COMMISSION OF THE EUROPEAN COMMUNITIES 
Brussels, 17.10.1996 
COM(96) 480 final 
COMMUNICATION FROM THE COMMISSION 
TO THE COUNCIL, THE EUROPEAN PARLIAMENT, 
THE ECONOMIC AND SOCIAL COMMITTEE 
AND THE COMMITTEE OF THE REGIONS 
on the public consultation on the draft Notice on the application of the competition rules 
to the postal sector and, in particular, on the assessment of certain State measures 
relating to postal services 

Table of Contents 
1. Introduction 3 
2. Background 3 
3. Public consultation 4 
4. Role and status of the draft Notice 5 
5. Relationship between Directive and Notice 5 
6. Content of the draft Notice 6 
7. Results of the public consultation 6 
8. Conclusions and follow-up 10 
Annex 1 List of written reactions on the public consultation 
1. Introduction 
In December 1995, the Commission published its proposed package of measures concerning 
the development of the postal sector in the Official Journal. The Notice on the application of 
the competition rules to the postal sector was published as a draft for consultation. This 
Communication intends to provide information on the results of this public consultation. A 
speedy finalisation of the codecision procedure on the Commission's proposal fora European 
Parliament and Council Directive on the development of Community postal services is highly 
desirable. This Communication may contribute to that process. 
Several reactions to the public consultation show that there is uncertainty or misunderstanding 
on the role and status of the draft Notice, and on the relation between the Directive and the 
Notice. This Communication goes into these aspects before describing the results of the public 
consultation. It finishes with further steps the Commission intends to take with regard to the 
Notice. 
2. Background 
The Commission submitted a Green Paper on the development of the single market for postal 
services in June 19921, which was followed by an extensive public consultation. This resulted 
in Guidelines for the Community postal services, issued in June 19932. In its Resolution of 7 
February 19943, the Council invited the Commission to put forward proposals for the 
harmonisation and gradual liberalisation of the postal sector. Subsequently, after substantial 
discussion the Commission adopted in July 1995 a package of measures concerning the 
development of the postal sector, consisting of a proposal for a European Parliament and 
Council Directive on common rules for the development of Community postal services and the 
improvement of quality of service4, and a draft Commission Notice on the application of the 
competition rules to the postal sector and, in particular, on the assessment of certain State 
measures relating to postal services. 
1 COM(91) 476 final 
2 COM(93) 247 of 2 June 1993 
3 OJNo C48, 16.2.1994 
4 COM(95) 227 final, Proposal for a European Parliament and Council Directive on 
common rules for the development of Community postal services and the improvement 
of quality of service. 
Both documents have been published together in the Official Journal in December 1995. The 
package has been presented to the European Parliament, the Council, the Economic and 
Social Committee and to the Committee of the Regions. On the basis of the first reactions to 
the draft Notice it was decided, and announced during the Telecommunications Council in 
November 1995, to postpone the publication of the final Notice until a decision on the Directive 
is taken. Nevertheless, such publication will occur not later than the end of 1996 as the sector 
urgently needs the clarity with regard to competition law which the Notice will bring. 
3. Public consultation 
Interested parties were invited to submit observations on the draft Notice within two months 
after its publication in the Official Journal, which took place on 2 December 19955. This period 
officially ended on 2 February 1996. Since it was decided not to publish the final Notice 
immediately after the two-month consultation period but only after a decision on the Directive 
is taken or, at the latest, by the end of the year 1996, it was possible to allow interested parties 
some additional time to formulate their reactions to the Notice. The consultation period is 
formally closed with the publication of this Communication. Further reactions will be taken into 
account to the extent possible during the rest of the procedure. 
DG IV received 46 reactions. The organisations which have reacted représenta broad range 
of different interest groups. Detailed information on the reactions received is set out below. The 
reactions will be taken into careful consideration during the process of finalising the Notice 
before its publication in the Official Journal. 
In general, the Commission has printed reactions to the public consultations on proposed 
Notices and Directives and made them available to interested parties upon request. In this 
case, the parties which have responded to the consultation on the draft postal Notice have 
often done so in combination with a reaction to the draft postal Directive. Consequently, the 
reactions to the draft Directive and to the draft Notice will be printed together. 
5 OJ C 322/03, 1995 Draft Commission Notice on the application of the competition rules 
to the postal sector and, in particular, on the assessment of certain State measures relating 
to postal services. 
4. Role and Status of the draft Notice 
The draft Notice is based on the competition rules in the European Community Treaty, and 
explains the Commission's views with regard to the application and practical consequences 
of these principles in the postal sector, and the possible exceptions to these principles. It also 
sets out the position which the Commission would adopt before the Court of Justice in cases 
referred to the Court by national Courts under Article 177 EC. The Notice is not a legally 
binding document and it does not need to be: the competition provisions of the Treaty are 
already legally binding. The Commission is already faced with an increasing number of 
complaints and questions about the application of the competition rules to the postal sector. 
