" Re-mailing " for large-quantity postal deliveries is not contrary to EC competition Law

The ECJ has ruled that in the absence of an agreement between the postal services of the Member States concerned fixing terminal dues in relation to the actual costs of processing and delivering incoming trans-border mail, it is not contrary to Article 90 of the EC Treaty (now Article 86 EC), read in conjunction with Article 86 of the EC Treaty (now Article 82 EC) and Article 59 of the EC Treaty (now, after amendment, Article 49 EC), for a body such as Deutsche Post AG to exercise the right provided for by Article 25(3) of the Universal Postal Convention, to charge internal postage on items of mail posted in large quantities with the postal services of a Member State other than the Member State to which that body belongs.

On the other hand, the exercise of such a right is contrary to Article 90(1) of the Treaty, read in conjunction with Article 86 thereof, in so far as the result is that such a body may demand the entire internal postage applicable in the Member State to which it belongs without deducting the terminal dues corresponding to those items of mail paid by the above-mentioned postal services.

The Court also ruled that there was no need to distinguish electronic remail from physical remail. A body such as Deutsche Post, which has exclusive rights as regards the collection, carriage and delivery of mail, must be regarded as an undertaking to which Germany has granted exclusive rights within the meaning of Article 86 EC. An undertaking with a statutory monopoly over a substantial part of the common market is also to be regarded as holding a dominant position within the meaning of Article 82 EC.

For the postal services of the Member States, performance of the Universal Postal Convention (UPC) obligations (which German legislation assigns to Deutsche Post) is in itself a service of general economic interest within the meaning of Article 86(2) EC. In the Court’s view, the performance of this service in economically balanced conditions would be jeopardised if Deutsche Post were obliged to forward and deliver to addressees resident in Germany bulk mail posted by senders resident in Germany using postal services of other Member States, without any provision allowing it to be financially compensated for all the costs occasioned by that obligation.

A postal services operator cannot simultaneously bear (i) the costs entailed in the performance of the service of general economic interest of forwarding and delivering international items of mail and (ii) the loss of income resulting from the fact that bulk mailings are no longer posted with the postal services of the Member State in which the sender and addressees are resident but with those of other Member States.

The Court therefore concluded that in such a case, Article 86(2) EC justifies, for the purposes of the performance, in economically balanced conditions, of the task of general interest entrusted to Deutsche Post by the UPC, to treat cross-border remail as internal mail and, consequently, to charge internal postage dues. The situation would be different if terminal dues for incoming cross-border mail within the Community were fixed in relation to the actual costs of processing and delivering it by agreements between the postal services concerned (Joined Cases C-147/97 and C-148/97, Deutsche Post v. GZS and Citicorp, judgement of 10/2/00).