£ 878 MILLION CLAIM BROUGHT AGAINST ROYAL MAIL

[TrueBlueTerrier]

https://postandparcel.info/156500/news/ ... oyal-mail/

International Distribution Services Limited has been served with an £878 million collective action claim relating to its anti-competitive behaviour in the “bulk mail” market.

The claim has been filed on behalf of Bulk Mail Claim Limited. BMCL has been formed for the purposes of bringing the claim on behalf of an estimated 290,000 class members who were overcharged as a result of Royal Mail’s behaviour.

A Royal Mail spokesperson said: “We confirm that we have received an application for a collective proceedings order from an entity called Bulk Mail Claim Ltd which we consider to be without merit and we will defend it robustly.”

Background

Bulk mail is a type of mail typically sent by organisations such as NHS Trusts, retailers, charities, local authorities, banks, utility companies, advertisers and publishers. It includes bills, council tax statements, bank statements, utility company bills, charity fundraising appeals, advertising mail and some magazine subscriptions.

In 2018, an Ofcom investigation found that during 2014 Royal Mail engaged in conduct that affected competition in the market for the delivery of bulk mail and had abused its dominant position, in breach of EU and UK law. Ofcom fined Royal Mail £50m. A copy of Ofcom’s decision can be found here.

At the time, Jonathan Oxley, Ofcom’s Competition Group 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.”
Ofcom’s decision was upheld by the Competition Appeal Tribunal and Court of Appeal. Royal Mail’s subsequent request for permission to appeal to the Supreme Court was refused.

The Claim

The proposed claim is for damages resulting from Royal Mail’s breach of competition law. It is brought on behalf of all persons who purchased or paid for relevant bulk mail services at any time after 10 January 2014.

In summary, the proposed claim alleges that Royal Mail’s anti-competitive behaviour had the effect of cutting off competition for bulk mail delivery services from 2014 onwards, with the result that senders of bulk mail (such as NHS Trusts, retailers, charities, local authorities, banks, utility companies, advertisers and publishers) were overcharged throughout this period. The proposed claim seeks to achieve compensation for this overcharge.

Robin Aaronson of Bulk Mail Claim Limited, the Proposed Class Representative, commented: “Where there has been an abuse of dominant position, as has occurred in this case, it is important that those suffering loss are able to obtain redress. A collective claim is the only fair and efficient form of redress in this case, given that there are hundreds of thousands of affected customers and it would be commercially unviable for them to bring individual proceedings.”

Andrew Wanambwa, Partner in the Dispute Resolution team at Lewis Silkin, commented: “Royal Mail abused its dominant position, resulting in hundreds of thousands of bulk mail customers being overcharged. The purpose of this claim is to hold Royal Mail accountable for its actions and secure compensation for affected customers.”

A case management hearing to determine next steps in the claim will be held by the Competition Appeal Tribunal.

[Barnacle]

By what measure were they ‘overcharged’? Surely they would be charged more for processing & delivery by any competitor?

For example, there are numerous businesses offering D2D delivery but none of them are as economical and offer the coverage that RM does.

Is it really RM’s fault that the competition is crap?

[midegarelu]

Down Stream Access (DSA) hasn't fulfilled what it set out to do!

The original intention was to provide an alternative to Royal Mail, thereby breaking up the monopoly as required by EU legislation.

The only company to set up end to end delivery was TNT/Wistl and they cherry picked the areas (built up, high density areas), yet still they couldn't make a profit!

The best way to end the law suit would be to beef up Revenue Protection and check every arrival from these Mickey Mouse companies and make sure they pay for every item, before I retired most of this work basically went through "on the nod" probably losing RM millions of pounds a week.

Perhaps its time for someone with the balls to take on the powers that be and end this fiasco of DSA.

[SpacePhoenix]

The best way to end the law suit would be to beef up Revenue Protection and check every arrival from these Mickey Mouse companies and make sure they pay for every item, before I retired most of this work basically went through "on the nod" probably losing RM millions of pounds a week.

