CD Wow to pay £41 million compensation

30-05-2007

CD Wow to pay £41 million compensation
Online music retailer CD Wow has been ordered to compensate British record companies to the tune of £41 million after failing to stop illegally importing cheap CDs from Asia.

Today's high court ruling in London comes after the Hong Kong-based firm was found to have broken the terms of a three-year-old deal with record companies.

But CD Wow, the third biggest internet music retailer in the UK after Amazon and Play, says it is considering whether to appeal against the court's decision, which will see it pay £37 million plus interest to the British Phonographic Industry (BPI).

"We are the little guys selling CDs to the UK market and they [the BPI] have picked on us for that reason," said chief executive Henrik Wesslen.

"Other bigger sites doing the same thing have been left alone."

BPI chief executive Geoff Taylor insists that CD Wow had been "undermining the legitimate businesses of UK retailers and record companies".

"Illegal imports of this kind undermine the huge investments made by businesses here in home-grown musical talent," he continued.

"CD Wow is no consumer champion; it is a rogue trader that now has to face the consequences of its actions.

"We have an extremely competitive record industry and retail sector here in the UK, and at an average price of around £8.50, CDs are better value than ever."

Mr Taylor concluded: "The vibrancy of British music depends on a fair return on the investments that allow British talent to shine. This decision is an important step in ensuring that British music has a bright future."

BPI general counsel Roz Groome meanwhile said of the six-year legal battle: "CD Wow have consistently broken the law, ignored high court rulings, and have continued to trade illegally throughout.

"Clearly the courts have lost patience with this rogue retailer and the message is clear; any company seeking to engage in this type of illegal trade will face the toughest sanctions."


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