Final delivery for postal monopolies

Eleven member states to open up postal market but concerns about slow progress on competition.

Postal service monopolies are due to end in most of the EU on 1 January, amid criticisms that there is still little real competition in the sector.

When the EU’s third directive on the liberalisation of postal markets comes into force at the beginning of 2011, a further 11 countries will be obliged to allow new providers to compete against national incumbents on the last – and largest – sub-sector to be liberalised, letters under 50 grams. They will join the six member states that have already introduced full liberalisation, theoretically opening up 95% of the internal postal market to competition. In the remaining ten member states, the deadline for full liberalisation is still two years away.

The Free and Fair Post Initiative, which represents users and competitors of the public postal operators, is concerned about the slow development of competition.

It is urging the European Commission and member states to “step up their efforts” to promote effective postal liberalisation, ensuring in particular that level playing-fields in each country encourage new entrants.

The group says that incumbent operators are favoured by disparities in VAT regimes, labour rules and minimum wage legislation. It claims some countries have put in place barriers to hinder competition, citing Belgium’s intention to impose tough licensing conditions and Austria’s failure to grant all postal providers access to residential postboxes.

Strike action

Resistance to change also comes from trade unions, which point to the state of the industry in the Netherlands, one of the countries to liberalise the sector early. Since last month, workers have held a series of strikes in protest at plans by TNT to cut more than 10,000 jobs. TNT, which once held the monopoly in the Netherlands, said it needed to make redundancies in the face of competition from Deutsche Post.

The Commission said it would take action against member states that did not transpose the directive on time or correctly.

It has set up the European Regulatory Group for Post (ERGP), which held its first meeting on 1 December, with the aim of sharing best regulatory practice. But the Commission is also keeping an eye on the social effects of the changes, and insists that liberalisation will be successful only if national regulators ensure pay and work conditions do not suffer. Next year, Michel Barnier, the European commissioner for the internal market, is to chair a postal user forum to look at the impact of liberalisation.

Light mail

Postal liberalisation has been introduced in stages in the EU since 2003, beginning with parcel and business post. Mail weighing less than 50 grams is the final sector of the market to be opened to competition.

At the beginning of next month, Estonia, Finland, Germany, the Netherlands, Sweden and the UK will be joined by Austria, Belgium, Bulgaria, Denmark, France, Ireland, Italy, Malta, Portugal, Slovenia and Spain in opening up their postal markets.

Click Here: Golf special