In my previous post, I wrote about how I bought and Amazon Kindle, and how I can use gift cards to purchase ebooks from the Kindle store. So far the Kindle has been an amazing experience and I personally recommend you get yourself one. However, there is a downside, since there is ‘technically’ no legal way to obtain ebooks for your Kindle device.
Today I hope to explore the legality of downloading ebooks from Amazon, and how stupid copyright laws, badly behaving book publishers and a Malaysian Sales Tax all contribute to making it impossible for you to purchase ebooks for your Kindle while still complying with any and all laws pertaining to them.
A tale of 2 laws
To look at the legality of downloading books from Amazon, you have to take into account Tax laws as well as the Copyright laws.
There is no such thing as partially legal, there is only legal and illegal.
Therefore it’s either the ebook purchase would fully comply with all laws pertaining to the purchase of ebooks online or not, there are a host of grey areas, but as long as even one law is broken, the purchase is illegal. I’m no lawyer but I believe this is the case.
So straight out of the park, let me inform you that ebook purchases online from Amazon do NOT pay a Sales Tax to the Malaysian Government (specifically the LHDN). Books incur a 20% sales tax (according to some unconfirmed sources), and since Malaysian law does no differentiate between electronic or tangible transactions, if you don’t pay the Sales Tax it is ILLEGAL, even though you bought it from an authorized source like Amazon. This is of course more along the lines of tax evasion then it is copyright infringement–but still.
So from a purely legal perspective you can’t buy books from Amazon, unless of course you were to pay the sales tax yourself, but I couldn’t find a column in my borang BE for this particular case.
However, maybe you’re crazy and think it’s OK to deprieve the Malaysian government of Taxes, but not OK to deprieve an author from their due payments. Crazy people exist, I know, I’m one of them. So let’s look at the copyright bit of it.
So now that we know it’s impossible to pay the tax, how about from a copyright perspective?
Here’s where it gets a bit confusing. Remember your college textbooks that said “NOT INTENDED FOR SALE IN THE US”? I remember cause I had a whole bunch of them, and I always wondered why they printed it on the book?
The reason was, that I bought International Edition books, these were generally the cheaper cousin of the US edition books which were usually printed on better paper and included additional material like CDs and answers. However, instead of having ‘premium’ and non-premium books the text book publisher instead decided that all students in the US had to buy the US edition books, which meant that students in the US winded paying nearly 2 to 3 times more for textbooks than Malaysian students. Now you might think this is acceptable, but it isn’t…you might think the US is a richer country and textbook publishers have a right to make money.
Think of it this way, if a textbook company said that Singaporean students could purchase cheaper books than their Malaysian counterparts, how many rallies from Perkasa do you think we’d see. Apart from the obvious joke that Perkasa probably doesn’t read books, it’s quite obviously wrong to charge people different prices just because their locality is different.
We wouldn’t stand for anyone charging you different prices for food at a restaurant because of your religion or nationality, why is this any different?
Fortunately though, the book publishers can’t create anything that’s legally binding. While they may say it’s not ‘intended’ for sale in the US, they can’t outright prevent you from selling it there, even though they own the copyright. So while they’re accurate in saying the International version isn’t intended for sale in the US, they can’t legally prevent the importation or ‘legally purchased’ copyrighted material from countries like India. Hence the popularity of sites like Alibris who’ve made a living selling international editions books to US students, saving students a fortune that would otherwise be wasted on premium paper and CDs.
When you buy a book, you bought a tangible product and the contents of the book, however you didn’t buy the copyright of the book. You still can’t make copies of it, or distribute it, but you can most definitely sell the book once you’re done with it. This is a portion of US law called the first-sale doctrine.
However, where it gets a bit murky is this. Amazon won’t sell a Malaysian citizen an online ebook, because Amazons agreement with the book publishers is only for US users. If Amazon were to sell it to a Malaysian, they’d be breaching their contract. So they put in security measures in place to prevent ebooks from reaching Malaysian citizens in Malaysia.
The only way to buy an ebook from Amazon is to ‘lie’ to Amazon about your location, and that’s borderline fraudulent behavior. While this isn’t exactly fraud, I would venture that this is still illegal.
However, that’s not even the most complicated part. According to this blog, the first sale doctrine does not extend to ebooks, particularly because ebooks are leased and not sold.
