Deutsche Post Should Win Appeal Over Parcel Unit State Aid

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Deutsche Post Should Win EU Appeal Over Parcel Unit State Aid

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By Stephanie Bodoni

March 24 (Bloomberg) -- Deutsche Post AG, Europe’s largest mail service, should win a bid to uphold a ruling that it didn’t misuse 572 million euros ($765 million) in state subsidies to cover losses at its parcel-delivery business, an adviser to the European Union’s highest court said.

Advocate General Niilo Jaeaeskinen of the European Court of Justice in Luxembourg said he agreed with the earlier ruling that the German mail company hadn’t misused the aid, in a non- binding opinion today.

The European Commission, the EU’s executive agency, is appealing a ruling by a lower court in 2008 that annulled its decision that Deutsche Post had misused the aid. The case goes back to 1994, when United Parcel Service Inc. complained that Deutsche Post offered anti-competitive rebates to customers in its door-to-door package service, undercutting private businesses.

Deutsche Post returned the subsidies to Germany after the EU agency decided that the company had used them to cover losses on its parcel-delivery business between 1994 and 1998. Deutsche Post could be ordered to repay the aid again if the European Commission succeeds with its appeal.

“We welcome this decision by the advocate general which also confirms the position of Deutsche Post,” Uwe Bensien, a spokesman for the company in Bonn, said by telephone today.

The court usually rules within the six months that follow an opinion.

Commission spokeswoman Amelia Torres declined to immediately comment.

The case is C-399/08 P Commission v Deutsche Post.