Dutch postal regulator to get extra powers to boost competition

Ministers in the Netherlands introduced new postal legislation today that they say will improve competition in the Dutch postal market. Economic affairs minister Henk Kamp said the bill proposes measures that would allow the country’s postal regulator, the OPTA, to intervene in the market much earlier in the event that mail businesses face unfair competition.

At the moment, the OPTA can only take action against national postal service PostNL when there have been complaints from rivals about an abuse of PostNL’s dominant position in the market.

The new proposals would allow the regulator to step in to set preventive measures before unfair competition arises.

And, it would mean the OPTA can launch an investigation based on mere suspicions that a company like PostNL is offering postal services below cost in order to grab a larger market share.

“Competition in the postal market ensures greater quality at lower prices,” the minister said today.

“To make the postal market attractive to businesses during this era of declining volumes, it is important that the OPTA can take action earlier to combat unfair competition.”

Competition

The Dutch postal market has been fully open to competition since April 2009, but there has been concern at the limited number of postal operators providing competition to universal service provider PostNL.

The OPTA issued a report 12 months ago, following a review of the market, warning that competition was “insufficiently developed”, and calling for amendments to the 2009 Postal Act to reduce the risks of PostNL’s dominant position and promote competition.

Yesterday the regulator said the new proposals from the government would provide it “significant market power” to impose measures to tackle competition problems including predatory pricing, discriminatory pricing and excessive postal rates.

The OPTA said ministers were basing their proposals on its recommendations.

“OPTA believes the bill is a feasible scheme in which it can provide better solutions to market developments,” the regulator said. “OPTA would point to the danger that the scheme may be less effective if no obligations can be imposed with respect to an abuse by services covered by the universal postal service.”

Operators

PostNL told Post&Parcel that it was currently reviewing the government proposals, but could not yet determine the full impact of the measures on its business.

However, spokesman Marc Potma said his company believed the current postal regulation in the Dutch market was “sufficient”.

“The Netherlands has the most competitive postal market in Europe. The Netherlands has the largest network competition in Europe,” said the PostNL spokesman, who suggested that the regulator’s view that there was insufficient competition in the market was “not a fact, only a theory”.

“The only available study is a theoretical exercise which mentions possible antitrust violations,” said Potma. “Besides, it is generally known that the Netherlands has very low postal rates across the board.”

One of PostNL’s main domestic competitors in the postal market, Sandd, told Post&Parcel today that it was pleased with the proposed amendments to the Postal Act in protecting the market from unfair competition.

But, the company said it was unsure whether the proposals would actually encourage more entrants in the market.

Erik Klinge, a spokesman for Sandd, said: “Sandd is happy with the improved legislation as it creates a level playing field in the Dutch market with improved supervision. We cannot estimate whether this will encourage new competition in this market.”