Tag: Royal Mail

Postcomm is risking the wrath of Royal Mail by pledging to treat new entrants to the postal market with a regulatory ‘light touch’. The move, outlined in the watchdog’s corporate strategy for the next three years, is designed to free them from unnecessary regulation. A Postcomm spokeswoman says that it is doing what is necessary to prevent abuse of the system, rather than for its own sake. She explains: “In a fully competitive market, regulation is not necessary, as weaker players will be edged out.”

Royal Mail has agreed to tighten its internal compliance procedures following an investigation by Postcomm into allegations that two of the company’s promotion schemes were anti-competitive.

The schemes were designed by Royal Mail to encourage customers to use mail as part of their marketing activities. The complainant – another postal operator – alleged that, in encouraging customers to switch to Royal Mail, the company was intending to remove competition from the market.

Postcomm has concluded that Royal Mail appears to have contravened two conditions in its licence designed to facilitate competition. As a result, the company has given several undertakings to Postcomm on the way it will in future conduct any promotional offers and special deals with non standard terms.

Another competitor to Royal Mail will later this month face court action for throwing away mail. Postcomm, the industry regulator, will present evidence against an individual working for one of Royal Mail’s rivals at Redditch, West Midlands. It will be the second prosecution of a new postal operator in two months as the regulator aims to ensure that service standards are maintained.
Competitors to Royal Mail include Express Dairies, UK Mail, Deutsche Post, TPG and Hays DX. A spokesman for Postcomm said: “There will be more prosecutions. We hope there won’t be too many more, but we have to ensure that the new operators maintain adequate standards.” Postwatch, the consumers’ group, said: “The higher profile the action against dumping, the better, as it is one of the constant problems in the postal service. But it also does not seem a level playing field when rival operators face prosecution but Royal Mail deals with dumping incidents itself.”