Postal operators in Europe remain firmly opposed to the European Commission’s plans to regulate cross-border parcel deliveries, senior officials and managers have reaffirmed.
Proposals to regulate issues such as pricing and third-party access to delivery networks are unnecessary given the existing competition between different players for cross-border deliveries, they declared in presentations and in a panel discussion at the recent European Post & Parcel Services conference in Amsterdam, organised by Marketforce.
The Commission had cited high cross-border prices as a particular problem in its proposals last May.
Botond Szebeny, PostEurop Secretary General, claimed that the European Commission “has not justified why intervention is needed” in the fast-growing cross-border parcels market where there is increasing competition between a rising number of players.
On average, eight different operators compete for domestic parcel delivery and seven operators for cross-border delivery within and between the EU’s 28 member states at present, according to the association. In comparison, in 2013 there were five domestic and four cross-border competitors on average.
As the voice of European postal operators, PostEurop objects in particular to the EC’s proposals on transparency of postal rates and terminal dues, tariff affordability and network access, he said. “We don’t see the need for third-party access when we’re in a competitive market.”
In a panel discussion, the PostEurop secretary general highlighted a Copenhagen Economics study last year showing that “there is competition and there is no market failure”. He suggested that national postal regulators (NRAs) could monitor cross-border markets instead of having an EU-wide new regulation.
Denis Joram, chief economist at France’s La Poste, queried the EC’s move to make postal tariffs more transparent. “I don’t see how it will help e-commerce by putting pressure on (delivery) prices. It’s necessary to ensure competition is working well. But I don’t see a problem with competition,” he commented.
Cord Leudemann, a legal expert at German regulator Bundesnetzagentur, pointed out, however, that cross-border parcels are not covered by the existing Universal Service Obligation for domestic parcels. “The agency supports the general objective of the regulation,” he stated. He admitted, however, that ‘affordability’ of postal tariffs “is not a clear term”.
Robin Noble, a state aid expert with UK-based Oxera Consulting, commented that some of the pricing of Amazon’s customer loyalty scheme Amazon Prime “almost raises the question of abusing a market position” and the issue of whether other retailers could compete with this programme or not.
Both the European Council of Ministers and the European Parliament are currently discussing the Commission’s proposed regulation. In December, the Council published a progress report which questioned whether a regulation only covering public postal operators might distort competition, and suggested adding other parcel operators to the paragraph on tariff transparency (§4) while removing the paragraphs on publication of terminal dues (§4.2), assessing tariff affordability (§5) and third-party access (§6).
At the start of March, various stakeholders then discussed the Commission’s cross-border parcel delivery proposal at a European Parliament event. In a summary, PostEurop said that many stakeholders and MEPs had expressed clear reservations and raised concerns about the risk of introducing some distortion of competition.
Jean-Paul Forceville, Chairman of PostEurop, stressed at the event: “PostEurop and its members are opposed to the requirement for national regulators to assess the affordability of postal operators’ tariffs on an annual basis, irrespective of the local situation and absence of any indication that tariffs might not be affordable. An affordability assessment would involve significant resources and costs for postal operators and national authorities. It is disproportionate, considering that the Commission only expects 5 to 10% of tariffs across Europe to fail the test. A more targeted approach would avoid unnecessary costs and red tape.”
He added: “In the competitive and free parcel delivery market, access to the delivery networks of postal operators is and should be part of normal commercial negotiations. No EU-wide market failure has been demonstrated, which would justify regulating third party access.”
