Lawmakers seek federal review of UPS-DHL proposal
Two U.S. senators have asked the Justice Department and the Federal Trade Commission to review a proposal by UPS Inc. to carry some air packages for DHL. But UPS says the agencies don’t have authority over the vendor relationship.
Sen. Herb Kohl, D-Wisc., and Sen. Orrin Hatch, R-Utah, said in a letter dated Friday (1st of August) to Thomas Barnett, assistant attorney general in charge of the Justice Department’s antitrust division, and William Kovacic, chairman of the Federal Trade Commission, that the deal being worked out raises competition concerns.
“If consummated, DHL will become reliant for air transportation on one of its two major competitors,” the letter states. “This raises the question if DHL will still be able to effectively compete against UPS, since UPS will now have a large role in determining the cost and quality of DHL’s services.”
UPS spokesman Norman Black said that the arrangement the Atlanta-based company is working out with DHL is similar to one it has been operating under for several years with the United States Postal Service.
Black said UPS has not received any communications from the Justice Department or the FTC about the proposed deal. He said lawyers for UPS and DHL continue to work on finalizing a contract, which they expect to complete by the end of the year.
Justice Department spokeswoman Gina Talamona said the agency has seen media reports about the proposal, but she declined to comment further.
“Generally speaking, the antitrust division can look at matters that affect competition,” Talamona said.
