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Review of the impact of competition in the postal market on consumers

13 July 2015

The universal postal service has been a vital piece of society infrastructure, ensuring everyone can communicate with everyone else across the UK and overseas. It has served a particularly important role to vulnerable postal consumers and those with special needs, as well as business and Government wanting to communicate with all.

Over recent years, following an extensive programme of postal reform in the EU, national postal operators, called universal service providers (USPs) have been corporatised and, in some cases, fully or partly privatised. The postal market has become more dynamic, with declines in traditional letter products set alongside strong growth in distribution of goods bought online. Although the market is moving from communication to distribution, regulatory obligations remain focused on the need for a universal service obligation (USO). 

The analysis in both sections is underpinned by recognition that EU citizens still have the right to receive a universal postal service. As the USP, Royal Mail is still subject to certain regulatory controls, for example, it is the USP until 2021 but not necessarily thereafter.

This document also updates a previous market review undertaken in 2011 for Consumer Futures, previously the statutory representative for consumers of postal services across the United Kingdom, prior to becoming part of the Citizens Advice Service.

In undertaking this assignment, Postal Logistics and Consulting Worldwide (PLCWW) has taken account of Ofcom’s decisions on the DSA price proposals and the Direct Delivery submission announced at the beginning of the review.