Royal Mail attacks regulator

Royal Mail Group yesterday accused Postcomm of giving an unfair advantage to its foreign competitors after the postal regulator published the terms and conditions for its new long-term licences.

The standard permits, to be introduced from January in place of the 12-month interim permits, will allow rival operators to approach any company to deliver mail within the licensed area.

They will complement the European postal services directive which, also from January, will lower the weight limit for mail in the licensed area from 350g to 100g.

Royal Mail, which is the only operator to hold a long-term licence to provide postal services across the country, said: “What the regulator is doing is opening the market much quicker here than in the rest of the European Union. Our Dutch and German competitors will be able to use the profits made in their domestic markets to target mail in the UK.”

The new licences will allow rival operators to carry bulk mail and provide consolidation, enhanced document exchange and tracked business-to-business services until 2005. This will represent 30 per cent of the postal market in value terms.

Postcomm began consultation yesterday on the proposed issue of long-term licences to Hays Commercial Services, TNT UK and TPG Post UK, all of which hold interim licences. Deutsche Post, which holds an interim licence, said it would apply for the standard version.

It added it had also faced competition in its domestic market, which is one of the most liberalised in Europe. “We had to learn to swim very early and today we can swim a little faster than others can.”

Royal Mail said it favoured the European “weight step” approach to liberalisation because it ensured fair competition. But Postcomm said this approach did not allow much competition. Even lowering the limit to 50g in the reserved area would leave 70 per cent of the market protected, it added.

Hays said the new licences would give it “the kind of longer-term security of tenure in the market that is important to our existing customers and potential customers”.