Rivals pin hopes on German probes

Date: 28/09/00

Internal Market Commissioner Frits Bolkestein's proposals may have been a huge disappointment to the Union's private post sector.

But the latest in a series of cases launched by competition chief Mario Monti against German operator Deutsche Post has given rivals hope that strict enforcement of Union anti-trust rules could finally breathe some life into the EU market.

The Commission followed up on weeks of threats with a formal 'statement of objections' against the company in August for allegedly abusing its dominant position in the German market. Monti's aides demanded an explanation for the elevated price of German stamps - at h0.56 the highest in Europe - which, they said, could not be justified by the cost of delivering mail. Commission officials also sided with the US' United Parcel Service, which first accused Deutsche Post in 1994 of predatory pricing by offering huge below-cost discounts to big customers.

The German firm had been expected to defend itself against the allegations at special hearings with the Commission, rivals and other inter-ested parties behind closed doors in Brussels at the end of next month. But sources say the company, which is planning an EU-wide stock sale in November, has been given more time after arguing that it needed longer to prepare an adequate defence.

The company's opponents are calling for a new date to be set as soon as possible, as Deutsche Post continues to enjoy its unchallenged position in the Union's biggest market. "We still hope that a hearing will be organised this year - in November," said Anton Van der Lande, UPS' vice-president of international affairs. "We have waited long enough."

The latest challenge to Deutsche Post follows allegations that the operator overstepped the mark by intercepting cross-border mail sent to Germany by the UK's Royal Mail and imposing a surcharge on it. Union competition watchdogs are also examining claims that it violated state aid rules by siphoning cash from its monopoly of the letters market to fund a multi-billion-euro spending spree in the Union's post market.

Internal Market Commissioner Frits Bolkestein's proposals may have been a huge disappointment to the Union's private post sector. But the latest in a series of cases launched by competition chief Mario Monti against German operator Deutsche Post has given rivals hope that strict enforcement of Union anti-trust rules could finally breathe some life into the EU market.