This is the story in brief:
If you’re still struggling with the legalese, and wondering what all the hullabaloo regarding the proviso 2m is about, here is the gist:
So, Vikram Seth gets published in Britain by Hachette, in the US by HarperCollins, in Canada by McArthur, and by Penguin in India. They’ve been granted the rights by Seth and, at the moment, with their territories protected, one edition cannot infringe upon the other. Hence one cannot ‘commercially’ import one edition into another country, though one could buy a copy or two for personal use from say Amazon, etc.
What this bill proposes to do is to allow any foreign edition of a book originally published in India to be legally imported into India – commercially. The author’s consent is not required. So, now you will have any edition of Vikram Seth coming into India, infringing upon the rights of Penguin India. The same thing will hold true for all other publishers/authors in India. Parallel importation therefore implies doing away with exclusivity. So if it’s legal anywhere else in the world, that same product can be imported alongside locally manufactured ones.
The logic is that all editions should be available, and the competition should be healthy for Indian publishers. If parallel import is allowed, Indian editions would become cheaper. And, since the Indian editions are cheaper anyway as the Indian publishers claim, they shouldn’t be worried at all. Added to it, if it is okay for companies such as Nokia etc (electronic goods for instance), why shouldn’t it work for the book industry as well?
There are several flaws in this logic because the book industry (esp. the trade book industry) doesn’t work in the same manner as the electronic goods industry etc. One has to pay duty on the import of electronic goods. Books are non-taxable (non-commercial). You will never see them being advertised on TV or FM or whatever. The ground realities are different. Such imports will directly affect Indian publishing, not just sales.
Supposing we legalise this import, how long will it take for the same foreign editions to lower their prices to kill the Indian original edition of the same book? They could easily print their books in the subcontinent to match the Indian prices. With no territorial protection, it will be the death of the Indian edition – of any book.
Two: Books have a shelf life of about four months (talking of the front list). After that they’re ‘remaindered’, i.e., sold at ‘raddi’ prices. Once this law comes into force, after four months, the remainder merchants in India will import the remainders of successful books from the foreign countries in bulk and sell them here at prices lower than that of the Indian edition of those books. Hence, they too will kill the Indian edition. And, in any case, the author will get no royalty on the foreign remainders that have been dumped into India (remember: there are no royalties on remainders). Only the remainder merchants will profit.
In the long run, this will kill the Indian publishing industry:
- Publisher: because no publisher will invest in a book knowing that any of its foreign editions/remainders can come into the market and kill the Indian edition any time. Why would a publisher sell the rights of the books to a publisher in the US (or any other country) for instance, knowing that if it’s not illegal in India, anybody from there can sell the US version here or anybody from here can lawfully bring it in? What incentive would the Indian publishers have to publish a book?
- No author would like to publish in India for the very same reasons – because they wouldn’t be making any royalty.
Regardless of the clauses in the publisher-author contract, the author/publisher will lose control over the book once its foreign editions come out.
Question: Do you think the West would spend so much carting them physically to India and then selling them at throw away prices? Or the Indian traders to 'import' them and then sell them at low prices? Wouldn't that be a losing proposition for either of them? For Singapore etc, it may be easier, of course.
Answer: No, the freight will be negligible when you’re buying almost literally by the kilo weight. Remainders are
bulk clearance well below cost. The local remainder merchants would be happy to go there and buy/import.
bulk clearance well below cost. The local remainder merchants would be happy to go there and buy/import.
So, in brief:- Foreign publishers will be able to print legal editions here locally infringing the local ones.
- Surplus stock of export editions sold elsewhere into say Singapore etc can now be dumped here to match local price. Much better than returning to the original publisher to claim returns at cost.
- So we would attract remainders, planned local printings, and export surplus.
In such conditions, how can Indian publishing in English survive at all, leave alone thrive?
Thanks for decoding it.
ReplyDeleteIf I am getting it right, it sounds like what has been happening to other Indian retail markets. Foreign firms come through acquisitions, take over, mergers or long-term investment plans and eat into the market of the local traders. As it is, royalty for authors in India is really not very high. With the publishing firms shying away from investing, it will go down much further. In any case, this is just no way to protect an author's copyright. The question is can our leaders withstand the aggressive pushing of the agenda in the name of making Indian markets more competitive.
ReplyDeleteIsn't it interesting that books are hardly advertised even through posters and the like, whereas here in London, one sees book posters, ads, and trailers everywhere!
