Court maintains fixed book price system to protect small local publishers

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South Korea's Constitutional Court ruled that the fixed book price system, which bans book price discounts of more than 10 percent, is constitutional.

The article in the Publishing Industry Promotion Act on the fixed book price system states that the price of a book is determined by publishers and that online retailers are allowed to give a maximum 10 percent discount on all books published 12 months ago or more. It also stipulates that no more than 5 percent in bonus benefits such as membership points can be provided.

“The legislative purpose of the article in question, which is to help keep local publishers stay afloat by preventing excessive price competition between publishers and expanding reader access to books, is justified,” the court ruled with the unanimous opinion of all judges.

South Korea’s fixed book price system was first launched in 2003 to help smaller publishers survive the competition against large bookstores that have the resources to offer substantial discounts.

However, the court also said, “It is true that since the implementation of the fixed book price system, paperbacks’ sales have decreased over the years -- which has led to a decrease in the number of local bookstores. But this is actually due to changes in the social and economic environment, such as the development of the internet.”

The court added that such problems would have worsened faster if the fixed book price system had not been in place.

The ruling came after an e-book author filed a constitutional complaint in January 2020, arguing that their basic rights, such as their right to decide how much their book should cost and how much of a discount they should offer, were being violated.

The e-book author also argued that readers of paperbacks and e-books should have the right to pursue happiness and truth by choosing the type of book they’d like to read cheaply and more conveniently. The author stated that they were planning to launch an online platform that publishes and distributes e-books in the future and that the fixed book price system violates their basic rights as a prospective publisher.

As for the e-book publishing market, the court recognized the need to preserve the cultural diversity of the publishing industry here -- and by extension the cultural diversity of society in general through the books it publishes -- by preventing large corporate platforms from abusing their economic power.

By Lee Jung-joo(lee.jungjoo@heraldcorp.com)