Tag: TNT

Mail distribution company TNT NV said it is ‘not afraid’ of facing financial repercussions if it decides to freeze or perhaps even abandon current cooperation agreements with local mail distributors in Germany.

‘At the moment we have no calculation of any expected costs, but we’re not afraid of financial repercussions,’ a TNT spokesman told Thomson Financial News.

TNT said it may freeze or perhaps even abandon all current cooperation agreements it has signed with regional German mail distributors in light of proposed German legislation which would see a minimum wage imposed for postal workers.

TNT is ‘very much opposed’ to that government proposal as it would ‘destroy whatever level playing field is left for us in Germany — if at all,’ the TNT spokesman said.

‘It is very difficult for any company, such as ours, to pursue normal business in an area where there’s outright market protection going on,’ he added, referring to the German postal market.

Aside from the minimum wage for postal workers, which would also hit TNT’s competitors in the German market, TNT also wants the VAT exemption for Deutsche Post — its biggest rival — rescinded by the German government.

TNT has said it would lobby to delay the market liberalisation, due for January 2008, because Germany is poised to introduce a minimum wage which TNT says is too high for it to effectively compete with Deutsche Post. One of the conditions for opening the market was a level playing field with Germany.

TNT aims to compensate for an expected loss of business at home when the market is opened up by expanding abroad, and Germany and the UK are its main targets.

Mei Li Vos, responsible for postal liberalisation within the Dutch Labour party, said it was doubtful whether a minimum wage for postal workers in Germany would pose a major problem for TNT, adding she was not convinced Dutch liberalisation should be delayed over it. “As a social democrat, I find it great that there will be a minimum wage. I doubt whether that is really a problem with regards to a level playing field,” Vos told Reuters.

A delay is unlikely if Labour, part of Prime Minister Jan Peter Balkenende’s centrist coalition, opposes it.

Asked if the German minimum wage was a reason to use an “emergency break” procedure to delay Dutch liberalisation, Vos said: “Not for this reason. If we are going to use it, it’s in the event that Dutch employment conditions have not been regulated well.”
Vos said, however, that no final conclusions had been reached and that parliamentarians were still looking into possible other competition problems in the German market.