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News Royal Mail Broke the Competition Law, Fined £50m

Discussion in 'Business News & Resources' started by Erik, Aug 15, 2018.

  1. Erik

    Erik

    Joined:
    Sep 26, 2012
    Messages:
    2,823
    Whistl, previously known as TNT, was set to become Royal Mail's new competitor in the bulk mail delivery business. They however still depend on Royal Mail to deliver parcels on some areas they cannot reach. Ofcom has then found that Royal Mail's price raise in 2014 is meant for competitors such as Whistl to pay higher costs for areas where they still use the company.

    [​IMG]

    This is the biggest fine imposed to Royal Mail to date, in which they are now appealing. It even mentioned that the decision is "without merit" and "fundamentally flawed".

    Jonathan Oxley, Ofcom's Competition Group Director, has said:

    This is truly terrible news for Royal Mail, surely giving them a bad reputation trying to muscle out competitors in the industry. This also goes to show that the company has complete control over deliveries within the UK, and with sneaky methods like this, it would be next to impossible creating something that will best compete against Royal Mail. Whistl has already stopped competing against Royal Mail, but surely there are more small players out there trying to chip its way in this huge potential. Best be wary however, not until Royal Mail plays by the rules and gives fair competition.

    What do you think? Did the price increase implemented by Royal Mail prove unfair competition, or do you side with Royal Mail that they only raised prices to endure costs?
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