France surely is a culturally rich country. Unfortunately, when it comes to the economy – things are not really blooming. Part of that issue is the state’s ever-increasing interventionism. The country now has a project aimed at slashing development of web libraries. And by web libraries I mean Amazon.
The french Senate has voted a ban on Amazon’s free shipping on books. The free-shipping is frowned upon in France, as the policy is contravening the Lang Law. Simply put the law, named after Jack Lang, states that publishers set a fixed price to any book. Retailers can afterwards discount the book up to 5%, but no more. The reason for this policy to be so deeply ingrained is that it supports the 3500 bookstores in France. It is a “part of our cultural heritage“, as conservative lawmaker and law sponsor Christian Kert states.
So what is Amazon guilty of? Apparently the company is using the 5% discount AND offers free shipping. Isn’t this absolutely terrifying? The good people of France can’t let that happen, now can they?
The bill passed, Amazon is forced to stop offering free shipping
Put forward by the centre-right opposition UMP party, the bill passed by the senate this month. A near-universal pro vote assured the bill will stand and soon Amazon and others will be forced to drop the free shipping.
The “Anti-Amazon Law” as it is informally referred to, is rumoured to be a payback for the company’s decision of setting up its fiscal headquarter in Luxembourg, to avoid french taxes. It is also part of an increasing wave of what some might call “discrimination” against american companies. Both Amazon and Google have been having their fair share of legal issues with France and they are constantly under fiscal audit.
The Anti-Amazon law is but a symptom of a state incapable of holding onto talent and encouraging innovation
While this particular law has drawn a lot of attention, it’s but a symptom of a growing problem in France – the socialist / interventionist state. Things seem pretty grim there. Taxes under socialist leader Francois Hollande grew to upwards 75% for high earners. This caused the mass emigration of talented high earners and companies historically providing for the state’s lavish expenses.
This article in Newsweek quickly went viral as it shows the people’s distaste with the way the country is managed. Business are forced to pay taxes, rather than being encouraged to innovate and develop. Talented entrepreneurs and professionals are driven abroad, rather than being encouraged to stay and help the country recover. Still a large group of people, heavily relying on social care, heavily resisting change, do support the government’s actions.
A deeply iconic example of France’s resistance happened january the 13th. Some of the cabbies in Paris attacked an Uber car, breaking the glass and slashing the tyres. The reason – cabbies were not happy with the new taxes and the Uber-like apps that caused unwanted competition. Inside the cab – Eventbrite founder and one of those talented professionals leaving the country to find success, Renaud Visage. The old France meets the new France. Violence ensues.
The country is also pushing for increasing regulations in the EU against internet companies such as Google, Amazon and Facebook, instead of pushing for increasing regulation to foster innovation and economic development. The country’s inability to adapt and evolve in this new age can pose serious threats to the EU itself. As France still has plenty of negotiation power, it might push further for a rigid European Union, an inward looking, scared empire that might not make it very well into the next century.