Royal Mail faces OFT investigation into market abuse

by Claire Billings,, Brand Republic 21-Mar-03, 07:00

LONDON - Royal Mail could face an investigation into allegations that it has abused its dominant position in the market, after six direct mail firms launched a 'super complaint' through consumer watchdog Postwatch.

The complaint centres on the accusation that Royal Mail may be preferring its own mail consolidation business to others, and comes as the postal operator faces increased competition from rivals as the UK mail market begins deregulation.

A "super-complaint" must be lodged by a recognised consumer body on behalf of a group of customers and relate to the operation of a market. The process allows for it to be fast-tracked.

As part of the submission, the Office of Fair Trading must decide whether to launch an investigation within 90 days.

Postwatch said the move comes after it received complaints from some of the UK's biggest direct mail companies, which have declined to be identified, over the past 18 months.

The companies need to use Royal Mail's delivery offices to send letters to UK consumers. According to the companies, the Royal Mail can change the terms of contracts at the last minute, because it has a monopoly over the last mile of delivery to homes.

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