EU regulation may have little impact on cross-border parcel prices, say Posts

Price disclosure obligations in the forthcoming EU cross-border parcel delivery regulation will put providers under public pressure but may not have a significant impact on prices for most business customers, according to senior postal managers.

The regulation, which was passed by the European Parliament earlier this month, is set to enter force in the spring, Raphaël Goulet, head of the Public Interest Services unit at the European Commission’s DG GROWTH, told the Leaders in Logistics Post & Parcel Europe conference in Berlin last week. It is likely to get approval by the EU Council of Ministers in April, be published in the EU’s Official Journal in the spring and then enter force 20 days later, he said.

Outlining the regulation’s main provisions, Goulet explained that all parcel delivery companies will have to provide national postal regulators once a year with information on their revenues and volumes, broken down into domestic and international, workforce and sub-contractors, and “any publicly accessible price list”. This information will be confidential and will not be published.

In addition, they will have to provide non-discounted single piece prices for 15 different delivery products, including ‘letter’ services containing goods up to 500g, 1kg and 2kg; parcel services with goods up to 1kg, 2kg and 5kg; and standard, registered and track & trace services. These prices will be published by the Commission on a website.

National regulatory authorities (NRAs) will then assess cross-border tariffs (that are subject to the postal USO) in terms of their impact on users such as individuals and SMEs, including in remote areas.

In terms of annual timings, Goulet said companies will have to provide tariff information to NRAs by January 31 and the tariffs will be published by the Commission by March 31. The NRAs will provide their tariff assessments by June 30 and these will be published by July 31.

But Denis Joram, La Poste’s Director of Regulatory Affairs, told the audience of some 200 postal industry managers and suppliers that the regulation would probably have little impact on prices given that most large and medium-sized customers pay negotiated rates.

And he underlined: “The (delivery) prices paid by consumers are set by e-retailers, not by Posts. And retailers can charge what they want. More than 60% offer free delivery, so they internalise the costs.”
 
Joram claimed the problems of SMEs trying to compete with major e-retailers and the leading marketplaces revolved around “investments in marketing”, and not the cost of delivery.

In a panel discussion, Jan Bart Henry, PostNL’s long-serving head of EU Affairs, declared: “The market will regulate prices and competition.”

In response, Goulet emphasised: “We are not suggesting all prices are too high. The regulation offers a process. The conclusion may be that certain prices can be justified.”