Aug 14, 2018

Royal Mail fined £50m for ‘serious breach’ of competition law

Britain's communications watchdog has fined Royal Mail a record £50m for a "Serious breach" of competition law, after finding the company abused its near-monopoly with price increases to penalise rivals who tried to compete in delivering business letters. At the time, Whistl was extending its own household bulk mail delivery service in certain parts of the country, but suspended the expansion after Royal Mail increased prices it would charge it in the remaining areas. "Royal Mail broke the law by abusing its dominant position in bulk mail delivery," said Jonathan Oxley, Ofcom's competition group director. The competition probe began after Royal Mail announced different price plans for wholesale customers, based on whether they were able to hit mail volume targets for areas covering the whole of the UK. It planned to charge around 0.25p more per letter for companies that wished to do some of their own household deliveries. Whistl, a unit of Dutch mail group TNT at the time, later withdrew from bulk delivery in 2015, leaving Royal Mail without competition in that area.

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