Poland prepares to open postal market to full competition

Postal operator InPost reports that the final move to open Poland’s PLN 6bn (EUR 1.5bn) postal market to full competition is now getting underway in the country’s Parliament. But the company is warning that proposed postal reforms could be slow to implement, and claimed that as currently worded, the draft regulations hand key advantages to the state-owned postal service, Polish Post.

Legislation was introduced into Parliament last week that, if approved by lawmakers, will allow private sector competitors to deliver letters under 50g in weight in competition with Polish Post, which currently has a monopoly on this area of the market.

At present, companies like InPost have taken to fixing metal weights on business letters in order to get round the monopoly restrictions.

But Poland is among 11 remaining European Union members that will fully liberalise its postal market from next year, to comply with EU postal laws.

Lower prices

InPost believes the area of the Polish postal market currently reserved for Polish Post’s monopoly represents around 75% of volumes and 50% of revenues in Poland’s postal sector as a whole.

Rafał Brzoska, the InPost chief executive, said: “The rules governing the conduct of postal activity in Poland were a huge barrier to the functioning of independent service providers, so the year 2013 will undoubtedly be a turning point.”

Brzoska said with the full opening of the market, Poland is likely to see an increase in the number of postal operators, with foreign companies among those looking to enter the market. Belgium’s bpost and Austrian Post are among other European postal operators known to be interested in expanding operations in Eastern Europe.

More competition in the market should mean lower prices for postal services, added the InPost chief.

“This will improve cost competitiveness and quality of service,” he said. “It is well-known that the state monopoly, on mail delivery was not beneficial to customers.”

“Unjustified” advantages

For InPost, the full liberalisation of the market will mean an almost instant improvement in efficiency as it is no longer required to separately prepare letters weighing less than 50g in order to get around the monopoly restrictions.

But Brzoska said under the proposed postal reforms Polish Post will keep a monopoly on postal money orders, and will also benefit from “unjustified” exemptions from VAT.

The InPost chief said it appears that private sector postal services will also have limited access to the last mile delivery network operated by Polish Post.

He said: “The costs incurred by the state budget, in connection with maintaining the privileged position of Polish Post, weaken the financial condition of the country and undermine Poland’s international reputation.”

Independent postal operators’ association OZPNOP is also pressing for changes to the current postal reform proposals in Poland.

The group’s president, Wieslaw Klimaszewski, said there was “moderate optimism” in the current state of the legislation in opening up the market, but said it looks as though private operators will be subject to much more stringent operating conditions than Polish Post.

He suggested some of the proposals were not consistent with EU postal laws, including the monopoly on money orders and lack of a Downstream Access system for competitive postal services to access Polish Post’s advantageous last mile network.

“That is why we will continue to actively fight for new regulations that allows the reform of Polish regulations to European standards, to therefore support the sustainable development of the postal sector in Poland,” said Klimaszewski.