European antitrust officials have launched a probe to determine whether iPad maker Apple and five international publishers struck illegal deals to fix the price of e-books in Europe.
The European Commission will look at deals between the US gadget giant and US publishing powerhouses Simon & Schuster and Harper Collins, Britain's Penguin, France's Hachette Livre and Germany's Verlagsgruppe Georg von Holtzbrinck.
Amelia Torres, the commission's competition spokeswoman, said the probe will see whether the agreements "had the objective or effect of restricting competition and fixing the price of e-books at a high level in Europe."
"This is an important issue for consumers, for people like me and you who love to read books, including on an electronic platform," Torres told a news briefing, adding that the case will be treaty as a matter of priority.
Apple is in a fierce battle over the growing e-reader market with US online retail giant Amazon, which launched a new version of its Kindle tablet in the United States in September costing US$199, half the price of the iPad.
The opening of the probe follows surprise raids in March by EU competition authorities in the offices of several companies active in the e-book sector in several EU states.
The commission said in a statement that it would investigate whether Apple and the five publishers engaged in illegal deals or practices that "would have the object or the effect of restricting competition in the EU."
The probe will also examine the character and terms of agreements between the five publishing houses and retailers for the sale of e-books.
"The Commission has concerns that these practices may breach EU antitrust rules that prohibit cartels and restrictive business practices," the statement said.
Britain's Office of Fair Trading (OFT) had run its own parallel investigation into e-books but it will close it now that Brussels opened a probe, the commission said.
The OFT will cooperate closely with the commission in the case, it added.
Pearson, the group that owns Penguin publishing house, said that it "does not believe it has breached any laws, and will continue to fully and openly cooperate with the Commission."
The iPad gives users the ability to surf the internet, watch films, check emails and read books downloaded from Apple's iBook store.
Apple and Amazon compete an increasingly crowded market, but many are struggling to stand out above the rest.
In France, retail giant FNAC sells books through the Kobo Touch tablet.
Samsung launched the Galaxy Tab last year, but despite being touted by some in the industry as an "iPad killer," it has struggled to live up to its billing.
Hewlett-Packard began selling its TouchPad in July but the world's top personal computer maker pulled its tablet from store shelves just seven weeks later because of poor sales.