TNT CEO says co may withdraw from Germany in legal spat over liberalization

TNT NV chief executive officer Peter Bakker has warned that TNT might withdraw from Germany if it loses its court case over the minmium wage its pays its German workers amid a dispute over the liberalisation of the German postal market.

‘If we lose the court case and the VAT situation remains, a withdrawal would be one of the possibilities,’ Bakker said at a press conference after the company’s fourth quarter results.

TNT lodged in January a lawsuit against the German state in a bid to have the alternative minimum wage it is paying its German-based workers to be declared valid.

TNT claims the German government is thwarting liberalisation of the German market by imposing a sector-wide minimum wage of up to 9.80 eur – a wage that Deutsche Post AG has already agreed on with trade union Verdi.

But the Dutch postal group claims that, unlike its rivals, Deutsche Post enjoys a VAT exemption for 40 pct of its operations in Germany.

TNT currently pays its German workers 7.50 eur per hour and claims that only Deutsche Post can afford to have the minimum wage set at the 9.80 eur level.