Some EU Nations Balk at Fully Open Market

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The European Commission plans to propose full postal deregulation by the end of this year to take effect in 2009, leaving some European postal operators concerned.

On July 28, the postal providers in Belgium, Cyprus, France, Greece, Italy, Hungary, Luxembourg, Poland and Spain called for caution. These operators cover more than half of the European Union population.

Their action followed last month's release of a PricewaterhouseCoopers study sponsored by the EC that aimed to assess in each member state how full liberalization in 2009 would affect universal service requirements.

Effects of opening the market would vary by country, the study said, so each nation needs to take specific measures to guarantee the sustainability of universal service in a liberalized environment.

These measures include increasing productivity, reducing the network of post offices and aligning labor costs of the incumbent operator with those of its competitors. Another measure involves reducing the universal service provision itself in order to reduce its cost and to increase prices for small users.

The postal operators saw these measures as either detrimental for the majority of users or inoperable, and they said no proof is given that the measures would meet the objectives. Also, the measures do not guarantee the financing of universal service, and they harm the scope, quality and accessibility of the services now offered to the countries, the operators said.

Finally, the study does not meet the explicit request by the European Parliament in February to determine appropriate financing of universal service, the postal operators said.

Meanwhile, leaders of national postal companies in the Netherlands, Sweden, Finland and Germany called last month for a European initiative to fully open that continent's postal markets by 2009. In a policy paper to the European Union Internal Market Commissioner, the postal group said that business customers, which account for about 85 percent of the mail market, do not need universal service protection and are better served by an open, competitive postal market.

In other international postal news, Michael Regan, director of international postal affairs for the U.S. Postal Service, became chair of the Universal Postal Union's Postal Operations Council upon the Aug. 3 retirement of Jim Wade as USPS international business vice president. Mr. Wade was elected council chair in 2004.

The UPU, a specialized agency of the United Nations, has 190 member countries. Its operations council oversees most aspects of the UPU, including technical, economic, commercial and operational areas.

Mr. Regan joined the USPS as a management intern specialist in international postal affairs in 1968. He has held various positions, all in the international business area, including extensive work on UPU programs, events and issues.

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