Deutsche Post told by cartel office to open up mail sorting monopoly

Germany’s Cartel Office has said Deutsche Post World Net AG must allow mail sorters and consolidators of letters weighing below 100 grams access to its delivery networks. The Cartel Office also criticised Deutsche Post for giving rebates of between 3 and 21 pct to its own major client firms for bulk mail contracts, which it does not offer to other mail service providers. ‘Through granting rebates, Deutsche Post is hindering competitors from entering the letter collection, pre-sorting and delivery market,’ it said, adding that this hurts small- and medium-sized companies’ whose letter volumes are too small to obtain a rebate. It said that Deutsche Post’s current exclusive license to distribute letters in Germany below 100 grams does not justify this kind of behaviour. It also said the EU had already decided last October that a provision in the German Postal Act allowing Deutsche Post to discriminate against small commercial mail sorters is a violation of EU competition laws. Deutsche Post is scheduled to lose its monopoly at the end of 2007 as part of an EU-wide move to liberalise the market for mail delivery. Deutsche Post’s chief executive Klaus Zumwinkel said recently that his firm has no intention of relinquishing its monopoly prior to 2008. Therefore, it is considered certain that Deutsche Post will seek an injunction against the cartel office’s decision, the Sueddeutsche Zeitung reported today.