By Vanessa Mock
BRUSSELS--European Union regulators said Friday they had
received an offer from Penguin International Ltd. to scrap the
e-book deals it has with Apple Inc. (APPL) in an effort to
alleviate competition concerns and settle a 16-month long
probe.
Penguin, owned by the U.K.'s Pearson Group PLC (PSON.LN), would
become the fifth book publisher to settle with the European
Commission if its offer is accepted.
The Commission, which acts as the EU's antitrust watchdog, said
the offer would be sent out to third parties and rivals in an EU
procedure known as market testing.
"If the market test confirms that Penguin's commitments are
suitable to address the Commission's competition concerns, the
Commission may make them legally binding on Penguin," it said in a
statement.
Penguin's proposals were "substantially the same" as those
proposed previously by Simon & Schuster Inc., HarperCollins
Publishers Ltd., Hachette Livre SA and Holtzbrinck GmbH, and made
legally binding by the Commission in December 2012, it said.
Those four publishers settled after regulators said they, with
Apple's help, may have breached EU antitrust rules by jointly
changing their contracts for the sale of e-books to more favorable
terms, thereby extracting higher prices.
"Penguin [now] offers to terminate existing agency agreements,"
the Commission said, adding that it would also refrain from a key
retail price clause, known as the "most favoured nation" contract,
for five years. That clause prevents retailers from undercutting
Apple's e-book prices.
Under the deal, Penguin would draw up new agency agreements that
would allow retailers to set the retail price of e-books for two
years.
Write to Vanessa Mock at vanessa.mock@dowjones.com
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