Industry in brief DIRECTOR OF STRATEGY & POSTAL AFFAIRS, CHARLES NEILSON PROVIDES HIS REGULAR ROUND-UP OF INDUSTRY NEWS.
Ofcom issues Statement of Objections to Royal Mail
Ofcom agrees to Royal Mail’s
In January 2014 we submitted a complaint to the postal regulator, Ofcom relating to Royal Mail’s proposed price increases. We said that the proposed changes were unfair because they targeted postal companies that were providing their own end-to-end delivery and imposed higher prices on them. That unfairness amounted to a breach of the postal regulatory rules and also a breach of competition law. Ofcom took up the case, investigated it, gathered evidence and eventually issued the Statement of Objections. The Statement alleges that higher bulk mail delivery prices would act as a strong disincentive against entry into the delivery market. This would increase barriers to expansion for postal operators like Whistl seeking to compete with Royal Mail in this market, leading to a potential distortion of competition against the interests of consumers. In essence the Statement of Objections issued by Ofcom concurs with most of the complaint made by Whistl. However this is just a provisional view. Both Whistl and Royal Mail will give Ofcom further evidence and arguments about the case. We expect Ofcom to make a final decision next year.
request for Boxing Day USO exception
Ofcom to review the regulation of Royal Mail
Ofcom has agreed to Royal Mail’s request that Boxing Day (26 December) should be permanently designated as an exception to the universal service when it falls on a Saturday. In a statement issued on 1 October, Ofcom said: ‘Royal Mail was previously granted an exception (by the previous regulator, Postcomm) when Boxing Day fell on Saturday in 2009. Prior to the Postal Services Act 2000, Royal Mail’s policy (at least since the 1980s) was not to collect and deliver mail when Boxing Day fell on a Saturday. ‘Ofcom issued a consultation on affected if there are no deliveries and collections when 26 December falls on a Saturday. The consultation closed on 10 September 2015 and we received eleven responses. ‘After analysis of these responses we have decided to agree to Royal Mail’s 30 July 2015 to seek views from stakeholders on how they may be
Ofcom has launched a ‘fundamental’ review of regulation governing Royal Mail. The review follows the withdrawal of Whistl, Royal Mail’s only major challenger in the end-to-end mail delivery market, calling for a seismic shift in the way the postal market is regulated. Ofcom has said it will review the situation now that Royal Mail is ‘no longer being subject to national competition’. This will include ‘the company’s ability to set wholesale prices in a way that might harm competition’. Despite the structural decline of post, the continuing rise of e-commerce coupled with the position of the UK as leaders in the European e-commerce market, has raised awareness of the importance of the post and parcel market. The review attracted a wide range of responses from industry bodies and posting customers alike. Thank you to all those who contributed and we look forward to reporting Ofcom’s provisional views next year.
request for an exception in relation to deliveries and collections when 26 December falls on a Saturday.’
10 Whistl Magazine • Winter 2015
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