Doors open to more postal competition in Europe

Lawmakers and regulators in Europe are monitoring the impact of increased competition on service quality, as more EU Member States open up their postal markets. The New Year saw the deadline passing for the majority of European Union members to liberalise the remaining segment of the market – items under 50g in weight – under the third EU Postal Directive.

The 2008 law allows 11 Member States until the end of 2012 to follow comply – these include the Czech Republic, Cyprus, Greece, Hungary, Latvia, Lithuania, Luxemburg, Malta, Poland, Romania and Slovakia.

Elsewhere, the Directive requires that competitors of national postal services now have access to the market for items of any weight – but does allow regulators to seek contributions from significant market entrants in order to maintain universal postal services.

The French regulator ARCEP said in a briefing note last week that it is expecting the market for letters to remain largely “out of reach” of competitors to the universal service provider, La Poste, particularly in the non-bulk segment.

Most of the competition will come in the business mail, it said, along with international mail, for which other companies are already seeking involvement.

In other European countries, particularly the six Member States that opened their markets early – Finland, Sweden, UK, Estonia, Germany, and the Netherlands – full competition has been relatively slow in coming.

ARCEP said much of the investment in these countries by new competitors has been in the business mail segment, particularly for direct mail services and transactional mail, although these areas are “sensitive” to economic conditions.

In Germany and Spain, the regulator suggested competition in these areas had generally kept to densely-populated areas, offering a “slow” service compared to national postal operators.

Nevertheless, ARCEP said it would be keeping a close eye on the situation to ensure that increased competition in France does not threaten universal postal coverage.

It stated: “If competition were to develop to the point of capturing significant market share, we could, as required by law, make competitors contribute to the financing of the ‘universal postal service’ La Poste is required to implement, as is the case in telecommunications.”

Last month saw a written declaration from Members of European Parliament calling for the EU Commission to immediately review the impacts of the Postal Directive on service quality and labour conditions in the postal industry.

MEPs Cornelis de Jong, Georges Bach, Isabelle Durant, Saïd El Khadraoui and Marian Harkin, also called on the Commission to delay any infraction proceedings against Member States that fail to open up their markets before the Directive’s deadlines, “until the effects of liberalising postal services on service quality and labour conditions have been fully appraised”.

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