Postcomm publishes 'minded to' decision on Mailsort Light investigation

24 June 2009

Postcomm has today published its ‘minded to’ decision in connection with its investigation into Royal Mail’s offering of Mailsort Light (“MSL”).

Following a detailed investigation and assessment of the evidence gathered, Postcomm is ‘minded to’ conclude that Royal Mail is contravening, has contravened and is likely to contravene (unless appropriate action is taken) Condition 10(2) and Condition 11(2) of its licence through the offering of MSL.

This ‘minded to’ decision was issued to Royal Mail on 17 June 2009.  In accordance with Postcomm’s Enforcement Guidance, Royal Mail is being given the opportunity to submit written and oral representations in response to the document. Royal Mail must submit any written representations by 29 July 2009 and has been given the opportunity of an oral hearing subsequently.

Postcomm’s Enforcement Guidance states that it will consider any representations from third parties made in relation to the published ‘minded to’ decision. Third party representations should be submitted to Mary Davies by 29 July 2009 indicating at the time of submission whether any information should be treated as confidential.

Following consideration of any representations received, Postcomm expects to make its final decision in autumn 2009.

Explanatory Notes

  • MSL is a credit offered by Royal Mail to its customers against certain ‘teaser’ or ‘reminder’ mailings sent as part of an advertising campaign.  MSL is not available as a service on its own and to be eligible to receive the credit, a customer’s campaign must fulfil certain criteria (set out in detail in section 1 of the ‘minded to’ decision).  Provided these criteria are met, MSL customers receive a credit of 4.5p for each teaser or reminder item sent.
  • Condition 10 applies if Royal Mail is required to provide access to its postal facilities to other persons pursuant to a condition of its licence.  Condition 10(2) provides that Royal Mail shall conduct its business as a postal operator in the manner best calculated to secure that neither it, nor any related person of Royal Mail, nor any other person, obtains any unfair commercial advantage in connection with the provision by Royal Mail of access to its postal facilities. 
  • Condition 11 was included in Royal Mail’s licence in pursuance of Postcomm’s duty (under section 5(1) of the Act) to “further the interests of users of postal services… wherever appropriate by promoting effective competition”. Condition 11(2), the operative provision of Condition 11, only applies in certain circumstances, in particular where it is not specifically disapplied by Condition 11(1)(b).  Condition 11(1)(b) provides that Condition 11(2) shall not apply where the postal services “are supplied in a sector of the market where there is effective competition”.  Assuming that it is not disapplied by virtue of Condition 11(1)(b) (or another provision of Condition 11(1)), Condition 11(2) of the licence provides that Royal Mail:-

                  • in the terms on which it supplies or offers to supply services to customers: 
                       - shall not show undue preference to any person or class of persons;
                       - shall not exercise any undue discrimination against or seek to impose any undue restriction on any person or class of persons; and
                  • shall not set terms or charges for the supply of postal services which are excessive, or which are predatory.

  • Timetable of the investigation:
    1. In December 2007 Postcomm began its preliminary assessment;
    2. On 3 March 2008 Postcomm opened a full investigation and a Scope of Investigation was published on its website (link to this);
    3. On 4 March 2009, Postcomm issued a slightly amended Scope of Investigation (link to this) to clarify in particular that Condition 10 as well as Condition 11 of Royal Mail’s licence may potentially apply to the conduct under investigation;
    4. On 17 June 2009, Postcomm issued its ‘minded to’ decision to Royal Mail, allowing Royal Mail until 29 July 2009 to submit its written representations and giving Royal Mail the opportunity for an oral hearing.

Related documents:

Full list of related documents.