Postcomm takes first steps to split Royal Mail operations

Postcomm has set the ball rolling on a consultation which could lead to the eventual separation of Royal Mail’s collection and delivery operations in order to improve on current access agreements.

A consultation document was published yesterday to review the current framework allowing rival operators to use Royal Mail’s delivery arm. Earlier in the week, Postcomm proposed the principle of ‘wholesale equivalence’ which has already been adopted by Ofcom to reduce the burden of regulation on BT.

These moves stem from Postcomm’s Strategy Review which was launched in August 2007. As part of this review Postcomm has made a commitment to evaluate the current access agreements and identify and resolve any problems with the existing arrangements.

A letter was sent this week to all postal operators, organisations representing mail users and postal watchdog Postwatch asking for their views on how best to regulate the industry from 2010 when the current price control arrangement expires.

In the letter, Postcomm chief executive Sarah Chambers said: “We want to begin by taking a top-down approach, based on what we have learned from our Strategy Review. We want to consider whether adopting a different approach could allow a significant reduction in the scope of regulation, whilst maintaining sufficient protection for customer and operators in those areas where Royal Mail has substantial and enduring market power.”