Archive for the ‘Law’ Category

Frightful Owner

January 16th, 2018
Gwyn Headley

by Gwyn Headley

Managing Director

David Carton, one of fotoLibra’s valued contributors, has uploaded some of his images to specialist ecommerce sites as well as to fotoLibra.

Recently he was informed by one of these sites that they were removing one of his images, as the “rightful owner” of the image had sent them a Take-Down notice.

Carton was puzzled as to who this “rightful owner” could be as the image (shown below) was a scan of a 1902 ad for the long defunct Great Northern Railway in Ireland, and not attributed to any artist.

 

 

Naturally he asked for the Rightful Owner’s name. It was the Universal Music Group, claiming copyright on the image.

Why? UMG had done a search for GNR and issued take down notices for every image they could find which had GNR in the keywords.

Yes, but why? I did a Google search for GNR and found this:

  • GNR is the Great North Run — Newcastle Half Marathon
  • GNR Motors is a vehicle repair shop in the Midlands
  • GNR are one of the UK’s leading IT distributors
  • GNR is an abbreviation for the elderly American pop group Guns N’ Roses

The Great Northern Railway (Ireland), the subject of Carton’s image, does not appear high on the Google search list because it closed down in 1958.

But Guns N’ Roses do, and their agents UMG have sedulously trawled the internet to ensure the world ceases and desists from making even the tiniest profit through any association with the group. Their tsunami of threats has flooded to encompass the poor old Great Northern Railway (Ireland), defunct before the Guns N’ Roses singer was even born.

So to avoid the threat of litigation the ecommerce site capitulated and removed the image. Carton objected, and the site demanded that before they would even consider reinstatement he should agree to these conditions :

“a statement by you that you consent to the jurisdiction of the Federal District Court, San Francisco County, California, United States and that you will accept service of process from the person who provided notification described above or an agent of such person;

“a statement by you that, under penalty of perjury, you have a good faith belief that the material was removed or disabled as a result of mistake or misidentification of the material to be removed or disabled.”

 

Oh, please. These guys simply caved in under corporate bullying. Carton let the matter drop, and the image is now freely available on the fotoLibra site. So now Mr Rose of the Guns N’ Roses beat combo can breathe a sigh of relief that his pockets aren’t being pilfered and go back to being a milkshake duck.

You Might As Well Jump.

Or was that someone else?

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Gwyn Headley

by Gwyn Headley

Managing Director

Well, that might be pushing it a bit, but I’ve always wanted to write a headline like that.

We take care to vet every image uploaded to fotoLibra. The first hurdle of course is quality; images must have a minimum pixel dimension of 1750 and a resolution of 300 ppi. (PPI and DPI deniers — I know your arguments, but the  majority of fotoLibra sales are for print use and they need to be 300 dpi). If you read this blog about PPI/DPI you’ll see that one of the reasons we demand 300 ppi is to prevent porn being uploaded.

We hadn’t thought of drugs.

Someone I’ll call Eugene had. He appears to be from the Ukraine, but that’s easy to mask. What he did was very simple and (I’m reluctant to say it) quite clever. He simply uploaded photographs of drugs to fotoLibra and offered  them for sale. In the Image Description field he wrote “Ve vant to build strong lasting relationship mit customers like you” and followed it with a Skype contact.

Ingenious. Had the images remained on fotoLibra they would very quickly have been picked up by search engines (all our keywords are indexed so search engines can crawl and find them easily) and anyone searching for, say, Hygetropin on the web would have been able to find it nicely displayed on the squeaky clean fotoLibra site together with handy details of how to purchase it.

We spotted the images within an hour of upload. Not much discussion was needed. We simply deleted them.

Yvonne (and if you’ve had dealings with Yvonne, you’ll know she makes Jacqui Norman look like a pussycat) wrote to our hopeful new member:

Hello Eugene

fotoLibra is a professional picture library selling image usage rights to publishers, advertising agencies and so on. We are not a shop window for online drugs’ salesmen; we have therefore removed the images from your portfolio and cancelled your membership.

