House leader alleges discrimination against U.S. express companies
The chairman of the House Ways and Means Committee has asked the U.S. International Trade Commission to investigate competitive conditions in overseas markets for U.S.-based express courier companies.
In a letter dated June 30, Rep. Bill Thomas, R.-Calif., said his concerns stem from “continued discriminatory treatment by foreign governments in areas such as licensing,” as well as market-distorting conditions that can arise overseas.
Thomas’s letter to ITC chairman Deanna Tanner Okun requested that the fact-finding investigation “examine the composition of the global industry, major market participants, and factors driving change, including regulatory reform in major markets.” It also asked the commission to examine the extent to which government-sanctioned monopolies may affect conditions in foreign markets. In addition, Thomas asked the ITC to identify additional trade impediments facing U.S.-based express delivery services in foreign markets.
Thomas added that the report should include an examination of related services provided by express companies such as customs facilitation and logistics services.
The request by Thomas comes as the two biggest U.S.-based express companies, FedEx Corp. and United Parcel Service, are fighting a bitter legal battle with DHL International, their biggest overseas competitor, and DHL’s parent company, Deutsche Post World Net. FedEX and UPS are challenging the legitimacy of the ownership of DHL Airways, an all-cargo airline whose primary business is carrying packages and documents for DHL Worldwide Express, the U.S.-based subsidiary of DHL International. DHL International acknowledges that it holds a minority stake in DHL Airways, but FedEx and UPS claim that DHL and Deutsche Post effectively control DHL Airways.
It’s not known whether the request by Thomas is related to the legal battle by FedEx and UPS against DHL and Deutsche Post, but the inquiry could put added pressure on DHL.
The letter by Rep. Thomas did not cite any particular countries, but one that is sure to be investigated is China. All three of the big global express operators do extensive business there, but DHL claims to have the biggest market share.
