Royal Mail 'Breached Competition Law'

The postal regulator has accused Royal Mail of "breaching competition law' in its treatment of rivals, in a provisional finding.

Ofcom issued what it called a Statement of Objections against the company in the wake of a complaint brought by Whistl related to bulk mail delivery service charges.

The regulator said: "On 10 January 2014, Royal Mail announced changes to the prices, terms and conditions for bulk mail delivery services known as ‘access services’.

"These services enable other postal operators to hand over letters that they collect from large business customers (such as councils, banks and utility companies) to Royal Mail for final sorting and delivery.

"Whistl UK Ltd submitted a complaint to Ofcom in January 2014, alleging that the changes were anti-competitive.

"Ofcom opened an investigation on 21 February 2014. On 4 March 2014, Royal Mail suspended the planned changes, and on 11 March 2015 the company announced that it had withdrawn them."

Whistl later suspended its home delivery services but that was after a financial backer pulled out of an expansion plan.

Ofcom alleged that the planned changes to Royal Mail's wholesale prices would have meant that its rivals in delivery services would have had to pay more for bulk mail delivery services than its other customers, and they were a disincentive to competition in the market.

Royal Mail said it would submit a "robust defence".

"The company considers that the pricing changes proposed in 2014 were fully compliant with competition law.

"They were an important part of Royal Mail’s commercial response to both changing market conditions and to Ofcom's statements in its March 2013 guidance document on end-to-end competition in the postal sector."