Regards,

Yvonne Seeley

Curses! Foiled again!

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A Note On A Vote

July 23rd, 2015
Gwyn Headley

by Gwyn Headley

Managing Director

On our last blog A Little Help Here I asked friends of fotoLibra to contact their MEPs to ask them to vote against the clause in the Reda Report aimed at restricting the freedom of panorama — the ability of photographers to shoot what they want, where they want.

Always being one to practice what I preach, I wrote to our MEPs as well. One replied as follows:

First let me say that UKIP MEPs voted against this. Personally I intended to vote against it but had to leave the chamber before the vote actually happened. I am sorry that I was not able to add my vote to rejecting this but circumstances intervened.

I hope that this will help you decide how you will vote in the proposed referendum on EU membership and that you will decide to vote to leave.

I could have done without the last paragraph, even though many fotoLibra contributors seem eager to sever ties with the Continong.

So I replied as follows:

I’m sorry to hear you were unable to vote on the issue, but I am delighted that the Panorama amendment was defeated.

For small businesses like fotoLibra it is crucial that the European market is as free and open as it possibly can be, and I will vigorously support our continued membership and increased participation in an expanding European Union.

He answered:

I am pleased to know you will be voting to leave the EU in the referendum.

Hello? Where did that come from? Does no one read anything any more?

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Gwyn Headley

by Gwyn Headley

Managing Director

As you all know, I am an extremely intelligent person, with a brain the size of an asteroid.

But even my great intellect has stalled when faced with the concept for a proposed bill to be placed in front of the European Parliament. So I need your help.

The bill, put as simply as possible, seeks to restrict the freedom of panorama in all EU countries. The freedom of panorama, which you may not know you already possess*, allows you to take a photograph in a public place. That’s basically it.

But in a corner of your photograph might be the Louvre Pyramid, the Angel of the North, the Kelpies, the Sagrada Familia, the Guggenheim Bilbao, the Atomium — some structure that someone, somewhere, has copyrighted. Under this proposed law, that will make it illegal for you to sell or share your photograph. Full stop.

What I can’t get my head round is — “Who Will This Benefit?”

Governments usually pass laws to benefit themselves or some noisy sector of the community. Occasionally they benefit the public as a whole. The only reason governments build roads is to collect taxes from the people living at the other end (OK, that’s cynical).

But I really cannot see who can benefit from this proposal. The owners of the Atomium? They might make a couple of euros from selling their own postcards. Yet at a stroke it will criminalise hundreds of thousands of innocent photographers. Is that a good idea?

Of course the law will be ignored and flouted everywhere except the UK, where it will doubtless be enforced with Draconian rigour. But the authorities can be as unpredictably vindictive as 14-year-old girls, and this is one more arrow for their quivers.

Île de France MEP Jean-Marie Cavada proposes to restrict the freedom of panorama in all EU countries, intending to limit the impact of “American monopolies such as Facebook and also Wikimedia” and serving to protect “a sector of European culture and creativity”.  fotoLibra contributor Catherine Ilsley writes “I can only conclude that his aim is to reduce EU regulations to the lowest common denominator. This is unacceptable in my opinion as it takes away established rights enjoyed in other countries.”   In the UK the freedom of panorama is permitted under section 62 of the Copyright Designs and Patents Act 1988. The proposal was stapled to a motion tabled by German “Pirate Party” MEP Julia Reda and apparently was not at all what she had proposed.

Predictably, the UK media was outraged: “Now EU wants to BAN your photos of the London Eye and the Angel of the North!” screamed the Daily Express.

A letter in The Times last Friday, signed by luminaries of the British photographic world along with Jimmy Wales, founder of Wikipedia, strongly protested against the proposed legislation — “If such a measure is adopted in the future, most websites and most photographers would instantly become copyright infringers with any photo of any public space which features at least one structure designed by a person that is either alive, or died fewer than 70 years ago.

