Anti-competitive behaviour
Postcomm has wide-ranging powers to gather information and investigate complaints about anti-competitive behaviour in the mail market.
As the single provider of the universal service in the UK, Royal Mail has developed a comprehensive UK-wide delivery network giving rise to significant economies of scale in collection and delivery that rival postal operators do not enjoy. Royal Mail used to be the monopoly provider of postal services in the UK and the market was fully liberalised only in 2006.
For this reason, Royal Mail’s licence contains specific provisions designed to ensure that Postcomm can intervene if Royal Mail is engaging in anti-competitive behaviour. Such behaviour may involve the supply of services at prices or on terms that are unduly preferential, unduly discriminatory or unduly restrictive, or which are predatory or excessive. It may also involve obtaining an unfair commercial advantage over competitors, or refusing to supply access to postal facilities.
Postcomm can investigate Royal Mail for anti-competitive behaviour under Part 4 of the company’s licence, and if we find that anti-competitive behaviour has occurred, we can take a range of actions, including:
- Agreeing undertakings with Royal Mail to ensure it takes steps to resolve any situation where anti-competitive behaviour has arisen or could arise.
- Issuing a provisional or final enforcement order instructing the company to deal with an anti-competitive situation.
- Imposing a financial penalty on Royal Mail.
Allegations of anti-competitive behaviour against other operators would be likely to fall within the scope of UK competition law and may be referred by Postcomm to the Office of Fair Trading. A Memorandum of Understanding between Postcomm and the Office of Fair Trading (pdf, 42KB) aims to promote co-operation and co-ordination between Postcomm and the Office of Fair Trading when dealing with cases of anti-competitive behaviour for which they have overlapping powers. (More information on codes and policies governing Postcomm's work.)
In March 2007, Postcomm issued guidance to ensure that Royal Mail does not act anti-competitively when taking part in competitive tenders for mail business.
Postcomm's series of downloadable factsheets on key issues in the mail market includes a brief guide to our work dealing with anti-competitive behaviour.