ReplyDeleteThis will mean the end of Indian Writing in English!!Average writers will not become good ones, good ones won't become great and brilliant ones won't become geniuses. No publisher/editor will invest enough time and expertise behind the making of books for the above to happen. Less and less people will write booksa s publishers will no longer provide any support. And whatever little marketing and advertisement was happening (once in a while on the fm and hoardings on buses) will now forever stop!!
ReplyDeleteUnless our leaders can somehow convince the govt to not pass the act!!
In order to do so we need to ACT NOW!!
Thank you, everybody. Yes, more authors need to be aware of how this will affect them.
ReplyDelete@Prashant, that is true. As I said, it's even worse for the book trade since as it is people rarely buy books. They'd buy anything else rather than --!
Thanks Divya! It doesn't look too good. Perhaps, time will sow the 'embryo of change' if it does. Though usually an optimist, I only hope it happens someday soon.
ReplyDeleteThis is quite in contrast to the Wine industry (which I follow off and on). There the foreign wines can never compete with the ones make in Nashik or Bangalore, only because of a heavy duty. The expensive Indian wine therefore stays cheaper than the useless imported ones.But I guess, we aren't too lucky in the case of books.
thanks, Divya!
ReplyDeleteIt is important to point out the converse case as well. The average price of a university level textbook in the US is $120. The Indian edition of the same text or an adaptation is in general priced at about Rs400. Under the amended act, it would be legal to export the Indian edition to the US. It is an ongoing problem and multinational publishing companies have been combatting this legally and through Customs.
ReplyDeleteIf the amendments go through, all reprint rights granted to Indian operations will be withdrawn and the students will be left to buy the full priced foreign editions. Can an average Indian student afford to buy it at its current price of $130?
Thanks a lot, Subroto. Someone's claiming otherwise though:
ReplyDeletehttp://cis-india.org/advocacy/ipr/blog/indian-law-and-parallel-exports/
Would you please comment?
Aren't there better things to do for our lawmakers than enact something that will solely benefit foreigners?
ReplyDeleteAre we smelling another scam here?
Can someone move the Supreme Court against this proposed amendment?
Thanks, Divya for the enlightenment :)
Sam
@Divya
ReplyDeleteYou write in your summary:
"1. Foreign publishers will be able to print legal editions here locally infringing the local ones."
This is simply not true. Any publisher printing a book in India without the copyright owner's permission (usually the copyright owner is the publisher the author sold the book to) will be committing copyright infringement even if s.2(m) is amended.
This amendment makes it legal to buy a book outside of India (regardless of whether it has been printed in India—so it covers books that aren't being printed in India as well) and sell it here.
To be clear: It does *not* allow for publishing of a book here without permission.
"2. Surplus stock of export editions sold elsewhere into say Singapore etc can now be dumped here to match local price. Much better than returning to the original publisher to claim returns at cost."
Much better for book-lovers I would think than burning remaindered books. But more seriously:
If dumping is the feared problem, it should be solved via anti-dumping laws, not via copyright. Preventing parallel importation would not just prevent dumping, but would also prevent a library from buying books unavailable in India from Amazon.
@Sol: The problem is that most lawyers are not aware of how the book publishing industry really works. The ground realities are very different. Publishers have lived and experienced the problems; they're not up in arms for no reason.
ReplyDeletePlease do read this carefully: http://dearddsez.blogspot.com/2011/02/thomas-abrahams-rebuttal-to-why.html
This also explains why anti-dumping laws will not work here.
@Divya: The problem is that most book publishers are not aware of how legal policy really works. The ground realities are very different. Copyright policy wonks have lived and experienced the problems; they're not up in arms for no reason. (See Rahul Matthan's article in yesterday's Indian Express: http://goo.gl/wPMUo)
ReplyDeleteApologies for the above sarcasm, but I would appreciate it if you would engage with the issues that have been raised rather than merely make general statements of the above sort.
# On enforcement of anti-dumping laws
Anti-dumping laws are enforced by exactly the same mechanism that parallel imports are enforced by: customs officers. A blanket ban might be easier for publishers, but setting fire to your house to get rid of pests is not a recommended pest-control technique.
# On definition of anti-dumping laws
Thomas says: "And assuming we want to invoke anti-dumping law, what parameters will be fixed? what discount are we going to cap? What quantity?" If parameters of price differentials and quantities cannot be set, then it is not a problem of dumping that you're dealing with. Dumping means offloading large quantities of a good at a substantially cheaper price, thus inundating local industry. If you don't know how to define it, ask some economists and international trade lawyers for help.
