Royal Mail fined £50m for competitor discrimination

THE communications regulator has fined Royal Mail £50m for a “serious breach” of competition law.

Ofcom s ai d t he company abused its dominant position by discriminating against its only major competitor for delivering letters, Whistl.

The penalty follows an investigation into a complaint by Whistl, one of Royal Mail’s wholesale customers.

The complaint was linked to changes it made to wholesale customers’ contracts in 2014, including price increases.

The price rises meant that any of Royal Mail’s wholesale customers seeking to compete with it by delivering letters in some parts of the country, as Whistl was, would have to pay higher prices in the remaining areas — where it used Royal Mail for delivery.

Following notification of these new prices, Whistl suspended plans to extend delivery services to new parts of the UK.

Ofcom’s investigation found Royal Mail’s actions amounted to “anti-competitive discrimination against customers, such as Whistl, who sought to deliver bulk mail”.

Jonathan Oxley, Ofcom’s com- petition director, said: “Royal Mail broke the law by abusing its dominant position in bulk mail delivery.

“All companies must play by the rules. Royal Mail’s behaviour was unacceptable, and it denied postal users the potential benefits that come from effective competition.”