bpost fine over “abusive” discounts extended by €37m
Belgian competition authorities have slapped national postal service bpost with an extra EUR 37.4m fine for abusing its position in the domestic market. The move follows a EUR 2.3m fine imposed by the country’s postal regulator back in July 2011, against which bpost is still appealing.
This week, the Belgian Competition Council also decided against bpost, adding the eight-figure sum to bpost’s bill, deciding that the postal operator had been offering “very high” postage discounts to its major customers during the 18 months up to July 2011, blocking competitor mail handlers from the market.
The watchdog said banks and distance sellers were being granted rebates based on high volumes or presorted mail that reached up to 50% of the basic postage rate.
It said this was against competition rules within European postal law.
bpost did scrap the “abusive” discounts following last year’s ruling by the Belgian Institute for Postal Services and Telecommunications.
But following this week’s ruling, bpost insisted that “the Council’s decision and arguments are economically and legally unfounded”, and said it was considering the possibility of another appeal.
The company 51% owned by the state said it was able to pay the fine, and dismissed the penalty as having “no impact” on its business.
Per sender
bpost said the case against it stemmed from complaints filed by three “intermediary” companies.
These are companies that provide mail preparation, collection and sorting services for business mail before entering it into the bpost last mile delivery network.
The Belgian Competition Council said that through the “per sender” tariff bpost was offering the same kind of rates to large customers for using its end-to-end delivery services as it was offering intermediaries inputing mail into its last mile network. By comparison, in the UK the Downstream Access system requires Royal Mail’s prices to include a certain “headroom” that means Access operators can make a profit on their services.
“Access to large customers is important for any company within mail delivery”
The Council said the bpost discounts meant that despite a market liberalised since the start of 2011, major mailers had little encouragement to work with intermediaries when they could claim the same discounts having bpost providing collection, sorting and delivery.
“Access to large customers is important for any company that plans to expand within mail delivery in Belgium,” said the watchdog, which noted that the country’s Access market was one of the key areas of competition within Belgium’s newly-liberalised postal market.
The Council said it had reduced its intended penalty for bpost by the amount the regulator, the Belgian Institute for Postal Services and Telecommunications (IBPT) fined bpost in July 2011. It said the EUR 37.4m penalty was related to the estimated impact on boost’s direct mail turnover from the offending discounts.
France
bpost argued this week that in France, the French regulator and competition authority have ruled a similar discount system run by La Poste as acceptable.
“Bpost’s European competitors, including the French operator La Poste and a dozen other postal operators, may continue to calculate their discounts according to this model, then they are subject to exactly the same EU regulations (as bpost),” the company said in a statement.
The Belgian Competition Council insisted on Monday there were “significant differences” in the La Poste model compared to the bpost system.
bpost also said on Monday that it believed its per sender discount model did have economic benefits for the entire postal sector, even for competitor mail handlers.
“The granting of discounts dependent on the volume from the sender actually stimulates the entire postal sector which thrives on written communications,” it said.