Nevertheless the European Parliament is voting on the proposal on July 9th. Please let your MEP know how you feel about this move, whether you are for or against it, and ask how you can find out how he or she voted. In case you don’t know who your local MEP is (I didn’t), here’s how to find out:
https://www.mysociety.org/contact-your-meps/?gclid=CL7J3JeLt8YCFYPLtAodIvABDg

I’ve written to mine, and this is what I’ve said.

Dear MEP

On July 9th the European Parliament is voting on a bill to restrict the freedom of panorama —  the right to take photographs in a public place.

Effectively this will instantly criminalise hundreds of thousands of innocent photographers, from selfie seekers to the 40,000 members of fotoLibra, a picture library which gives photographers a platform from which to license their image rights.

It is hard to see who will benefit from this unnecessary piece of legislation; the vested interests run so deep they are invisible to the general public.

Please may I, on behalf of fotoLibra and its contributor photographers, ask you to oppose this legislation, which can serve no public good.

Many thanks for your attention.

Yours sincerely
Gwyn Headley
Managing Director, fotoLibra

Please don’t copy and paste my words because these systems reject identical letters, but feel free to adapt them in any way you want. Let the politicians know how you feel!

Catherine Ilsley says “I intend to write to Mr. Cavada and my local MEP about this. I have already signed the petition and shared it on my personal / photographic pages on Facebook and on LinkedIn. In addition to mailing fotoLibra, I also sent the petition to the BFP and another Europe-based stock library that I contribute to. Next up are UK-based photographic magazines. I would welcome any further ideas as I’m not sure that I can do any more at a personal level.

Let’s all make a fuss about this. This is a needless proposal which can only hinder the great majority of citizens.

Here’s an example. Under Belgian law the following image uploaded to fotoLibra by Chr•s B•k•r is illegal, so please look away now if you are in Brussels:

Atomium

Atomium

This is what they want you to see — an image of the Atomium on its Wikipedia page:

The Atomium as it appears on its Wikipedia page

The Atomium as it appears on its Wikipedia page

*unless you live in the jack-booted juntas of France or Belgium, which already have laws which drastically curtail the freedom of panorama.
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Gwyn Headley

by Gwyn Headley

Managing Director

The pulchritudinous chanteuse Taylor Swift attracted plaudits this week for defying the might of Apple, the world’s most profitable company.

She wrote “We don’t ask you for free iPhones. Please don’t ask us to provide you with our music for no compensation” (during Apple Music’s three-month trial period).

Her whole piece was packed with praise for Apple, but she resolutely made her point, and it worked — Apple backed down and will now pay artists during the initial trial.

Well done Taylor. The labourer is worthy of his hire. People need to be paid for their work. fotoLibra jumps on any and every attempt we see by corporations to dodge paying photographers their rightful fees.

Taylor Swift doesn’t need to pay photographers, apart from organised photo shoots, obviously. But we can’t help but notice the draconian conditions imposed by Ms Swift’s promoters on photographers who attend her concerts. Here are some extracts from her photographer’s contract (my emboldening):

“The photographs, taken in accordance with Paragraph 1 may be used on a one time only basis.
“You and/or your employer will be responsible for all costs related to the rights granted in this Authorisation.
“On behalf of yourself and the publication you expressly grant the perpetual worldwide rights to use the published Photographs for any non-commercial purposes (in all media and formats), including but not limited to publicity and promotion on their websites and/or social media accounts or pages.
“If you or the publication breach this Authorisation, all rights are granted herein will be immediately and automatically rescinded.
“If you fail to fully comply with this authorisation, authorised agents [of Taylor Swift] may confiscate and/or destroy the technology or devices that contain the masterfiles of the Photographs and other images, including, but not limited to, cell phones and memory cards, and the Photographs and any other images, and eject you from the venue, in addition.”

Ah, bless!

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How It Works

February 2nd, 2015

If fotoLibra is informed of any unauthorised usage of a fotoLibra image by a UK limited company we will immediately follow it up with a demand for payment. If that isn’t successful, and the image belongs to one of our Pro or Platinum contributors, we will institute court proceedings.

