The sixth major review in three decades has again recommended restrictions on the importation of books be abolished. The Harper competition review echoes earlier advice from the Productivity Commission, the Australian Competition & Consumer Commission and the Prices Surveillance Authority as far back as 1989.
The response from book publishers and their authors has been true to form. For nakedly self-interested and absurd rhetoric, author Richard Flanagan takes the cake. According to Flanagan, the abolition of parallel import restrictions on books is "ideological vandalism" that would consign "Australia's most successful cultural industry into a desert" and mean that "Australia as a nation will have had its tongue torn out". He was joined by Peter Carey and Thomas Keneally in an open letter to claim Australia will again become "a colony of the mind" if the changes proceed.
In his submission to Harper, Michael Heyward of Text Publishing claimed "any proposal to dismantle territorial copyright is in fact a radical instrument of cultural engineering".
It was threats such as these that cowed the Rudd government in 2009, when ministers Emerson and Chris Bowen brought a proposal to cabinet to liberalise book imports following the Productivity Commission's unambiguous advice. Labor shouldn't make the same mistake twice. This time, Labor should side with consumers and back a reform that will deliver cheaper books for schools, students and the poor.
For the changes to proceed, the government will need to amend section 44A of the Copyright Act (1968). Passage through parliament, without potentially messy negotiations with the crossbench, is assured only with Labor's support.
Despite being incorporated in the Copyright Act, parallel import restrictions do not protect intellectual property and are in fact a restriction on trade. Parallel import restrictions prevent booksellers here from importing legal copies of a book from overseas if a local publisher has negotiated an agreement with the copyright holder. The government in effect stops the importation of legal copies of a book to protect the profitability of local publishers and their international partners, at the expense of consumers. The claims by publishers and authors boil down to one tenuous argument: because parallel import restrictions allow publishers to make higher than usual profits from exclusively importing overseas titles, they are able to take more risks on new Australian authors and effectively cross-subsidise local books.
But there's no compelling evidence for this claim.
On the contrary, all the available evidence shows parallel import restrictions are an ineffective tool for promoting Australian literary content, with many unintended consequences.
The Productivity Commission found that, on average, consumers here paid 35 per cent more for books than their US counterparts. The report also found the benefits of these higher prices often accrued to the printing industry and foreign copyright holders rather than Australian authors.
In 1998 the New Zealand government embraced this reform. A review six years later for the government was glowing. It found income earned by local publishers grew substantially, book prices fell below Australia's, and New Zealand-printed book exports nearly doubled.
The same year Australia enacted the same reform for CDs. As a 2009 report by Tim Wilson showed, following liberalisation the number of recording artists and the amount they received from royalty payments grew strongly. At the same time the average wholesale price of CDs fell by 32 per cent between 1999 and 2008, to the benefit of consumers.
In 2003 the government removed parallel import restrictions on software, with no adverse effects. A partial deregulation of book imports in 1991 did speed up the importation of foreign titles but had no measurable effect on prices because it maintained restrictions on parallel importation if the book was made available in a reasonable timeframe.
The government has announced it will proceed with the changes, but only after yet another Productivity Commission inquiry, this time into intellectual property arrangements, due in August next year. There's no reason for further delay. No new report will contradict the six previous reviews that backed the change.
The government should also reconsider its opposition to equivalent changes in the importation of cars, again backed by the Harper review and the Productivity Commission. Many of the arguments about liberalising book importation apply to cars. The restrictions mainly benefit domestic car sellers at the expense of consumers. When we had a car manufacturing industry this policy was a misguided attempt at protectionism. It's even more ludicrous now that car manufacturing will cease and there are no domestic jobs to protect.
Consumers will continue to pay higher prices as long as the Coalition and Labor fail to reject special-interest pleading.
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