Table of Contents

Multi-Modal Competition and the Future of Mail

Multi-Modal Competition and the Future of Mail

Advances in Regulatory Economics series

Edited by Michael A. Crew and Paul R. Kleindorfer

This compilation of original papers selected from the 19th Conference on Postal and Delivery Economics and authored by an international cast of economists, lawyers, regulators and industry practitioners addresses perhaps the most significant problem that has ever faced the postal sector – electronic competition from information and communication technologies. This has increased significantly over the last few years with a consequent serious drop in mail volume.

Chapter 2: Price Differentiation: What is Acceptable for a Universal Service Provider?

Richard Eccles

Subjects: economics and finance, competition policy, public sector economics


Richard Eccles† 01 1 INTRODUCTION The EU Postal Services Directive 97/67 as amended, most recently by Directive 2008/6 (the Directive) contains a strict obligation of the universal service provider (USP) not to discriminate as between services for businesses, bulk mailers or consolidators of mail whenever special tariffs for such services are applied. No distinction is made between worksharing discounts and purely commercial, volume discounts and, moreover, the provision has been interpreted strictly in individual cases by the European Commission and the European Court of Justice (ECJ). By contrast, the French national regulatory authority, ARCEP, appears to have taken a competition-focused approach to the application of the provision by requesting an opinion from the Conseil de la Concurrence on the acceptability as a matter of competition law, of withholding purely commercial volume discounts as opposed to worksharing discounts from mail preparation firms. The Conseil concluded that mail originators were not in an equivalent position to mail preparation firms and therefore did not merit equal treatment as regards volume discounts. It is important to USPs in a number of European countries to be able to apply volume discounts only to their own direct sender, mail originator customers, but not also to apply such discounts to intermediaries including mail preparation firms. However, USPs would be well advised to exercise caution in following the approach of La Poste as covered in the Conseil de la Concurrence Opinion without first taking into account this strictness of the European Commission and ECJ decisions under Article 12,...

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