Getty Images allow bloggers to use their 30 million images for free. We will not pursue bloggers who use watermarked fotoLibra images, but we will send a request for them to link to the original Preview image on fotoLibra.

However, the commonest misuse of watermarked images from fotoLibra is by aggregation sites.  The Internet is a wondrous thing, God wot, and sometimes it will do things without reference to any human agency. Someone with a name like Dave Spart in NYC has created an aggregation site to generate stories. Its sole raison d’être is to attract humans to click on a link. That is all it does, and all it wants to do. As a result Mr Spart is now a billionaire.

What his app does is borrow, steal or create a story, usually in pictures, which then has a compelling headline added, so people are enticed to click and read it. The Mail Online loves using these. Spart then charges his advertisers per click. And he is very successful at attracting advertisers.

You’ve all seen what I mean: You’ll Never Believe What This Teenage Mom Found In Her Attic! or Awesome Landscape Photos Show Terrifying Effects Of Nature; 23 Fruits And Veggies That Practically No One Knew Existed. #5 Is Trippin’ Me Out or This Pilot Stuck His Camera Out The Window And What He Captured Will Blow Your Mind. You know the sort of thing. They Cannot Help Capitalising Every Word. And It Clearly Doesn’t Take Much To Blow A Typical Punter’s Mind.

One of the biggest click stories recently was based on a book titled “What I Eat” by Faith D’Aluisio and Peter Menzel. The writer and photographer spent four years and a million dollars researching, writing and photographing the book.  It was concentrated into 20 images online, headed with catchlines like “What People Eat Around The World”, “See The Incredible Differences In The Daily Food Intake Of People Around The World” and “80 People, 30 Countries And How Much They Eat On A Daily Basis.” Spart probably made a fortune from the feature. No payment — or even credit — was made to D’Aluisio and Menzel.

Is this fair? No.

Will it be stopped? No.

Will D’Aluisio and Menzel be compensated? No.

Will Spart get richer? Yes.

Will fotoLibra pursue unauthorised image usage on our contributors’ behalf? Yes, under the terms we have described above.

Will we sue Mr Spart? No. He’s in the US, and he’s richer than us. And he is probably unaware his site is using any of our images … if it is.

I’ve never found any of our watermarked images on his site.

But I’m still annoyed!

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Let’s get this straight — I love America. It’s a great place; brash, confident, a can-do country. If a British business fails, the humiliation and disgrace is a permanent stain. If an American business fails, they pick themselves up, dust themselves down, and start all over again. And some of my best friends are Americans, as you’d expect me to say.

In fact it was my American friend Martha Moran who alerted me to this extraordinary story, an unprecedented combination (to my mind) of ignorance, hubris, licit connivance and venality.

Photographer Udi Tirosh posted this blog. It describes how the US Patent & Trademark Office has awarded a patent to Amazon for photographing things against a white background. That’s right — a patent on what we call cut-outs. The imagery that made Dorling Kindersley books famous around the world.

How can they get away with this? What effect will it have? The darker side of American business confidence also lies in this “let’s try it on” attitude. And all too often the American establishment colludes.

There’s much not to like about America. Deranged gun laws. The Albuquerque Police Department, who have shot dead 55 people since 2010. The US legal system. The $67 million claimed by a judge for a lost pair of trousers. Companies who attempt to copyright phrases in the English language. Bridgeman Art Library‘s case against Corel for nicking their images — Bridgeman was British, Corel won. The publishers of He’s So Fine sued George Harrison‘s Harrisongs for plagiarism with My Sweet Lord, which had one chord change in common. Harrison lost. The catastrophic Gulf oil spill caused by an American subsidiary of the British firm BP — BP was given a swingeing, humungous fine and ordered to pay billions of dollars of compensation, sometimes to people living a couple of hundred miles inland.

Every man, woman and child in the United Kingdom spends £70 a year with Amazon. It provides an amazing selection and a terrific service. Of course we buy from Amazon SARL in Luxembourg, not from Amazon.co.uk, which merely takes our order in the UK, locates the product in the UK and posts it out to us in the UK from within the UK.

