Ofcom accuses Royal Mail of breach of competition law

Communications regulator Ofcom has accused Royal Mail of breaching competition law after it proposed raising prices for its bulk mail delivery customers.

Bulk mail is collected by other postal firms from businesses and passed to Royal Mail for sorting and delivery.Royal Mail set out the price changes in January 2014, before withdrawing them.

Rival firm Whistl, which had planned its own delivery network, claimed the price hikes were anti-competitive.

Ofcom said its specific allegations include that “changes to Royal Mail’s wholesale prices for bulk mail delivery services contained a differential in pricing which meant that, in practice, higher access prices would be charged to… customers that competed with Royal Mail in delivery than to those access customers that did not”.

At the time that the price increase was proposed, TNT Post – now Whistl – was proposing to launch a rival bulk letter sorting and delivery service for business customers.

Following the price hike, it complained to the regulator about anti-competitive practice on the part of Royal Mail and ultimately gave up on its rival venture.

Source: Ofcom accuses Royal Mail of breach of competition law – BBC News