Amazon (AMZN) Faces Major Challenges in France

E-commerce giant Amazon (AMZN) was hit last week in France, after French lawmakers aimed to protect local bookshops from online booksellers. The newly passed law, which still needs to clear the Senate, bars online booksellers from offering free delivery to customers, as well as capping discounts at a maximum of 5%. The law reflects other anti-discounting measures in the country, which started in 1981 under the Socialist government which intended to protect smaller bookshops from large supermarket chains.

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Over the past decade, French publishers have protested Amazonâ s "unfair competition" which was forcing them out of business. In France, online book sales rose to 13.1% of total book sales in 2011, up from 3.2% in 2003. There are still far more bookstores in France than most Western countries, which has 2,000 to 2,500 for a population of 65 million, compared to the 1,000 in Britain, which has nearly the same population. Amazon responded by stating that the law would hurt sales of books from smaller publishing houses, which did not have the distribution networks of larger publishers. Amazon is facing problems of its own in the United States, where it has battled against Apple (AAPL) and the Department of Justice over price-fixing claims. However, Amazon isnâ t alone in being targeted by the French government. Franceâ s data protection watchdog recently edged closer to fining Google (GOOG) over its data collection and storage practices, claiming that the search giant failed to comply with a three-month ultimatum to change its business practices in the country. The French government has also requested the European Union to improve the regulation of large global Internet companies like Amazon, Google, and Facebook, to discourage the dominance of e-commerce and other online services. The French government is also pushing for tighter tax regulations, so companies cannot move their headquarters into lower-cost EU countries. Amazon and Google are both facing ongoing tax audits in France as well. Regardless of its European problems, Amazon is still moving ahead in the United States with its ambitious plans to challenge a wide variety of companies. Amazon is currently targeting Netflix with its original programming, streaming content, and upcoming set-top box similar to Appleâ s Apple TV. The company is also going after the smartphone market with an upcoming smartphone, and recently rolled out a new version of the Kindle Fire, the HDX -- a lightweight, high-powered unit designed to rival Appleâ s iPad. Other News About AMZN Amazon Set-Top Box Coming By End Of Year Is Amazon ready to challenge the Apple TV and Google Chromecast? Amazon Gadget Speculation Heats Up as Holiday Nears Will Amazon impress holiday shoppers again? Other Stocks in the News Gates, Ballmer Seek Re-Election to Microsoft Board Can Gates and Ballmer stay with the company they founded? Security Firm Says iPhone Bug Can Thwart Device Wiper A security glitch comprises iPhones. Copyright 2013 by, Inc. InvestorGuide has no control over the sites we link to, is not affiliated with these sites, and cannot take responsibility for their quality or suitability. The news, analysis, commentary and profile information is not meant to be comprehensive, and the data provided is not guaranteed to be accurate. WebFinance Inc., the publisher of this newsletter, is not a registered investment advisor or a broker/dealer. This is not a stock recommendation newsletter but rather a source for investment ideas, and we encourage you to fully research any company before considering investing. The opinions expressed herein are those of the author and do not necessarily represent the views of nor are they endorsed by WebFinance Inc. No employee of WebFinance has owned or currently owns any shares in the company described above. The above is neither an offer nor solicitation to buy or sell any securities. The trading of securities may not be suitable for all potential readers of this newsletter, and the purchase of stocks mentioned in this newsletter may result in the loss of some or all of any investment made. We recommend that you consult a stockbroker or financial advisor before buying or selling securities or making investment decisions. We are not responsible for claims made by advertisers and sponsors. Anyone who makes decisions based on what they read here does so at their own risk and cannot hold WebFinance Inc. (DBA, Inc.) or its employees responsible.

Published on Oct 10, 2013
By Leo Sun
Leo Sun
Leo Sun is a freelance finance writer and position trader. He focuses on a combination of value and momentum investing, with a strong interest in the trading philosophies of Warren Buffett and Peter Lynch. Leo also has experience writing articles to help small business owners acquire loans and manage their finances. He regularly contributes to the Stock of the Day analysis.

Copyrighted 2020. Content published with author's permission.

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