In the past three years Amazon has generated sales of more than £7.6 billion in the UK, without paying any corporation tax on the profits from those sales. They paid just £4.2 million in tax in 2013, 0.1% of their UK revenues.

And you know why? Because their tax advisors are smarter than our taxmen and our government. Amazon is doing nothing wrong. We are missing out because of the incompetence of our legislators and HMRC.

And can Dorling Kindersley now expect Amazon to come knocking?

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Gwyn Headley

by Gwyn Headley

Managing Director

This story comes from the Consumer Champions page in The Guardian this Saturday:

Why can’t we use Google images on our website?
I set up my sister’s website and used two Google images. It said nothing about copyright – but now Getty has billed us £950.
In August 2010 my sister asked me to design a website for her hair and beauty salon.
We found two striking images on Google and used them. We rejected those which had “copyright” or similar words, or where the identity of the model was obvious.
Three months later, Getty Images wrote claiming the photos were subject to its copyright. She was asked to remove them immediately and to cease and desist from further use. She was also billed £950 for “unpaid licence fees”, an enormous sum for a local business.
As I reckoned the images were worth about £50 at most, and were only on the site for three months, I ignored this demand. Getty sent a heavier letter in January 2011. In June, she received a “notice of case escalation” and the fee demanded was now £1,149.50, an impossible amount to pay.
We heard nothing more – I thought Getty had realised there was little point in chasing this – until December 2012 when debt collectors sent a threatening letter. Is this a big organisation trying to beat up a small business? BF, Shrewsbury

Getty Images collects fees for photographers whose work is used.
They have to earn their crust – and pay models, make-up artists, lighting technicians and others involved in a shoot. Using their images for free is copyright theft. But Getty Images acknowledges that when non-professional web designers try to find artwork through a search engine, it can be unclear what – if any – fee there is to pay, and even more unclear how to pay.
Phrases such as “These images may be in copyright” could apply to all, or none, of the images viewed. In your case, you selected two pricey images at £475 each to use for six months.
Getty accepts that you would not have taken these had you known the cost. These images were “digital rights managed” and their use is easily detectable.
You could, however, have chosen “royalty-free” images which would have given you a lifetime’s use for £10 to £20.
There are a number of websites to consult before using images [and here the left-leaning British newspaper The Guardian provides links to two American-owned websites].
Getty accepts “that there are many small businesses and image users that are new to licensing content” and says “it is not our core business to chase hairdressers”.
And while it called in debt collectors, it has not sold them the debt – it remains a matter between Getty and you.
Following our call, it has reassessed the situation. It says it is unfair for those involved in the shoot to be unpaid, but it is willing to cut the bill to £500 as a compromise solution.
We feel that this is reasonable.

Ah, poor dab! A big organisation trying to beat up an ickle-wickle image thief? The ‘compromise solution’ is more than reasonable, I’d say. I  wonder what the complainant thought of that?

“As I reckoned the images were worth about £50 at most, and were only on the site for three months, I ignored this demand.”

So that’s all right then. This ignorant, selfish, greedy web designer is complaining because her theft has been uncovered. And by complaining, she has managed to get her bill reduced by £450. Result, I’d say.

The Internet is a wondrous thing, God wot, but it has led to a number of unforeseen situations. Firstly, the value of a photograph has plummeted. Secondly, previously honest, trustworthy individuals now feel no qualms about stealing images, music, films and games on the basis that “if I can see it on my screen it’s mine.”

It’s interesting, but hardly surprising, that the people who have commented on this complaint on The Guardian’s website have all been critical of the complainant.

VictoriaLuckie writes:

Photos cost photographers to take. The photographer will probably have had to pay for equipment, studio / lighting hire and models. What you thought the photos were worth is irrelevant. As is the excuse that you were not professional. It saddens me that the Guardian would run an ill-thought out and unbalanced piece like this that completely undermines an industry that has it tough enough already.

