Most-Favoured-Nation (“MFN”) Clauses

Amazon European Antitrust e-book investigation

The Europea Commission had concerns relating to certain parity clauses contained in contracts between Amazon and publishers. These clauses, sometimes referred to as “most-favoured-nation” clauses, require publishers to inform Amazon about more favourable or alternative terms offered to Amazon’s competitors and/or offer Amazon similar terms and conditions than to its competitors. This requirement includes forcing publishers to also offer to Amazon any new alternative business models, such as using different distribution methods or release dates, or making available a particular catalogue of e-books.

These clauses may make it harder for other e-book retailers to compete with Amazon by developing new and innovative products and services. Such clauses may also limit competition between different e-book distributors and reduce choice for consumers.

The European Commission considered in 2015 that Amazon’s behaviour may violate EU antitrust rules that prohibit abuses of a dominant market position and restrictive business practices.

Amazon sought to address the Commission’s concerns about the ebook practices by offering not to enforce, introduce or to change the terms of its agreements with publishers, and an agreement was reached.