Would take too long and there isn't the staff available anyway

[Mr Rush]

The claim of anti-competitive behaviour is perversely counterintuitive. If anyone unfamiliar with the operation were to see the headline they'd think the big bad GPO had squished Whistl's little start-up operation, per the conventional understanding of what competition and its inverse mean. No-one was stopping TNT/Whistl from delivering their stuff except Whistl who did not want to deliver it.

Ofcom's report The Communications Market 2012, 6. Post in the section on access mail (ie, DSA) shows it growing from 4% of total volume handled in 2005 to 44% by 2011. My own eyes tell me this must be something like 80% these days. I hardly ever see a '1' or a '2' on anything and constantly have to explain to people why their bank statement is three weeks out of date or their NHS letter informing them of their appointment date only turned up two days in advance and, no, for once it hasn't been sitting in the frame all that time because we've been clearing. We don't collect the damn stuff but we sure as hell collect the grief for it.

Interestingly enough, in another Ofcom report Review of postal users' needs from the same year the number one most desired improvement to the postal service was... earlier delivery!

[Barnacle]

The claim of anti-competitive behaviour is perversely counterintuitive. If anyone unfamiliar with the operation were to see the headline they'd think the big bad GPO had squished Whistl's little start-up operation, per the conventional understanding of what competition and its inverse mean. No-one was stopping TNT/Whistl from delivering their stuff except Whistl who did not want to deliver it.

Ofcom's report The Communications Market 2012, 6. Post in the section on access mail (ie, DSA) shows it growing from 4% of total volume handled in 2005 to 44% by 2011. My own eyes tell me this must be something like 80% these days. I hardly ever see a '1' or a '2' on anything and constantly have to explain to people why their bank statement is three weeks out of date or their NHS letter informing them of their appointment date only turned up two days in advance and, no, for once it hasn't been sitting in the frame all that time because we've been clearing. We don't collect the damn stuff but we sure as hell collect the grief for it.

Interestingly enough, in another Ofcom report Review of postal users' needs from the same year the number one most desired improvement to the postal service was... earlier delivery!

The only thing stopping the competition from delivering that final mile is their lack of desire to do it.

Customers expect us early and want us early and RM is staffed by early birds so why not provide the service the customer expects

[clashcityrocker]

The only thing stopping the competition from delivering that final mile is their lack of desire to do it.

I don't know if you are being deliberately obtuse or you simply don't understand what happened.
Whistl were delivering their own stuff. They had postmen on the streets delivering and they were delivering lots more letters than we were.
They wanted to expand their operation. Royal mail prevented it. That is why they were fined and that is why they are now facing the 2 actions.

[Barnacle]

The only thing stopping the competition from delivering that final mile is their lack of desire to do it.

I don't know if you are being deliberately obtuse or you simply don't understand what happened.
Whistl were delivering their own stuff. They had postmen on the streets delivering and they were delivering lots more letters than we were.
They wanted to expand their operation. Royal mail prevented it. That is why they were fined and that is why they are now facing the 2 actions.

I based my comment on what MrRush wrote about what occurred, which contradicts your version.

[Mr Rush]

They wanted to expand their operation. Royal mail prevented it.

The case, per the article, is that Royal Mail "overcharged" for access. Whether Whistl was going to use the money that we so kindly helped them save to set up its own USO-compliant service for realz is completely hypothetical. This is far more absurd than the analogous local loop unbundling in the telecoms sector.

[clashcityrocker]

They wanted to expand their operation. Royal mail prevented it.

The case, per the article, is that Royal Mail "overcharged" for access. Whether Whistl was going to use the money that we so kindly helped them save to set up its own USO-compliant service for realz is completely hypothetical. This is far more absurd than the analogous local loop unbundling in the telecoms sector.

Yet Royal mail have already been fined £50 million and lost the argument in the Supreme Court.