to drop MFN clauses from e-book deals

Amazon has offered to drop the Most Favoured Nation clauses from its e-book contracts, following a European Commission investigation into the online retailer’s deals, it has been reported today. 

According to Reuters the proposal means that Amazon, by far the most dominant e-bookseller in the UK and across Europe, will no longer—through specific MFN clauses—force publishers to give them terms as good as those for rivals. Reuters quotes “a person familiar with the matter”, but the report is consistent with what The Bookseller has been told. It was reported last year that Amazon was seeking to settle the case. Last week Apple and Amazon ended a deal that tied them into an exclusive contract for the supply and sale of audiobooks, after pressure from regulators.

The EC opened a formal antitrust investigation into “certain business practices” by Amazon in the distribution of e-books in June 2015; in particular the probe focused on clauses which have shielded Amazon from competition from other e-book retailers, these included the right to be informed of more favourable or alternative terms offered to its competitors; and/or the right to terms and conditions at least as good as those offered to its competitors.

The Bookseller reported in June 2014 that Amazon was pressing for new terms with contracts that included MFN clauses over pricing and deals, though MFN requirements have been in some publisher contracts for longer. The terms are widely believed to have been a significant factor in preventing competition emerging in the moribund e-book market that Amazon currently dominates.