Advances in Regulatory Economics series
Edited by Michael A. Crew, Paul R. Kleindofer and James I. Campbell Jr
Chapter 19: United Kingdom Postal Services Regulation
Richard Eccles† INTRODUCTION In the United Kingdom (UK), postal services markets were fully liberalized with eﬀect from 1 January 2006 under the Postal Services Act 2000. This is subject to a requirement on all postal operators to hold a license granted by the Postal Services Commission (‘Postcomm’). Licenses are required for all operators transporting letter mail items weighing less than 350 grams for a price of less than £1.1 These thresholds reﬂect the original reservable area thresholds under the EC Directive 97/67 on the internal market for postal services (the ‘Postal Directive’). Postcomm’s policy is to grant licenses to all operators subject only to compliance with certain essential requirements. A more relaxed legal regime applies for the grant of licenses outside the reduced reservable area under the second EU Postal Services Directive, Directive 2002/39/EC (50 grams or 2.5 times the fastest standard tariﬀ, 65 pence in the UK). The universal services provider, Royal Mail, is also required to hold a license and indeed Royal Mail’s license is the principal measure by which Royal Mail is regulated. Postcomm has granted 19 long-term licenses to other postal operators.2 The primary statutory objective of the regulator, Postcomm, under the Postal Services Act 2000, is to ensure the provision of the universal service.3 Moreover, the universal service must be provided at aﬀordable prices and at a geographically uniform tariﬀ throughout the UK.4 The promotion of eﬀective competition between postal operators is an additional, but secondary objective of Postcomm,5 being...
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