Royal Mail wholesale unit suffers setback

Royal Mail's new wholesale unit has come under attack after postal delivery company Deya withdrew its licence application after citing continued barriers to competition.

Deya was awarded one of the first long term licences in December last year, effective from January 2003. However, it has been unable to progress because the cost of accessing the Royal Mail network has not yet been established.

"The Royal Mail does not want to publish Access Codes but wishes to negotiate with individual licence holders," said Deya chief executive Paul Spain.

"This will involve considerable professional costs in undertaking protracted negotiations which are unlikely to be returned through new business gains."

The application withdrawal is a blow for Royal Mail's wholesale unit.

Successful negotiations with licence holders is central to establishing a fully liberated postal market.

Spain expressed regret that regulator Postcomm had not tackled the issue of Access Codes itself. "We would have preferred Postcomm to rule on Access Charging and publish this information for all operators to create a level playing field for access to the final mile," he added.

Four licence holders, Deutsche Post Global Mail UK, TPG Post UK, Hays DX and Business Post, are still believed to be in negotiations with Royal Mail.

Spain added: "There are few, if any, collections taking place by licence holders despite the first stage of liberisation having commenced at the start of this year."

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