The Commission has to ensure the application of the competition rules set out in the Treaty, 
and the compatibility of State measures concerning undertakings to which special or exclusive 
rights have been granted with the rules of the Treaty. The draft Notice publicises the guiding 
principles, available to all interested parties, of how and why the Commission applies, and 
intends to apply in the future, the competition rules of the Treaty. The draft Notice should avoid 
and prevent infringements of the Treaty by increasing clarity, and should enable all interested 
parties to understand their position. 
5. Relationship between Directive and Notice 
The Directive and the Notice are intended to address different aspects of the postal sector, but 
they are intended to operate in parallel. The Directive is intended to create new legal 
provisions, and specifically to harmonise the rules on postal services. The Notice is limited to 
explaining the Commission's view on already applicable Treaty provisions and their relevance 
for the postal sector: primarily this concerns Community competition law. It would not have 
been appropriate to write Articles into the proposal for a Directive which merely re-stated the 
existing law. But it was thought useful, and indeed necessary, to explain in a certain amount 
of detail what the Commission considers to be the implications of the existing competition 
provisions for postal monopolies and services. 
The Directive will impose a series of positive obligations on Member States, primarily to 
provide a good quality postal service. It also authorises them to impose universal service 
obligations on postal companies, or to require competing postal operators to contribute to a 
fund to finance the universal service. 
The Notice, on the other hand, being based on competition law, points out that certain kinds 
of behaviour, either of Member States or of dominant postal operators, are not permitted. Since 
the Notice is stating the existing law, it has to use the same terms used in the competition 
rules of the Treaty. 
6. Content of the draft Notice 
- Chapter 1 of the draft Notice contains a number of definitions which are necessary for the 
text which follows. Definitions which appear in the Directive and in the draft Notice are 
intended to be identical. 
- Chapter 2 explains the meaning of public undertakings and undertakings to which special 
or exclusive rights are granted, according to Article 90(1) of the Treaty. 
- Chapter 3 explains how the freedom to provide services in the sector, exceptionally, has to 
be interpreted in the light of Article 59 of the Treaty. This chapter also addresses the issue of 
licensing. 
- Chapter 4 provides a description of the Commission's views with regard to the relevant 
markets within the postal sector. It explains why the public postal operators are regarded as 
having dominant positions and touches on potential abuses of these positions vis-à-vis users 
of postal services and competitors. 
- Chapter 5 explains in general what exemptions from the general prohibition of restrictions 
of competition could be acceptable from a competition law point of view and how, according 
to. trie Commission, these could be applied to the postal sector. This includes issues such as 
transparency of accounting and non-discriminatory access to the postal network. 
- Chapter 6 outlines the guiding principles with regard to State aid to postal operators. 
- Chapter 7 concerns a review of the Notice in light of case experience, which is foreseen for 
the year 2000. 
7. Results of the public consultation 
As a result of the public consultation the Commission has to date received 46 reactions to the 
draft Notice. This figure does not include the opinions presented by the European Parliament 
(provisional), the Economic and Social Committee, and the Committee of the Regions. Some 
of the reactions are very short and only concern one or two issues, others are very detailed 
and touch on nearly every paragraph of the draft Notice. 
It is possible to distinguish several groups of respondents with different interests: public postal 
operators and private operators, trade unions, user organisations, associations and other 
organisations, and national regulatory authorities and Member States. The classification of 
certain respondents within the particular interest groups identified above has not always been 
self-evident. The overall appreciation of the draft Notice varies per group while remaining quite 
consistent within most groups. 
A majority of the respondents, 60 % (28 out of 46), take a positive attitude towards the 
contents of the Notice and support the publication of a final version. The main elements of the 
reactions per group are as follows. 
7.1 Public Postal Operators 
PostEurop, which is the Association of European Public Postal Operators, and the UPU, the 
Universal Postal Union, have both been incorporated in this group of respondents. The 
reactions of PostEurop and the UPU are similar to those expressed by most of the individual 
public postal operators. 
A majority of the public postal operators does not support the contents of the draft Notice in 
its current form. Their comments point out that in their view the approach and the wording 
taken in the draft Notice are still different from that taken in the Directive. Although mostfcublic 
operators are in favour of a gradual and controlled opening of the market concern is expressed 
with regard to the possible effects of the liberalization of direct mail and inward cross-border 
mail. Most public postal operators fear that liberalization of these markets will lead to abusive 
distribution by competitors or to abusive diversion of reserved mail. The postal operators from 
Member States where direct mail has been partially or completely liberalized do not confirm 
this view. Some public operators state that liberalisation on the basis of contents or origin of 
the postal items will cause practical problems. A special problem with regard to liberalization 
of inward cross-border mail is said to exist in Ireland and Luxembourg. In these Member States 
the proportion of inward cross-border mail is notably higher than the EU average. 
