OFFICE OF FAIR TRADING / CONSIGNIA CLEARED OF ABUSE OF DOMINANT POSITION
Consignia plc’s agreement to allow Postal Preference Service Limited (PPS) to use Royal Mail trademarks on consumer lifestyle survey questionnaires does not breach competition law, the OFT has found. The competition authority started a Competition Act inquiry following complaints from Claritas (UK) Limited and the Direct Marketing Association that PPS’s use of the Royal Mail trademarks
would undermine competition in the market for consumer lifestyle data. The OFT investigation found that PPS – which is partly owned by Consignia – had not achieved substantially higher response rates than its competitors, that the Royal Mail trademarks had not markedly boosted the response rate, and that potential customers of PPS data were likely to continue to purchase data from their current suppliers. In sum, PPS is competing legitimately; competition is not being undermined. Consignia, which currently has a monopoly in the delivery of ordinary mail, has therefore been cleared of abusing a dominant position in the UK in breach of the Chapter II prohibition in the Competition Act 1998.
Notes
1. Consignia is a newly formed company registered in England and Wales under the Companies Act 1985. It has an issued share capital of GBP50,000 which is beneficially wholly owned by The Post Office. The assets and business of The Post Office, including Royal Mail, Parcelforce and Post Office Counters, have been transferred to Consignia by a statutory transfer. Amongst other services, Consignia provides a range of letter and parcel services in the UK and
internationally, principally under the Royal Mail, Parcelforce and German Parcel trade marks. It is currently the only postal operator licensed to deliver mail costing less than GBP1 per item and weighing less than 350g in the UK.
2. PPS is a co-operative joint venture company formed on 23 October 2000. Consignia has a 44.6 per cent shareholding in PPS. The other shareholders are: PTT Post B. V. (the Dutch postal administration), Direct Vision (UK) Limited, Tri-Direct Ltd, Bryan Cassady and Thomas Adelbert.
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