Russian Post is in a war of words with the country’s competition body FAS which claims that it ‘wants to prevent liberalisation’ following publication of a proposed new law on opening the
national postal market to competition.A revised version of the ‘postal communications’ bill has been submitted to the government andcould be reviewed in September. The discussions around the new draft law, which would replacelegislation dating from 1999, have been going on for a while without agreement.
Now, however, Igor Artemyev, the chief of Federal Antimonopoly Service (FAS), has called RussianPost ‘inefficient’, claiming that the postal operator doesn’t have any reform programmes and isresisting reforms and liberalisation of the market while disrupting the business activity of othermarket players.
“Looking at the main basic service – letter delivery – there is no real competition for themoment, and the post doesn’t allow this competition. On the one hand, it doesn’t want to bereformed. On the other hand, it doesn’t allow competitors who could operate more efficiently. Thisway, it is slowly dropping into a slump,” Artemyev told journalists.
In response, Russian Post called Artemyov’s statements “extremely strange” as the previousmanagement of the FAS, the federal ministry on anti-monopoly policy, had been involved in definingthe postal strategy in Russia over the past decade.
The Russian postal operator rejected criticism and claimed it has always stood for developing acompetitive postal market in the country. “However, market liberalisation measures have to beadjusted to the needs of Russian citizens and organisations and guarantee an equal access to postalservices across the whole country. If the FAS initiatives regarding postal reform are implemented,a considerable part of the Russian population will be deprived of access to postal services andpractically infringed in their rights. All this will increase social tension threatening thestability of society,” the company declared. The new FAS proposals on postal liberalisation supportthe interests of the private sector at the expense of regular citizens, Russian Post claimed.
Russian Post CEO Alexander Kiselyov responded to Artemyev’s claims, saying: “Russian Post isworking not only to make a profit but is fulfilling an important social mission, above all. Wedeliver letters, press, goods, accept payments and money transfers in the most remote areas of thecountry – not because it is profitable but because it is necessary for people. Russian Post’scompetitors are interested in serving big cities. They are not interested in the regions of FarNorth, for example, because it is not profitable for them to work in these areas. But we work bothin profitable and less profitable market segments. We are prepared to abandon the social programmesand operate in the competitive market, if the government decides to remove this social burden fromus.”
Russian Post argued it is currently the only company providing postal services in remote, poorlypopulated regions that are difficult to access. “Today, more than 37 million people living invillages have the possibility to use postal services only thanks to Russian Post.” The enterpriseoperates over 3.5 million postal offices in the regions of Far North and where there are no othercompanies.
Kiselyov reiterated that the postal operator is increasing its efficiency, improving productionand business processes as well as the operations system and paying attention to the well-being andsocial protection of its employees. “Unfortunately, due to the loss-making services, the company’sown resources are not sufficient to ensure a planned development pace. There is no way Artemyev – ahead of a big state institution – couldn’t know about the reforms Russian Post isimplementing.”
The conflict between the FAS and Russian Post emerged just a few weeks after Russian Post wasobliged by the Federal Arbitration Court of the Far East District to pay RUB 6 million (€144,700)as a fine for abusing its dominant position on the market. This was due to unfavourable conditionsRussian Post stipulated in its contract with the Russian Telekom (Rostelekom), including additionalcharges for delivery of registered mail.
The Federal Antimonopoly Service is an authorised federal executive authority in Russiaresponsible for the adoption of regulations controlling and supervising the legislation oncompetition in trading markets. It aims to ensure freedom of competition and effective businessprotection stimulating the development of new technologies and the most effective productionmethods.