The public postal operators in Member States where the postal market is fully liberalized would 
prefer reciprocal market access. They fear that public postal operators with a protected home 
market, and who may advocate large reserved areas, will enter their geographical markets to 
extend their activities. 
There is confusion about the issue of "downstream access". Some operators fear that they 
may be forced to open up (even parts of) their network at every point that customers and 
competitors would desire. Most public operators recommend that the coordination between the 
Directive (in its final form) and the Notice be improved and would prefer them to be published 
together. 
The postal operators who have reacted to the draft Notice in a supportive manner have stated 
that their experiences with liberalization are positive. These operators stress that substitution 
by, for example, fax and e-mail is the real threat to the postal market. They advocate 
liberalization according to a clear and short timetable and they would prefer new regulation to 
be as limited as possible. 
7.2 Private Postal Operators 
The reactions from the private postal operators are unanimously positive with regard to the 
gradual introduction of liberalisation as proposed. These operators appreciate the 
Commission's interpretation of the competition rules and the clarity which the Notice will bring 
with regard to the application of the competition rules is warmly welcomed. The private 
operators look forward to fair competition on the postal market and to an extension of their 
permitted activities. Concern is expressed with regard to the possibility of continuation of cross-
subsidisation from the reserved sector to the non-reserved sector and the Commission's 
attention is drawn to the issue of the application of VAT. 
7.3 Trade Unions 
The reactions of the trade unions focus on the possible effects of liberalization on employment. 
It is feared that measures from postal operators to improve their efficiency and an increase of 
competition in the postal sector will lead to a substantial limitation of the numbers of jobs. 
Concern is also expressed on the coordination between the Directive and the Notice. If 
guidelines are proven to be needed, the trade unions would prefer them to be published after 
the publication of the Directive. 
7.4 User Organisations 
The user organisations are unanimously in favour of gradual liberalization of the postal market. 
They prefer users to have the possibility of choosing from several suppliers of postal services. 
Some user organisations recommend keeping Direct Mail and inward cross-bordermail outside 
of the reservable area. It is interesting to note that public postal operators say that they want 
to protect the quality of service interests of users by maintaining a large reserved area, while 
the user organisations expect quality of service to improve, and tariffs to decrease, through an 
increase in competition. The coherence between the Directive and the Notice is regarded as 
a point of concern. 
7.5 Associations and other Organisations 
Included in this group is the Joint Committee on postal services. This Committee ensures the 
dialogue between representatives of employers and employees in the postal sector. The 
reaction of the Joint Committee on postal services is similar to those expressed by most 
individual public postal operators (see above). A large majority of associations and other 
organisations have expressed a positive attitude towards the Notice and welcome the 
introduction of more competition on the postal market. These organisations placed much 
emphasis on increased transparency of accounting and on the close monitoring of cross-
subsidisation between reserved and non-reserved areas. They want this to be restricted to a 
minimum level. Quality of service needs to improve and is expected to improve as a result of 
liberalization and competition. A minority of associations and other organisations express their 
concerns qn the coordination between the Directive and the Notice in its current form. The 
European Blind Union asks for special provisions for disabled people. 
7.6 National Regulatory Authorities and Member States 
A clear majority of the national regulatory authorities and Member States which have 
responded to the consultation support the draft Notice. Included in this group is the European 
Committee on Postal Regulation (ÔERP) which in fact represents all postal regulators in the 
EU. 
Only a few national regulatory authorities have responded individually. CERP welcomes the 
Notice but feels a need for improved consistency between the Directive and the Notice, in 
order to achieve a higher level of legal certainty. CERP expresses its concerns over the 
application of an open access principle. Limitation of cross-subsidisation is an important issue 
for the national regulatory authorities. 
The coherence between the Directive and the Notice is an important issue for most of the 
Member States which have responded individually. One Member State appreciates the 
Commission's attempt to bring clarity to the postal sector on the application of the competition 
rules, but strongly opposes liberalization of direct mail and inward cross-border mail because 
of the presumed risk of "cream-skimming" and the deviation of mail. Another Member State 
draws special attention to the social consequences of reforms in the postal sector and to the 
need to improve the quality of cross-border postal services. One Member State has expressed 
its support for the Notice and the Directive, though it would prefer both documents to be 
published together. One Member State broadly welcomes the Notice and the guidance it will 
bring, and urges that the liberalization momentum be maintained. Another Member State 
confirms the Commission's competence to issue a Notice and welcomes its publication. This 
Member State emphasises that the Notice makes sufficiently clear what position the 
9 
Commission intends to take with regard to the interpretation and application of the competition 
rules and on the issue of freedom to provide services. 