# Engaging with policy formulation
Engage with policy formulation, by all means. We are a better country if ordinary publishers like you engage with the policymaking process. I'm truly gladdened to see folks like you taking an interest in arcane subject like copyright law, and even doing a "translation" of policy debates to plainspeak.
But please: Don't mess with copyright law as a knee-jerk reaction to your fears. I still haven't seen a clear explanation from Thomas how parallel importation (doctrine of international first sale) is different from second-hand bookstores or libraries (doctrine of first sale) at a policy level. They all deprive the copyright owner (usually not the author, but the publisher) of control over distribution after the initial sale. We need to maintain the balance in copyright law between rights of owners and rights of the public. Please don't mess with that balance without a convincing policy case (which is more than "oh noes, we will drown in remainders, even though there is no proof of this happening from countries that have recently gone in for parallel importation such as New Zealand").
From Thomas:
ReplyDelete"1. Foreign publishers will be able to print legal editions here locally infringing the local ones." This is simply not true. Any publisher printing a book in India without the copyright owner's permission (usually the copyright owner is the publisher the author sold the book to) will be committing copyright infringement even if s.2(m) is amended. This amendment makes it legal to buy a book outside of India (regardless of whether it has been printed in India—so it covers books that aren't being printed in India as well) and sell it here. To be clear: It does *not* allow for publishing of a book here without permission.
--Not true. Firstly in trade publishing rights owners are most commonly authors not publishers. A contract anywhere (UK/US/Timbuktu) obviously means authorial consent. There is no contract that specifies that the author can control where a book is printed. And let us not confuse local publishing with local reprinting. Just as a book is printed in the UK or US and increasingly a book is printed in China, it is equally printed in India by foreign publishers. This is something the Indian print industry has been getting better at though we’re still some way behind china. It is a good offshore model and brings in good forex. Earlier territorial copyright meant that a publisher could print here but could only deliver local stock with the copyright owner’s consent. Now post 2m that consent will no longer be required; it can be shipped to any wholesaler.
Secondly, if the point is conceded that no book can be printed in India without the author’s consent (and that will amount to infringement), why is so difficult to accept the next logical step and say that “no book should be sold in India without the author’s consent”—which is what territorial copyright is about anyway.
ReplyDelete"2. Surplus stock of export editions sold elsewhere into say Singapore etc can now be dumped here to match local price. Much better than returning to the original publisher to claim returns at cost." Much better for book-lovers I would think than burning remaindered books.
--Not at all. But again it’s a question of how one sees the industry and the rights of copyright holders. It can be argued that vested interest or not, publishers still know their readers fairly well (certainly better than say lawyers spouting abstract concepts) and will ensure that the most wanted books are available here at the lowest prices. There is also a system of procurement that ensures that even the most obscure book can be made available here if not locally stocked.
So the issue is whether publishers are putting out books higher than reasonable profit, higher than affordability levels of the common man and students. If so that should be annotated and shown where there is such a pattern. They will consistently refuse to come to grips with specifics and answer the key questions—how will it be better? What are prevailing price patterns? How much cheaper should books get from present levels? which books are not available here? Is the damage that will be caused be worth it?
Take a look at petrol prices (perhaps the govt should be spending more time addressing this):
Bangladesh Rs. 22
Cuba Rs.19
Nepal Rs. 34
Burma Rs. 30
Pakistan Rs. 26
Afghanistan Rs. 36
INDIA Rs. 65.40
Books by contrast are anything from 30% to 90% cheaper than original prices.
But more seriously: If dumping is the feared problem, it should be solved via anti-dumping laws, not via copyright. Preventing parallel importation would not just prevent dumping, but would also prevent a library from buying books unavailable in India from Amazon.
--already answered in my rebuttal. Also answered that no publisher would have an objection to a library buying individual copies though they would be wasting money—it is still cheaper to order through a distributor or publisher than to order from amazon which will be selling at cover price off an average 15-20% discount + postage, which is much more expensive than ordering it locally.
@Divya
ReplyDeleteThe problem is that most book publishers are not aware of how the legal policy framing really works. The ground realities are very different. Copyright policy wonks have lived and experienced the problems; they're not up in arms for no reason.
I apologize for the above patronizing comment. But I was hoping for engagement on the substantive issues rather than vague generalities.
# On enforcement anti-dumping laws
Enforcement of anti-dumping laws is done via the same mechanism as parallel importation: the customs.