And Baldur McQueen comments

“….I reckoned the images were worth about £50 at most…”
I love that 🙂
I do wonder if I could do the same at the Hair & Beauty Salon?
“…. I reckon this haircut is worth a fiver at most, so I’ll pay you nothing…”

Good on you both.

I’m thinking maybe we should have a Copyright notice on every fotoLibra page. We should never overestimate the intelligence of users.

fotoLibra is to Getty Images as plankton to a whale, and we do not have cadres of sharp-suited lawyers we can order to jump at our command. And obviously we can’t police illegal image usage around the world.

But we are prepared to go to law in the UK on behalf of our Pro and Platinum members in good standing who can show us proof of UK commercial usage of any of their images which had earlier been uploaded to fotoLibra. This is strung about with conditions, alas, which is not as good as we would have liked, but it is a strong gesture of intent. Where we have had sufficient evidence to go before the Small Claims Court on behalf of our Pro and Platinum members, we have done so — and we have won every time, and got the money.

What we can’t do is sue private bloggers who use watermarked fotoLibra Previews, or organisations based overseas. Any Previews they may take have all got big fotoLibra watermarks, so everyone know’s they nicked the image, and who they nicked it from. In the UK we can certainly send them take-down notices and demand payment and a link through to the photographer’s page on fotoLibra, but the threat of having a County Court Judgement against them seems little deterrent to bloggers, who are often pseudonymous.

On the internet, no one knows you’re a dog.

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Perpetual Vigilance

January 23rd, 2013
Gwyn Headley

by Gwyn Headley

Managing Director

I don’t know if it’s age, cynicism or personal general grumpiness but there seem to be a lot more villains around now than when I were a lad.

If you run a shop, shrinkage is the name you give to shoplifting. I guess it’s endemic. If you run a website like fotoLibra, you make sure you are as well protected as possible from shoplifters, or hackers if we use a general term for web-based criminality.

To put it in terms that I understand, we have to stop thieves. We have two sorts — those who want to steal your photographs, and those who want to steal our money. The latter is far more common, I’m sorry to say.

Stealing photographs, first of all. The basic fact is they can’t, not unless they can design and mount an incredibly expensive and sophisticated assault on our firewalled servers. But frankly, we’re not Cartier or Tiffany. It’s much cheaper to buy an image from us than spend months trying to figure out how to steal it. So there’s little incentive. The few infringements we do spot are people using fotoLibra watermarked Previews on their websites, on the basis that if it’s on the internet, it must be free. On behalf of our Pro and Platinum members, we have successfully sued every commercial infringer we have discovered in our jurisdiction.

Stealing money is far more devious, and we fell for it once — and only once. This is how it works. First ‘You’ steal someone’s credit card details. Then You join fotoLibra as a free member and upload one picture. Then You join fotoLibra as a buyer, using the name on the stolen credit card. Then You buy the picture You’ve just uploaded for a humungous amount of money, using Your stolen credit card.

Unfortunately for You, we at fotoLibra scrutinise every sale carefully, and if something doesn’t look right, we pounce — unlike lethargic banks and credit card companies.

There was an incident last year when an Indonesian photographer uploaded a couple of images and six hours later two separate women in the USA signed up as buyers and bought his images for large sums of money. We notify photographers of sales every 30 days, but somehow our Indonesian chummy felt sure his images had been sold long before we would have informed him and pestered us daily to pay him ‘his’ money. We didn’t, and six weeks later the bank removed the entire amount from our account, citing credit card fraud. Strange that we never heard back from the photographer after we informed him a criminal investigation was under way.

Yesterday and today we made two big image sales, both of (I’m sorry to say) of unremarkable images, both uploaded by different Vietnamese photographers. One was bought for a great deal of money by an Australian, the other for nearly as much money by a lady in Leicestershire.

Now if my name is Gwyn Headley, I can’t for the life of me see why I should open a Hotmail account under the name of phil.bennett.1972@hotmail.com. It’s just not logical. So when we saw the lady in Leicestershire — let’s call her Lulu Leicester — had ‘bought’ the image using the email address Debbie Derby the first warning bells began to ring.

