The Bookseller is reporting that the agency model may cause more legal problems in the UK than it does in the US.
According to Serena Hedley-Dent, partner at London solicitor Farrer & Co, it is essential that the model is seen to be “genuine” to avoid being seen as collusion. She explained: “Within an agency model, you have to know who is actually driving the deal . . . If [Apple] are imposing their own terms and conditions, their own retail prices, effectively you have collusion among publishers because they are all being signed up on the same terms. Publishers need to make sure if they are signing an agency agreement they are in control of it, and setting their own terms and prices.”
However, she added that some markets were so competitive that it was difficult to establish why pricing of a product settled around the same figure. “What this throws up is there may be something the competition authorities want to look into, to make sure it is working as it should be, instead of being a front for something else.”
This is not the case in the US, where the Supreme Court has ruled that resale price maintenance is legal. Nevertheless, if all the US “agency model” publishers colluded to set the same ebook prices for all of them, it would still be possible to bring an anti-trust action for price fixing. Unlikely, however.