# On defining parameters for anti-dumping laws
In his rebuttal, Thomas points out the parameters: quantity and price differential. He fails to point out why they won't work. Instead he goes into a detailed explanation of pricing in the book market, which seems to undermine his point about price differential. That leads one to ask: If is isn't dumping, and is legit competition, then why are you worried about it?
If you have difficulties defining it, I'll be glad to point out some able people in India working in the fields of trade economics and international trade law. They'll help magnificently.
# On engaging with copyright policy formulation
It gladdens my heart to see ordinary folks like you realizing the centrality of copyright law to the way we encounter and work with knowledge. It is awesome that you care enough to even produce a plainspeak version of the arcane ideas being discussed. It is wonderful that ordinary citizens are engaging in policy debates, and heaven knows our country needs more of this.
But please, for the love of all that's sacred and true, do not engage with it in a knee-jerk manner born of fear.
Please understand that copyright policy isn't just about giving control to copyright owners. It is a balance.
The law allowing for second-hand bookshops represents that balance. I still haven't seen any convincing argument from Thomas or you as to how parallel importation differs from second-hand bookshops from a policy angle. In both cases, a copy of the book is sold once with the permission of the owner. Subsequent sales of that copy don't need the owner's permission.
Criminalising a large class of activities (single instances of import of an out-of-print book by a library) and simply saying, "but we are fine with it" doesn't do. Let the law state that it is fine. Unless parallel imports are allowed, the law makes criminals of all those librarians.
@ Sol: Why anti-dumping laws will not be practical: Firstly this is not like consumer goods—microwave or refrigerator that is being dumped in here. We’re taling of multiple product lines--there will be 40,000 plus titles to track, and the damage would have been done by the time you invoke the law. And assuming we want to invoke anti-dumping law, what parameters will be fixed? what discount are we going to cap? What quantity? I’ll explain why this will never work. There are no real averages to draw lines and say this much and no more for either discount or price or quantity. To understand why we need to understand cost to price structures. Indian publishing (both publishing and imports) is essentially low margin. Our books are priced to market; that means from cost our mark up is about twice or 2.5 times for imports and about 3-4 on average for local publishing—to enable the prices you see prevalent now. Abroad it is roughly 8-10 times from cost. To enable low pricing in India, we already have overseas terms that exceed 70% discounts, going into ‘net pricing’ (not standard discounts but individual book exceptions that are sold on net prices) for the ones that we pick to push big. Once the market is opened up, you will have two things—(a) targeted remainders as against the minor trickle now and (b) surplus clearance or even targeted sale to undercut the existing lawful edition.
ReplyDeleteAnd yes parallel importation (the current trickle) does see enforcement the logical way. Our margins do not allow us to hire expensive lawyers. So far (believe me, each of us keeps tabs) we have ‘unaware imports’ and ‘deliberate imports’. It is an irritant but is gradually reducing as the market matures. But the moment it touches key brands or serious revenue streams, legal action is taken; and if it’s not fixed by just sending a notice (which works 95% of the time), then the matter is taken to court.
-- It’s essentially ‘theoretical construct’ vs ‘lived knowledge’. You’re simply trying to cut off your nose to spite your face. It might help if you tried to discuss the issue with a couple of senior publishers and made an effort to understand the problem, before deriving your own conclusions.
@Sol:
ReplyDelete@Divya The problem is that most book publishers are not aware of how the legal policy framing really works. The ground realities are very different.
--Can you think of a better reason for wanting to change the law? Publishers are not aware of the law. Laws are supposedly made to handle problems. And it is ridiculous that a bunch of copyright lawyers will decide for the industry what is good for us, ignoring all our protestations.
2.Copyright policy wonks have lived and experienced the problems; they're not up in arms for no reason. I apologize for the above patronizing comment. But I was hoping for engagement on the substantive issues rather than vague generalities.
-- And yet they stick to just the vaguest of generalities. Would you please look at the facts?
# On enforcement anti-dumping laws Enforcement of anti-dumping laws is done via the same mechanism as parallel importation: the customs.
--No. Parallel importation is fixed in the courts (‘on discovery’), not at customs -- as I found out. Someone's accountable. Anti-dumping will be impossible to manage.
On defining parameters for anti-dumping laws In his rebuttal, Thomas points out the parameters: quantity and price differential. He fails to point out why they won't work. Instead he goes into a detailed explanation of pricing in the book market, which seems to undermine his point about price differential. That leads one to ask: If is isn't dumping, and is legit competition, then why are you worried about it? If you have difficulties defining it, I'll be glad to point out some able people in India working in the fields of trade economics and international trade law. They'll help magnificently.