The 2nd-hand market for ebooks would be awesome, particularly since ebooks lose little to no value over time, ebooks don’t tear, fade, lose their jackets, or incur dubious highlighting and scribbles. In the digital realm there is no difference between brand new and 2nd-hand. So (according to this blog post) in order to circumvent the issue of a 2nd-hand ebook market destroying the gold-lined pockets of book publishers–they’ve changed the way they ‘sell’ you ebooks by leasing them to you. A quote from from the post is given below:
Also, copyrighted digital content like music, computer software, and ebooks aren’t technically sold, they are leased according to the licensing terms a person agrees to when they put their money down for the song, etc.
At ebook distributor sites like Fictionwise.com, the terminology “sell” and “buy” are used, but in their FAQs, they say you are only leasing an ebook, not buying the content, so you can’t resell it, etc.
The difference between “lease” and “buy” is also used as a justification of why an ebook can’t be resold.
All those who say that “first sale doctrine” applies to copyrighted ebooks are wrong from a legal perspective.
Now since you can’t sell something you leased–selling 2nd hand ebooks would be illegal. Hence all ebooks have to come directly from publishers, giving them near monopolistic control of their content. That’s bad, but no one seems to mind–especially the book publishers.
Now I seriously doubt the blog authors assertion that ebooks are leased, since I doubt you can have a lease that last indefinitely for a one-time fee–that is a sale!!
On the other hand, how many small time book stores, or regular folk have the cash to spend on long expensive legal pursuits to determine once and for all if that’s the case.
From the copyright perspective though, the best I can say is that its a 50-50 chance that you can legally buy a book from Amazon, and I’m not sure.
So what? I can still contribute legally
At this point, you might be saying so what? You can still buy a book and contribute to the author, that’s all the matters, and screw the legal mumbo-jumbo. I agree.
Consider however, that buying partially legal at best, and considering it legal doesn’t make it legal. You can still be sued, the same way you may be sued if you downloaded the content from a torrent site. So what’s the different.
How about the Ethical aspect?
This is my favorite perspective, is it ethical to buy books from Amazon. I’m not an expert on Ethics but I believe it’s ethical.
What about local Ebooks?
It’s not clear to me if Maxis will sell you Kindle friendly book formats like .mobi , or even .epub (which you’ll need to convert).
A quick price comparison (image above) between Maxis Ebuuk and Amazon reveals that Maxis Ebuuk is (on average) 33.21% higher than Amazon, that’s a lot of dough, but it’s easily explained with the Malaysian Sales Tax of 20% (if Maxis is even paying it).
So if Maxis charges 30% more, the book price is 130% that of Amazon. With 20% going to sales tax (of the sales price, not the cost price), the actual book price from Maxis (before taxes) is about 104% (just 4% more than Amazon). So if you’re wondering why Maxis sells Ebuuks for a higher price than Amazon that may explain it.
What bothers me is that if the Government is so into education and encouraging reading, why is it then levying a silly sales tax on books? Why give tax exemptions and book vouchers, when you’re still taxing the books?
Then again, we all have to work within the framework of the law, and at the moment that’s the case.
It does however, lead to the conclusion that Maxis and Amazon are selling books for the same price before taxes, which isn’t surprising because prices are set by publishers, so even the super-scaling Amazon would be selling them for the same price as smaller time operations like Maxis Ebuuk.
That would then naturally lead me to the assumption that book publishers, and authors are being paid the same royalties for BOTH Amazon purchases and Maxis purchases. So if you’re wondering–there’s your answer.
This post seemed to have started on the right track, but ended up exploring so many other areas. I wanted to find out if it was ‘legal’ to purchase books from Amazon from Malaysia, and it the answer is a resounding–NO!
If you’re into copyright law, it’s still a grey area of buying ebooks from Amazon.
However, if you’re only interested in contributing the author, well then I assume the authors get paid the same amount regardless of whether you purchase the book from a local ebook retailer or Amazon.
The bottom line, while it’s not legal, it’ll at least contribute to the author, and you end up paying about 30% less for your reading fix.
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hi I just bought kindle, I dont think changing location could make you buy ebooks in amazon. it seems they dont want our money after all (I’m living in indonesia)
Just to inform you and the blog readers that printed books are free from import tax.
Thanks for the info mechir, are you absolutely sure that books are exempted from Sales Tax? I’m not entirely convinced though…
Sorry, I mistakenly quote on import tax. But Books are also exempted from sales tax. I cannot find the schedule A of the sales tax act but this document does cite on the exemption for books and magazines. http://18.104.22.168/en_v2/uploads/Publications_pdf/Guide_For_MalaysianManufacturers/English/english.pdf
oh, on another note, we could easily buy international e-magazines from zinio and magzter. even kobo sells some of their e-books in malaysia. i believe it is more on the malaysian dealer who want to make more money rather than any logistical or governance hindrance.
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