We searched for ‘Lulu Leicester’ online, and found a telephone number for her. She is a respected academic. We rang her and asked ‘Have you recently bought a photograph from fotoLibra.com?’ No, she hadn’t heard of us. ‘Does your credit card end in 1234?’ Yes, it does. “Cancel it immediately,’ we said, ‘it has been compromised and has been used in an attempt to commit fraud.’

We haven’t contacted the Australian gentleman, but as he signed up as a buyer seven minutes after the second Vietnamese photographer joined up and uploaded his one photograph we suspect he’s probably not what he claims to be.

All this takes time and vigilance. The scam works this way: we pay 50% of the money we receive to the photographer, the thieves prove the use of a working credit card and go on to empty its resources in a matter of hours. Six weeks later (it’s always a little over six weeks, never any quicker) the banks wake up and deduct the money from our account, never informing us in advance.

The Australian purchaser tried three different credit cards in three different names before the fourth went through. We cancelled these transactions immediately.

We can track these people down — we know where they are — and we would be happy to pass the information on to the competent authority. The trouble is, who has the authority? And are they competent?

Wouldn’t it be nice if the banks were as alert as we try to be?

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Printed books are zero-rated for VAT in the UK. Ebooks are taxed at 20%.

Publishers have taken a softly-softly approach to VAT on ebooks, fearful that if they kick up too much of a fuss the Government will awaken to the fact that printed books are presently zero-rated and slap 20% on them overnight.

Such a move would decimate the British publishing industry — and by extension picture libraries, photographers and all the industry’s ancillary suppliers would take a huge hit. It’s therefore unlikely to happen, but who can predict what a politician may take into his head to do.

City law firm Berwin Leighton Paisner has announced on its website:

VAT treatment of ebooks – The firm is taking a groundbreaking case challenging HMRC’s view that ebooks are standard-rated for VAT purposes, in contrast with physical books which are zero-rated.”

Hard-nosed commercial firms like BLP do not take cases on pro bono, or challenge national or international law simply for the greater good. Therefore they’re doing this for one of their clients, and that client will have deep, deep pockets.

Who can it be? Who will benefit?

Well, the consumer will benefit if prices fall by 20% (they won’t). Publishers will benefit from a boost in sales.

But by far the biggest beneficiaries will be the retailers. Apple sells ebooks. Tesco sells ebooks. They will both see a hike in profits. BLP numbers Apple and Tesco among its gilt-edged list of clients.

Our digital publishing company Heritage Ebooks sells 50 illustrated ebooks from its site for every one ebook sold by the rest of the UK’s ebook sales outlets — Waterstones, Foyles, Tescos and so on — put together.

And for every one of our ebooks that we sell from our site, Amazon will sell twelve from theirs.

It is disproportionately huge. OK, so we’re tiddlers, microbes even, but I expect the proportions are similar whatever you publish.

Amazon has been subject to much opprobrium and contumely for selling ebooks to UK customers and charging the full 20% VAT while taking advantage of the 3% VAT they pay as a company based in Luxembourg. Like Starbucks, Macdonalds and KFC, large American companies have an aversion to paying their fair share of tax in Europe, and as their lawyers and accountants are sharper than ours, they can get away with it.

And now some organisation, through BLP, is challenging HMRC’s ruling on the grounds that charging different rates of VAT on print books and ebooks breaches EU law on fiscal neutrality.

Come on, this has to be Amazon. Who else could afford such a suit? And who else would profit more?

Amazon charge us, the publisher, for the bandwidth used when a customer buys and downloads a Heritage Ebook from them. Because our ebooks are highly illustrated, they have large filesizes and therefore incur high bandwidth usage fees. And because one or two books are downloaded via 3G rather than broadband, Amazon charges us across the board at mobile phone companies’ bandwidth fees.

The result is that for two of our titles, we are losing 10p on every sale made through Amazon because of their charges. Amazon are thereby forcing us to raise our prices.

And I thought their intention was to drive prices down.

 

 

 

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