ReplyDelete--You're most welcome to try if you find it that simple. The point is you can’t define it by either price or qty or discount. What laws are you going to fix to check dumping?
• Price? Say it shouldn't be less than half the original price? Given that India's a low-priced market, such books will be brought in and priced just marginally lower. That might undercut prices for a short while, but will not last long. This is not 'competition'. It disregards the rights and wishes of the creator (the contracts they sign, and lowered royalties), and the investor who's taken risks with his investments in getting fair returns from his work.
• Discounts? That it shouldn’t have a discount less than 70%? The invoice will show 70% and the rest will be passed as credit note or marketing grant.
• Qty? That can range from 10 copies to 100,000 copies that will be hit. How do you propose to control that?
But please, for the love of all that's sacred and true, do not engage with it in a knee-jerk manner born of fear. Please understand that copyright policy isn't just about giving control to copyright owners. It is a balance. The law allowing for second-hand bookshops represents that balance. I still haven't seen any convincing argument from Thomas or you as to how parallel importation differs from second-hand bookshops from a policy angle.
ReplyDelete--Fact (1): The author has already got his/her first royalty once on an old book. And (2) The number is far smaller. Remainders and targeted undercutting sales will cause damage on a much larger scale. In both cases, a copy of the book is sold once with the permission of the owner. Subsequent sales of that copy don't need the owner's permission.
--Why don't you let the author decide? That's what happens in ‘mature markets’.
Criminalising a large class of activities (single instances of import of an out-of-print book by a library) and simply saying, "but we are fine with it" doesn't do. Let the law state that it is fine. Unless parallel imports are allowed, the law makes criminals of all those librarians.
ReplyDelete--Why not revise the amendment to clearly say that librarians can order/import non commercial quantities to be limited to 5-10 copies per year, rather than subjecting the whole publishing industry to this?
@Divya
ReplyDeleteThanks for responding on the substantives. I will not take up on disagreements of opinions: let us just say that we choose to disagree. I will only point out a few errors of fact in your contentions.
1. Customs
It is parallel "imports" that you wish to prohibit, and you don't think customs has anything to do with it? Oh well, then anti-dumping hasn't anything to do with customs either. The level of monitoring required to police parallel import is exactly the same as for anti-dumping.
Please have a look at s.53 of the Copyright Act: "... shall be deemed to be goods of which the import has been prohibited or restricted under section 11 of the Customs Act, 1962, and all the provisions of that Act shall have effect accordingly". Customs deals with parallel importation. I don't know what lawyers you've been speaking with.
2. On the difference between 2d hand bookshop and parallel importation, you write:
Fact (1): The author has already got his/her first royalty once on an old book.
The same goes for parallel importation. The first sale still has to be *legal* for parallel importation to be legal. If the author does not get royalties on a legal sale, I would think that the publisher has entered into an unfair contract with the author.
3. First sale and subsequent control over distribution.
You assert: "Why don't you let the author decide? That's what happens in ‘mature markets’.
That is not true. Take a look at Article 6 of the TRIPS Agreement, and Article 6 of the WIPO Copyright Treaty. Please name a single country in which first sale does not take away further rights of distribution in case of books (only in case of artworks like paintings, is the situation is different in some countries). No 'mature market' allows for a copyright owner to control distribution after first sale. Read up the Wikipedia page on the "First sale doctrine", if you please.
As I said, there's a huge difference between theory and practice. Please speak to the publishers and they'll tell you. At the moment, you could try looking at Thomas Abraham's third rebuttal. That too explains more , if only people would make an effort to understand. If you've already made up your mind, there's no point.
ReplyDeleteThat is the problem here! The lawyers are not listening! They appear to have just made up their mind that's all!
ReplyDeleteIt's not even about fair 'competition'. This is about your own title coming into your own market/country to kill your own edition. If one calls it 'growth', it's a Cancerous one we're looking at.
ReplyDelete@Anonymous (May 10, 2011): I've deliberately not included your comment here because: (a) you posted anonymously (pls care to identify yourself if u want to participate on my blog, esp. in a debate; I don't encourage anonymous posts); and (b) we've already had several rounds of debate over this with IPR lawyers, which have already covered these points extensively. No point going round in circles any longer. I'm afraid we wound up the discussion almost three months ago.
ReplyDeleteYou can check out all the posts in detail on this very blog, and also on Nilanjana Roy's blog if you like.