Amazon gets nod for Canadian distribution center

Mon Apr 12, 2010 6:28pm EDT
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VANCOUVER (Reuters) - Internet retailer won approval on Monday to build a distribution center in Canada, despite complaints from Canadian booksellers that it would damage the country's culture.

Heritage Minister James Moore said the federal government agreed to allow the depot to open after Amazon pledged to promote Canadian authors, including making more Canadian content available on its Kindle e-readers.

"Amazon has shown its willingness to promote Canadian cultural products and we are pleased it is continuing to demonstrate this through this new investment." Moore said in a statement.

Canada's content rules call for radio and television broadcasters to air a certain percentage of content written or produced by Canadians, while booksellers must ensure that a percentage of their inventory is Canadian.

Canadian booksellers had urged Ottawa to reject the U.S. company's plan, arguing it violated measures that require foreign investments in the book business be compatible with national cultural policies.

The Canadian Booksellers Association is reviewing the government's announcement, but said its concerns remain. "We do not think this will be a good thing for Canadians," said executive director Susan Dayus.

Amazon, the world's largest online retailer, already sells books, music and consumer goods via its Canadian website, and it had argued that allowing it to also distribute from a Canadian facility would save customers money.

It competes with Canadian retailers, including Indigo Books & Music, the country's biggest bookseller. Indigo is also majority owner of the Kobo Inc electronic bookstore, in which U.S.-based Borders Group has a 20 percent stake.

(Reporting Allan Dowd; editing by Rob Wilson)