Distribution reforms will crush news trade'

Locks: 15,000 newsagents at risk

The Periodical Publishers Association has urged the Government not to go ahead with its plans to modernise newspaper and magazine distribution, claiming it could result in the closure of 15,000 newsagents.

The proposals involve abolishing the Vertical Agreements Exclusion order in the Competition Act that allows publishers to award contracts on a regional basis.

The move aims to bring the UK into line with Europe and allow the distribution of titles on a national basis.

The Department of Trade has issued a consultation document on the proposal to reform the law.

The PPA, which has lobbied with regional and national newspapers on the issue for the past 18 months, fears the Government’s planned changes will pose a huge threat to small newsagents and cost the industry £100m a year.

In a letter to Trade Secretary Patricia Hewitt this week, PPA chief executive Ian Locks stressed the importance magazines and newspapers have in the diversity of opinion in the UK, adding that “this plurality and diversity rests full square on having an efficient and cost-effective distribution chain”.

He said the current system, closely monitored by the Office of Fair Trading, ensured the “widest possible availability” of magazines and newspapers and by removing the vertical exclusion agreement, “the Government would destabilise security of supply of newspapers and magazines at an affordable price to village shops and rural locations as well as to smaller outlets on urban fringes”.

According to Locks, research carried out by the PPA has shown that up to 50 per cent of traffic in such outlets is driven by newspapers and magazines.

Locks warned that “without this affordable supply many would close – a figure approaching some 15,000 outlets”.

He said the PPA had been in talks with the CBI and agreed that the present law worked well. “We note that, from close questioning of our colleagues in countries such as France and Germany, governments there are not seeking to create the difficulties and disadvantages to their publishing industries that are proposed by the UK Government,” he said.

“There is no obligation for the UK Government to impose cross-border conditions on national arrangements.

We can see absolutely no benefit in doing so, only a huge downside through putting UK magazine and newspaper publishing at a significant disadvantage and potentially undermining the viability of thousands of independent retailers.”

By Ruth Addicott

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