Postal services
Overview
Good postal services are essential to all economic and social activities and are a vital part of communication within the internal EU market. The promotion and safeguard of effective competition in the supply of postal services in the Community is one of the core tasks of the Competition Directorate-General and, more generally, of the Commission.
Opening up the postal services markets
Traditionally, Member States have entrusted postal services to public administrations or publicly owned companies. The progressive opening of the national postal services markets to competition has taken more time than other sectors dominated by public networks, such as Telecoms.
Postal Services in the EU are currently covered by Directive 97/67/EC of 1997, as amended byDirective 2002/39. This legislation created a regulatory framework which guarantees citizens a universal service, while also limiting the extent to which Member States may choose to restrict access for economic operators. Currently restricted access for economic operators only applies to mail under 50g. As such, the Directive aims to ensure the best possible service through a gradual opening of the market. The main elements of the regulatory framework include:
- the minimum characteristics of the universal postal service which must be guaranteed by all Member States,
- the quality standards for intra-EU cross-border services,
- tariff principles
- principles governing transparency of accounts of universal service providers
- the separation of regulatory and operational functions in the postal sector
- common maximum limits for those services which may be reserved by a Member State to its universal service provider(s) to the extent necessary to ensure the maintenance of the universal service. These limits have been progressively reduced, in1999, 2003, and 2006.
In October 2006, the Commission tabled a proposal setting the final target for full opening at the beginning of 2009. As a result, users and consumers in all Member State will be able to enjoy the benefits of increased competition, while retaining the high standards and universal service provision required under the Directive. (For definitions on "universal service" and "reserved area" please consult these frequently asked questions on the EU postal policy). Virtually all Universal Service Providers ("USPs") in the EU are public undertakings controlled by the Member States, with the notable exception of Germany and the Netherlands.
For consumers, it is important that the opening up of the postal markets does not lead to a decline in the services they currently enjoy. Increasing competition through gradual removal of the reserved areas should enhance the reliability and quality of postal services. The current requirements for high quality universal service (such as the density of post offices and letter boxes) will be fully maintained, and closely monitored by national regulatory authorities. Faced with competition, universal service providers will come under pressure to become more efficient and more customer-focused. Consumers will benefit both as senders and as receivers of mail from a more quality focused service and should also benefit from savings passed on to them through cost reductions of business users and large volume mailers such as banks or utility companies. In any case, the universal service obligations guarantee that all Member States will ensure the continued affordability of postal services.
More competition for postal services will also create new employment opportunities, both in new postal companies that are emerging and, indirectly, in the industries dependent on the post, which grow alongside the postal sector. In the longer term, more competition will enable employment to be sustained by promoting growth in the sector and by allowing it to adapt to the rapid changes of information society.
In short, increased competition by completing the internal market for postal services is about ensuring the best possible and most cost effective postal services for citizens and businesses in Europe.
Applying competition rules
In parallel with this liberalisation, the Commission applies the competition rules to the European postal services markets according to the principles set out in the Notice from the Commission on the application of the competition rules to the postal sector and on the assessment of certain State measures relating to postal services.
DG Competition focuses on anticompetitive behaviour in the postal services markets, that is to say, behaviour infringing Articles 81 and 82 (and eventually in combination with Article 86) of the EC Treaty.
DG Competition also monitors State aid to the postal services sector and contributes to the development of State aid policy in this field.
Under Article 87 of the EC Treaty, State aid is defined as any aid granted by a Member State or through State resources which distorts competition by favouring certain undertakings and which affects trade between Member States. State aids are in principle incompatible with the Common market.
However, under Article 86(2) EC, an aid necessary for the performance by an undertaking of a service of general economic interest may, if certain conditions are fulfilled, be deemed compatible with the Common market.
The Community Framework for State aid in the form of public service compensation (press release IP/05/937) defines the conditions under which a public service compensation can be authorised. Among other conditions, the compensation must not exceed the net costs entailed by the undertaking in providing the public service. This is aimed at preventing undertakings from using public service compensation to cross subsidise commercial activities.
DG Competition also enforces the Merger Regulation in the postal services markets with the aim of preventing effective competition from being hampered by merging companies.
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