British Record Companies Win £41m In Damages

Benjamin Fox writes "The BBC is reporting that online retailer CD-Wow has been ordered to pay £41m to the British Phonographic Industry. The London High Court ruled that Hong Kong-based CD-Wow, which imports cheap (but genuine) CDs from Hong Kong and elsewhere into the U.K., is '"in substantial breach" of a 2004 agreement to stop importing CDs.' This is a serious blow to proponents of an open, no-barrier music market."

Comments

B.S.

[ushering05401]

From TFA:

"The vibrancy of British music depends on a fair return on the investments that allow British talent to shine.

"This decision is an important step in ensuring that British music has a bright future."

So my question is... Why are the cd's being sold at such low prices in places like Hong Kong, where this company is buying them for resale in England. How are the artists getting a fair return selling their albums for such low prices in Hong Kong?

Regards.

Re:Ah, globalisation

[capnez]

I'm still waiting to hear an even vaguely plausible reason why record companies charge vastly more for a music CD [...] in the UK than to buy that same CD from Hong Kong including shipping halfway around the world [...]. And I'll be waiting a long time, because there isn't one.

You are right - if consumers were able to participate in the global market on the same level as multinational corporations, this would be no problem. Today, the corporations get to conduct cheap business abroad, but consumers are still hampered by tariffs, taxes, etc. The soluction is not to restrict the corporations, but to further liberate private citizens across the globe (who should be just as free to do whatever they want).
Your cynical definiton of globalization is skewed. Globalization should mean more and global freedom for everybody. For many companies and ordinary citizens, this is already a reality (in the European Union, for example). What we need to do now is to make globalization the reality for everybody. For example, this would mean that a UK citizen can buy CDs in Hong Kong or anywhere else (usually where they get them for the cheapest price).

However, in this special case we are dealing with, the company apparently broke an "agreement" (i.e., a contract) - although TFA is not very clear what exactly happend (speaking of "breaking [a] 2004 court undertaking [...]", whatever that is), and if they did that, they are lawfully punished for it.

Anyway, the course must not be more restrictions - it must be more openness and liberty for companies and citizens alike.

Let's make things fair

[antic]

I'm sure this is flawed thinking, but oh well:

If you want protection from parallel imports/greymarket sales, then you should be forced to develop your products from scratch in the country in which you're expecting protection.

e.g., if you benefit from cheaper production in China, the customers should be able to expect cheaper sales via China/HK. If you want to kill off parallel imports in CountryX, then research, design and handle production for your product entirely in Country.

grey importing legal in Australia

[atmurray]

Interestingly, in Australia the court system has found on several occasions to date that "grey importing" (unofficial importing) is legal and in fact (as sony found out: http://games.slashdot.org/article.pl?sid=05/10/06/ 1211211) circumvention of devices which prevent grey importing (e.g mod chips which get around region encoding) is also legal. It's interesting/scary how countries seem to go in virtually completely different directions on some of these issues (and in this case it is the UK and Australia which have inherited the same legal system).

Who's the importer in the story?

[Keith_Beef]

Not CD Wow.

CD WOW! is owned and operated by Music Trading Online (HK) Limited (a Hong Kong company).

Items over the UK HM Customs & Excise VAT Personal Import allowances Orders containing items over the UK Customs & Excise VAT personal import allowance are sent via Hong Kong Post, our postal agent. Hong Kong Post arranges the payment of VAT and or any other taxes and duties which may apply to UK H M Customs and Excise on your behalf FROM THE AMOUNT YOU HAVE ALREADY PAID. You will not be asked to pay any additional sums upon delivery / collection.

If I live in the UK and order something from overseas, I am officially the importer.

I have to pay the relevant import duties and taxes when the goods arrive. In this case, as you will notice from the text quoted from CD Wow's site, the duties are paid on my behalf by the shipping agent, out of the payment made to CD Wow. But in essence, it is still me, as the importer, who is paying the duties albeit through an agent.

The company selling the stuff to me is the exporter.

Beef.