8. Conclusions and follow-up 
As stated above, the full comments are available on request. A majority of the reactions 
supports the draft Notice. It would be extremely difficult to attach different weights to the 
reactions received, to do this in an objective way, and to determine the overall appreciation 
of the Notice on that basis. The reactions reflect the specific interests of the different groups. 
Uncertainty about future developments in the postal sector, which is inevitable taking account 
of technological developments, even without any liberalization, results in a defensive attitude 
from public postal operators and trade unions. A number of these respondents have reacted 
to the Notice on the somewhat formal grounds that it should not be adopted before the 
Directive and that it is not always using the same terminology as the Directive. These reactions 
seem to translate concerns among these respondents about maintaining the balance between 
harmonisation and liberalisation and the impact of a more competitive market environment. 
Aside from this the consensus about the advantages of introducing or extending competition 
in the postal sector is widespread. It is clear that the general appreciation of the Notice can 
be improved considerably by a clearer explanation of its role and legal status. Discussions 
between the Commission's services and some of the parties have proved to be very useful in 
this respect. The fear that the ultimate Directive and Notice will not be consistent can be 
removed by publishing the Notice in a final (adjusted) form. The approach taken to postpone 
the publication of the Notice until the end of this year was appreciated by many respondents. 
The reactions to the public consultation will be further analyzed in the context of the progress 
with regard to decision making on the postal Directive, and will be taken into consideration 
during the process of finalising the Notice. The same applies to the opinions presented by the 
European Parliament, the Social and Economic Committee and the Committee of the Regions. 
On the basis of the public consultation it has become clear that the text of the Notice can be 
improved to achieve further clarity on important issues, notably issues such as definitions, the 
issue of universal service and the relationship between reserved areas and special and 
exclusive rights, on access principles and on cross-subsidisation. The European Pariiament 
concluded its first reading on the draft postal harmonisation Directive on 9 May 1996. Work 
on the draft Directive continues in the European Parliament and in the Council. The results 
achieved by the end of this year with respect to the draft Directive will be taken into account 
when the Notice will be finalised, with subsequent publication in the Official Journal. 
10 
Annex 1 
LIST OF WRITTEN REACTIONS ON THE PUBLIC CONSULTATION 
Public Postal Operators 
La Poste/de Post, Belgium. 1 
Post Danmark, Denmark 2 
Deutsche Post AG, Germany 3 
La Poste, France 4 
An Post, Ireland 5 
Postes et Télécommunications, Luxembourg 6 
PTTPost, The Netherlands 7 
Finland Post Ltd 8 
Posten pà Aland, (Finland) 9 
Sweden Post, Sweden 10 
The Post Office, United Kingdom 11 
PostEurop 12 
Universal Postal Union 13 
Private Operators 
Association of European Document Exchanges 14 
Association of European Express Carriers 15 
The European Express Organisation 16 
Transport Development Group pic, Consumer Division, United Kingdom 17 
Transport en Logistiek Nederland, The Netherlands 18 
Unions 
Communication Workers Union/Communication Managers Association, UK 19 
Deutsche Postgewerkschaft, Germany 20 
Postal Telegraph and Telephone International 21 
Sindicato Nacional dos Trabalhadores dos Correios e Telecomunicacoes, P 22 
User Organisations 
Bureau Européen des Unions de Consommateurs 23 
European Mail & Express Services Users Association 24 
European Mail Order and Distance Selling Trade Association 25 
Federation of European Direct Marketing 26 
Mail Users'Association Ltd, United Kingdom 27 
The Reader's Digest Association, Inc 28 
11 
Associations and Other Organisations 
British Printing Industries Federation, United Kingdom 29 
Envelope Makers & Manufacturing Stationers* Association, United Kingdom 30 
EU Committee of the American Chamber of Commerce in Belgium 31 
European Blind Union 32 
European Centre of Enterprises with Public Participation 33 
Fédération Française des Sociétés d'Assurances, France 34 
International Chamber of Commerce ..35 
Union of Industrial and Employers Confederations of Europe 36 
Joint Committee on Postal Services 37 
National Regulatory Authorities and Member States 
Ministère de l'Economie et des Télécommunications, Belgium 38 
Bundesministerium fur Post und Telekommunikation, Germany 39 
Ministère de La Poste des Télécommunications et de l'Espace, France 40 
Hoofddirectie Telecommunicatie en Post, The Netherlands 41 
Bundesministerium fur Ôffentliche Wirtschaft und Verkehr, Austria 42 
Instituto das Comunicaçôes de Portugal ,...43 
Ministry of Transport and Communications, Finland 44 
Department of Trade and Industry, United Kingdom 45 
European Committee on Postal Regulation 46 
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