***Productivity Commission recommends repeal of the Parallel Importation Restrictions for books***

The Productivity Commission report, released on 14 July, recommends that the Government should repeal the Parallel Importation Restrictions (PIRs) for books.

Whereas the Commission's draft report had proposed a partial liberalisation of the import restrictions, the final report recommends their repeal, and that:

Three years notice should be given to facilitate industry adjustment.
Current financial assistance for encouraging Australian writing and publishing should be reviewed immediately, and any changes implemented prior to the repeal of the PIRs. The new arrangements should be reviewed after five years.
To assist in monitoring the impact of these changes, the ABS should undertake a revised version of its 2003-04 industry survey as soon as possible and update it prior to the five year review.

Australia's restrictions on the parallel importation of books result in higher local book prices, according to this report. While this is a cost to consumers, the benefits to publishers and authors are not well-targeted.

The Commission undertook extensive analysis of international book prices and concluded that the current restrictions create material upward pressure on book prices in Australia.

By removing the restrictions, local booksellers and libraries would have the option of accessing better value books from overseas. Local publishers would have a strong incentive to make their prices more competitive and to look for greater efficiencies in their operations.

The Commission found that the support to Australian authors provided by the restrictions is poorly targeted. 'One of the Commission's concerns is that consumers pay higher prices for books, regardless of their cultural significance' the Commission's Deputy Chairman, Mike Woods, said. 'A second concern is that these costs to consumers generate greater benefits for overseas authors and publishers than they do for our local writers. In effect, Australian consumers are subsidising foreign book producers.'
The report reflects more detailed analysis by the Commission about the costs of the PIRs. While still acknowledging the substantial cultural benefits of the restrictions, the Commission has decided they have significantly greater costs.

In particular, the Commission found that the bulk of the benefit of the PIRs was going to foreign authors. The Commissions draft report had found that the benefits of the PIRs were about equally shared between Australian and foreign authors and publishers, but further analysis revealed that foreign companies and authors get approximately 50% more benefit from PIRs than Australians, amounting to a substantial leakage directly from Australian consumers overseas.

ALIA made a joint submission (with the Australian Digital Alliance and the Australian Libraries Copyright Committee) arguing for the removal of these restrictions. It is available at:

ALIA submission