Request for judicial review by Indigo and CBA argues that Amazon.ca is Canadian

Both Canadian Heritage and Amazon.com intend to oppose a leave for judicial review in the matter of Amazon.ca’s entry to Canada, according to documents filed with the Federal Court of Canada. On August 2, the Canadian Booksellers Association (CBA) and Indigo Books & Music Inc. jointly filed an application with the Federal Court of Canada for a judicial review of Heritage’s decision in July that the proposed Amazon.ca web service did not violate Canadian ownership provisions of the Investment Canada Act. In the application, CBA and Indigo ask that the court quash Heritage’s decision, declare Amazon.ca to be a Canadian business in accordance with the Investment Canada Act, and force Industry Canada minister Allan Rock to enforce the provisions of the Act in accordance with Amazon’s Canadian status. The dispute stems from a July decision by Canadian Heritage officials to allow Amazon.com to set up a Canadian subsidiary in partnership with Canada Post. Amazon, amid a flurry of media interest, set up a Canadian web site with responsibility for fulfilment and warehousing contracted out to the Crown corporation. Predictably, Indigo and its Canadian bookseller allies objected to the move and asked Canadian Heritage to review the deal. Canadian laws forbid booksellers in Canada to be controlled by non-Canadians. On July 10, the department ruled that Amazon was not a Canadian bookseller operating in Canada and thus not subject to this country’s book policy. They argue in their application that Amazon is "carrying on business in Canada" because: "Contracts between Amazon.ca and its Canadian customers are legally formed in Canada, because the communication of the acceptance by Amazon.ca of the customer’s order is received by the customer in Canada; "Amazon.com.ca, Inc., or one of its affiliates, orders, and owns, the inventory stored in the Assured Logistics warehouse; "Retail deliveries are made domestically to Canadian customers from the Assured Logistics warehouse within Canada, which is dedicated to the Amazon.ca business in Canada; "Amazon.ca’s profits arise in Canada; "Amazon.ca has launched an extensive advertising campaign across Canada. It is currently advertising on Canada Post trucks across Canada, which serve as moving billboards for the Amazon.ca store, and has placed full-page advertisements in newspapers across Canada to inform Canadians that the new Amazon.ca site has been tailored just for Canada; "Amazon.ca sponsors the periodical Books in Canada: The Canadian Review of Books. Books ordered from Amazon.ca arrive wrapped in a free copy of the magazine; "Amazon.com Inc. has applied to register the trademark Amazon.ca in Canada." The leave also makes dozens of other arguments, including a key point that Canadian booksellers are not required to have resident owners or head offices to be considered Canadian. The CBA and Indigo also point out to the court that this country’s book policy has a long history of consistent application. For example, they say, Borders was denied entry in 1995 because the operation was deemed to have non-Canadian control. In February this year, Canadian Heritage rejected the establishment of a store by HMS Host, another American bookseller, in the Halifax airport in accordance with its book policy. Finally, the parties argue that Amazon.com was itself denied a proposed call centre in New Brunswick, to be established with the assistance of former New Brunswick premier Frank McKenna in that province, because the facility would have been subject to the book policy as well. The CBA and Indigo are being represented by Blake, Cassels & Graydon LLP.

Request for judicial review by Indigo and CBA argues that Amazon.ca is Canadian

Broadcast | September 6, 2002

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