Brussels, 20/03/2001 (Agence Europe) - The European Commission concluded the investigation opened against Deutsche Post AG (DPAG) by deciding that the German postal operator had abused its dominant position by granting fidelity discounts and by engaging in predatory pricing in the market for business parcel services (for details, see EUROPE of 5 October, p.11). Following this decision, DPAG saw itself inflicted with a fine of EUR 24 million and forced to create a separate company for these services.
The Commission investigation is based on the complaint put forward in 1994 by United Parcel Service asserting that Deutsche Post used profits from its letter-mail monopoly to finance a predatory pricing strategy in the parcel sector open, it, to competition. The Commission agreed that this system of crossed subsidies constituted an abuse of dominant position as it had as a consequence to prevent the arrival of effective competitors in the market, with better prices and a better service. In order to make the market more transparent, DPAG has undertaken to create a separate company to provide business parcel services. This new company will be free to procure the "inputs" necessary for its services (for example parcel sorting, transport and distribution) from DPAG or third parties or even produce them itself. In case the company chooses to buy them from DPAG, the latter will have to provide it with all of the good and services concerned at the market price. Moreover, DPAG has undertaken that all inputs, which it will provide to the new company will be equally provided to its competitors, at the same price and with the same conditions. Due to this, DPAG will not be incited to invoice the new company as prices below that of the market. The decision, adopted today by the Commission, is important as it is the first decision formally adopted in the postal sector under Article 82 of the Treaty, which bans the abuse of dominant positions.