Notice of modification to the control preventing Royal Mail margin squeeze

  • Start: 28 November 2013
  • Status: Closed
  • End: 10 January 2014

1.1 On 27 March 2012 we published our Statement 'Securing the Universal Postal Service: Decision on the new regulatory framework' ('the March 2012 Statement'). This set out our decision on the new regulatory framework for the postal sector, which gave Royal Mail Limited ('Royal Mail') more commercial and operational flexibility (particularly in relation to setting the majority of its prices). Regulatory safeguards were implemented to protect consumers and, where appropriate, promote effective competition.

1.2 Together with the March 2012 Statement, we imposed a set of controls and accounting conditions. Included in these was a regulatory condition made pursuant to powers under section 38 and Schedule 3 of the Postal Services Act 2011 (the "Act") (and in made in accordance with section 53 and paragraph 3 of Schedule 6 of the Act) to impose on Royal Mail, the universal service provider, an access condition. The access condition was made and notified on 27 March 2012 and is available at Annex 9 of the March 2012 Statement the ("USP Access Condition").

1.3 The USP Access Condition gives access to Royal Mail's postal network to other postal operators and users. The USP Access Condition includes a price control condition on Royal Mail.

1.4 On 28 November 2013, we consulted a proposed modification to paragraph 6.4 in the USP Access Condition to explicitly remove unrecoverable VAT from the downstream cost calculation .

1.5 This Statement sets out the stakeholder replies to this consultation, our responses to those comments and our final decision.


Main documents

Supporting documents

Supporting documents

Supporting documents

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Responses

Responder name Type
140110_Modification_to_USPA_6_Royal_Mail_response.pdf (PDF File, 375.0 KB) Organisation
TNT_Post.pdf (PDF File, 13.1 KB) Organisation